<PAGE>

                                                                Exhibit 10.2





                  ACQUISITION AND CONSTRUCTION LOAN AGREEMENT

                                    between

                             830 WINTER STREET LLC

                                      and

                        ANGLO IRISH BANK CORPORATION PLC

                                 July 11, 2000









<PAGE>


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

Section
-------
<S>     <C>                                                                         <C>
1.      DEFINITIONS                                                                  2

2.      AGREEMENT TO MAKE ADVANCES; LIMITATIONS                                      2
        2.1   Agreement to Make Advances                                             2
        2.2   Submission of Draw Requests for Advances/Reallocation of Line Items    2
        2.3   Amount of Advances/Release of Retainage                                3
        2.4   Quality of Work/Stored Materials                                       4
        2.5   Cost Overruns                                                          4
        2.6   Confirmation of Representations                                        4
        2.8   Advances to Contractor; to Others                                      4
        2.9   Advances Do Not Constitute a Waiver                                    5

3.      RIGHT TO RETAIN THE CONSTRUCTION INSPECTOR                                   5

4.      THE NOTE                                                                     5

5.      ARRANGEMENT FEE                                                              6

6.      COLLATERAL SECURITY AND GUARANTY                                             6

7.      CONDITIONS TO CLOSING AND INITIAL ADVANCE                                    7
        7.1   Loan Documents                                                         7
        7.4   Other Contracts                                                        7
        7.5   Key Lease                                                              7
        7.6   Certified Copies of Organization Documents                             7
        7.7   Resolutions                                                            7
        7.8   Incumbency Certificate; Authorized Signers                             7
        7.9   Validity of Liens                                                      8
        7.10  Deliveries                                                             8
        7.11  Construction Inspector Report                                          9
        7.12  Legal and Other Opinions                                               9
        7.13  Lien Search                                                            9
        7.14  Mechanic's Lien Law                                                   10

</TABLE>


                                      -i-

<PAGE>


<TABLE>
<S>     <C>                                                                        <C>
        7.15  Notices                                                               10
        7.16  Appraisal                                                             10
        7.17  Arrangement Fee                                                       10
        7.18  Performance; No Default                                               10
        7.19  Representations and Warranties                                        10
        7.20  Proceedings and Documents                                             10
        7.21  Waiver                                                                10

8.      CONDITIONS OF SUBSEQUENT ADVANCES                                           11
        8.1   Prior Conditions Satisfied                                            11
        8.2   Performance; No Default                                               11
        8.3   Representations and Warranties                                        11
        8.4   No Damage                                                             11
        8.5   Receipt of the Lender                                                 11
        8.6   Mechanic's Lien Law                                                   12
        8.7   Waiver                                                                13
        8.7   Project Approvals                                                     13
        8.9   Construction Documents                                                13

9.      REPRESENTATIONS, WARRANTIES AND COVENANTS                                   13
        9.1   Organization; Authority, Etc.                                         13
        9.2   Title to Assets                                                       14
        9.3   Financial Statements                                                  14
        9.4   No Material Changes, Etc.                                             14
        9.5   Franchises, Patents, Copyrights, Etc.                                 15
        9.6   Litigation                                                            15
        9.7   No Materially Adverse Contracts, Etc.                                 15
        9.8   Compliance With Other Instruments, Laws, Etc.                         15
        9.9   Tax Status                                                            15
        9.10  No Event of Default                                                   16
        9.11  Setoff, Etc.                                                          16
        9.12  Certain Transactions                                                  16

</TABLE>


                                      -ii-

<PAGE>


<TABLE>
<S>     <C>                                                                         <C>
        9.14  Partners, Beneficiaries, Etc.                                         16
        9.15  ERISA Plan                                                            16
        9.16  Solvency                                                              16
        9.17  Availability of Utilities                                             16
        9.18  Access                                                                16
        9.19  Condition of Site and Improvements                                    16
        9.20  Compliance with Requirements/Historic Status/Flood Area               17
        9.21  Project Approvals                                                     17
        9.22  Construction Contract; Architect's Contract                           17
        9.23  Key Lease                                                             17
        9.24  Other Contracts                                                       18
        9.25  Violations                                                            18
        9.27  Project Budget                                                        18
        9.28  Environmental Matters                                                 18
        9.29  Effect of Draw Request                                                19
        9.31  General                                                               19

10.     AFFIRMATIVE COVENANTS OF THE BORROWER                                       19
        10.1  Punctual Payment                                                      19
        10.2  Commencement, Pursuit and Completion of Construction                  19
        10.3  Financial Statements, Certificates and Information                    19
        10.4  Insurance; Bonds                                                      20
        10.5  Liens and Other Charges                                               21
        10.6  Inspection of Project and Books, Appraisals                           21
        10.7  Compliance with Laws, Contracts, Licenses, and Permits                22
        10.8  Use of Proceeds                                                       22
        10.9  Project Costs                                                         22
        10.10 Insufficiency of Loan Proceeds                                        22
        10.11 Permanent Commitment                                                  22
        10.12 Deposit of Income                                                     22
        10.13 Publicity                                                             23

</TABLE>


                                     -iii-

<PAGE>


<TABLE>
<S>     <C>                                                                         <C>
        10.14 Sign Regarding Construction Financing                                 23
        10.15 Further Assurances                                                    23
        10.16 Notices                                                               23
        10.17 Other Affirmative Covenants                                           23

11.     NEGATIVE COVENANTS OF THE BORROWER                                          24
        11.1  Restrictions on Change Orders                                         24
        11.2  Restrictions on Easements, Covenants and Restrictions                 24
        11.3  No Amendments, Terminations or Waivers                                24
        11.4  Restrictions on Indebtedness                                          25
        11.5  Restrictions on Liens, Etc.                                           25
        11.6  Restrictions on Loans and Investments                                 26
        11.7  Merger, Consolidation, Conversion, Business Operations, and
               Ownership and Disposition of Assets                                  26
        11.8  Sale and Leaseback                                                    27
        11.9  Distributions                                                         27
        11.10 Financial Covenants                                                   27
        11.11 Other Negative Covenants                                              27

12.     EVENTS OF DEFAULT AND REMEDIES                                              27
        12.1  Events of Default                                                     27
        12.2  Suspension and Termination of Advances and Acceleration               30
        12.3  Completion of Project, Etc.                                           31
        12.4  Other Remedies                                                        32
        12.5  Distribution of Collateral Proceeds                                   33
        12.6  Power of Attorney                                                     33
        12.7  Waivers                                                               33

13.     INSURED LOSS                                                                33
        13.5  Taking                                                                35

14.     SETOFF                                                                      35

15.     EXPENSES                                                                    35

16.     INDEMNIFICATION                                                             36

</TABLE>


                                      -iv-

<PAGE>


<TABLE>
<S>     <C>                                                                         <C>
17.     LIABILITY OF THE LENDER                                                     36

18.     RIGHTS OF THIRD PARTIES                                                     37

19.     SURVIVAL OF COVENANTS, ETC.                                                 37

20.     ASSIGNMENT AND PARTICIPATION                                                37
        20.1 Conditions to Assignment by Lender                                     37
        20.2 New Notes, Agreement                                                   38
        20.3 Participations                                                         38
        20.4 Pledge by the Lender                                                   38
        20.5 No Assignment by the Borrower                                          38

21.     RELATIONSHIP                                                                38

22.     NOTICES                                                                     39

23.     GOVERNING LAW                                                               40

24.     CONSENT TO JURISDICTION; WAIVERS                                            40

25.     PREFERENCES                                                                 40

26.     RULES OF INTERPRETATION                                                     41

27.     HEADINGS                                                                    41

28.     COUNTERPARTS                                                                41

29.     ENTIRE AGREEMENT, ETC.                                                      41

30.     CONSENTS, AMENDMENTS, WAIVERS, ETC.                                         42

31.     TIME OF THE ESSENCE                                                         42

32.     SEVERABILITY                                                                42

33.     RELEASE OF MORTGAGED PROPERTY                                               42

</TABLE>


                                      -v-

<PAGE>


                                    EXHIBITS

<TABLE>
<S>                     <C>
Exhibit "SVY"           Form of Surveyor's Certificate
Exhibit "PLANS"         Form of Architect's Certification Re: Plans and
                        Specifications
Exhibit "Budget"        Project Budget
Exhibit "BOR"           Borrower's Requisition Certificate
Exhibit "GC"            General Contractor's Requisition Certificate and Partial
                        Waiver and Subordination of Lien
Exhibit "ARCH"          Architect's Requisition Certificate
Exhibit "INSURANCE"     Required Property, Liability and Other Insurance

</TABLE>



                                      -vi-

<PAGE>


                                   SCHEDULES

<TABLE>
<S>                     <C>
Schedule 1 -            Definitions
Schedule 2 -            Partners, Beneficiaries, Etc.
Schedule 3 -            Project Approvals Not Yet Obtained
Schedule 4 -            Project Approvals Obtained
Schedule 9.6 -          List of Litigation Matters [if any]
Schedule 9.17 -         Availability of Utilities

</TABLE>


                                     -vii-

<PAGE>


                   ACQUISITION AND CONSTRUCTION LOAN AGREEMENT

         This Acquisition and Construction Loan Agreement is made as of the
11th day of July, 2000, by and between 830 WINTER STREET LLC ("Borrower"), a
Delaware Limited Liability Company, with a principal place of business at c/o
PRAECIS PHARMACEUTICALS INCORPORATED One Hampshire Street, Cambridge,
Massachusetts 02139, and ANGLO IRISH BANK CORPORATION PLC ("Lender"), with a
principal place of business at Stephen Court, 18-21 St. Stephen's Green, Dublin
2, Ireland.

         The following are background facts relating to this Agreement:

         A.   Utilizing its own funds and proceeds of the initial Advance under
the Loan evidenced hereby, Borrower is acquiring the fee simple interest in a
parcel or parcels of land known and numbered as 830 Winter Street situated in
Waltham, Middlesex County, Massachusetts (the "Site"), together with the
improvements located thereon (the "Improvements) consisting of a first-class
office building containing not less than 176,900 gross square feet, accessory
roadway, parking, utility and access improvements and appurtenant easement
rights and privileges. The Site and the Improvements are shown on a certain
survey (the "Survey") referred to in a Surveyor's Certificate being provided
concurrently to Lender substantially in the form of Exhibit "SVY" attached to
this Agreement and in a certain As-Built Plan dated June 4, 2000, revised July
7, 2000 prepared by Martinage Engineering Associates, Inc. (the "Site Plan").

         B.   Borrower intends to renovate the Improvements which renovations
generally consist of the following and related accessory improvements (together,
the "Renovation Project"): tenant fit-out and conversion of the existing office
building into a combined office/laboratory building for lease in its entirety to
the Key Tenant (as hereinafter defined) or, to the extent provided for in the
Project Budget, tenant fit-out under an Approved Sublease.

         The Renovation Project is more specifically described in the Plans and
Specifications or, as applicable, separate plans for tenant improvement work
under Approved Subleases.

         C.   Subject to the terms of this Agreement funding for the acquisition
and renovation of the Site and Improvements is to be provided (i) first by funds
to be provided by Borrower independent of the proceeds of the financing from
Lender under this Agreement ("Borrower's Required Equity") and (ii) subsequently
by advances of the loan proceeds being provided by Lender under this Agreement
in accordance with, for the Renovation Project, the Project Budget attached to
this Agreement as Exhibit "Budget" (the "Project Budget"; which term shall
include such later additions of this Project Budget as are approved by Lender).

         D.   In connection with the construction of the Renovation Project,
Borrower will enter into a guaranteed maximum price Construction Contract (the
"Construction Contract") with John Moriarty & Associates, Inc. (the
"Contractor") and will enter into an Architect Agreement (the "Architect's
Contract") with Jung Brannen, (the "Architect"). As used herein, the term
"Improvements" shall mean the Improvements as the same are affected by the
Renovation Project.

         E.   Borrower has further entered into a lease dated July 11, 2000 (the
"Key Lease") of all the Improvements and the Site to PRAECIS PHARMACEUTICALS
INCORPORATED, a Delaware corporation (the "Key Tenant"), which is an entity
affiliated or under common control with the Borrower.


                                      -1-

<PAGE>


1.       DEFINITIONS. This Agreement, its Exhibits and other Loan Documents
utilized various defined terms which shall have the meanings set forth in
Schedule 1 attached to this Agreement or, if separately defined elsewhere herein
or in any other Loan Documents, as set forth in such separate definitions.


2.       AGREEMENT TO MAKE ADVANCES; LIMITATIONS.

2.1      AGREEMENT TO MAKE ADVANCES. Subject to the terms and conditions of this
Agreement and the other Loan Documents and relying upon the representations and
warranties contained in this Agreement and the other Loan Documents, after
application of Borrower's Required Equity amounts, the Lender agrees to lend to
the Borrower and the Borrower agrees to borrow such amounts as are requested by
the Borrower up to a maximum aggregate principal amount equal to the Loan Amount
to pay for the acquisition (the "Acquisition") of the Site and Improvements and
the Project Costs for the Renovation Project actually incurred by the Borrower
and set forth in the Renovation Project Budget approved by Lender. The initial
Advance under the Loan for the Acquisition is not to exceed $24,000,000 with the
balance of Borrower's Acquisition Costs being paid by Borrower as part of
Borrower's Required Equity.

         Advances for Project Costs and Acquisition Costs shall, in no event,
exceed in the aggregate sixty-two percent (62%) of all such costs as determined
by Lender; provided that, notwithstanding the forgoing, upon achievement of
Project Completion and so long as no Default exists and no Event of Default has
occurred, Borrower shall have the right to draw an Advance of any then
undisbursed balance of the Loan Amount upon a Draw Request therefor submitted
within sixty (60) days after being notified in writing by Lender that Project
Completion has occurred and Lender has determined that Borrower has otherwise
satisfied all preconditions to such an Advance contained herein, the proceeds of
which Advance may be used for any proper business purposes of Borrower. If
Borrower fails to so submit such a Draw Request or, having submitted one, fails
to satisfy such preconditions within such 60-day period, Borrower shall
irrevocably forfeit and cease to have any right to draw down such balance.

         Notwithstanding anything to the contrary contained herein, no Advances
for Project Costs (as opposed to Acquisition Costs) shall be made unless and
until Lender has approved, after submittal by Borrower, a detailed Project
Budget, all Project Approvals required for the commencement of the Renovation
Project (except as otherwise provided in Section 8.8 hereof), a final set of
Plans and Specifications at a level of detail sufficient to form the basis of
the guaranteed maximum price Construction Contract, the Architect's Certificate
in the form of Exhibit Plans and, the Construction Contract and the Architect's
Contract, together with applicable consents to the collateral assignment to
Lender of such Contracts. Borrower agrees to submit to Lender such detailed
Project Budget, final Plans and Specifications, such Project approvals, the
Construction Contract, the Architect's Contract and such consents and
Architect's Certificate, by no later than the date which is the earlier of (i)
October 1, 2000, or (ii) the date required under the Key Lease for the
commencement of the Renovation Project.

2.2      SUBMISSION OF DRAW REQUESTS FOR CONSTRUCTION ADVANCES/REALLOCATION OF
LINE ITEMS.

         2.2.1     Draw Requests for Advances in the Renovation Project shall be
submitted to Lender no more frequently than monthly and shall be delivered to
Lender, together with all required certifications and other information required
under this Agreement, by no later than the tenth (10th) business day preceding
the requested date for making the Advance.


                                      -2-

<PAGE>


         The Borrower's Draw Request shall be in such form as Lender reasonably
requires and, except for Advances drawn after Project Completion pursuant to the
second paragraph of Section 2.1 above, shall be accompanied by: (a) a currently
dated certification of the Borrower in the form of Exhibit "BOR" attached to and
made a part of this Agreement; (b) with respect to amounts to be paid to the
Contractor and/or any subcontractors, materialmen or suppliers -- (i) a
completed requisition from the Contractor or subcontractors, etc., as the case
may be, in the form of AIA Document G702 or similar form approved by Lender,
together with copies of related invoices, (ii) a currently dated certification
and a completed Partial Waiver and Subordination of Lien from the Contractor in
the form of Exhibit "GC" and Schedule 1 to Exhibit "GC" attached to and made a
part of this Agreement, (iii) completed partial or final lien waivers in form
acceptable to Lender from all subcontractors, laborers and materialmen for work
done and materials supplied by them to the extent of their prior receipt of
payment for such work and/or materials, and (iv) a currently dated certificate
from the Architect in the form of Exhibit "ARCH" attached to this Agreement; (c)
to the extent requested by Lender, current verifications from the Construction
Inspector and Key Tenant evidencing their respective approvals of the work
performed to the date of such Draw Request; and (d) such other information,
documentation and certifications as Lender shall reasonably require for a
transaction of this nature.

         2.2.2     The Project Budget now sets or hereafter shall set forth
certain line items evidencing the components of Project Costs, including certain
contingency line items. In no event shall Lender be obligated to advance funds
from any non-contingency line item in the Project Budget for application to
another line item set forth in the Project Budget unless (a) Lender determines
that the line item from which the reallocation is to occur has been completed
and fully paid or (b) Borrower demonstrates actual savings based upon evidence
reasonably satisfactory to Lender as to the expected cost of completing the line
item. Further, under all circumstances, advances from contingency line items
shall only be made in the sole discretion of Lender; provided that, so long as
no Default exists and no Event of Default has occurred and Lender has otherwise
approved a final Project Budget, Borrower shall have the right to utilize up to
fifty percent (50%) of the unused contingency to cover any cost overruns under
Section 2.5 hereof.

2.3      AMOUNT OF ADVANCES/RELEASE OF RETAINAGE. Aggregate Advances under the
Loan shall never exceed the lesser of the Loan Amount or the aggregate of the
initial Advance for the Acquisition plus total Project Costs actually incurred
by the Borrower, less, in all events, Borrower's Required Equity. Prior to any
Advances for Project Costs Borrower shall provide evidence satisfactory to
Lender that Borrower has contributed not less than $4,500,000 towards such costs
as a part of Borrower's Required Equity (and in addition to the portion of
Borrower's Required Equity used for the Acquisition). In no event shall any
Advance for Direct Costs of constructing the Renovation Project exceed an amount
equal to (a) the total value (as determined by the Lender) of the labor,
materials, fixtures, machinery and equipment completed, approved and
incorporated into the Renovation Project prior to the date of the Draw Request
for such Advance, less (b) retainage in an amount equal to ten percent (10%),
with no further retainage upon Lender's determination that the Renovation
Project is fifty percent (50%) completed, of such total value ("Retainage")
except to the extent the purpose of the Advance is to pay Retainage under the
terms hereof, less (c) the total amount of any Advances previously made by the
Lender for such Direct Costs, less (d) any Borrower's Required Equity designated
by Lender for application to Direct Costs. With respect to any other Direct
Costs and all Indirect Costs, in no event shall any Advance exceed an amount
equal to the amount of such Direct Costs and Indirect Costs approved by the
Lender, incurred by the Borrower prior to the date of the Draw Request


                                      -3-

<PAGE>


for such Advances, and theretofore paid or to be paid with the proceeds of
such Advance, less the total amount of any Advances previously made by the
Lender for such Direct Costs and Indirect Costs and less any Borrower's
Required Equity designated by Lender for application to such Costs.

         With respect to any particular construction subcontract, Retainage
shall be available for advance only upon delivery of evidence satisfactory to
Lender that all work under such subcontract has been 100% completed and approved
by the Construction Inspector and, if required by Lender, the Key Tenant and
with Lender having received such final lien waivers as Lender may require in
connection therewith. Except as set forth in the preceding sentence, retainage
on account of the Construction Contract shall not be available for advance until
the final completion of the Project as approved by the Lender and, if requested
by Lender, the Key Tenant, and with Lender having received such final lien
waivers as Lender may require in connection therewith.

2.4      QUALITY OF WORK/STORED MATERIALS. No Advance shall be due unless all
work done at the date the Draw Request for such Advance is submitted is done in
a good and workmanlike manner and without defects, as confirmed by the report of
the Construction Inspector. No Advances shall be made with respect to any
materials not yet incorporated into the Renovation Project except as otherwise
approved by Lender in its sole discretion.

2.5      COST OVERRUNS. If the Borrower becomes aware of any change in Project
Costs which will or is likely to increase a category or line item of Project
Costs reflected on the Project Budget, Borrower shall immediately notify the
Lender in writing and promptly submit to the Lender for its approval a revised
Project Budget. Further, upon the request of Lender, Borrower shall within ten
(10) days after notice of such request, deposit with Lender additional
Borrower's Required Equity funds sufficient, in the judgment of Lender (after
taking into account, if any, line item reallocations permitted under Section
2.2.2 hereof and rights of Borrower to utilize contingency amounts under the
proviso at the end of Section 2.2.2), to cover the cost of such overrun or
potential overrun amount. No further Advances shall be made under this Agreement
until Borrower has complied with the foregoing and any failure by Borrower to do
so shall be an Event of Default hereunder. The provisions of this Section 2.5
are in addition to those set forth in Section 10.10 of this Agreement.

2.6      CONFIRMATION OF REPRESENTATIONS. Each Draw Request shall constitute a
representation and warranty by the Borrower that all of the conditions set forth
in this Agreement to such Advance have been satisfied on the date of such Draw
Request and that all representations and warranties contained herein or in any
other Loan Document remain true and complete as of the date of such Draw Request
except to the extent that the representation and warranty relate expressly to an
earlier date (in which case, Borrower shall update such representation to make
it currently accurate and Lender shall have the right to approve such update as
a precondition to honoring the Draw Request).

2.7      ADVANCES TO CONTRACTOR; TO OTHERS. At its option, after the occurrence
of any Default or Event of Default, the Lender may make any or all Advances (a)
for Direct Costs incurred under the Construction Contract directly to Contractor
for deposit in an appropriately designated special bank account, (b) through the
Title Insurance Company, or (c) to any Person to whom the Lender in good faith
determines payment is due. Any portion of the Loan so disbursed by the Lender
shall be deemed disbursed as of the date on which the Lender makes such
disbursement and all such advances shall


                                      -4-

<PAGE>


satisfy PRO TANTO the obligations of the Lender hereunder and shall be secured
by the Security Documents as fully as if made directly to the Borrower.

2.8      ADVANCES DO NOT CONSTITUTE A WAIVER. No Advance made by the Lender
shall constitute a waiver of any of the conditions to the Lender's obligation to
make further Advances nor any of the terms and conditions of this Agreement.

3.       RIGHT TO RETAIN THE CONSTRUCTION INSPECTOR. The Lender shall have the
right to retain, at the Borrower's cost and expense, the Construction Inspector
to perform various services on behalf of the Lender, including, without
limitation, to review the Project Budget and the Plans and Specifications, to
make periodic inspections (approximately at the date of each Draw Request) for
the purpose of assuring that construction of the Renovation Project to such date
is in accordance with the Plans and Specifications, to advise the Lender of the
anticipated cost of and time for completion of construction of the Renovation
Project and the adequacy of any contingencies in the Project Budget, and to
review the Construction Contract and subcontracts.

         The fees of the Construction Inspector shall be paid by the Borrower
forthwith upon billing therefor and expenses incurred by the Lender on account
thereof shall be reimbursed to the Lender forthwith by the Borrower upon request
therefor.

         Neither the Lender nor the Construction Inspector shall have any
liability to the Borrower on account of (a) the services performed by the
Construction Inspector, (b) any neglect or failure on the part of the
Construction Inspector to properly perform its services, or (c) any approval by
the Construction Inspector of construction of the Renovation Project.

         Neither the Lender nor the Construction Inspector assumes any
obligation to the Borrower or any other Person concerning the quality of
construction of the Renovation Project or the absence therefrom of defects.

4.       THE NOTE. The obligation of the Borrower to pay the Loan Amount or, if
less, the aggregate unpaid principal amount of all Advances made by the Lender
hereunder plus accrued interest thereon, shall be evidenced by the Note and
payable in accordance therewith. In the event the Note is lost, destroyed or
mutilated at any time prior to payment in full of the indebtedness evidenced
thereby, the Borrower shall execute a new note substantially in the form of the
Note.

         The Note provides for a term ("Initial Term") commencing on the date
hereof and ending on July 30, 2003, or such earlier date, if any, to which the
scheduled maturity date is accelerated under the terms of the Note or such later
date, if any, to which the scheduled maturity date is extended as set forth
below (the "Maturity Date"). The Initial Term is subject to two (2), one-year
extension rights upon satisfaction of the conditions set forth below with
respect to each such extension option and subject, in all events, to the rights
of acceleration in the Note:

         (a)  Borrower and Guarantor shall have delivered to Lender a
"date-down" certificate certifying to Lender's satisfaction that all the
representations and warranties contained herein or in any of the other Loan
Documents are true and complete as of the date of the request for the extension
and the date of commencement of the extension period (subject, with respect to
any representation that relates expressly to an earlier date, any update thereof
acceptable to Lender having the effect of making such representation then
currently accurate);


                                      -5-

<PAGE>


         (b)  Project Completion shall have been achieved;

         (c)  No Default or Event of Default shall exist;

         (d)  Borrower shall have given Lender written notice of Borrower's
request to exercise its extension right at least thirty (30) days, but no more
than one hundred twenty (120) days, before the Maturity Date (or, in the case of
a second one-year extension, the Maturity Date, as previously extended);

         (e)  Without limiting clause (c) above, no breach of any covenants
imposed upon Borrower or Guarantor shall exist including, without limitation,
the covenants relating to loan to value ratio and Debt Service Coverage Ratio,
set forth in Section 11.10 of this Agreement. Lender shall have the right to
require Borrower to obtain an updated Appraisal satisfactory to Lender in all
material respects and at Borrower's expense, showing continuing compliance with
the loan to value ratio covenant as of a date not more than thirty (30) days
prior to the date of the contemplated extension;

         (f)  All of the conditions set forth in Section 7 of this Agreement, to
the extent applicable, shall continue to be satisfied;

         (g)  Borrower shall have paid, for each such extension, an extension
fee equal to 1/8% of the outstanding principal amount of the Loan (plus any
unadvanced portions thereof available for disbursement for Project Costs or as
otherwise available pursuant to Section 2.1 hereof) as of the date of the
proposed extension, plus reimbursed Lender for all third-party fees and expenses
incurred by Lender (including reasonable attorney fees and costs) in connection
with such extension;

         (h)  As set forth in the Note, monthly principal amortization payments
shall be required on the first day of each month during an extension period in
an amount equal to the Monthly Principal Payment Amount (as defined in the
Note);

         (i)  At the election of Lender, Borrower shall have provided evidence
to Lender that Borrower has placed into effect for the extension period an
interest rate protection arrangement satisfactory to Lender; and

         (j)  Within fifteen (15) days of any request therefor, Borrower and
Guarantor shall have executed and delivered to Lender such agreements and
documents as Lender may reasonably require incident to the extension.

5.       ARRANGEMENT FEE. The Borrower agrees to pay to the Lender on or before
the Closing Date a commitment fee in the amount of $330,000.00, one-half of
which, or $165,000.00, has previously been received by Lender.

6.       COLLATERAL SECURITY AND GUARANTY. The Project Obligations shall be
secured by a perfected first priority mortgage lien and security in the
Collateral, whether now owned or hereafter acquired, pursuant to the terms of
the Security Documents. The Security Documents include certain guaranties from
the Guarantor with respect to the Project Obligations.


                                      -6-

<PAGE>


7.       CONDITIONS TO CLOSING AND INITIAL ADVANCE. The obligation of the Lender
to make the initial Advance shall be subject to the satisfaction of the
following conditions precedent:

7.1      LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to the Lender.

7.2      [Intentionally Deleted]

7.3      [Intentionally Deleted]

7.4      OTHER CONTRACTS. The Borrower shall have delivered to the Lender
correct and complete photocopies of all other executed contracts with
contractors, subcontractors, engineers or consultants for the Project, and of
all development, management, brokerage, sales or leasing agreements for the
Project.

7.5      KEY LEASE/INTEREST RATE PROTECTION AGREEMENT. The Key Lease shall have
been duly executed by the respective parties thereto, shall be in full force and
effect with no modifications thereto that have not been approved by Lender, and
shall be in form and substance satisfactory to the Lender. The Lender shall have
received a certified or fully executed copy of the Key Lease, together with a
current completed tenant estoppel certificate from the Key Tenant, in form and
substance satisfactory to Lender. To the extent required by the Lender, the
Lender, the Borrower and the Key Tenant shall have duly executed and delivered a
non-disturbance, attornment and subordination agreement, in recordable form and
otherwise in form and substance satisfactory to Lender, and the Lender shall
have received a fully executed copy of each such document.

         Borrower shall have entered into and paid all costs of an interest rate
protection agreement (the "Interest Rate Protection Agreement") with a party and
on terms and conditions satisfactory to lender which shall provide, without
limitation, interest rate protection for Eurodollar Rates (as defined in the
Note) in excess of the per annum rate which is one hundred twenty-five basis
points over the one-month LIBOR Rate (as defined in the Note) in effect as of
the date of the Interest Rate Protection Agreement, based upon a principal loan
in the Loan Amount for a three (3) year term.

7.6      CERTIFIED COPIES OF ORGANIZATION DOCUMENTS. The Lender shall have
received from each of the Parties a certified copy of its Organization Documents
as in effect on such date of certification, such Organizational Documents to be
in form and substance satisfactory to the Lender.

7.7      RESOLUTIONS. All action necessary for the valid execution, delivery and
performance by each Party of this Agreement and the other Loan Documents to
which it is or is to become a party shall have been duly and effectively taken,
and evidence thereof satisfactory to the Lender shall have been provided to the
Lender. The Lender shall have received from each such Person true copies of the
resolutions authorizing the transactions described herein, each certified as of
a recent date to be true and complete.

7.8      INCUMBENCY CERTIFICATE; AUTHORIZED SIGNERS. The Lender shall have
received from each Party an incumbency certificate, dated as of the Closing
Date, giving the name of each individual who shall be authorized: (a) to sign,
in the name and on behalf of such Person each of the Loan Documents to which
such Person is or is to become a


                                      -7-

<PAGE>


party; (b) in the case of the Borrower, to make Draw Requests; and (c) to give
notices and to take other action on its behalf under the Loan Documents.

7.9      VALIDITY OF LIENS. The Security Documents shall be effective to create
in favor of the Lender a legal, valid and enforceable first lien and security
interest in the Collateral. All filings, recordings, deliveries of instruments
and other actions necessary or desirable in the opinion of the Lender to protect
and preserve such lien and security interest shall have been duly effected. The
Lender shall have received evidence thereof in form and substance satisfactory
to the Lender.

7.10     DELIVERIES. In addition, the following items or documents, together
with any others required by Lender's Closing Agenda, shall have been delivered
to the Lender by the Borrower and shall be in form and substance satisfactory to
the Lender:

         (a)  PLANS AND SPECIFICATIONS. Two complete sets of the Site Plan and
         the Plans and Specifications and, to the extent then obtainable,
         approval thereof by any necessary Governmental Authority, together with
         a certification from the Borrower's Architect in the form of Exhibit
         "PLANS" attached to this Agreement.

         (b)  TITLE POLICY. The Title Policy, together with proof of payment of
         all fees and premiums for such policy and true and accurate copies of
         all documents listed as exceptions under such policy.

         (c)  OTHER INSURANCE. Duplicate originals or certified copies of all
         policies and certificates of insurance required by the Security Deed or
         hereunder to be obtained and maintained during the construction of the
         Renovation Project with such mortgagee provisions as Lender shall
         require.

         (d)  EVIDENCE OF SUFFICIENCY OF FUNDS. Evidence that the proceeds of
         the Loan, together with Borrower's Required Equity delivered to the
         Lender or applied by Borrower to the costs of the Acquisition and
         Project Costs with the approval of Lender on or before the Closing
         Date, will be sufficient to cover costs of the Acquisition and all
         Project Costs reasonably anticipated to be incurred to complete the
         Renovation Project and to satisfy the obligations of the Borrower to
         the Lender under this Agreement.

         (e)  EVIDENCE OF ACCESS, AVAILABILITY OF UTILITIES, PROJECT APPROVALS.
         Evidence as to:

              (i) the methods of access to and egress from the Site, and nearby
              or adjoining public ways, meeting the reasonable requirements of
              the Improvements and the status of completion of any required
              improvements to such access;

              (ii) the availability of water supply and storm and sanitary sewer
              facilities meeting the reasonable requirements of the Project;

              (iii) the availability of all other required utilities, in
              location and capacity sufficient to meet the reasonable needs of
              the Project; and

              (iv) Core and Shell Certificate of Occupancy for the existing
              Improvements (prior to the implementation of the Renovation
              Project).


                                      -8-

<PAGE>


         (f)  ENVIRONMENTAL REPORT. An environmental site assessment report or
         reports of one or more qualified environmental engineering or similar
         inspection firms approved by the Lender, which report or reports shall
         indicate a condition of the Site and any existing improvements thereon
         in compliance with all Requirements and in all respects satisfactory to
         the Lender in its sole discretion and upon which report or reports the
         Lender is expressly entitled to rely. In addition, Lender shall be
         provided with evidence of the professional liability insurance coverage
         of such firm(s) and the naming of Lender as an additional insured
         thereon.

         (g)  SURVEY AND TAXES. A Survey of Site Plan and Surveyor's
         Certificate, and evidence of payment of all real estate taxes and
         municipal charges on the Site (and any existing improvements thereon)
         which were due and payable prior to the Closing Date. If the Site is
         part of a subdivision, a complete copy of the subdivision plan and
         evidence of the approval thereof by applicable Governmental Authority
         shall also be required to be delivered.

         (h)  REQUIRED EQUITY. Evidence that the Borrower's Required Equity
         shall have been applied to the costs of Acquisition and Project Costs
         in a manner approved by Lender.

         (i)  PAYMENT AND PERFORMANCE BONDS. Such Payment and Performance Bonds
         as may have been requested by the Lender from time to time; provided
         however, Lender agrees not to request any Payment and Performance Bonds
         as long as John Moriarty & Associates, Inc. is the Contractor and
         Lender is satisfied with the credit of such Contractor.

         (j)  DRAW REQUEST. To the extent the initial Advance includes a request
         for funds to be applied to the Renovation Project, a Draw Request
         complying with the provisions of Section 2.2 hereof.

7.11     CONSTRUCTION INSPECTOR REPORT. The Lender shall have received a report
or written confirmation from the Construction Inspector that (a) the
Construction Inspector has reviewed the Plans and Specifications, (b) the Plans
and Specifications have been received and approved by each Governmental
Authority to which the Plans and Specifications are required under applicable
Requirements to be submitted, (c) the Construction Contract satisfactorily
provides for the construction of the Renovation Project in accordance with the
Plans and Specifications, and (d) in the opinion of the Construction Inspector,
construction of the Renovation Project can be completed on or before the Project
Completion Date for an amount not greater than the amount allocated for such
purpose in the Project Budget.

7.12     LEGAL AND OTHER OPINIONS. The Lender shall have received favorable
opinions in form and substance satisfactory to the Lender and the Lender's
counsel, addressed to the Lender and dated as of the Closing Date, from counsel
to the Borrower and each Guarantor acceptable to the Lender, as to such matters
as the Lender shall reasonably request, including, without limitation,
compliance of the Improvements, as affected by the Renovation Project with all
applicable environmental, land use and zoning requirements and the due
execution, authorization, validity and enforceability of all Loan Documents.

7.13     LIEN SEARCH. The Lender shall have received a certification from the
Title Insurance Company or counsel satisfactory to the Lender (which shall be
updated from


                                      -9-

<PAGE>


time to time at the Borrower's expense upon request by the Lender) that a search
of the public records disclosed no conditional sales contracts, security
agreements, chattel mortgages, leases of personalty, financing statements or
title retention agreements which affect the Collateral.

7.14     MECHANIC'S LIEN LAW

         (a)  INITIAL ADVANCE. In the event that for any reason the initial
         Advance is not funded on the Closing Date, the terms and provisions of
         Section 8.6 (a) and (b) shall be applicable for the initial Advance.

         (b)  LIEN BOND. If requested by the Lender, the Borrower has provided
         evidence that the Borrower has obtained and recorded with the Registry
         a satisfactory lien bond in an amount equal to the Construction
         Contract, which lien bond shall be obtained by the Borrower and shall
         name the Lender as dual obligee; provided however, Lender agrees not to
         request any lien bond so long as John Moriarty & Associates, Inc. is
         the Contractor and Lender is satisfied with the credit of such
         Contractor.

7.15     NOTICES. All notices required by any Governmental Authority under
applicable Requirements to be filed prior to commencement of construction of the
Project shall have been filed.

7.16     APPRAISAL. The Lender shall have received an Appraisal, in form and
substance satisfactory to the Lender, stating that the Site and Improvements
prior to completion of the Renovation Project has a market value of at least
$41,500,000 and thereafter, assuming completion of the Renovation Project in
accordance with the Plans and Specifications, a market value of at least
$50,000,000.

7.17     ARRANGEMENT FEE. The Borrower shall have paid to the Lender the
arrangement fee pursuant to Section 5.

7.18     PERFORMANCE; NO DEFAULT. The Borrower shall have performed and complied
with all terms and conditions herein required to be performed or complied with
by it on or prior to the Drawdown Date of the initial Advance, and on the
Drawdown Date of the initial Advance, there shall exist no Default or Event of
Default.

7.19     REPRESENTATIONS AND WARRANTIES. The representations of warranties made
by the Obligors in the Loan Documents or otherwise made by or on behalf of the
Obligors in connection therewith or after the date thereof shall have been true
and correct in all material respects when made and shall be true and correct in
all material respects on the Drawdown Date of the Advance.

7.20     PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Agreement and the other Loan Documents shall
be satisfactory to the Lender and the Lender's counsel in form and substance,
and the Lender shall have received all information and such counterpart
originals or certified copies of such documents and such other certificates,
opinions or documents as the Lender and the Lender's counsel may reasonably
require.

7.21     WAIVER. Any waiver by the Lender of any of the conditions precedent
contained herein for the closing of the Loan and the initial Advance shall not
be deemed to be a waiver by the Lender of such conditions precedent for any
subsequent Advance or any other obligation of the Lender hereunder.


                                      -10-

<PAGE>


8.       CONDITIONS OF SUBSEQUENT ADVANCES. The obligation of the Lender to make
any Advance after the initial Advance shall be subject to the satisfaction of
the following conditions precedent:

8.1      PRIOR CONDITIONS SATISFIED. All conditions precedent to the initial
Advance and any prior Advance shall continue to be satisfied as of the Drawdown
Date of such subsequent Advance.

8.2      PERFORMANCE; NO DEFAULT. The Borrower shall have performed and complied
with all terms and conditions herein required to be performed or complied with
by it on or prior to the Drawdown Date of such Advance, and on the Drawdown Date
of such Advance there shall exist no Default or Event of Default.

8.3      REPRESENTATIONS AND WARRANTIES. Each of the representations and
warranties made by the Obligors in the Loan Documents or otherwise made by or on
behalf of the Obligors in connection therewith after the date thereof shall have
been true and correct in all material respects on the date on when made and
shall also be true and correct in all material respects on the Drawdown Date of
such Advance.

8.4      NO DAMAGE. The Site and Improvements, or any portion thereof, shall not
have been injured or damaged by fire, explosion, accident, flood or other
casualty or subject to any actual or threatened Taking.

8.5      RECEIPT OF THE LENDER. The Lender shall have received, all in form and
substance satisfactory to Lender:

         (a)  DRAW REQUEST. A Draw Request complying with the requirements
         hereof, including those set forth in Section 2.2 hereof;

         (b)  ENDORSEMENT TO TITLE POLICY. A "date down" endorsement to the
         Title Policy indicating no adverse change in the state of title as of
         the Drawdown Date and containing no survey or other exceptions not
         approved by the Lender. The endorsement shall increase the amount of
         coverage to be not less than all amounts advanced under the Loan,
         including the amount of the Advance with respect to which the
         endorsement is sought;

         (c)  CURRENT SURVEY. An updated Survey if required by the Title
         Insurance Company, the Lender or any Key Tenant;

         (d)  APPROVAL BY CONSTRUCTION INSPECTOR. Approval of the Draw Request
         for such Advance by the Construction Inspector, accompanied by a
         certificate or report from the Construction Inspector to the effect
         that in its opinion, based on-site observations and submissions by the
         Contractor, the construction of the Renovation Project to the date
         thereof was performed in a good and workmanlike manner and
         substantially in accordance with the Plans and Specifications, stating
         the estimated total cost of construction of the Renovation Project,
         stating the percentage of in-place construction of the Renovation
         Project, and stating that the remaining non-disbursed portion of the
         Loan and Borrower's Required Equity allocated for such purpose in the
         Project Budget or otherwise is adequate to complete the construction of
         the Renovation Project. Lender shall use all commercially reasonably
         effects to cause the Construction Inspector shall act promptly to
         perform its inspection and to complete its report within a five (5)
         business day period after the Inspector has received all


                                      -11-

<PAGE>


         materials and information reasonably required by the Inspector and
         finished its inspection.

         (e)  APPROVAL BY KEY TENANT. At the option of the Lender, inspection of
         work in place and approval of such work by the Key Tenant as being in
         compliance with the terms of the Key Lease; and

         (f)  CONTRACTS. Evidence that one hundred percent (100%) of the cost of
         the remaining construction work is covered by firm fixed price or
         guaranteed maximum price contracts.

8.6      MECHANIC'S LIEN LAW.

         (a)  NOTICE OF CONTRACT, MECHANIC'S LIEN. The Lender may withhold or
         refuse to fund any advance hereunder if:

              (i) a Notice of Contract has been filed under Section 4 of the
              Mechanic's Lien Law; or

              (ii) a Notice of Contract has been filed by the Contractor under
              Section 2 of the Mechanic's Lien Law, unless with respect to the
              subject Draw Request, an accurately completed and valid Partial
              Waiver and Subordination of Lien in the form of Schedule 1 to
              Exhibit "GC" has been provided to the Lender with a Payment Period
              date no more than twenty-five days before the date of the funding
              of the such advance;

              (iii) any other statutory or common law lien related to claims for
              labor, materials or supplies has been filed or established and not
              released.

         (b)  PAYMENT PERIOD DATE. In the event that the Lender has not funded
         any Draw Request within twenty-five days after the applicable Payment
         Period date as set forth in such Schedule 1 to Exhibit "GC" as
         submitted with the subject Draw Request, the Lender may, at it option,
         withhold or refuse to fund the Draw Request and require the Borrower to
         resubmit an updated Draw Request in accordance with Section 2.2, above,
         with an updated Schedule 1 to Exhibit "GC".

         (c)  LIEN BOND. If requested by the Lender, at any time, the Borrower
         shall provide evidence that the Borrower has obtained and recorded with
         the Registry a satisfactory lien bond in an amount equal to the unpaid
         construction costs, which lien bond shall be obtained by the Borrower
         and name the Lender as dual obligee.

         (d)  NOTICE OF SUBSTANTIAL COMPLETION. Upon the substantial completion
         of the work provided for in the Construction Contract, the Borrower
         shall have provided evidence to Lender that the Borrower has timely
         obtained from the Contractor and recorded with the Registry, a Notice
         of Substantial Completion as provided for in the Mechanic's Lien Law;
         and

         (e)  NOTICE OF TERMINATION. In the event of the termination of the
         Construction Contract, the Borrower shall have provided evidence to
         Lender that the Borrower has timely recorded with the Registry, a
         Notice of Termination as provided for in the Mechanic's Lien Law.


                                      -12-

<PAGE>


8.7      WAIVER. Any waiver by the Lender of any of the conditions precedent
contained herein for any Advance shall not be deemed to be a waiver by the
Lender of such conditions precedent for any subsequent Advance or any other
obligation of the Lender hereunder.

8.8      PROJECT APPROVALS. Evidence as to the obtaining of all Project
Approvals which are requested, necessary or desirable for the construction
and/or operation of the Renovation Project and the access thereto, including,
without limitation, the City of Waltham's Board of Health Recombinant DNA Permit
for the use of the Improvements by the Key Tenants, together with copies of all
such Project Approvals; provided, however, that notwithstanding the foregoing,
the required DWPC Permit in respect of the sewer system construction and
connection shall be obtained and delivered to Lender no later than December 7,
2000.

8.9      CONSTRUCTION DOCUMENTS. Each of the Architect's Contract and
Construction Contract shall have been duly executed and delivered by the
respective parties thereto, shall be in full force and effect with no
modifications thereto that have not been approved by Lender, and shall be in
form and substance satisfactory to the Lender. The Architect and the Contractor
shall have duly executed and delivered to the Lender a consent to the assignment
of the Architect's Contract and the Construction Contract, in the form
previously delivered by the Lender to Borrower.

9.       REPRESENTATIONS, WARRANTIES AND COVENANTS. The Borrower represents,
warrants, and covenants to the Lender as follows:

9.1      ORGANIZATION; AUTHORITY, ETC.

         (a)  ORGANIZATION; GOOD STANDING. The Borrower is a limited liability
         company duly organized under the laws of the State of Delaware pursuant
         to the Borrower's Organizational Documents, and is, and will at all
         times be, validly existing and in good standing under the laws of such
         State. The Guarantor is a corporation duly organized under the laws of
         the State of Delaware pursuant to Guarantor's Organizational Documents
         and is, and will at all times be, validly existing and in good standing
         under the laws of such State. Each of the Obligors is, and will at all
         times be, duly organized and is, and will at all times be, validly
         existing, in good standing, and qualified to do business in each
         jurisdiction where required. Each Obligor has, and will at all times
         have, all requisite power to own its property and conduct its business
         as now conducted and as presently contemplated.

         (b)  AUTHORIZATION. The execution, delivery and performance of this
         Agreement and the other Loan Documents to which any Obligor is or is to
         become a party and the transactions contemplated hereby and thereby (i)
         are within the authority of such Obligor, (ii) have been duly
         authorized by all necessary proceedings on the part of such Obligor,
         (iii) do not conflict with or result in any breach or contravention of
         any provision of any other agreement binding upon such Obligor or any
         provision of law, statute, rule or regulation to which such Obligor is
         subject or any judgment, order, writ, injunction, license or permit
         applicable to such Obligor, (iv) do not conflict with any provision of
         the Organizational Documents of such Obligor, and (v) do not require
         the approval or consent of, or filing with creditors, trustees for
         creditors or shareholders of, or other holders, directly or indirectly,
         of interests in, such Obligor or the approval or consent or filing with
         any governmental agency or authority other than those approvals or
         consents already obtained and the filing of the Security Documents


                                      -13-

<PAGE>


         and the Financing Statements in the appropriate public records with
         respect thereto.

         (c)  ENFORCEABILITY. The execution and delivery of this Agreement and
         the other Loan Documents to which each Obligor is or is to become a
         party will result in valid and legally binding obligations of such
         Obligor enforceable against it in accordance with the respective terms
         and provisions hereof and thereof, except as enforceability is limited
         by bankruptcy, insolvency, reorganization, moratorium or other laws
         relating to or affecting generally the enforcement of creditors' rights
         and except to the extent that availability of the remedy of specific
         performance or injunctive relief is subject to the discretion of the
         court before which any proceeding therefor may be brought.

         (d)  SINGLE PURPOSE ENTITY/LIMITATIONS. The Borrower is a Single
         Purpose Entity and the Organizational Documents of the Borrower limit
         the business of the Borrower to activities relating to the ownership,
         construction, operation, leasing and maintenance of the Site and
         Improvements and all matters incidental or accessory thereto.

9.2      TITLE TO ASSETS. The Guarantor owns all of the assets reflected in the
balance sheet of the Guarantor as at the Balance Sheet Date or acquired since
that date free from all encumbrances except for Permitted Liens (except property
and assets sold or otherwise disposed of in the ordinary course of business
since that date).

9.3      FINANCIAL STATEMENTS. There has been furnished to the Lender:

         (a)  A balance sheet as of the Balance Sheet Date and a statement of
         income for the fiscal year then ended, for Guarantor, audited and
         certified by Ernst & Young LLP. Such balance sheets and statements of
         income have been prepared in accordance with generally accepted
         accounting principles and fairly present the financial condition of
         Guarantor as at the close of business on the date thereof and the
         results of operations for the fiscal year then ended. As of the date of
         this Agreement, there are no liabilities or contingent liabilities of
         Guarantor known to the directors, officers, partners, members or
         trustees of Borrower which are not disclosed in said balance sheet and
         the related notes thereto.

         (b)  A balance sheet and a statement of income of Guarantor for each of
         the fiscal quarters of Guarantor ended since the Balance Sheet Date,
         certified by Guarantor's chief financial officer, partner or trustee to
         have been prepared in accordance with generally accepted accounting
         principles consistent with those used in the preparation of the annual
         audited statements delivered pursuant to paragraph (a) above and to
         fairly present the financial condition of the Guarantor at the close of
         business on the dates thereof and the results of operations for the
         fiscal quarters then ended (subject to year-end adjustments).

         (c)  If requested by Lender, lease summaries acceptable to Lender for
         the Key Lease and all other Leases for the Improvements, whether or not
         the tenant thereunder has commenced occupancy or the payment of rent.

9.4      NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date, there has
occurred no materially adverse change in the financial condition or business of
each Person as shown on or reflected in the respective balance sheet as at the
Balance Sheet Date, or the statement of income for the fiscal year then ended,
other than changes in the


                                      -14-

<PAGE>


ordinary course of business that have not had any material adverse effect either
individually or in the aggregate on the business or financial condition of such
Person.

9.5      FRANCHISES, PATENTS, COPYRIGHTS, ETC. Borrower possesses, and will at
all times possess, all franchises, patents, copyrights, trademarks, trade names,
licenses and permits, and rights in respect of the foregoing, adequate for the
conduct of its business substantially as now conducted or as it is intended to
be conducted with respect to the Site and Improvements, without known conflict
with any rights of others.

9.6      LITIGATION. Except as shown on Schedule 9.6 hereof, there are no
actions, suits, proceedings or investigations of any kind pending or threatened
against any Obligor before any court, tribunal or administrative agency or board
or any mediator or arbitrator that, if adversely determined, might, either in
any case or in the aggregate, materially and adversely affect the business,
assets or financial condition of such Person, or result in any liability not
adequately covered by insurance, or for which adequate reserves are not
maintained on the balance sheet of such Person, or which question the validity
of this Agreement or any of the other Loan Documents, any action taken or to be
taken pursuant hereto or thereto, or any lien or security interest created or
intended to be created pursuant hereto or thereto, or which will adversely
affect the ability of an Obligor with respect to the acquisition, construction
or use of the Site and Improvements or to pay and perform the Project
Obligations in the manner contemplated by this Agreement and the other Loan
Documents.

9.7      NO MATERIALLY ADVERSE CONTRACTS, ETC. Each Obligor is not subject to
any charter, corporate or other legal restriction, or any judgment, decree,
order, rule or regulation that has or is expected in the future to have a
materially adverse effect on the business, assets or financial condition of such
Obligor. Each Obligor is not, and will not be, a party to any contract or
agreement that has or is expected to have any materially adverse effect on the
business of such Obligor.

9.8      COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Each Obligor is not, and
will not at any time be, in violation of any provision of its Organizational
Documents or any agreement or instrument to which it may be subject or by which
it or any of its properties may be bound or any decree, order, judgment,
statute, license, rule or regulation, in any of the foregoing cases in a manner
that could result in the imposition of substantial penalties or materially and
adversely affect the financial condition, properties or business of such
Obligor.

9.9      TAX STATUS. Each Obligor (a) has made or filed, and will make or file
in a timely fashion, all federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject,
(b) has paid, and will pay when due, all taxes and other governmental
assessments and charges shown or determined to be due on such returns, reports
and declarations, except those being contested in good faith and by appropriate
proceedings, (c) if a partnership, limited partnership, limited liability
partnership, or limited liability company, has, and will maintain, partnership
tax classification under the Code, and (d) has set aside, and will at all times
set aside, on its books provisions reasonably adequate for the payment of all
taxes for periods subsequent to the period to which such returns, reports or
declarations apply. There are no unpaid taxes in any material amount claimed to
be due by the taxing authority of any jurisdiction, and the officers, partners
or trustees of each Obligor know of no basis for any such claim. Each Obligor
has filed, and will continue to file, all of such tax returns, reports, and
declarations either (i) separately from any parent or affiliate or (ii) if part
of a consolidated filing, as a separate member of any such consolidated group.


                                      -15-

<PAGE>


9.10     NO EVENT OF DEFAULT. No Default or Event of Default has occurred and is
continuing.

9.11     SETOFF, ETC. The Collateral and the Lender's rights with respect to the
Collateral are not subject to any setoff, claims, withholdings or other
defenses.

9.12     CERTAIN TRANSACTIONS. None of (a) the officers, trustees, directors,
partners, managers, members, stockholders, beneficiaries, or employees of any
Obligor or Subsidiary thereof or (b) any corporation, partnership, trust or
other entity in which any such officer, trustee, director, partner, manager,
member, stockholder, beneficiary, or employee has a substantial interest or is
an officer, director, trustee, manager or partner, is presently a party to any
transaction with the Borrower (other than for services as employees, officers,
trustees, managers and directors).

9.13     [Intentionally Deleted]

9.14     PARTNERS, BENEFICIARIES, ETC. Except as set forth in Schedule 2, the
Borrower has no general partners, limited partners, partners, beneficiaries,
stockholders, or members.

9.15     ERISA PLAN. The Borrower does not, and will not maintain or contribute
to an ERISA Plan.

9.16     SOLVENCY. Neither Borrower nor any Guarantor (a) is insolvent or will
be rendered insolvent by the Indebtedness incurred in connection with the Loan,
(b) has unreasonably small capital with which to engage in its business, (c) has
incurred Indebtedness beyond its ability to pay such Indebtedness as it matures
and (d) has assets having a value less than required to pay any Indebtedness.

9.17     AVAILABILITY OF UTILITIES. Except as otherwise indicated in Schedule
9.17 hereof, all utility services necessary and sufficient for the construction,
development and operation of the Improvements are presently, and will at all
times be, available to the boundaries of the Site through dedicated public
rights of way or through perpetual private easements, approved by the Lender,
with respect to which the Security Deed creates a valid and enforceable first
lien. The Borrower will also promptly obtain all utility installations and
connections required for the operation and servicing of the Improvements for
their intended purposes, and will furnish the Lender with evidence thereof which
is satisfactory to Lender.

9.18     ACCESS. The rights of way for all roads necessary for the full
utilization of the Improvements for their intended purposes have either been
acquired by the appropriate Governmental Authority or have been dedicated to
public use and accepted by such Governmental Authority or are provided for in
easements benefiting the Site and Improvements and insured under the Title
Policy as part of the insured premises. All such roads shall have been
completed, or all necessary steps have been taken by the Borrower and such
Governmental Authority to assure the complete construction and installation
thereof prior to the date upon which access to the Improvements via such roads
will be necessary, and the right to use all such roads, or suitable substitute
rights of way approved by the Lender, shall be maintained at all times for the
Improvements. All curb cuts, driveways and traffic signals shown on the Plans
and Specifications are existing or have been fully approved by the appropriate
Governmental Authority and after the completion thereof, shall be maintained at
all times for the Improvements.

9.19     CONDITION OF SITE AND IMPROVEMENTS. Neither the Site nor the
Improvements nor any part thereof is now damaged or injured as result of any
fire, explosion, accident,


                                      -16-

<PAGE>


flood or other casualty or has been the subject of any Taking, and to the
knowledge of the Borrower, no Taking is pending or contemplated.

9.20     COMPLIANCE WITH REQUIREMENTS/HISTORIC STATUS/FLOOD AREA. The
construction of the Improvements and the use and occupancy of the Improvements
contemplated thereby comply with, and will at times comply with, all
Requirements. The Borrower will give all such notices to, and take all such
other actions with respect to, such Governmental Authority as may be required
under applicable Requirements to construct the Improvements and to use, occupy
and operate the Improvements following Project Completion. Borrower has received
no notice alleging any non-compliance by the Improvements or the Site with any
Requirements or indicating that the Site or the Improvements are located within
any historic district or has, or may be, designated as any kind of historic or
landmark site under applicable Requirements. The Site is not in any special
flood hazard area as defined under applicable Requirements.

9.21     PROJECT APPROVALS.

         (a)  Except for any certificates of occupancy required for the
         Renovation Project or as otherwise set forth on Schedule 3 hereto, the
         Borrower has obtained all Project Approvals. All Project Approvals
         obtained by the Borrower are listed and described on Schedule 4 hereto,
         have been validly issued and are in full force and effect. The Borrower
         has no reason to believe that any of the Project Approvals not
         heretofore obtained by the Borrower will not be obtained by the
         Borrower in the ordinary course following Project Completion in
         accordance with the Plans and Specifications. No Project Approvals will
         terminate, or become void or voidable or terminable, upon any sale,
         transfer or other disposition of the Site or Improvements, including
         any transfer pursuant to foreclosure sale under the Security Deed.

         (b)  The Borrower will promptly obtain all Project Approvals not
         heretofore obtained by the Borrower (including those listed and
         described on Schedule 3 hereto and any other Project Approvals which
         may hereafter become required, necessary or desirable) and will furnish
         the Lender with evidence that the Borrower has obtained such Project
         Approvals promptly upon its request. If an outside date is set forth on
         Schedule 3 as a deadline for Borrower to obtain a specific Project
         Approval, Borrower shall obtain the issuance of such Project Approval
         by such deadline date.

         (c)  The Borrower will duly perform and comply with all of the terms
         and conditions of all Project Approvals obtained at any time, including
         all Project Approvals listed and described on Schedules 3 and 4 hereto.

9.22     CONSTRUCTION CONTRACT; ARCHITECT'S CONTRACT. The Construction Contract
and the Architect's Contract are each in full force and effect with no
modifications thereto not previously approved by Lender and each of the parties
thereto are in full compliance with their respective obligations thereunder. The
work to be performed by the Contractor under the Construction Contract is the
work called for by the Plans and Specifications, and all work required to
complete the Renovation Project in accordance with the Plans and Specifications
is provided for under the Construction Contract.

9.23     KEY LEASE. The Key Lease is in full force and effect with no defaults
thereunder or deficiencies in the performance of obligations thereunder and no
modifications thereto not previously approved by Lender. All of the parties to
such agreements are in full compliance with their respective obligations
thereunder and there


                                      -17-

<PAGE>


does not exist any condition which would materially and adversely affect the
ability of the Key Tenant to fulfill and perform all its obligations under the
Key Lease.

         Lender acknowledges and agrees that the tenant under the Key Lease
shall have the right to sublease up to an aggregate of 40,000 square feet of its
premises to third parties without Lender's approval (except as set forth below);
provided that Borrower provides copies of such subleases to Lender. Subleases
covering space in excess of such 40,000 square feet shall require Lender's prior
written approval. With respect to any such sublease (whether or not included in
the 40,000 square feet) for which Borrower desires Lender to provide subtenant
with a non-disturbance and recognition agreement Lender's prior approval of such
sublease shall be required. Subleases approved by Lender hereunder (or not
requiring Lender's approval) are referred to herein as "Approved Subleases".

9.24     OTHER CONTRACTS.

         (a)  The Borrower has not made, and will not make any contract or
         arrangement of any kind or type whatsoever (whether oral or written,
         formal or informal), the performance of which by the other party
         thereto could give rise to a lien or encumbrance on the Site or
         Improvements (except as otherwise expressly permitted or acknowledged
         hereunder with respect to construction contracts and subcontracts for
         the Renovation Project).

         (b)  The Borrower has not made, and will not make, any contract or
         arrangement of any kind or type whatsoever, with any affiliate of the
         Borrower unless such contract or arrangement is (i) approved in writing
         in advance by the Lender, (ii) on the same terms as would be generally
         available to the Borrower in an arm's length contract or arrangement
         with a third party, and (iii) evidenced by a written agreement. In this
         connection, Lender acknowledges its approval of the Key Lease.

9.25     VIOLATIONS. The Borrower has received no notices of nor has any
knowledge of, any violation of any applicable Requirements or Project Approvals.

9.26     PLANS AND SPECIFICATIONS. The Borrower has furnished the Lender with
true and complete sets of the Plans and Specifications and copies of the Site
Plan. The Plans and Specifications so furnished to the Lender comply with all
Requirements, all Project Approvals, and all restrictions, covenants and
easements affecting the Site and Improvements, and have been approved by the
Contractor, the Borrower's Architect, the Key Tenant, and each Governmental
Authority to the extent obtainable as of the date hereof and required for
construction of the Renovation Project. The Plans and Specifications, as
approved by the Key Tenant and each Governmental Authority are substantially the
same plans and specifications included in the Construction Contract and covered
by all payment, performance and/or lien bonds provided in connection herewith.

9.27     PROJECT BUDGET. The Project Budget accurately reflects all Project
Costs and the intended first application of Borrower's Required Equity to such
Project Costs.

9.28     ENVIRONMENTAL MATTERS. The Borrower incorporates by reference herein
the representations and warranties contained in the Indemnity Agreement as if
each was fully set forth herein.


                                      -18-

<PAGE>


9.29     EFFECT OF DRAW REQUEST. Each Draw Request submitted to the Lender as
provided in Section 2.2 hereof shall constitute an affirmation that the
representations and warranties contained in this Agreement and in the other Loan
Documents remain true and correct as of the date thereof; and unless the Lender
is notified to the contrary, in writing, prior to the Drawdown Date of the
requested Advance or any portion thereof, shall constitute an affirmation that
the same remain true and correct on the Drawdown Date.

9.30     GENERAL. Each of the Borrower and any Guarantor has disclosed any
material fact or condition which is necessary to make the representations and
warranties set forth herein or in any other Loan Document not materially
misleading.


10.      AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower covenants and
agrees that, so long as the Loan is outstanding or the Lender has any obligation
to make any Advances:

10.1     PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or cause to
be paid the principal and interest on the Loan and all other amounts provided
for in the Note, this Agreement and the other Loan Documents to which the
Borrower is a party, all in accordance with the terms of the Note, this
Agreement and such other Loan Documents.

10.2     COMMENCEMENT, PURSUIT AND COMPLETION OF CONSTRUCTION. The Borrower will
commence construction of the Renovation Project by no later than the tenth
(10th) day following the Closing Date, will diligently pursue construction of
the Renovation Project in accordance with the Construction Schedule, will attain
Project Completion on or prior to the Project Completion Date, and will pay all
sums and perform all such acts as may be necessary or appropriate to complete
such construction, all in accordance with the Plans and Specifications, in full
compliance with all restrictions, covenants and easements affecting the Site and
Improvements, all Requirements, all Project Approvals, and with all terms and
conditions of the Loan Documents and the Key Lease, without deviation from the
Plans and Specifications unless the Borrower obtains the prior approval of the
Lender, the Key Tenant and if applicable, the surety company or companies
issuing any Payment and Performance Bonds. Such construction shall be completed
free from any liens, claims or assessments (actual or contingent) asserted
against the Site and Improvements for any material, labor or other items
furnished in connection therewith. The Borrower will furnish evidence of
satisfactory compliance with this Section to the Lender on or before the Project
Completion Date.

10.3     FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower will
deliver, or cause to be delivered, to the Lender:

         (a)  as soon as practicable, but in any event not later than ninety
         (90) days after the end of each fiscal year of the Borrower, an
         unaudited balance sheet of the Borrower at the end of such year, and
         the related unaudited statement of income, each setting forth in
         comparative form the figures for the previous fiscal year and such
         statement to be in reasonable detail, prepared in accordance with
         generally accepted accounting principles, together with a certification
         by the principal financial or accounting officer, partner or trustee of
         the Borrower that the information contained in such financial statement
         fairly presents the financial position of the Borrower on the date
         thereof (subject to year-end adjustments) and that, in making the
         examination necessary to said certification,


                                      -19-

<PAGE>


         such Person has obtained no knowledge of any Default or Event of
         Default under this Agreement;

         (b)  as soon as practicable, but in any event not later than forty-five
         (45) days after the end of each six (6) month period of each fiscal
         year of the Borrower, copies of the unaudited balance sheet of the
         Borrower as at the end of such 6-month period, and the related
         unaudited statement of income, statement of retained earnings, changes
         in capital, and statement of cash flows for the portion of the
         Borrower's fiscal year then elapsed, all in reasonable detail and
         prepared in accordance with generally accepted accounting principles,
         together with a certification by the principal financial or accounting
         officer, partner or trustee of the Borrower that the information
         contained in such financial statements fairly presents the financial
         position of the Borrower on the date thereof (subject to year-end
         adjustments) and that, in making the examination necessary to said
         certification, such Person has obtained no knowledge of any Default or
         Event of Default under this Agreement;

         (c)  contemporaneously with the delivery of the financial statements
         referred to in clause (a) above, a statement of all contingent
         liabilities of the Borrower which are not reflected in such financial
         statements or referred to in the notes thereto, and a statement of
         projected cash flows of the Borrower for the current fiscal year, all
         in reasonable detail and certified by the principal financial or
         accounting officer of the Borrower;

         (d)  simultaneously with the delivery of the financial statements
         referred to in clauses (a) and (b) above, a statement signed by the
         principal financial or accounting officer, partner or trustee of the
         Borrower and setting forth in reasonable detail computations evidencing
         compliance with the covenants contained in Section 11.10;

         (e)  promptly following the Borrower's receipt thereof, copies of the
         annual financial statements of the Key Tenant;

         (f)  the financial statements and information required of the
         Guarantors under the Guaranty in accordance with the delivery schedule
         for such set forth in the Guaranty; and

         (g)  from time to time such other financial data and information
         (including accountants' management letters) as the Lender may
         reasonably request.

10.4     INSURANCE; BONDS.

         (a)  The Borrower will obtain and maintain insurance with respect to
         the Site and Improvements and the operations of the Borrower as
         required in Exhibit "INSURANCE" attached hereto and incorporated
         herein. All insurance premiums shall be paid annually, in advance, and
         Lender shall be provided with evidence of such prepayment prior to the
         initial Loan Advance and thereafter at least thirty (30) days prior to
         each annual renewal or replacement of such coverage.

         (b)  The Borrower will require the Contractor, the Architect, and any
         other architect, contractor, engineer or design professional providing
         design, construction, or engineering services in connection with the
         construction of the Renovation Project to obtain and maintain at all
         times during the construction of


                                      -20-

<PAGE>


         the Renovation Project (and for the Architect, for a period of not less
         than one (1) year after the date of Project Completion) such insurance
         as may be reasonably required by the Lender, all such insurance to be
         in such amounts and form, to include such coverage and endorsements,
         and to be issued by such insurers as shall be approved by the Lender,
         and to contain the written agreement of the insurer to give the Lender
         thirty (30) days' prior written notice of cancellation, nonrenewal,
         modification or expiration.

         (c)  The Borrower will obtain and provide to the Lender or will cause
         the Contractor or any subcontractor designated by the Lender to obtain
         and provide to the Lender such Payment and Performance Bonds as the
         Lender may from time to time request, such bonds to be in dual obligee
         form.

         (d)  The Borrower will provide or will cause any such Person to provide
         the Lender with certificates evidencing such insurance upon the request
         of the Lender.

10.5     LIENS AND OTHER CHARGES. The Borrower will duly pay and discharge, or
cause to be paid and discharged, before the same shall become overdue all claims
for labor, materials, or supplies that if unpaid might by law become a lien or
charge upon any of its property.

10.6     INSPECTION OF PROJECT AND BOOKS, APPRAISALS.

         (a)  Upon at least one (1) Business Day advance notice, the Borrower
         shall permit the Lender and the Construction Inspector, at the
         Borrower's expense, to visit and inspect the Site and Improvements and
         all materials used or to be used in the construction thereof and will
         cooperate with the Lender and the Construction Inspector during such
         inspections (including making available working drawings of the Plans
         and Specifications); PROVIDED that this provision shall not be deemed
         to impose on the Lender or the Construction Inspector any obligation to
         undertake such inspections.

         (b)  Upon at least three (3) Business Days advance notice, the Borrower
         shall permit the Lender at the Borrower's expense to visit and inspect
         the Site and Improvements, to examine the books of account of the
         Borrower (and to make copies thereof and extracts therefrom) and to
         discuss the affairs, finances and accounts of the Borrower with, and to
         be advised as to the same by, its officers, partners, or trustees, all
         at such reasonable times and intervals as the Lender may reasonably
         request; PROVIDED that so long as no Default or Event of Default shall
         have occurred and be continuing, the Borrower shall only be obligated
         to pay the expenses associated with one (1) such investigation of the
         books of Borrower during any twelve (12) month period.

         (c)  The Lender shall have the right to obtain from time to time, at
         the Borrower's cost and expense, updated Appraisals of the Project and
         an updated or new Environmental Report for the Project, PROVIDED that
         so long as no Default or Event of Default shall have occurred and be
         continuing, the Borrower shall only be obligated to pay for the costs
         and expenses associated with one (1) such Appraisal and one (1) such
         updated or new Environmental Report during any twelve (12) month
         period.


                                      -21-

<PAGE>


         (d)  The costs and expenses incurred by the Lender in obtaining such
         Appraisals or performing such inspections shall be paid by the Borrower
         forthwith upon billing or request by the Lender for reimbursement
         therefor.

10.7     COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The Borrower
will, or will cause each Obligor and each Subsidiary thereof to, comply with (a)
the applicable laws and regulations wherever its business is conducted,
including all Environmental Laws and all Requirements, (b) the provisions of its
Organizational Documents and all Loan Documents to which Borrower or such
Obligor or Subsidiary are signatories, (c) all agreements and instruments by
which it or any of its properties may be bound, including, in the case of the
Borrower, the Architect's Contract, the Construction Contract, the Key Lease,
and all restrictions, covenants and easements affecting the Project, (d) all
applicable decrees, orders and judgments, and (e) all licenses and permits
required by applicable laws and regulations for the conduct of its business or
the ownership, use or operation of its properties, including all Project
Approvals.

10.8     USE OF PROCEEDS. Except to the extent otherwise permitted after Project
Completion under Section 2.1 hereof, the Borrower will use the proceeds of the
Loan only after first expending all of Borrower's Required Equity and then
solely for the purpose of paying for the costs of the Acquisition and/or Project
Costs in accordance with the Project Budget.

10.9     PROJECT COSTS. The Borrower will pay all Project Costs in excess of the
Loan Amount, regardless of the amount, whenever due or otherwise required by
Lender in order to attain Project Completion prior to the Project Completion
Date.

10.10    INSUFFICIENCY OF LOAN PROCEEDS. If at any time while the Loan is
outstanding or the Lender has any obligation to make Advances hereunder, the
Lender reasonably determines that the remaining undisbursed portion of the Loan,
together with the undisbursed balance of Borrower's Required Equity and any
other sums previously deposited by the Borrower with the Lender in connection
with the Loan, is or will be insufficient to fully complete and equip the
Renovation Project in accordance with the Plans and Specifications, and to pay
all other sums due or to become due under the Loan Documents, regardless of how
such condition may be caused, the Borrower will, within fifteen (15) days after
written notice of such determination from the Lender, deposit with the Lender
such sums of money in cash in an amount sufficient to remedy the condition
described in such notice, and sufficient to pay any liens for labor and
materials alleged to be due and payable at the time in connection with the
Improvements, and, at the Lender's option, no further Advances of the Loan shall
be made by the Lender until Borrower has fully complied with the provisions of
this section. All such deposited sums shall stand as additional security for the
Obligations and, prior to the occurrence of a Default, shall be disbursed by the
Lender in the same manner as Advances under this Agreement before any further
Advances of the Loan proceeds shall be made. The Lender shall have no obligation
to pay the Borrower any interest with respect to such deposited funds.

10.11    PERMANENT COMMITMENT. [Intentionally Deleted]

10.12    DEPOSIT OF INCOME. The Borrower will deposit with the Lender, upon
request at any time after an Event of Default, any sums received by the Borrower
from tenants under Leases (other than amounts paid by tenants to reimburse the
Borrower for construction work performed for tenants the cost of which has not
been disbursed to the Borrower by the Lender under the Loan), in a special
account, from which no funds


                                      -22-

<PAGE>


shall be drawn by the Borrower without the Lender's prior approval, and which
sums shall stand as additional security for the Obligations, subject to the
rights of tenants in such sums. It is expressly agreed that, at the Lender's
option, such sums shall be disbursed in the same manner as Advances before any
further Advance of the Loan is made.

10.13    PUBLICITY. The Borrower will permit the Lender to obtain publicity in
connection with the Acquisition and construction of the Renovation Project
through press releases and participation in such events as ground breaking and
opening ceremonies; provided, however, any publicity naming Guarantor shall not
be generated by Lender without first obtaining Guarantor's consent, not to be
unreasonably withheld.

10.14    SIGN REGARDING FINANCING. If requested by the Lender, the Borrower
will, at its cost and expense, erect and maintain on a suitable location on the
Site a sign indicating that the financing evidenced hereby is being provided by
the Lender, such location and sign to be subject to the approval of the Lender.

10.15    FURTHER ASSURANCES.

         (a)  REGARDING CONSTRUCTION. The Borrower will furnish or cause to be
         furnished to the Lender all instruments, documents, boundary surveys,
         footing or foundation surveys, certificates, plans and specifications,
         title and other insurance, reports and agreements and each and every
         other document and instrument required to be furnished by the terms of
         this Agreement, the other Loan Documents or the Key Lease, all at the
         Borrower's expense.

         (b)  REGARDING PRESERVATION OF COLLATERAL. The Borrower will execute
         and deliver to the Lender such further documents, instruments,
         assignments and other writings, and will do such other acts necessary
         or desirable, to preserve and protect the Collateral at any time
         securing or intended to secure the Obligations, as the Lender may
         reasonably require.

         (c)  REGARDING THIS AGREEMENT. The Borrower will cooperate with, and
         will do such further acts and execute such further instruments and
         documents as the Lender shall reasonably request to carry out to its
         satisfaction the transactions contemplated by this Agreement and the
         other Loan Documents.

10.16    NOTICES. The Borrower will promptly notify the Lender in writing of (i)
the occurrence of any Default or Event of Default; (ii) the occurrence of any
other event which may have a material adverse effect on the Site or Improvements
or the business or financial condition of any Obligor; or (iii) the receipt by
the Borrower of any notice of default or notice of termination with respect to
any material contract or agreement relating to the ownership, construction,
operation, or use of the Site or Improvements, including, without limitation,
the Architect's Contract, the Construction Contract and the Key Lease.

10.17    OTHER AFFIRMATIVE COVENANTS. The Borrower will:

         (a)  Remain solvent and pay all of its Indebtedness from its assets as
         the same become due;

         (b)  At all times be a Single Purpose Entity and hold itself out to the
         public as a legal entity, separate and distinct from any other Person,
         including any Obligor, Subsidiary of the Borrower, or any parent or
         affiliate of the Borrower; and


                                      -23-

<PAGE>


         (c)  Maintain adequate capital for the normal obligations reasonably
         foreseeable for a business of its size and character and in light of
         its contemplated business operations.

11.      NEGATIVE COVENANTS OF THE BORROWER. The Borrower covenants and agrees
that, so long as the Loan is outstanding or the Lender has any obligation to
make any Advances:

11.1     RESTRICTIONS ON CHANGE ORDERS. Other than for Non-Material Change
Orders, the Borrower will not cause, permit or suffer to exist any deviations
from the Plans and Specifications and will not approve or consent to any change
order or construction change directive without the prior approval of the Lender,
the Key Tenant, and the surety company or companies issuing any Payment and
Performance Bonds. The Borrower shall promptly provide Lender with copies of all
Non-Material Change Orders.

11.2     RESTRICTIONS ON EASEMENTS, COVENANTS AND RESTRICTIONS. The Borrower
will not create or suffer to be created or to exist any easement, right of way,
restriction, covenant, condition, license or other right in favor of any Person
which affects or might affect title to the Project or the use and occupancy of
the Project or any part thereof without obtaining the prior approval of the
Lender which consent shall not be unreasonably withheld. Lender acknowledges it
has approved the Title Policy Exceptions.

11.3    NO AMENDMENTS, TERMINATIONS OR WAIVERS.

         (a)  The Borrower will not amend, supplement or otherwise modify,
         whether by change order or otherwise (other than a Non-Material Change
         Order), any of the material terms and conditions of the Architect's
         Contract, the Construction Contract, the easements and agreements
         referred to in the Title Policy Exceptions and other contracts assigned
         to Borrower as part of its Acquisition, or the Key Lease without in
         each case the prior approval of the Lender; provided, however, (i) with
         respect to the Architect's Contract, Lender's prior approval shall not
         be unreasonably withheld and (ii) with respect to the Construction
         Contract Lender shall also have a reasonable approval right over any
         surety or surety companies issuing any payment, performance or lien
         bonds pursuant to Section 7.10(i) hereof.

         (b)  The Borrower will not, directly or indirectly, terminate or
         cancel, or cause or permit to exist any condition which would result in
         the termination or cancellation of, or which would relieve the
         performance of any obligations of any other party under, the
         Architect's Contract, the Construction Contract, the easements and
         agreements referred to in the Title Policy Exceptions and other
         material contracts assigned to Borrower as part of its Acquisition or
         the Key Lease.

         (c)  The Borrower will not, directly or indirectly, waive or agree or
         consent to the waiver of, the performance of any obligations or any
         other party under the Architect's Contract, the Construction Contract,
         the easements and agreements referred to in the Title Policy Exceptions
         and


                                      -24-

<PAGE>


         other material contracts assigned to Borrower as part of its
         Acquisition or the Key Lease.

         (d)  The Borrower will not, directly or indirectly, amend, or allow the
         amendment of, any of the Organizational Documents of the Borrower in
         any material respect, including, without limitation, any such amendment
         which would allow or authorize the expansion of Borrower's activities
         beyond the ownership, construction, operation and maintenance of the
         Site and Improvements and all matters incidental or accessory thereto.

11.4     RESTRICTIONS ON INDEBTEDNESS. The Borrower will not create, incur,
assume, guaranty or be or remain liable, contingently or otherwise, with respect
to any Indebtedness other than:

         (a)  Indebtedness to the Lender arising under any of the Loan
         Documents;

         (b)  current liabilities of the Borrower relating to the Site and
         Improvements, incurred in the ordinary course of business but not
         incurred through (i) the borrowing of money, or (ii) the obtaining of
         credit except for credit on an open account basis customarily extended
         and in fact extended in connection with normal purchases of goods and
         services;

         (c)  Indebtedness relating to the Site or Improvements, in respect of
         taxes, assessments, governmental charges or levies and claims for
         labor, materials and supplies to the extent that payment therefor shall
         not at the time be required to be made in accordance with other
         provisions of this Agreement or any other Loan Document; and

         (d)  Indebtedness to any Obligor or any parent or affiliate of the
         Borrower; provided, however, (i) the proceeds of such Indebtedness
         shall only be used to enable the Borrower to pay its ordinary and
         customary operating expenses or other costs and expenses related to the
         Site or Improvements; (ii) no payments shall be made or required
         relative to the said Indebtedness on or before payment in full of the
         Obligations; (iii) any payments received by the holder of said
         Indebtedness shall be held in trust for, and paid in kind to, the
         Lender; and (iv) the said Indebtedness of the Borrower shall be (1)
         evidenced by documents satisfactory in all respects to the Lender, (2)
         subordinate in payment to the Obligations, (3) unsecured, (4)
         non-defaultable and non-callable upon a default or otherwise until one
         year and one day from the repayment in full of the Obligations, and (5)
         if Lender elects, subject to an intercreditor agreement with the Lender
         in form and substance satisfactory to the Lender.

11.5     RESTRICTIONS ON LIENS, ETC. The Borrower will not (a) create or incur
or suffer to be created or incurred or to exist any lien, encumbrance, mortgage,
pledge, charge, restriction or other security interest of any kind upon any of
its property or assets of any character whether now owned or hereafter acquired,
or upon the income or profits therefrom or, directly or indirectly, upon any of
the beneficial or legal interests in Borrower; (b) transfer any of its property
or assets or the income or profits therefrom for the purpose of subjecting the
same to the payment of Indebtedness or performance of any other obligation in
priority to payment of its general creditors or except in connection with a
Permitted Transfer under Section 11.7 hereof, permit to occur any change in the
ownership and/or control of beneficial or legal interests in Borrower from that
represented on Schedule 2 hereof; (c) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money


                                      -25-

<PAGE>


security agreement, device or arrangement; (d) suffer to exist for a period of
more than thirty (30) days after the same shall have been incurred any
Indebtedness or claim or demand against it that if unpaid might by law or upon
bankruptcy or insolvency, or otherwise, be given any priority whatsoever over
its general creditors; or (e) sell, assign, pledge or otherwise transfer any
accounts, contract rights, general intangibles, chattel paper or instruments,
with or without recourse; provided that the Borrower may create or incur or
suffer to be created or incurred or to exist:

         (a)  statutory liens relating to the Project to secure taxes,
         assessments and other governmental charges or claims for labor,
         material or supplies in respect of obligations not overdue;

         (b)  liens in favor of the Lender under the Loan Documents;

         (c)  other liens on the Project consisting of easements, rights of way,
         covenants and restrictions if and to the extent the same are disclosed
         on the Title Policy and have been approved by the Lender ("Title Policy
         Exceptions").

11.6     RESTRICTIONS ON LOANS AND INVESTMENTS. The Borrower will not make or
permit to exist or to remain outstanding any loan by the Borrower to any Person
or any Investment except Investments in:

         (a)  marketable direct or guaranteed obligations of the United States
         of America that mature within one (1) year from the date of purchase by
         the Borrower;

         (b)  demand deposits and bankers acceptances of United States banks
         having total assets in excess of $1,000,000,000;

         (c)  certificates of deposit and time deposits of United States banks
         having total assets in excess of $1,000,000,000 that mature within one
         (1) year from the date of purchase by the Borrower; and

         (d)  securities commonly known as "commercial paper" issued by a
         corporation organized and existing under the laws of the United States
         of America or any state thereof that at the time of purchase have been
         rated and the ratings for which are not less than "P 1" if rated by
         Moody's Investors Services, Inc., and not less than "A 1" if rated by
         Standard and Poor's.

11.7     MERGER, CONSOLIDATION, CONVERSION, BUSINESS OPERATIONS, AND OWNERSHIP
AND DISPOSITION OF ASSETS.

         (a)  The Borrower shall not own any assets other than the Site and
         Improvements or other assets incidental to the ownership or operation
         of the Site and Improvements.

         (b)  Other than as a result of a "Permitted Transfer" (as defined in
         Schedule 1 hereto), the Borrower will not become a party to any merger
         or consolidation, or agree to or effect any asset acquisition or stock
         acquisition.

         (c)  The Borrower will not become a party to or agree to or effect any
         disposition of the Site and Improvements or any part thereof.

         (d)  The Borrower will not convert into any other type of entity.


                                      -26-

<PAGE>


         (e)  The Borrower will not engage in any business operations other than
         those necessary or appropriate for the ownership, construction,
         management, leasing or operation of the Site and Improvements or engage
         in any conduct or omission the effect of which could deprive the
         Borrower of its status as a Single Purpose Entity.

         Notwithstanding anything to the contrary contained in this Agreement or
any other Loan Document, Borrower and/or Guarantor shall have the right to make
Permitted Transfers.

11.8     SALE AND LEASEBACK. The Borrower will not enter into any arrangement,
directly or indirectly, whereby the Borrower shall sell or transfer any property
owned by it in order then or thereafter to lease such property or lease other
property that the Borrower intends to use for substantially the same purpose as
the property being sold or transferred.

11.9     DISTRIBUTIONS. The Borrower will not make any Distributions after the
occurrence of any Default or Event of Default.

11.10    FINANCIAL COVENANTS. The Borrower covenants and agrees that, so long as
the Loan is outstanding, the Borrower will not permit the outstanding principal
amount of the Loan to exceed 66% of the Appraised Value of the Project; provided
that Borrower shall not be in breach of this covenant unless Lender has given
Borrower notice of such deficiency and Borrower has failed within thirty (30)
days thereafter to pay down the principal of the Loan to a sufficient extent so
as to eliminate any deficiency, together with payment of any applicable
prepayment or the like charges. In no event, however, shall Lender be obligated
to make any Advances hereunder during such "cure" period.

         The Borrower further covenants and agrees that, with respect to the
twelve (12) month period ending on December 31, 2000 and each ensuing twelve
(12) month period thereafter, the Borrower's Net Operating Income shall be not
less than 130% of Borrower's Debt Service Charges ("Debt Service Coverage
Ratio"). If, based on its review of the Borrower's most recent financial
statement and such other factors as the Lender reasonably deems appropriate, the
Lender determines that Borrower does not meet the Debt Service Coverage Ratio
requirement, then, within thirty (30) days after notice thereof from the Lender,
the Borrower shall have the right to cure such deficiency by paying down the
outstanding principal balance of the Loan so as to comply with this requirement.

11.11    OTHER NEGATIVE COVENANTS. The Borrower will not:

         (a)  Seek the dissolution or winding up, in whole or in part, of the
         Borrower or voluntarily file, or consent to the filing of, a petition
         for bankruptcy, reorganization, assignment for the benefit of creditors
         or similar proceedings; and

         (b)  Commingle any of its accounts with accounts of any other Person,
         including, any Obligor, Subsidiary of the Borrower, or parent or
         affiliate of the Borrower.

12.      EVENTS OF DEFAULT AND REMEDIES.

12.1     EVENTS OF DEFAULT. The occurrence of any one or more of the following
conditions or events shall constitute an "Event of Default":


                                      -27-

<PAGE>


         (a)  any failure by the Borrower to pay, within five (5) days of the
         due date, any interest on or principal of or other sum payable under
         the Note; or

         (b)  any failure by the Borrower to deposit with the Lender any funds
         required by Sectio 2.5 or Section 10.10 hereof to be deposited with the
         Lender, at the time and otherwise in accordance with such Sections; or

         (c)  any failure by the Borrower to pay as and when due and payable any
         other sums to be paid by the Borrower to the Lender under this
         Agreement and the continuance of such failure for a period of five (5)
         days after notice thereof from the Lender; or

         (d)  title to the Collateral is or becomes unsatisfactory to the Lender
         by reason of any lien, charge, encumbrance, title condition or
         exception and such matter causing title to be or become unsatisfactory
         is not cured to Lender's satisfaction or removed within thirty (30)
         days after notice thereof from the Lender to the Borrower; or

         (e)  any refusal by the Title Insurance Company to insure any Advance
         as being secured by the Security Deed as a valid first lien and
         security interest on the Project and continuance of such refusal for a
         period of twenty (20) days after notice thereof by the Lender to the
         Borrower; or

         (f)  Subject to Force Majeure, Project Completion shall not have been
         attained by the Project Completion Date; or

         (g)  the Key Tenant shall cease to make rental payments under the Key
         Lease whether or not a condition of Force Majeure exists; or

         (h)  any assertion is made by the Key Tenant that Borrower is in breach
         of any obligation of Borrower under its Lease or if the Lender shall
         otherwise determine, acting reasonably, that such a breach exists and
         if, upon the Lender's reasonable request from time to time, the Key
         Tenant fails to acknowledge promptly its continuing obligations under
         its Lease and that Borrower is in faithful compliance with Borrower's
         obligations under such Lease or if Lender, acting reasonably,
         determines that Key Tenant has suffered any material adverse change in
         its financial condition or ability to fulfill its obligations under the
         Key Lease; or

         (i)  the Project or any material part thereof is subject to a Taking;
         or

         (j)  any cessation at any time in construction of the Renovation
         Project for more than fifteen (15) consecutive business days except for
         Force Majeure, or any cessation at any time in construction of the
         Project for more than thirty (30) consecutive business days, regardless
         of the cause thereof; or

         (k)  any failure by the Borrower to duly observe or perform any term,
         covenant, condition or agreement contained in Section 10.4, Section
         10.17, Section 11.2, Section 11.3, Section 11.5, Section 11.9 or
         Section 11.10 hereof; or

         (l)  the Guarantor denies its liability or obligations under the
         Guaranty or the Indemnity Agreement, or shall notify the Lender of the
         Guarantor's intention to attempt to cancel or terminate the Guaranty or
         the Indemnity Agreement, or


                                      -28-

<PAGE>


         shall fail to observe or comply with any term, covenant, condition and
         agreement under the Guaranty or the Indemnity Agreement; or

         (m)  any representation or warranty made or deemed to be made by or on
         behalf of any Obligor in this Agreement or in any of the other Loan
         Documents, or in any report, certificate, financial statement, Draw
         Request, document or other instrument delivered pursuant to or in
         connection with this Agreement, any Advance or any of the other Loan
         Documents, shall prove to have been false or incorrect in any material
         respect upon the date when made or deemed to be made or repeated; or

         (n)  any dissolution, termination, partial or complete liquidation,
         merger or consolidation of any Obligor, or any sale, transfer or other
         disposition of all or substantially all of the assets of any Obligor,
         other than as permitted under the terms of this Agreement or the
         Guaranty; or

         (o)  [Intentionally Deleted]

         (p)  any suit or proceeding shall be filed against Borrower or the Site
         or Improvements which, if adversely determined, in the reasonable
         Judgment of Lender, would have a materially adverse affect on the
         ability of Borrower to perform each and every one of its respective
         obligations under and by virtue of the Loan Documents; or

         (q)  any failure by the Borrower to obtain any Project Approvals or to
         comply with any material condition thereof, or the revocation,
         termination, expiration or other invalidation of any Project Approvals
         previously obtained; or

         (r)  the death or mental incapacity of any Obligor that is an
         individual; or

         (s)  any change in the legal or beneficial ownership of any Obligor
         other than one previously approved by Lender or one that is a Permitted
         Transfer; or

         (t)  any change in the control of the management of Borrower, or the
         giving up or relinquishment of such control by the Person(s) who
         is(are) charged with the exercise of such responsibilities on the date
         hereof; or

         (u)  any failure by any Obligor to pay at maturity, or within any
         applicable period of grace, any obligation for borrowed money or credit
         received, including, without limitation, any Obligations, or in respect
         of any capitalized lease, or any failure to observe or perform any
         material term, covenant or agreement contained in any agreement by
         which it is bound, evidencing or securing borrowed money or credit
         received, or in respect of any capitalized lease, for such period of
         time as would permit (assuming the giving of appropriate notice if
         required) the holder or holders thereof or of any obligations issued
         thereunder to accelerate the maturity thereof; or

         (v)  any Obligor shall file a voluntary petition in bankruptcy under
         Title 11 of the United States Code, or an order for relief shall be
         issued against any such Person in any involuntary petition in
         bankruptcy under Title 11 of the United States Code, or any such Person
         shall file any petition or answer seeking or acquiescing in any
         reorganization, arrangement, composition, readjustment, liquidation,
         dissolution or similar relief for itself under any present or future
         federal, state or other law or regulation relating to bankruptcy,
         insolvency or


                                      -29-

<PAGE>


         other relief of debtors, or such Person shall seek or consent to or
         acquiesce in the appointment of any custodian, trustee, receiver,
         conservator or liquidator of such Person, or of all or any substantial
         part of its respective property, or such Person shall make an
         assignment for the benefit of creditors, or such Person shall give
         notice to any governmental authority or body of insolvency or pending
         insolvency or suspension of operation; or

         (w)  an involuntary petition in bankruptcy under Title 11 of the United
         States Code shall be filed against any Obligor and such petition shall
         not be dismissed within sixty (60) days of the filing thereof; or

         (x)  a court of competent jurisdiction shall enter any order, judgment
         or decree approving a petition filed against any Obligor seeking any
         reorganization, arrangement, composition, readjustment, liquidation or
         similar relief under any present or future federal, state or other law
         or regulation relating to bankruptcy, insolvency or other relief for
         debtors, or appointing any custodian, trustee, receiver, conservator or
         liquidator of all or any substantial part of its property; or

         (y)  any uninsured final judgment shall be issued in excess of $25,000
         in respect of Borrower or in excess of $500,000 in respect of
         Guarantor, and shall remain in force, undischarged, unsatisfied and
         unstayed, for more than thirty (30) days, whether or not consecutive;
         or

         (z)  any of the Loan Documents shall be cancelled, terminated, revoked
         or rescinded otherwise than in accordance with the terms thereof or
         with the express prior approval of the Lender, or any action at law,
         suit in equity or other legal proceeding to cancel, revoke or rescind
         any of the Loan Documents shall be commenced by or on behalf of the
         Borrower or any Obligor which is a party thereto or any of their
         respective stockholders, partners or beneficiaries, or any court or any
         other governmental or regulatory authority or agency of competent
         jurisdiction shall make a determination that, or issue a judgment,
         order, decree or ruling to the effect that, any one or more of the Loan
         Documents is illegal, invalid or unenforceable in accordance with the
         terms thereof; or

         (aa) any Obligor or any Subsidiary thereof shall be indicted for a
         federal or state crime, a punishment for which could include the
         forfeiture of any of its assets; or

         (bb) any "Event of Default", as defined or otherwise set forth in any
         of the other Loan Documents, shall occur; or

         (cc) any failure by any Obligor to duly observe or perform any other
         term, covenant, condition or agreement under this Agreement and
         continuance of such failure for a period of thirty (30) days after
         notice thereof from the Lender.


12.2     SUSPENSION AND TERMINATION OF ADVANCES AND ACCELERATION. Upon the
occurrence of any Default or Event of Default Lender shall have the right to
suspend the making of any Advances hereunder. Further, if any one or more Events
of Default shall occur, the Lender may by notice to the Borrower declare its
obligations to make Advances hereunder to be terminated, whereupon the same
shall terminate and the Lender shall be relieved of all obligations to make
Advances to the Borrower, and/or declare all unpaid principal of and accrued
interest on the Note, together with all other


                                      -30-

<PAGE>


amounts owing under the Loan Documents, to be immediately due and payable,
whereupon same shall become and be immediately due and payable, anything in the
Loan Documents to the contrary notwithstanding, without presentment, protest,
demand or other notice of any kind, all of which are hereby expressly waived by
the Borrower; provided that if any one or more of the Events of Default
specified in Section 12.1 (u), Section 12.1 Section 12.1 (v), or Section 12.1
(w), above, shall occur with respect to any Obligor, the Lender's obligations to
make Advances hereunder automatically shall so terminate and all unpaid
principal of and accrued interest on the Note, together with all other amounts
owing under the Loan Documents, automatically shall become and be immediately so
due and payable, without any declaration or other act on the part of the Lender.

12.3     COMPLETION OF PROJECT, ETC. If any one or more of the Events of Default
shall have occurred, and whether or not the Lender shall have terminated its
obligations to make Advances and accelerated the maturity of the Loan pursuant
to Section 12.2, the Lender, (i) if the construction of the Renovation Project
has not been fully completed, may cause the Renovation Project to be completed
and may enter upon the Site and construct and complete the Renovation Project in
accordance with the Plans and Specifications, with such changes therein as the
Lender may, from time to time, and in its sole discretion, deem appropriate and
(ii) whether or not the construction of the Renovation Project has been
completed, may enter upon the Site for the purposes of operating the
Improvements in such manner as Lender deems appropriate. In connection with any
construction of the Renovation Project undertaken by the Lender pursuant to the
provisions of this section or other action taken by Lender in connection with
the operation of the Collateral, the Lender may:

         (a)  use any funds of the Borrower, including any balance which may be
         held by the Lender as security or in escrow, and any funds remaining
         unadvanced under the Loan;

         (b)  employ existing contractors, subcontractors, agents, architects,
         engineers, managers, leasing agents and brokers and the like, or
         terminate the same and employ others;

         (c)  employ security watchmen to protect the Site and Improvements;

         (d)  make such additions, changes and corrections in the Plans and
         Specifications as shall, in the reasonable judgment of the Lender, be
         necessary or desirable;

         (e)  take over and use any and all Personal Property contracted for or
         purchased by the Borrower, if appropriate, or dispose of the same as
         the Lender sees fit;

         (f)  execute all applications and certificates on behalf of the
         Borrower which may be required by any Governmental Authority or
         Requirements or contract documents or agreements;

         (g)  pay, settle or compromise all existing or future bills and claims
         which are or may be liens against the Site or Improvements, or may be
         necessary for the completion or operation of the Site and Improvements
         or the clearance of title to the same;

         (h)  complete the marketing and leasing of leasable space in the
         Improvements, enter into new Leases, and modify or amend or perform
         obligations under


                                      -31-

<PAGE>


         existing or new Leases, all as the Lender shall deem to be necessary or
         desirable;

         (i)  prosecute and defend all actions and proceedings in connection
         with the construction or operation of the Site and Improvements or in
         any other way affecting the Site or the Improvements and take such
         action and require such performance as the Lender deems necessary under
         any Payment and Performance Bonds;

         (j)  take such steps as Lender may elect to identify and remediate any
         non-compliance of the Site and Improvements with Requirements
         applicable to it, including, Environmental Laws; and

         (k)  take such action hereunder, or refrain from acting hereunder, as
         the Lender may, in its sole and absolute discretion, from time to time
         determine, and without any limitation whatsoever, to carry out the
         intent of this section.

The Borrower shall be liable to the Lender for all costs paid or incurred for
the construction, equipping, completion and operation of the Site and
Improvements, whether the same shall be paid or incurred pursuant to the
provisions of this section or otherwise, and all payments made or liabilities
incurred by the Lender hereunder of any kind whatsoever shall be deemed Advances
made to the Borrower under this Agreement and shall be evidenced by the Note and
secured by the Security Deed and the other Security Documents. To the extent
that any costs so paid or incurred by the Lender, together with all other
Advances made by the Lender hereunder, exceed the Loan Amount, the amount of
such excess costs shall be added to the Loan Amount, and the Borrower's
obligation to repay the same, together with interest thereon at the Default
Rate, shall be deemed to be evidenced by this Agreement and secured by the
Security Deed and the other Security Documents. In the event the Lender takes
possession of the Site and Improvements and assumes control of such construction
or operation as aforesaid, it shall not be obligated to continue such
construction or operation longer than it shall see fit and may thereafter, at
any time, change any course of action undertaken by it or abandon such
construction or operation and decline to make further payments for the account
of the Borrower whether or not the Improvements shall have been completed or
require continued operation. For the purpose of this Section, the construction,
equipping, completion and operation of the Site and Improvements shall be deemed
to include any action necessary to cure any Event of Default by the Borrower
under any of the terms and provisions of any of the Loan Documents.

12.4     OTHER REMEDIES. If any one or more of the Events of Default shall have
occurred, and whether or not the Lender shall have terminated its obligations to
make Advances or accelerated the maturity of the Loan pursuant to Section 12.2,
the Lender may proceed to protect and enforce its rights and remedies under this
Agreement, the Note or any of the other Loan Documents, including, by
foreclosure, exercise of set-off or pledge rights and/or by suit in equity,
action at law or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this Agreement and the
other Loan Documents or any instrument pursuant to which the Obligations are
evidenced, including as permitted by applicable law the obtaining of the ex
parte appointment of a receiver, and, if any amount owed to the Lender shall
have become due, by declaration or otherwise, proceed to enforce the payment
thereof or any other legal or equitable right of the Lender, including actions
to enforce the Guaranty. No remedy conferred upon the Lender or the holder of
the Note in this Agreement or in any of the other Loan Documents is intended to
be exclusive of any other remedy and


                                      -32-

<PAGE>


each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or thereunder or now or hereafter existing at law
or in equity or by statute or any other provision of law.

12.5     DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that, following the
occurrence or during the continuance of any Default or Event of Default, the
Lender receives any monies in connection with the enforcement of any the
Security Documents, or otherwise with respect to the realization upon any of the
Collateral, such monies shall be distributed for application as follows:

         (a)  First, to the payment of, or (as the case may be) the
         reimbursement of the Lender for or in respect of all reasonable costs,
         expenses, disbursements and losses which shall have been incurred or
         sustained by the Lender in connection with the collection of such
         monies by the Lender, for the exercise, protection or enforcement by
         the Lender of all or any of the rights, remedies, powers and privileges
         of the Lender under this Agreement or any of the other Loan Documents
         or in respect of the Collateral or in support of any provision of
         adequate indemnity to the Lender against any taxes or liens which by
         law shall have, or may have, priority over the rights of the Lender to
         such monies;

         (b)  Second, to all other Obligations in such order or preference as
         the Lender may determine; provided, however, that the Lender may in its
         discretion make proper allowance to take into account any Obligations
         not then due and payable;

         (c)  Third, upon payment and satisfaction in full or other provisions
         for payment in full satisfactory to the Lender of all of the
         Obligations, to the payment of any obligations required to be paid
         pursuant to Section 9-504(1)(c) of the Uniform Commercial Code of the
         Commonwealth of Massachusetts; and

         (d)  Fourth, the excess, if any, shall be returned to the Borrower or
         to such other Persons as are entitled thereto.

12.6     POWER OF ATTORNEY. For the purposes of carrying out the provisions and
exercising the rights, remedies, powers and privileges granted by or referred to
in this Article, the Borrower hereby irrevocably constitutes and appoints the
Lender its true and lawful attorney-in-fact, with full power of substitution, to
execute, acknowledge and deliver any instruments and do and perform any acts
which are referred to in this Article, in the name and on behalf of the
Borrower. The power vested in such attorney-in-fact is, and shall be deemed to
be, coupled with an interest and irrevocable.

12.7     WAIVERS. The Borrower hereby waives to the extent not prohibited by
applicable law (a) all presentments, demands for performance, notices of
nonperformance (except to the extent required by the provisions hereof or of any
of the other Loan Documents), protests and notices of dishonor, (b) any
requirement of diligence or promptness on the Lender's part in the enforcement
of its rights (but not fulfillment of its obligations) under the provisions of
this Agreement or any of the other Loan Documents, and (c) any and all notices
of every kind and description which may be required to be given by any statute
or rule of law and any defense of any kind which the Borrower may now or
hereafter have with respect to its liability under this Agreement or under any
of the other Loan Documents.

13.      INSURED LOSS CASUALTY AND TAKING.


                                      -33-

<PAGE>


         In the event of any damage or destruction to the Collateral or any part
thereof by reason of fire or other hazard or casualty (collectively, a
"Casualty"), Borrower shall give prompt written notice thereof to Lender and
proceed with reasonable diligence, in full compliance with all Requirements and
the other requirements of the Loan Documents, to repair, restore, rebuild or
replace the affected property (collectively, the "Repair Work").

         All insurance claims shall be adjusted by Borrower, at Borrower's sole
cost and expense, but subject to Lender's prior written approval; provided that
if any Default exists or any Event of Default has occurred under any of the Loan
Documents Lender shall have the right to adjust and compromise such claims
without the approval of Borrower.

         All proceeds of insurance shall be paid to Lender and, at Lender's
option, be applied to the Obligations or released, in whole or in part, to pay
for the actual cost of repair, restoration, rebuilding or replacement
(collectively, "Cost To Repair"). If the Cost To Repair does not exceed
$250,000.00 and no Default exists or Event of Default has occurred, Lender shall
release so much of the insurance proceeds as may be required for Borrower to pay
for the actual Cost to Repair in a commercially reasonable manner. If the Cost
to Repair is $250,000 or more, Lender shall release so much of the insurance
proceeds as may be required to pay for the actual Cost To Repair if:

              (i) in Lender's good faith judgment such proceeds together with
              any additional funds as may be deposited with and pledged to
              Lender are sufficient to pay for the Cost To Repair;

              (ii) in Lender's good faith judgment the Repair Work is likely to
              be completed prior to the Project Completion Date if Project
              Completion has not occurred or otherwise prior to the Maturity
              Date; and

              (iii) no Event of Default has occurred under the Loan Documents.

         If Lender elects or is required to release insurance proceeds and the
Cost to Repair is $250,000 or more, Lender may impose reasonable conditions on
such release which shall include, but not be limited to, the following:

              (i) Prior written approval by Lender, which approval shall not be
              unreasonably withheld or delayed of plans, specifications, cost
              estimates, contracts and bonds for the restoration or repair of
              the loss or damage;

              (ii) Waivers of lien, architect's certificates, contractor's sworn
              statements and other evidence of costs, payments and completion as
              Lender may reasonably require;

              (iii) If the Cost To Repair does not exceed $250,000.00, the funds
              to pay therefor shall be released to Borrower. Otherwise, funds
              shall be released upon final completion of the Repair Work, unless
              Borrower requests earlier funding, in which event partial monthly
              disbursements equal to 90% of the value of the work completed or,
              if the applicable


                                      -34-

<PAGE>


              contract is on a cost plus basis, then 90% of the costs of the
              work completed if such cost is less than the value thereof shall
              be made prior to final completion of the repair, restoration or
              replacement and the balance of the disbursements shall be made
              upon full completion and the receipt by Lender of satisfactory
              evidence of payment and release of all liens;

              (iv) Determination by Lender that the undisbursed balance of such
              proceeds on deposit with Lender, together with additional funds
              deposited for the purpose, shall be at least sufficient to pay for
              the remaining Cost To Repair, free and clear of all liens and
              claims for lien;

              (v) All work to comply with the standards, quality of construction
              and Requirements applicable to the construction of the
              Improvements; and

              (vi) the absence of any Event of Default under any Loan Documents.

         If there is any Taking of any Collateral, the awards on account thereof
shall be paid to Lender and shall be applied to the Obligations, or at Lender's
discretion released to Borrower. If, in the case of a partial taking or a
temporary taking, in the sole judgment of Lender the effect of such taking is
such that there has not been a material and adverse impairment of the viability
of the Site and Improvements or the value of the Collateral, so long as no
Default exists or Event of Default has occurred Lender shall release awards on
account of such taking to Borrower if such awards are sufficient (or amounts
sufficient are otherwise made available) to repair or restore the Site and
Improvements to a condition reasonably satisfactory to Lender

14.      SETOFF. Borrower hereby grants to lender a direct and continuing lien,
right of set off and security interest, as security for the Project Obligations,
whether now existing or hereafter arising, upon and against all deposits,
credits, collateral and other property, now or hereafter in the possession,
custody, safekeeping or control of Lender or any entity related to or affiliated
with Lender or in transit to any of them. Regardless of the adequacy of any
other collateral, during the continuance of any Event of Default, any such
deposits (general or specific, time or demand, provisional or final, regardless
of currency, maturity, or the branch of the Lender where such deposits are held)
credits, collateral and property may be applied to or set off, without notice or
compliance with any other condition precedent (all of which is hereby waived)
against the payment of the Project Obligations and any and all other Obligations
in such manner and order as Lender in its sole discretion may determine.

15.      EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing and reproducing this Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (b) any taxes (including any
interest and penalties in respect thereto) payable by the Lender (other than
taxes based upon the Lender's net income), including any recording, mortgage or
intangibles taxes in connection with the Security Deed, or other taxes payable
on or with respect to the transactions contemplated by this Agreement, including
any taxes payable by the Lender after the Closing Date (the Borrower hereby
agreeing to indemnify the Lender with respect thereto), (c) all title insurance
premiums, and the reasonable fees, expenses and disbursements of the Lender's
counsel or any local counsel to the Lender incurred in connection with the
preparation, administration or interpretation of the Loan and the Loan Documents
and other instruments mentioned herein, the making of each Advance


                                      -35-


<PAGE>


hereunder, and amendments, modifications, approvals, consents or waivers hereto
or hereunder, (d) the fees, expenses and disbursements of the Lender incurred in
connection with the preparation, administration, interpretation or syndication
of the Loan and the Loan Documents and other instruments mentioned herein, and
the making of each Advance hereunder (including all fees paid to the
Construction Inspector, Appraisal fees, and surveyor fees) (e) all reasonable
out-of-pocket expenses (including reasonable attorneys' fees and costs, which
attorneys may be employees of the Lender) and the fees and costs of consultants,
accountants, auctioneers, receivers, brokers, property managers, appraisers,
investment bankers or other experts retained by the Lender in connection with
(i) the enforcement of or preservation of rights under any of the Loan Documents
against the Borrower or any Obligor or the administration thereof after the
occurrence of a Default or Event of Default and (ii) any litigation, proceeding
or dispute whether arising hereunder or otherwise, in any way related to the
Lender's relationship with the Borrower or any Party, and (f) all reasonable
fees, expenses and disbursements of the Lender incurred in connection with UCC
searches, UCC filings, title rundowns, title searches or mortgage recordings.
The covenants of this Section shall survive payment or satisfaction of payment
of all amounts owing with respect to the Note.

16.      INDEMNIFICATION. Other than due to Lender's or another Indemnitee's
(hereinafter defined) own gross negligence or willful misconduct, Borrower
agrees to indemnify and hold harmless the Lender and Lender's agents, employees,
directors, and affiliates and the agents, employees and directors of such
affiliates (collectively, the "Indemnitees") from and against any and all
claims, actions and suits, whether groundless or otherwise, and from and against
any and all liabilities, losses, damages and expenses of every nature and
character arising out of this Agreement or any of the other Loan Documents or
the transactions contemplated hereby and thereby including, without limitation,
(a) any brokerage, leasing, finders or similar fees, (b) any disbursement of the
proceeds of any of the Advances, (c) any condition of the Site or Improvements
whether related to the quality of construction or otherwise, (d) any actual or
proposed use by the Borrower of the proceeds of any of the Advances, (e) any
actual or alleged violation of any Requirements or Project Approvals, (f) any
action taken by Lender to enforce its rights and remedies under the Loan
Documents, including the rights and remedies set forth in Section 12 hereof, or
(g) the Borrower or any Party entering into or performing this Agreement or any
of the other Loan Documents, in each case including, without limitation, the
reasonable fees and disbursements of counsel and allocated costs of internal
counsel incurred in connection with any such investigation, litigation or other
proceeding. In litigation, or the preparation therefor, the Lender or any
affected Indemnitee shall be entitled to select its own counsel and, in addition
to the foregoing indemnity, the Borrower agrees to pay promptly the reasonable
fees and expenses of such counsel. The obligations of the Borrower under this
Section shall survive the repayment of the Loan and shall continue in full force
and effect so long as the possibility of such claim, action or suit exists. If,
and to the extent that the obligations of the Borrower under this Section are
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment in satisfaction of such obligations which is
permissible under applicable law.

17.      LIABILITY OF THE LENDER. The liability of the Lender to the Borrower
for any breach of the terms of this Agreement by the Lender shall not exceed a
sum equal to the amount which the Lender shall be determined to have failed to
advance in consequence of a breach by the Lender of its obligations under this
Agreement, together with interest thereon at the rate payable by the Borrower
under the terms of the Note for Advances which the Borrower is to receive
hereunder, computed from the date when the Advance should have been made by the
Lender to the date when the Advance is, in


                                      -36-
<PAGE>

fact, made by the Lender, and, upon the making of any such payment by the Lender
to the Borrower, the same shall be treated as an Advance under this Agreement,
in the same fashion as any other Advance under the terms of this Agreement. In
no event shall the Lender be liable to the Borrower, or anyone claiming by,
under or through the Borrower, for any special, exemplary, punitive or
consequential damages, whatever the nature of the breach of the terms of this
Agreement by the Lender, such damages and claims therefor being expressly WAIVED
by the Borrower.

         Notwithstanding the foregoing, Borrower agrees that no action shall be
commenced by Borrower for any claim of any kind against the Lender under or in
connection with this Agreement unless written notice specifically setting forth
the claim of Borrower shall have been given to the Lender within thirty (30)
days after the occurrence of the event which Borrower alleges gives rise to such
claims, and failure to give such notice shall constitute a WAIVER of any such
claim.

18.      RIGHTS OF THIRD PARTIES. All conditions to the performance of the
obligations of the Lender under this Agreement, including the obligation to make
Advances, are imposed solely and exclusively for the benefit of the Lender and
no other Person shall have standing to require satisfaction of such conditions
in accordance with their terms or be entitled to assume that the Lender will
refuse to make Advances in the absence of strict compliance with any or all
thereof and no other Person shall, under any circumstances, be deemed to be a
beneficiary of such conditions, any and all of which may be freely waived in
whole or in part by the Lender at any time if in its sole discretion it deems it
desirable to do so. In particular, the Lender makes no representations and
assumes no obligations as to third parties concerning the quality of the
construction by the Borrower of the Improvements or the absence therefrom of
defects.

19.      SURVIVAL OF COVENANTS, ETC. All covenants, agreements, representations
and warranties made herein, in the Note, in any of the other Loan Documents or
in any documents or other papers delivered by or on behalf of the Borrower or
any Party pursuant hereto and thereto shall be deemed to have been relied upon
by the Lender, notwithstanding any investigation heretofore or hereafter made by
it, and shall survive the making by the Lender of the Advances, as herein
contemplated, and shall continue in full force and effect either (i) so long as
any amount due under this Agreement or the Note or any of the other Loan
Documents remains outstanding or the Lender has any obligation to make any
Advances or (ii) for such longer period as may be provided for herein or in any
other Loan Document. All statements contained in any certificate or other paper
delivered to the Lender at any time by or on behalf of any Obligor or any
Subsidiary thereof pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by such
Person.

20.      ASSIGNMENT AND PARTICIPATION.

20.1     CONDITIONS TO ASSIGNMENT BY LENDER. Except as provided herein, the
Lender may assign to one or more banks or other entities (the "Banks") all or a
portion of its interests, rights and obligations under this Agreement and with
respect to the Loan; provided, however, that Lender agrees (i) so long as no
Default has occurred or an Event of Default exists, not to assign the whole of
such rights, interests and obligations during the Renovation Project, except in
the event of a consolidation, merger or acquisition of Lender or a sale of
substantially all of the commercial loan assets of Lender and (ii) if the
assignment is for a portion but not the whole of such interests, rights and
obligations, Lender shall act as the administrative agent for the Loan, subject
to the right of Lender to cease acting as such agent if another "qualified
institution"


                                      -37-
<PAGE>

who has become an assignee agrees to act as such agent. For purposes hereof, a
"qualified institution" shall mean a commercial bank or other financial
institution having total assets of at least one billion dollars. From and after
the effective date of any such assignment, (i) the assignee thereunder shall be
deemed to be a party hereto and, to the extent agreed to by the Lender, have the
rights and obligations of a Lender hereunder, and (ii) the Lender shall, to the
extent of its interest assigned as provided herein, be released from its
obligations under this Agreement.

20.2     NEW NOTES, AGREEMENT. Upon any such assignment by the Lender, the
Borrower, at its own expense, shall execute and deliver to the Lender (a) in
exchange for the Note, a new Note (or Notes) to the order of each such assignee
in an amount equal to the amount assumed by such assignee and, if the Lender has
retained some portion of its obligations hereunder, a new Note to the order of
the Lender in an amount equal to the amount retained by it hereunder and (b) an
amendment to this Agreement and any other Loan Documents, as may be reasonably
requested by the Lender, to evidence the assignment, provide for the rights and
interest of the assignee, and establish the rights, responsibilities and
obligations of the Lender as agent for itself and any such assignee. Such new
Note (or Notes) shall be provided as replacements for the surrendered Note (or
Notes), shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Note (or Notes), shall be dated the
effective date of such assignment and shall otherwise be in substantially the
form of the assigned Note (or Notes). Within five (5) days of issuance of any
new Notes pursuant to this Section 20.2, the Borrower shall deliver an opinion
of counsel, addressed to the Banks and the Agent, relating to the due
authorization, execution and delivery of such new Notes and the legality,
validity and binding effect thereof, in form and substance satisfactory to the
Banks. The surrendered Note (or Notes) shall be cancelled and returned to the
Borrower.

20.3     PARTICIPATIONS. The Lender (and any Bank) may sell participations to
one or more banks or other entities in all or a portion of the Lender's (or
Bank's) rights and obligations under this Agreement and the other Loan
Documents; provided that (a) any such sale of participations shall not affect
the rights and duties of the Lender (or Bank) hereunder to the Borrower (b) the
only rights granted to the participant pursuant to such participation
arrangements with respect to waivers, amendments or modifications of the Loan
Documents shall be the right to approve waivers, amendments or modifications
that would reduce the principal of or the interest rate on the Loan, extend the
term or increase the amount of the Loan or extend any regularly scheduled
payment date for principal or interest and (c) Borrower and Guarantor shall be
entitled to continue to deal exclusively with the named Lender herein whose
decisions shall be binding upon the other participants.

20.4     PLEDGE BY THE LENDER. The Lender may at any time pledge all or any
portion of its interest and rights under this Agreement (including all or any
portion of the Note) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the Lender from its obligations hereunder
or under any of the other Loan Documents.

20.5     NO ASSIGNMENT BY THE BORROWER. Other than as expressly permitted in
Section 11.7 hereof, the Borrower shall not assign or transfer any of its rights
or obligations under any of the Loan Documents without the prior approval of the
Lender.

21.      RELATIONSHIP. The relationship between the Lender and the Borrower is
solely that of a lender and borrower, and nothing contained herein or in any of
the other


                                      -38-

<PAGE>

Loan Documents shall in any manner be construed as making the parties
hereto partners, joint ventures or any other relationship other than lender and
borrower.

22.      NOTICES. Except as otherwise provided herein or in any other Loan
Document, each notice, demand, election or request provided for or permitted to
be given pursuant to this Agreement (hereinafter in this Section referred to as
"Notice") must be in writing and shall be deemed to have been properly given or
served by personal delivery or by sending same by overnight courier or by
depositing same in the United States Mail, postpaid and registered or certified,
return receipt requested, and addressed as follows:

              If to the Lender:

              Anglo Irish Bank Corporation PLC
              Stephen Court
              18/21 Stephens Green
              Dublin 2, Ireland
              Attn: Tom Browne, Director of Banking

              with a copy of:

              Anglo Irish Bank Corporation, PLC
              84 State Street, 4th Floor
              Boston, MA 02109
              Attn: David Drumm, Executive Vice President

              with a copy to:

              Michael J. Haroz, Esq.
              Goulston & Storrs, P.C.
              400 Atlantic Avenue
              Boston, MA 02110

              If to the Borrower:

              830 Winter Street LLC
              c/o PRAECIS PHARMACEUTICALS INCORPORATED
              One Hampshire Street
              Cambridge, MA 02139
              Attn: Ted English
              with a copy to:

              Kevin Slayne, Esq.
              Goodwin, Proctor & Hoar
              Exchange Place
              Boston, MA 02109-2881

Each Notice shall be effective upon being personally delivered or upon being
sent by overnight courier or upon being deposited in the United States Mail as
aforesaid. The time period in which a response to such Notice must be given or
any action taken with



                                      -39-
<PAGE>

respect thereto (if any), however, shall commence to run from the date of
receipt if personally delivered or sent by overnight courier, or if so deposited
in the United States Mail, the earlier of three (3) Business Days following such
deposit or the date of receipt as disclosed on the return receipt. Rejection or
other refusal to accept or the inability to deliver because of changed address
for which no Notice was given shall be deemed to be receipt of the Notice sent.
By giving at least thirty (30) days' prior Notice thereof, the Borrower or the
Lender shall have the right from time to time and at any time during the term of
this Agreement to change their respective addresses and each shall have the
right to specify as its address any other address which, in the case of
Borrower, as within the United States of America.

23.      GOVERNING LAW. This Agreement and each of the other Loan Documents,
except as otherwise specifically provided therein, are contracts under The laws
of the Commonwealth of Massachusetts and shall for all purposes be construed in
accordance with and governed by the laws of said Commonwealth (excluding the
laws applicable to conflicts or choice of law).

24.      CONSENT TO JURISDICTION; WAIVERS. THE BORROWER AND EACH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO PERSONAL JURISDICTION IN THE
COMMONWEALTH OF MASSACHUSETTS OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND (B) WAIVES
ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY STATE (I) TO THE RIGHT, IF
ANY, TO TRIAL BY JURY, (II) TO OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF
MASSACHUSETTS OR VENUE IN ANY PARTICULAR FORUM WITHIN THE COMMONWEALTH OF
MASSACHUSETTS. THE BORROWER AND EACH PARTY AGREES THAT, IN ADDITION TO ANY
METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL SERVICE OF
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED DIRECTED TO THE BORROWER AT THE
ADDRESS SET FORTH IN SECTION 22 ABOVE, AND SERVICE SO MADE SHALL BE COMPLETE
FIVE (5) DAYS AFTER THE SAME SHALL BE SO MAILED. NOTHING CONTAINED HEREIN,
HOWEVER, SHALL PREVENT THE LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING
OR EXERCISING ANY RIGHTS AGAINST ANY COLLATERAL AND AGAINST THE BORROWER, AND
AGAINST ANY PROPERTY OF THE BORROWER, IN ANY OTHER STATE. INITIATING SUCH SUIT,
ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY STATE SHALL IN NO EVENT
CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED HEREIN THAT THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF THE
BORROWER, EACH PARTY, AND THE LENDER HEREUNDER OR THE SUBMISSION HEREIN BY THE
BORROWER AND EACH PARTY TO PERSONAL JURISDICTION WITHIN THE COMMONWEALTH OF
MASSACHUSETTS.

25.      PREFERENCES. Lender shall have no obligation to marshal any assets in
favor of Borrower or any other Obligor or against or in payment of any or all of
the obligations of Borrower pursuant to this Agreement, the Note, the Security
Deed or any other Loan Document. Lender shall have the continuing and exclusive
right to apply or reverse and reapply any and all payments by Borrower to any
portion of such obligations. To the extent Borrower makes a payment or payments
to Lender for Borrower's benefit, which payment or proceeds or any part thereof
are subsequently



                                      -40-
<PAGE>

invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid to a trustee, receiver or any other party under any bankruptcy law,
state or federal law, received, the obligations or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by Lender.

26.      RULES OF INTERPRETATION. The following rules of interpretation shall
govern:

         (a)  A reference to any Loan Document, agreement, budget, document
         or schedule shall include such agreement, budget, document or schedule
         as revised, amended, modified or supplemented from time to time in
         accordance with its terms and the terms of this Agreement.

         (b)  A reference to any Exhibit hereto shall be deemed to
         specifically incorporate the terms and provisions of such Exhibit
         herein.

         (c)  The singular includes the plural and the plural includes the
         singular.

         (d)  A reference to any law includes any amendment or modification to
         such law.

         (e)  A reference to any Person includes its permitted successors and
         permitted assigns.

         (f)  Accounting terms not otherwise defined herein have the meaning
         assigned to them by generally accepted accounting principles applied on
         a consistent basis by the accounting entity to which they refer.

         (g)  The words "approval" and "approved", as the context so determines,
         means an approval in writing given to the party seeking approval after
         full and fair disclosure to the party giving approval of all material
         facts necessary in order to determine whether approval should be
         granted.

         (h)  Reference to a particular "section" refers to that section of this
         Agreement unless otherwise indicated.

         (i)  Use of the word "including" shall mean "including, without
         limitation" unless the context otherwise requires.

27.      HEADINGS. The captions in this Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.

28.      COUNTERPARTS. This Agreement and any amendment hereof may be executed
in several counterparts and by each party on a separate counterpart, each of
which when so executed and delivered shall be an original, and all of which
together shall constitute one instrument. In proving this Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.

29.      ENTIRE AGREEMENT, ETC. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire understanding of
the parties with respect to the transactions contemplated hereby. Neither this
Agreement


                                      -41-

<PAGE>

nor any term hereof may be changed, waived, discharged or terminated, except as
provided in .

30.      CONSENTS, AMENDMENTS, WAIVERS, ETC. Except as otherwise expressly set
forth in any particular provision of this Agreement, any consent or approval
required or permitted by this Agreement to be given by the Lender may be given,
and any term of this Agreement or of any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower of any terms of this Agreement or such other instrument or the
continuance of any Default or Event of Default may be waived (either generally
or in a particular instance and either retroactively or prospectively) with, but
only with, the written consent of the Lender. No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Lender in
exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No Advance made by the lender hereunder during the
continuance of any Default or Event of Default shall constitute a waiver
thereof. No notice to or demand upon the Borrower shall entitle the Borrower to
other or further notice or demand in similar or other circumstances.

31.      TIME OF THE ESSENCE. Time is of the essence with respect to each and
every covenant, agreement and obligation of the Borrower under this Agreement
and the other Loan Documents.

32.      SEVERABILITY. The provisions of this Agreement are severable, and if
any one clause or provision hereof shall be held invalid or unenforceable in
whole or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction, and shall not in any manner affect such clause or provision in any
other jurisdiction, or any other clause or provision of this Agreement in any
jurisdiction.

33.      RELEASE OF MORTGAGED PROPERTY.. Lender acknowledges that the Mortgaged
Property is subject to that certain Mutual Covenants by and between Polaroid
Corporation ("Polaroid") and Best Buyer Property Fund, L.P., dated as of March
25, 1999 filed with the Middlesex South Registry District of the Land Court as
Instrument No. 1101667 (the "MUTUAL COVENANTS"). Under certain circumstances the
owner of the Mortgaged Property is obligated to convey a portion of the
Mortgaged Property to Polaroid in return for the conveyance by Polaroid to the
owner of the Mortgaged Property of another piece of real property as described
in the Mutual Covenants (the "RECONFIGURATION"). Lender acknowledges that Lender
has reviewed the Mutual Covenants and agrees that if Borrower, as owner of the
Mortgaged Property, is obligated pursuant to the Mutual Covenants to convey a
portion of the Mortgaged Property to Polaroid, Lender will release from the lien
of its mortgage the applicable portion of the Mortgaged Property pursuant to the
Reconfiguration and Borrower agrees to amend the description of the Mortgaged
Property to include the new parcel of land received from Polaroid in the lien of
the Lender's mortgage (provided, in each case, the Reconfiguration does not
cause Borrower to be in non-compliance with any zoning or other laws).


                                      -42-

<PAGE>


         In Witness Whereof, this Agreement has been duly executed and delivered
as a sealed instrument as of the date set forth above.


Witness:                          830 WINTER STREET LLC,
                                  a Delaware limited liability company

                                  By:     PRAECIS PHARMACEUTICALS
                                          INCORPORATED,
                                          a Delaware corporation, its
                                          sole member

/s/ Mary E. DeLena                By: /s/ Kevin F. McLaughlin
---------------------------           -----------------------------
                                  Name:  Kevin F. McLaughlin
                                  Title: Sr. V.P. & C.F.O.
                                  Hereunto duly authorized


                                  ANGLO IRISH BANK CORPORATION PLC

/s/ Michael J. Haroz              By: /s/ Paul Doyle
---------------------------           -----------------------------
                                  Name:  Paul Doyle
                                  Title: Vice President
                                  Hereunto duly authorized



                                      -43-
<PAGE>

                                   SCHEDULE 1

                                  DEFINITIONS

         ADVANCE OR LOAN ADVANCE. Any disbursement of the proceeds of the Loan
made or to be made by the Lender pursuant to the terms of this Agreement.

         AFFILIATE OR AFFILIATE. With reference to any Person, (i) any director,
officer or employee of that Person, (ii) any other Person controlling,
controlled by or under direct or indirect common control of that Person, (iii)
any other Person directly or indirectly holding 10% or more of any class of the
capital stock or other equity interests (including options, warrants,
convertible securities and similar rights) of that person and (iv) any other
Person 10% or more of any class of whose capital stock or other equity interests
(including options, warrants, convertible securities and similar rights) is held
directly or indirectly by that Person.

         AGREEMENT. This Loan Agreement, including the Schedules and Exhibits
hereto.

         APPRAISAL. An MAI appraisal of the market value of the Project
conforming to FIRREA standards, performed by a qualified independent appraiser
approved by the Lender and prepared in a form satisfactory to Lender.

         APPRAISED VALUE. The market value of the Site and Improvements
determined by the most recent Appraisal obtained pursuant hereto, as such may be
reviewed and adjusted by the Lender.

         APPROVED SUBLEASE. As defined in Section 9.23.

         ARCHITECT. As defined in the Recitals to this Agreement.

         ARCHITECT'S CONTRACT. As defined in the Recitals to this Agreement, as
the same may hereafter be amended with the prior written consent of Lender.

         ASSIGNMENT OF INTEREST RATE PROTECTION AGREEMENT. The Assignment of
Interest Rate Protection Agreement dated or to be dated on or prior to the
Closing Date, made by Borrower in favor of Lender, as the same may hereafter be
amended with the prior written consent of Lender.

         ASSIGNMENT OF LEASES. The Assignment of Leases and Rents dated or to be
dated on or prior to the Closing Date, made by Borrower in favor of Lender, as
the same may hereafter be amended with the prior written consent of Lender.


                                       -1-

<PAGE>


         ASSIGNMENT OF PROJECT DOCUMENTS. The Collateral Assignment and Security
Agreement in Respect of Contracts, Licenses and Permits, dated or to be dated on
or prior to the Closing Date, made by the Borrower in favor of Lender, as the
same may hereafter be amended with the prior written consent of Lender.

         BALANCE SHEET DATE. December 31, 1999.

         BORROWER'S REQUIRED EQUITY OR BORROWER'S REQUIRED EQUITY FUNDS. The
amount of $17,500,000 to be applied first to the costs of the Acquisition and
$4,500,000 to be applied first to Project Costs, together with any other amounts
as the Lender shall determine due and owing from time to time pursuant
to Section 2.5 or Section 10.10 hereof

         BUSINESS DAY. Any day on which the Lender is open for the transaction
of banking business in Boston, Massachusetts.

         CLOSING DATE. The first date on which the conditions set forth in
Section 7 have been satisfied for the initial Advance.

         CODE. The Internal Revenue Code of 1986 and the regulations thereunder,
all as amended and in effect from time to time.

         COLLATERAL. All of the property, rights and interests of the Borrower
that are or are intended to be subject to the security interests, assignments,
and mortgage liens created by the Security Documents, including, without
limitation, the Site and Improvements.

         CONSTRUCTION CONTRACT. As defined in the Recitals to this Agreement, as
the same may hereafter be amended with the prior written consent of Lender.

         CONSTRUCTION INSPECTOR. R.C. May & Associates, Inc. or, at the Lender's
option, either an officer or employee of the Lender or such additional or
replacement consulting architects, engineers or inspectors appointed by the
Lender from time to time.

         CONTRACTOR. As defined in the Recitals to this Agreement.

         DEBT SERVICE CHARGES. For the applicable period of determination and
without duplication, the sum of (i) all regularly scheduled payments, charges,
fees and expenses payable by the Borrower with respect to the Project
Obligations, including regularly scheduled interest and principal installment
payments, and fees and charges payable hereunder and under the other Loan
Documents, (ii) all regularly scheduled payments, charges, fees and expenses
payable by the Borrower with respect to all other Indebtedness of the Borrower,
and (iii) the cost and expense payable by the Borrower with respect to all
credit enhancements, if any, relating to the Loan.

         DEBT SERVICE COVERAGE RATIO as defined in Section 11.10 of this
Agreement.

         DEFAULT. A condition or event which would, with either the giving of
notice or lapse of time or both, constitute an Event of Default.



                                       -2-
<PAGE>

         DEFAULT RATE. See the Note.

         DIRECT COSTS. All labor, materials, fixtures, machinery, equipment and
any other so-called "hard costs" required to construct, equip and complete the
Renovation Project in accordance with the Plans and Specifications.

         DISTRIBUTION. The (i) declaration or payment of any dividend, (ii)
distribution of cash or other property, (iii) purchase, redemption, or other
retirement (directly or indirectly), (iv) repayment of any loan to any party
directly or indirectly holding an interest in Borrower, or (iv) other
distribution, in each case, of, on or in respect of any shares of any class of
capital stock, partnership interests, or other beneficial or ownership interests
of the Borrower.

         DRAWDOWN DATE. The date on which any Advance is made or is to be made.

         DRAW REQUEST. With respect to each Advance, the request of the Borrower
for such Advance in form acceptable to Lender and all other documents required
by this Agreement to be furnished to the Lender as a condition to such Advance.

         ENVIRONMENTAL LAWS. As defined in the Indemnity Agreement.

         ENVIRONMENTAL REPORT. The environmental site assessment report from
Environ Corporation dated January, 2000 with respect to the Site or such other
environmental site assessment report required hereunder by Lender for the Site
or the Improvements.

         ERISA PLAN. Any employee benefit, employee pension, or multiemployer
plan within the meaning of the Employee Retirement Income Security Act of 1974,
as amended and in effect from time to time.

         EVENT OF DEFAULT. See Section 12.1.

         EXPENSES. For the applicable period of determination, and without
duplication, all ordinary and necessary costs and expenses actually paid in cash
by the Borrower in connection with the ownership and operation of the Site and
Improvements, including ordinary and necessary maintenance and repair expenses,
real estate taxes, insurance premiums, payments to utility companies, and
management fees, together with a commercial reasonable reserve amounts.

         Notwithstanding the foregoing, the following shall not be included in
Expenses: (i) Debt Service Charges; (ii) any costs or expenses paid from reserve
accounts; (iii) non-cash expenses such as depreciation; (iv) the cost of any
item required to be capitalized under GAAP; (v) any income, franchise, corporate
excise or similar taxes; (vi) any expenses for which the Borrower receives
reimbursement from sources not included in Gross Receipts, such as proceeds of
insurance and condemnation awards; and (vii) ordinary and necessary expenses for
tenant improvements and leasing commissions under Leases approved by Lender.

         FINANCING STATEMENTS. Uniform Commercial Code Form 1 Financing
Statement(s) from the Borrower in favor of the Lender.

         FORCE MAJEURE. Shall mean any delay due to strikes, lockouts or other
labor or industrial disturbance, civil disturbance, future order of or delay
caused by any government, court or regulatory body claiming jurisdiction
including, without


                                       -3-

<PAGE>

limitation delays in processing or release of necessary permits, act of the
public enemy, war, riot, sabotage, blockade, embargo, failure or inability to
secure materials, supplies or labor through ordinary sources by reason of
shortages or priority or similar regulation or order of any government or
regulatory body, lightning, earthquake, fire, storm, hurricane, tornado, flood,
washout, explosion other Acts of God, or other delays reasonably beyond the
control of Borrower. Force Majeure shall be deemed to exist only so long as
Borrower specifically notifies Lender in writing of such delay within a
reasonable period of time following Borrower's knowledge of the event or
condition, but in no event later than thirty (30) days after obtaining such
knowledge. Notwithstanding the foregoing, Force Majeure shall not be deemed to
exist for any condition (i) that is caused by the financial inability of
Borrower or (ii) that is continues for a period of six (6) months or more.

         GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. Principles that are (a)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to
time and (b) consistently applied with past financial statements of the
Borrower adopting the same principles; provided that a certified public
accountant would, insofar as the use of such accounting principles is
pertinent, be in a position to deliver an unqualified opinion (other than a
qualification regarding changes in generally accepted accounting principles)
as to financial statements in which such principles have been properly
applied.

         GOVERNMENT AUTHORITY. The United States of America, the State in which
the Land is located, the city or town in which the Land is located, and any
political subdivision agency, authority, department, commission, board, bureau,
or instrumentality of any of them.

         GROSS RECEIPTS. For the applicable period of determination and without
duplication, all income, revenues, proceeds, and cash receipts received by or on
behalf of the Borrower arising out of or relating to the ownership, rental, use
or operation of the Site and Improvements or any part thereof, including the
following: the gross rental income received from the rental of any part of the
Site and Improvements; interest received from any reserve or escrow accounts
relating to the Improvements; reimbursements received from tenants at the Site
and Improvements and real estate tax abatements. Security deposits received by
Borrower from tenants at the Site and Improvements shall be included in Gross
Receipts as and when applied by Borrower in connection with a breach or default
by said tenant. In any event, proceeds of any insurance proceeds and eminent
domain awards and any other extraordinary receipt of funds under circumstances
that would be deemed a capital transaction under GAAP shall not be included in
Gross Receipts.

         GUARANTOR. PRAECIS PHARMACEUTICALS INCORPORATED, a Delaware Corporation
having a usual place of business at One Hampshire Street, Cambridge,
Massachusetts 02139.

         GUARANTY. Together, the Guaranty of Costs and Completion and the
Guaranty of Non-Recourse Exceptions, dated or to be dated on or prior to the
Closing Date, made by the Guarantor in favor of the Lender, as the same may
hereafter be amended with the prior written consent of Lender.

         HAZARDOUS SUBSTANCES. As defined in the Indemnity Agreement.



                                       -4-

<PAGE>


         INDEBTEDNESS. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should be
made by footnotes thereto, including in any event and whether or not so
classified: (a) all debt and similar monetary obligations, whether direct or
indirect; (b) all liabilities secured by any mortgage, pledge, security
interest, lien, charge, or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; (c) all liabilities under capitalized leases; and (d) all
guaranties, endorsements and other contingent obligations whether direct or
indirect in respect of indebtedness of others, including the obligations to
reimburse the issuer in respect of any letters of credit.

         INDEMNITY AGREEMENT. The Environmental Compliance and Indemnification
Agreement dated or to be dated on or prior to the Closing Date, made, jointly
and severally, by the Borrower and the Guarantor in favor of the Lender, as the
same may hereafter be amended with the prior written consent of Lender.

         INDIRECT COSTS. All , all expenses as shown on the Project Budget which
are expenditures relating to the Renovation Project and are not Direct Costs.

         INTENDED USES. The purposes for which the Project may be used are
limited to the permitted uses under the Key Lease.

         INTEREST RATE PROTECTION AGREEMENT. As defined in Section 7.5 of this
Agreement.

         INVESTMENT. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect to any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person.

         KEY LEASE. As defined in the Recitals and as the same may hereafter be
amended with the prior written consent of Lender.

         KEY TENANT(S). As defined in the Recitals.

         LAND. Refers to the Site.

         LEASES. Any and all leases, licenses and agreements, whether written or
oral, relating to the use or occupation of space in the Improvements or on the
Site by Persons other than the Borrower, including the Key Lease, all as the
same may hereafter be amended with the prior written consent of Lender.

         LOAN. The loan or any portion thereof which is the subject of this
Agreement.

         LOAN AMOUNT. $33,000,000.

         LOAN DOCUMENTS. This Agreement, the Note, the Indemnity Agreement, the
Guaranty, and the Security Documents, and all other agreements, documents and
instruments now or hereafter evidencing, securing or otherwise relating to the
Loan, all as the same may hereafter be amended with the prior written consent of
Lender.


                                       -5-

<PAGE>


         MATURITY DATE. As defined in Section 4 of this Agreement.

         MECHANIC'S LIEN LAW. Chapter 254 of the General Laws of Massachusetts.

         NET OPERATING INCOME means the amount by which the Gross Receipts of
Borrower exceed the Expenses of Borrower.

         NON-MATERIAL CHANGE ORDERS. Change orders in the Construction Contract
not exceeding $25,000.00 singularly and $250,000.00 when aggregated with all
prior change orders approved by Lender hereunder or permitted without the
requirement of Lender approval.

         NOTE. The Promissory Note in the principal face amount of the Loan
Amount dated as of the date hereof, made by the Borrower to the order of the
Lender, together with any extension, renewal, replacement, substitution, or
modification thereof. If more than one promissory note shall be issued by
Borrower pursuant to the provisions of Section 2.02 hereof, the term "Note"
shall refer collectively to all such promissory notes.

         OBLIGATIONS. All indebtedness, obligations and liabilities of the
Borrower to the Lender, existing on the date of this Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, including, without limitation, the
Project Obligations.

         OBLIGOR(S). The Borrower and the Guarantor.

         ORGANIZATIONAL DOCUMENTS. For any corporation, partnership, trust,
limited liability company, limited liability partnership, unincorporated
association, business or other legal entity, the documents pursuant to which
such entity has been established or organized, as such documents may hereafter
be amended with the prior written consent of Lender.

         OUTSTANDING. With respect to the Advances or the Loan, the aggregate
unpaid principal thereof as of any date of determination.

         PARTY(IES). Each Obligor.

         PAYMENT AND PERFORMANCE BONDS. Separate, dual-obligee payment and
performance bonds (and, if available, lien bonds to be recorded in the
appropriate public records) relating to the Contractor and/or such major
subcontractors, as the Lender may require from time to time, issued by a surety
company or companies licensed to do business in the State where the Site is
located.

         PAYMENT PERIOD DATE. See Section 8.6.

         PERMITTED LIENS. Liens, security interests and other encumbrances,
permitted by Section 11.5.

         PERMITTED TRANSFER. The term "Permitted Transfer" shall mean (1) with
respect to Borrower or Guarantor the purchase or acquisition by merger or
consolidation of all or substantially all of the stock or membership interest or
assets of Borrower or Guarantor, provided that the successor entity surviving
such transaction: (a) has a tangible net worth equal to or greater than, as
applicable, the tangible net worth of


                                       -6-

<PAGE>

Borrower and Guarantor as of the date hereof; and (b) expressly assumes and
confirms in writing all of the obligations (including, without limitation, all
covenants, representations and warranties set forth in the Loan Documents) and
liabilities of, as applicable, Borrower or Guarantor under and with respect to
the Loan pursuant to such written documentation, in form and substance
reasonably acceptable to Lender and that does not increase the liabilities or
obligations of Borrower or Guarantor, together with such policy of insurance,
certificates and opinions of counsel as Lender may require, (2) with respect to
Guarantor, the purchase or acquisition of a stock or membership interest in, or
the assets of, another entity, and (3) with respect to Guarantor, the transfer
of publicly traded stock in Guarantor on any recognized stock exchange.

         PERSON. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.

         PERSONAL PROPERTY. All materials, furnishings, fixtures, furniture,
machinery, equipment and all items of tangible or intangible personal property
now or hereafter owned or acquired by the Borrower, in which the Lender has
been, or will be granted an interest to secure the Project Obligations.

         PLANS AND SPECIFICATIONS. Initially the schematic drawings for the
Renovation Project prepared by the Architect and more particularly identified on
Exhibit "PLANS" attached hereto, as the same may hereafter be developed,
modified or supplemented with the prior written consent of Lender in each case;
provided however, Lender's prior written consent shall not be required for
modifications or supplements related to Non-Material Change Orders.

         PROJECT APPROVALS. All approvals, consents, waivers, orders,
agreements, acknowledgments, authorizations, permits and licenses required under
applicable Requirements or under the terms of any restriction, covenant or
easement affecting the Site and Improvements, or otherwise necessary or
desirable, for the ownership, acquisition, construction, equipping, use,
occupancy and operation of the Site and Improvements (including the and
Renovation Project), whether obtained from a Governmental Authority or any other
Person.

         PROJECT BUDGET. The budget for total estimated Project Costs, submitted
by the Borrower, approved by the Lender and the Construction Inspector, and to
be attached hereto as Exhibit "Budget" upon submittal under Section 2.1 of this
Agreement, which includes: (a) a line item cost breakdown for Direct Costs (b) a
line item cost breakdown for Indirect Costs; and (c) a schedule of the sources
of funds to pay Project Costs, indicating by item the portion of Project Costs
to be funded through the Loan and Borrower's Required Equity, as said Budget may
hereafter be amended with the prior written consent of Lender.

         PROJECT COMPLETION. With respect to the construction of the Renovation
Project, the determination by the Lender that (i) the Borrower has completed the
construction of the Renovation Project in accordance with the Plans and
Specifications and the terms and conditions hereof and with no outstanding liens
or lien rights, (ii) the Borrower has satisfied all of the conditions of this
Agreement hereof, for the release of the Retainage and (iii) the Improvements,
as affected by the Renovation Project, have a full and unconditional Certificate
of Occupancy permitting Key Tenant's intended use under the Key Lease.

         PROJECT COMPLETION DATE. One (1) year from the date hereof.


                                       -7-

<PAGE>

         PROJECT COSTS. The sum of all Direct Costs and Indirect Costs that will
be incurred by the Borrower in connection with the construction, equipping and
completion of the Renovation Project.

         PROJECT OBLIGATIONS. All indebtedness, obligations and liabilities of
the Borrower to the Lender existing on the date of this Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, arising or incurred under this
Agreement or any of the other Loan Documents or in respect of any of the
Advances or the Note.

         QUALIFIED INSTITUTION. See Section 20.1.

         REGISTRY. Middlesex South County Registry of Deeds and, if applicable,
Middlesex South District of the Land Court.

         RENOVATION PROJECT As defined in the Recitals to this Agreement.

         REQUIREMENTS. Any law, ordinance, code, order, rule or regulation of
any Governmental Authority relating in any way to the acquisition, ownership,
construction, use, occupancy and operation of the Site and Improvements.

         RETAINAGE. See Section 2.3.

         SECURITY DEED. The Construction Mortgage and Security Agreement, dated
or to be dated on or prior to the Closing Date, made by the Borrower in favor of
the Lender, as the same may hereafter be amended with the prior written consent
of Lender.

         SECURITY DOCUMENTS. The Security Deed, the Assignment of Project
Documents the Assignment of Leases, the Assignment of Interest Rate Protection
Agreement, the Financing Statements and the Guaranty, and any other agreement,
document or instrument now or hereafter securing the Project Obligations, all as
the same may hereafter be amended with the prior written consent of Lender.

         SINGLE PURPOSE ENTITY means a limited liability company which, at all
times since its formation and thereafter, (a) was organized solely for the
purpose of owning the Site and Improvements, (b) has not and will not engage in
any business unrelated to the ownership of the Site and Improvements, (c) has
not and will not have any assets other than those related to the Site and
Improvements, (d) except as otherwise expressly permitted by the Loan Documents
has not and will not engage in, seek or consent to any dissolution, winding up,
liquidation, consolidation, merger, asset sale, transfer of membership
interests, or amendment of its certificate of formation or operating agreement,
(e) has not and will not fail to correct any known misunderstanding regarding
the separate identity of such entity, (f) [intentionally deleted] (g) has not
done and will not do any of the following: (I) file a bankruptcy, insolvency or
reorganization petition or otherwise seek any relief under any laws relating to
the relief from debts or the protection of debtors generally; (II) seek or
consent to the appointment of a receiver, liquidator, assignee, trustee,
custodian or any similar official for such entity or all or any portion of such
entity's properties; (III) make any assignment for the benefit of such entity's
creditors' or (IV) take any action that might cause such entity to become
insolvent, (h) has maintained and will maintain its accounts, books and records
separate from any other person or entity, (i) has not and will not commingle its
funds or assets with those of any other entity, (j) has held and will hold its
assets in its own name,



                                       -8-
<PAGE>

(k) has conducted and will conduct its business in its name (l) has paid and
will pay its liabilities, including salaries of any employees, out of its own
funds and assets, (m) has observed and will observe all limited liability
company formalities, (n) [intentionally deleted], (o) has no indebtedness other
than as expressly permitted under the Loan Documents, (p) has not and will not
assume or guarantee or become obligated for the debts of any other entity or
person, or hold out its credit as being available to satisfy the obligations of
any other entity or person, (q) will not acquire obligations or securities of
its members, (r) [intentionally deleted] has allocated and will allocate fairly
and reasonably shared expenses, including, without limitation, shared office
space, (s) has not and will not pledge its assets for the benefit of any other
person or entity, (t) has held and identified itself and will hold itself out
and identify itself as a separate and distinct entity under its own name and not
as a division or part of any other person or entity, (u) has not made and will
not make loans to any person or entity, (v) has not and will not identify its
members or any Affiliates of any of them as a division or part of it, (w) has
not entered and will not enter into or be a party to, any transaction with its
members or its Affiliates (including the managing member) except in the ordinary
course of its business and on terms which are intrinsically fair and are not
less favorable to it than would be obtained in a comparable arms-length
transaction with an unrelated third party, (x) has paid and will pay the
salaries of its own employees from its own funds, (y) has maintained and will
maintain adequate capital in light of its contemplated business operation and
(z) if such entity is a limited liability company, and such entity has one or
more managing members, then such entity's organizational documents shall provide
that such entity shall continue (and not dissolve) for so long as a solvent
managing member exists.

         SITE PLAN. As defined in the Recitals of the Agreement.

         SUBSIDIARY. Any corporation, partnership, association, trust, or other
business entity of which the designated parent shall at any time own directly,
or indirectly through a Subsidiary or Subsidiaries, at least a majority (by
number of votes) of the outstanding voting interests therein.

         SURVEY. As defined in the Recitals to this Agreement.

         SURVEYOR CERTIFICATE. With respect to any Survey, a certificate
executed by the surveyor who prepares such Survey dated as of a recent date and
containing such information relating to the Site and Improvements as the Lender
or the Title Insurance Company may require, such certificate to be substantially
in the form of Exhibit "SVY" to this Agreement.

         TAKING. Any condemnation for public use of, or damage by reason of, the
action of any Governmental Authority, or any transfer by private sale in lieu
thereof, either temporarily or permanently.

         TITLE INSURANCE COMPANY. Fidelity National Title, with a usual place of
business at 133 Federal Street, Boston, Massachusetts 02110.

         TITLE POLICY. An ALTA standard form mortgagee title insurance policy
(containing no exceptions or exclusions for creditor rights) issued by the Title
Insurance Company (with such reinsurance or co-insurance as the Lender may
require, any such reinsurance to be with direct access endorsements) in an
amount not less than the Loan Amount insuring the first priority position of the
Security Deed and that the Borrower holds marketable fee simple title to the
Site and Improvements and all related easement



                                       -9-
<PAGE>

rights, subject only to such exceptions as the Lender may approve, and
containing such endorsements and affirmative insurance as the Lender in its
discretion may require.

         TITLE POLICY EXCEPTIONS. As defined in Section 11.5.



                                      -10-
<PAGE>

                                   SCHEDULE 2

                         Partners, Beneficiaries, Etc.

         Borrower's sole member is PRAECIS PHARMACEUTICALS INCORPORATED



                                      -11-
<PAGE>

                                   SCHEDULE 3

         -    Building Permit for Tenant Fit-Out

         -    Certificate of Occupancy for Tenant Fit-Out

         -    Industrial Discharge Sewer Connection Permit

         -    Municipal Industrial Sewer Connection Permit from the City of
              Waltham

         -    Fuel Storage License for Emergency Generator Fuel Tank



                                      -12-
<PAGE>

                                   SCHEDULE 4

                           Project Approvals Obtained

         -    Building Permit No. 194, issued by the City of Waltham Building
              Department on August 25, 1999;

         -    Certificate of Occupancy for 3 story office building with parking,
              erected under Building Permit No. 194 (base building), dated June
              15, 2000;

         -    Advisory Opinion for 830 Winter Street project, signed by Jay
              Wickersham, Assistant Secretary of Massachusetts Executive Office
              of Environmental Affairs, MEPA Unit Director, on March 5, 1999;

         -    Order of Conditions from the Waltham Conservation Commission,
              dated March 16, 1998, for shared stormwater management system
              constructed in connection with the construction of the New England
              Baptist Hospital Wellness Center at 840 Winter Street, Waltham,
              Massachusetts, including portions of system located on 830 Winter
              Street property;

         -    Negative Determination of Applicability from the Waltham
              Conservation Commission, dated July 6, 1999;

         -    Letter from Bryant J. Firmin, NPDES Permit Manager for the
              Massachusetts Department of Environmental Protection, dated July
              2, 1999, confirming the absence of point source discharge with
              respect to stormwater management system;

         -    Certificate of Registration of Fuel Storage, issued by Waltham
              City Clerk on January 25, 2000, for storage of gasoline and diesel
              fuel in vehicles in structured parking facility;

         -    Permit from Waltham Board of Health for experimentation with and
              use of recombinant deoxyribonucleic acid, dated June 20, 2000.



                                      -13-
<PAGE>

                                  SCHEDULE 9.6

                                      None



                                       -1-
<PAGE>

                                 SCHEDULE 9.17

                                      None



                                       -2-
<PAGE>

                                 EXHIBIT "SVY"

                           SURVEYOR'S CERTIFICATE RE:

                        ------------------------------,
            830 Winter Street, Waltham, Massachusetts (the "Project")
                  owned by 830 Winter Street LLC (the "Owner")

To:             ANGLO IRISH BANK CORPORATION PLC        (the "Lender")

Re:             Survey Dated        , revised           (the "Survey")
                                  , entitled

                "------------------------------",
                 prepared by                    .

         The undersigned, a registered land surveyor, hereby certifies to the
Lender as follows:

         1.       The Survey was actually made on the ground and is correct
according to the record description of the parcel(s); except as otherwise noted
on the Survey, all improvements located on said parcel(s) lie wholly within the
lot lines and are located as shown on the Survey; and that all bodies of water,
wetlands, encroachments, building line restrictions, easements, drainage or
flowage rights, rights-of-way or uses which affect said parcel(s) or which are
encroachments by said parcel(s) upon adjoining property are fully shown on the
Survey and, to the extent such matters are of record, the respective recording
references are noted thereon; said parcel(s) lie within the zoning district(s)
as shown on the Survey; the location of the existing improvements and all
proposed improvements shown on the Survey meet all applicable setback, front,
side and rear yard restrictions relating to development of the type proposed for
this location; and said improvements comply (or, in the case of proposed
improvements, if built as shown on the Survey, will comply) with applicable
provisions of the zoning By-law and other relevant Ordinances of the City/Town
of _________.

         2.       Municipal water service, storm sewer, sanitary sewer
facilities, and telephone, electric and gas service are available to serve the
parcel(s) at the lot lines of the parcel(s) in the locations indicated on the
Survey.

         3.       Unless otherwise shown and detailed on the Survey, no
easements or rights of ways over land of others are required for

                  i)       access to and egress from the parcel(s),



                                       -1-
<PAGE>

                  ii)      any utilities which serve the parcel(s) and said
                           improvements, such as water, electricity, gas and
                           telephone, or

                  iii)     storm sewer and sanitary sewer facilities serving the
                           parcel(s) and said improvements.

                  If the Survey delineates off-site easements being required
over the land of others to serve the parcel(s) and said improvements, duly
recorded easements have been obtained from all land owners whose property is
affected in the areas shown on the Survey.

         4.       Without intending to limit any of the foregoing
certifications, the undersigned made a specific examination with respect to the
following items and reports as follows (indicate "none" or "as shown on the
Survey", as appropriate):

                  4.1      Rights of way, old highways, or abandoned roads,
                           lanes or driveways, drains, sewer, water, gas or oil
                           pipe lines across said property;

                  4.2      Springs, streams, rivers, ponds, lakes, swamps or
                           drainage ditches located, bordering on or running
                           through said property;

                  4.3      Cemeteries or family burial grounds located on said
                           property;

                  4.4      Telephone, telegraph or electric power poles, wires
                           or lines overhanging or crossing or located on said
                           property;

                  4.6      Encroachments or overhanging projections burdening
                           said property or appurtenant to said property;

                  4.7      Physical evidence of boundary lines;

                  4.8      Proposed changes in street lines;

         5.       Except as noted below, as of the date of the Survey, said
parcel(s) does (do) not lie within any (i) flood plain or flood-prone area, or a
flood plain area having special flood hazards identified as such under the Flood
Disaster Protection Act of 1973, or (ii) any local flood, wetlands or aquifer
district or (iii) any other special district such as, but not limited to, any
historical, parking, or conservancy district or (iv) any area subject to a
moratorium or rationing of water, or sewer or other utility services.

         6.       The Survey has been made in accordance with the most recent
edition of the "Minimum Standard Detail Requirements for Land Title Surveys"
jointly established



                                       -2-
<PAGE>

and adopted by ALTA and ACSM for a Class A Urban Survey, as defined therein, and
includes Items 1-4, 6-11 and 13 from Table A of such Requirements.

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

                                  By ___________________________
                                     Its
(CORPORATE SEAL)                     Hereunto duly authorized

                                                     SURVEYOR

Dated:__________________



                                       -3-
<PAGE>

                                EXHIBIT "PLANS"

             ARCHITECT'S CERTIFICATION RE: PLANS AND SPECIFICATIONS

             This certificate is rendered with respect to:

             The proposed renovation of the building known as and by 830
Winter Street, Waltham, Massachusetts (the "Building") and related facilities
(the "Renovations") to be constructed in accordance with the Plans and
Specifications prepared by /____________/ and described on Schedule A
attached hereto and made a part hereof (the "Plans and Specifications").

             We are furnishing this certificate to ANGLO IRISH BANK CORPORATION
PLC (the "Lender") to induce the Lender to make a loan to finance the
construction of the Renovations and it is intended that the Lender shall rely
upon the contents and accuracy of this certificate.

             In completing this certificate, we have assumed that: (i) the
Renovations will be completed in accordance with the Plans and Specifications;
(ii) the Renovations, once constructed, will be used as a combined
office/laboratory building; and (iii) the Renovations, once completed pursuant
to the Plans and Specifications, will be properly used and maintained.

             We hereby certify to the Lender, to the best of our knowledge,
belief and professional judgment, as follows:

             1.     The Plans and Specifications were drawn in accordance with
the degree of skill and care ordinarily exercised by practicing architects
performing similar services in similar conditions. The Plans and Specifications
as well as, based upon our review of the same, the plans and specifications for
the existing improvements, comply with all applicable federal, state and
municipal laws, rules, regulations and ordinances, including, without
limitation, zoning, building, handicapped access, fire, health and sanitary
codes and ordinances and subdivision control and environmental laws, rules and
regulations, including, without limitation, the Federal Clean Air Act, as
amended, and the Federal Clean Water Act, as amended, and state laws or
regulations consistent with the requirements of said Acts; and the Renovations,
if constructed in accordance with the Plans and Specifications, will likewise
comply with all applicable federal, state and municipal laws, rules and
regulations and ordinances of every nature and description which we are aware
relating to the construction and the intended use thereof.



                                       -1-
<PAGE>

         2.       All permits, licenses, approvals and the like ("permits")
required for the construction of the Renovations, including, without limitation,
building permits, earth removal permits, curb-cut permits, water connection
permits, sewer extension or connection permits and other permits relating to the
use of utilities, and permits required under the Federal Clean Air Act, as
amended, the Federal Clean Water Act, as amended, and by state law or
regulations consistent with the requirements of said Acts, have been validly
issued by the appropriate authorities, are now in full force and effect, and
true copies of which are attached to this certificate, as follows:

         [INSERT NAMES OF PERMITS WHICH HAVE BEEN ISSUED, DATES OF ISSUANCE AND
ISSUING AUTHORITIES]

         However, construction of the Renovations is not, as of this date,
sufficiently complete to make it possible to have secured the following permits,
which also are required for the Project:

         [IF APPLICABLE, INSERT NAMES OF PERMITS TO BE ISSUED AND ISSUING
AUTHORITIES]

It is the express opinion of the undersigned that the foregoing permits will
duly be issued in the ordinary course of construction of the Renovations and
upon the completion thereof.

         3.       The Plans and Specifications are identical to the plans and
specifications for the Renovations which have been filed with all governmental
agencies having jurisdiction incident to the issuance of the necessary
governmental construction permits, and are the same as the plans and
specifications listed in the construction contract(s) pursuant to which
construction of the Renovations is to be undertaken and include any plans and
specifications for work required of the owner under all leases pertaining to the
Improvements.

Executed under seal this     day of         , 2000.

                                  [NAME OF ARCHITECTS]

                                  By:____________________________
                                     Its
                                     Hereunto duly authorized

Dated:



                                       -2-
<PAGE>

                                EXHIBIT `BUDGET"

                                 PROJECT BUDGET


                   [Not attached to final closing documents.
           To be finalized and approved by all parties post-closing.]


                                       -1-
<PAGE>

                                 EXHIBIT "BOR"

                             BORROWER'S CERTIFICATE

BORROWER:

PROJECT:  830 Winter Street, Waltham, Massachusetts

                                REQUISITION NO.

TO:  ANGLO IRISH BANK CORPORATION PLC                           (the "Lender")

     The undersigned hereby certifies to Lender that:

     A.       No changes have been made in the Plans and Specifications, the
Construction Contract and the Architect's Agreement which require the prior
approval of Lender under the terms of the Acquisition and Construction Loan
Agreement (the "Agreement"), any tenant under a lease at the Improvements (a
"Key Tenant"), or of any governmental authority having jurisdiction over the
Improvements;

     B.       Construction of the Renovation Project has been performed to
date in accordance with the Plans and Specifications (along with changes to such
Plans previously approved by the Bank and the other parties referred to in
Paragraph A, above).

     C.       The balance to be advanced under the Loan shall be sufficient
for the payment of all related Direct or Indirect Costs for the completion of
construction of the Renovation Project in accordance with all of the terms and
provisions of the Agreement.

     D.       All monies requisitioned by the Borrower and disbursed by
Lender under previously approved requisitions for the purpose of making payments
to contractors, subcontractors, vendors and suppliers with respect to the
Renovation Project have been paid to all such contractors, subcontractors,
vendors and suppliers; all other funds requisitioned by Borrower and disbursed
by Lender under previously approved requisitions have been expended for the
purpose for which they were requisitioned.

     E.       The representations and warranties made in the Agreement or
any of the other Loan Documents are true and correct as of the date hereof with
the same effect as if made on this date;

     F.       The Borrower represents and warrants that it (i) is not in
default of any of its obligations to Lender in connection with the Site and
Improvements, including, without limitation, the Borrower's obligations under
the terms of the Loan Documents,


                                       -1-
<PAGE>

(ii) has not received notice from or been informed by any Key Tenant, or
governmental agency having jurisdiction over the Site and Improvements, of any
alleged deficiencies in the work performed to date or any deviation of such work
from the Plans and Specifications or notice of any kind of any assertion of a
claim that the Site and Improvements, is not in compliance with all applicable
Requirements, and (iii) asserts no failure on the part of Lender to perform its
obligations under the Loan Documents;

        G.       The Borrower represents and warrants that this Certificate is
in identical form to the certificate which is annexed to the Agreement as
Exhibit "BOR" and that there have been no changes or modifications thereto; and

        H. All capitalized terms herein shall have the same meanings ascribed
under the aforesaid Agreement.

                                                               Borrower:

                                       ---------------------------------

DATED:  ________________________



                                       -2-
<PAGE>

                                  EXHIBIT "GC"

              CONTRACTOR'S REQUISITION CERTIFICATE AND CONTRACTOR
                    PARTIAL WAIVER AND SUBORDINATION OF LIEN

                       Application for Payment No.______

TO:             ANGLO IRISH BANK CORPORATION PLC        ("Lender")

FROM:                                      ("Contractor")

RE:   Construction of [insert brief description of Renovation Project] located
      at [insert address] (the Renovation "Project"), which term includes all
      buildings, structures and site improvements related thereto by [insert
      name of Borrower] ("Owner").


      We are the general contractor for the Renovation Project, and to induce
Lender to advance loan proceeds to assist in funding construction of the
Renovation Project and knowing that Lender will rely on this certificate in
doing so, we hereby provide the attached Contractor Partial Waiver and
Subordination of Lien (the "Partial Waiver") as Schedule 1 to the Certificate
and certify to Lender as follows:

         1.       In reference to our contract dated _______________, 19__ with
                  Owner for construction of the Renovation Project, and the
                  Plans and Specifications therefor, no amendments,
                  modifications or changes have been made with respect to our
                  contract or the Plans and Specifications except such as have
                  had your prior written approval. There are no pending change
                  orders except as set forth on the Partial Wavier.

         2.       Our Application for Payment No.___, dated ___________, 2000
                  (the "Current Application for Payment"), which we understand
                  is to be included as an item in the Owner's requisition to
                  you, is in full compliance with the terms of our contract with
                  Owner, and, upon the payment of same, we will have no other or
                  additional claim (including claims for so-called "extras")
                  against Owner on account of our contract or otherwise for and
                  through the period of time ending upon the date of our Current
                  Application for Payment, for all labor and materials furnished
                  by us through and including the date of our Current
                  Application for Payment except as follows:

                  (a)      retainage not exceeding 10% of the value of labor and
                           materials incorporated into the Renovation Project
                           and covered by applications



                                       -1-
<PAGE>

                           submitted by us on account of the Renovation Project
                           for which payment is to be made to us after
                           substantial completion of our contract, as provided
                           therein (the aggregate amount of said retainage, as
                           of the end of the period covered by our Current
                           Application for Payment is $__________); and

                  (b)      such other unpaid, agreed or pending change orders
                           and disputed claims, if any, set forth on the Partial
                           Waiver.

         3.      The Owner is not in default of any of the Owner's obligations
                 to us as of the date hereof.

         4.       We have paid in full all our obligations to subcontractors,
                  workmen, suppliers and materialmen for and with respect to all
                  labor and/or materials and rented equipment, appliances or
                  tools related to the construction of the Renovation Project
                  supplied through and including the date of our last
                  Application for Payment, except for an amount equal to 10%
                  thereof, which we are holding in accordance with the terms of
                  such obligations and our contract, and all our subcontractors
                  have paid their subcontractors, workmen and materialmen in
                  full for and with respect to all labor and materials supplied
                  through and including the date of our last Application for
                  Payment.

Executed as an instrument under seal this ______ day of __________, 2000.

                                  [NAME OF GENERAL CONTRACTOR]

                                  By:______________________________
                                               Title:



                                       -2-
<PAGE>

                           SCHEDULE 1 TO EXHIBIT "GC"

              CONTRACTOR PARTIAL WAIVER AND SUBORDINATION OF LIEN

COMMONWEALTH OF MASSACHUSETTS  )
                               )  ss.

COUNTY OF ________________________      )

Date:  _____________                     Application for Payment No:  ________

OWNER:  ___________________________

        ___________________________

CONTRACTOR:     ___________________________

                ___________________________

LENDER:         Anglo Irish Bank Corporation PLC
                84 State Street, 4th Floor
                Boston, MA 02109
                Attn:  David Drum, Executive Vice President

         1.       Original Contract Amount:                      $______________

         2.       Approved Change Orders:                        $______________

         3.       Adjusted Contract Amount (line 1 plus line 2): $______________

         4.       Completed to Date:                             $______________

         5.       Less Retainage:                                $______________

         6.       Total Payable to Date (line 4 less line 5):    $______________

         7.       Less Previous Payments                         $______________

         8.       Current Amount Due (line 6 less line 7):       $______________

         9.       Pending Change Orders:                         $______________

         10.      Disputed Claims:                               $______________



                                       -3-
<PAGE>

         The undersigned who has a contract with the Owner for furnishing labor
or materials or both labor and materials or rental equipment, appliances or
tools for the erection, alteration, repair or removal of a building or structure
or other improvement of real property commonly known and identified as
___________________, located in ______________, ______________County,
Commonwealth of Massachusetts and owned by the Owner, upon receipt of
____________________and ____/100 Dollars ($__________) in payment of an
application for payment dated _________________, does hereby:

         a.       waive any and all liens and rights of lien on such real
                  property for labor or materials, or both labor and materials,
                  or rental equipment, appliances or tools, performed or
                  furnished through the following date: _____________,
                  _________, (the "Payment Period") except for retainage unpaid
                  agreed or pending change orders, and disputed claims as stated
                  above; and

         b.       subordinate any and all liens and right of lien to secure
                  payment for such unpaid, agreed or pending change orders and
                  disputed claims, and such further labor or materials, or both
                  labor and materials, or rental equipment, appliances or tools,
                  except for retainage, performed or furnished at any time
                  through the twenty-fifth day after the end of the above
                  Payment Period, to the extent of the amount actually advanced
                  by the Lender through such twenty-fifth day.

Signed under the pains and penalties of perjury this ___day of__________, 2000.

                                        CONTRACTOR:

                                        ---------------------------

                                        By:________________________
                                           Name:
                                           Title:
                                           Its duly authorized officer



                                       -4-
<PAGE>

                                 EXHIBIT "ARCH"

                      ARCHITECT'S REQUISITION CERTIFICATE

                     Application for Payment No. __________

TO:     Anglo Irish Bank Corporation PLC                        ("Lender")

FROM:                                                           ("Architect")

RE:      Construction of renovation project located at 830 Winter Street,
         Waltham, Massachusetts (the Renovation Project") by 830 Winter Street
         LLC

                                                                ("Borrower").

         We are the supervising architect for the Renovation Project, and to
induce Lender to advance loan proceeds to assist with funding construction of
the Renovation Project, and knowing that Lender will rely on this certificate in
doing so, we hereby certify to Lender to the best of our knowledge and belief
and pursuant to and in accordance with our obligations under Articles 1.2.3 and
2.6.3 of the Owner/Architect Agreement dated as of ______, 2000, as follows:

         1.       We inspected the Renovation Project on ________________, 2000
                  and found the status of the Renovation Project on that date
                  and the progress made on the Renovation Project since our last
                  certificate to you dated _______________, 199_ to be
                  materially in accord with all requirements known to us as
                  applicable to the construction of the Renovation.

         2.       We prepared the Plans and Specifications (as defined in our
                  closing certification previously provided to Lender) for the
                  Renovation Project, copies of which have been delivered to
                  you. We have made no changes to the Plans and Specifications
                  except such as you have approved in writing or with respect to
                  which your approval is not required under your arrangements
                  with Borrower. There are no pending change orders or
                  construction change directives except as follows:

                      [INSERT "NONE" IF THERE ARE NONE]

         3.       All work to date has been done in accordance with the Plans
                  and Specifications and in a good and workmanlike manner and in
                  accordance with applicable laws and regulations (including,
                  without limitation, applicable zoning restrictions pertaining
                  to setbacks, front, side and rear yards, height, loading, lot
                  coverage, parking and FAR or bulk restrictions) and in
                  conformity with applicable requirements of tenants of the
                  Improvements in which the Renovation Project is proceeding to
                  the extent such requirements have been made known to us. All
                  materials and fixtures usually furnished and installed or
                  stored on site at the current stage of construction have been
                  furnished,



                                       -1-
<PAGE>

installed or stored on site in accordance with the Plans and Specifications.
All of the work to date is hereby approved except as follows:

         [INSERT "NONE" IF THERE ARE NO EXCEPTIONS TO REPORT]

4.       We have examined the requisition being submitted herewith to you by
         Owner, which requisition includes an Application for Payment from
         ______________ ("Contractor") respecting construction of the Renovation
         Project. The payment so applied for by Contractor does not exceed (when
         added to the payments heretofore applied for by and paid to Contractor)
         90% of the value of labor and materials incorporated into the
         Renovation Project.

5.       We have been advised that as of this date there remains unexpended from
         the proceeds of your construction loan $________ which are available to
         fund construction costs, from which funds to pay the aforementioned
         Application for Payment will be deducted. In our opinion, such
         unexpended portion of your loan proceeds, after deduction of funds
         sufficient to cover both the current Application for Payment and the
         standard 10% retainage heretofore withheld and to become due on account
         of the current and previous applications, will be sufficient to pay for
         all construction costs reasonably required to complete the Renovation
         Project, provided that the amount advanced under the current
         application is, in fact, applied against obligations incurred for labor
         and materials heretofore furnished on account of construction of the
         Renovation Project.

6.       All permits, licenses, approvals and the like required to complete
         construction of the Renovation Project have been validly issued by the
         appropriate authorities and are in full force and effect, and there is
         no violation of any of the provisions thereof or of any legal
         requirements applicable to the Renovation Project of which we have
         notice or knowledge as of the date hereof except as follows:

        [insert "none" if there are no exceptions]

7.       To the best of our knowledge, there are no petitions, actions or
         proceedings pending or threatened to revoke, rescind, alter or declare
         invalid any laws, ordinances, regulations, permits, licenses or
         approvals for or relating to the Renovations Project.

8.       No amendments, modifications or changes have been made to our contract
         dated _______________, 199_ with Owner except such as have had your
         prior written approval.

9.       Borrower is not in default of any of Borrower's obligations to us as
         of the date hereof.

This certificate is rendered subject to our obligations under Article 2.6.3 of
the Owner/Architect Agreement, and in particular, with the standard of care owed
to the Owner in accordance with Article 1.2.3 thereof. We have relied on the
accuracy, sufficiency and completeness of the information obtained pursuant
thereto and in accordance therewith, and we shall incur no liability to any
entity based on such reasonable reliance.



                                       -2-
<PAGE>

Executed as a sealed instrument this _____ day of ______________, 2000.

                                       JUNG/BRENNEN ASSOCIATES, INC.

                                       By:___________________________

                                       Title: _________________________



                                       -3-
<PAGE>

                      EXHIBIT "INSURANCE" TO LOAN AGREEMENT

                REQUIRED PROPERTY, LIABILITY AND OTHER INSURANCE

         Borrower shall at all times provide and maintain the following
insurance coverages with respect to the Collateral issued by companies qualified
to do business in the Commonwealth of Massachusetts, having a Best's Rating of
not less than A8 and otherwise acceptable to Lender in its sole discretion:

         (i)      physical insurance on an all-risk basis without exception
         (including, without limitation, flood required if property is in a
         "Special Flood Hazard Area" A or V), vandalism and malicious mischief,
         earthquake, collapse, boiler explosion, sprinkler coverage, cost of
         demolition, increased costs of construction and the value of the
         undamaged portion of the building and soft costs coverage) covering all
         the real estate, fixtures and personal property to the extent of the
         full insurable value thereof, on a builder's risk nonreporting form
         prior to completion and occupancy to Occupy Endorsement, having
         replacement cost and agreed amount endorsements (with deductibles not
         in excess of it of insurable value);

         (ii)     rent loss or business interruption insurance in an amount
         equal to one year's projected rentals or gross revenues;

         (iii)    public liability insurance, with underlying and umbrella
         coverages totaling not less than $2,000,000 per occurrence and
         $5,000,000 in the aggregate or such other amounts as may reasonably be
         determined by Lender from time to time;

         (iv)     automobile liability insurance (including non-owned
         automobile) with a coverage of $2,000,000 per occurrence during
         construction;

         (v)      worker's compensation, employer's liability as required by
         law;

         (vi)     such other insurance coverages in such amounts as Lender may
         request.

         An actual insurance policy or certified copy thereof, or a binder,
certificate of insurance, or other evidence of property coverage in the form of
Acord 27 (Evidence of Property Coverage), Acord 25 (Certificate of Insurance),
or a 30-day binder in form acceptable to Lender with an unconditional
undertaking to deliver the policy or a certified copy within thirty (30) days,
shall be delivered at closing of the Loan and prior to the first Loan Advance.

         Flood insurance shall be provided if the property or the collateral is
located in a flood prone, flood risk or flood hazard area as designated pursuant
to the Federal Flood Disaster Protection Act of 1973, as amended, and the
Regulations thereunder, or if otherwise reasonably required by Lender.



                                       -1-
<PAGE>

         Lender shall be named as first mortgagee on policies of all-risk-type
insurance on the Property, as loss payee on the Collateral and its contents, and
as first mortgagee on rent-loss or business interruption coverages related
thereto.

         Except with respect to public liability insurance, as to which Lender
shall be named as an additional insured with respect to the Property or the
Collateral, all other required insurance coverages shall have a so-called
"Mortgagee's endorsement" or "Lender's loss-payable endorsement" which shall
provide in substance as follows:

         A.       Loss or damage, if any, under the policy shall be paid to
Lender and its successors and assigns ("Lender") in whatever form or capacity
its interest may appear and whether said interest be vested in said Lender in
its individual or in its disclosed or undisclosed fiduciary or representative
capacity, or otherwise, or vested in a nominee or trustee of said Lender.

         B.       The insurance under the policy, or under any rider or
endorsement attached thereto, as to the interest only of Lender, its successors
and assigns, shall not be invalidated nor suspended:

                  (a)      by any error, omission or change respecting the
                  ownership, description, possession or location of the subject
                  of the insurance or the interests therein or the title
                  thereto; or

                  (b)      by the commencement of foreclosure or similar
                  proceedings or the giving of notice of sale of any of the
                  property covered by the policy by virtue of any mortgage, deed
                  of trust, or security interest; or

                  (c)      by any breach of warranty, act, omission, neglect, or
                  noncompliance with any provisions of the policy by the named
                  insured, or any one else, whether before or after a loss,
                  which under the provisions of the policy of insurance, would
                  invalidate or suspend the insurance as to the named insured,
                  excluding, however, any acts or omissions of Lender while
                  exercising active control and manage-ment of the insured
                  property.

         C.       Insurer shall provide Lender with not less than thirty (30)
days, prior written notice of cancellation of the policy (for non-payment or any
other reason) or of the non-renewal thereof.

         D.       The insurer reserves the right to cancel the policy at any
time, but only as provided by its terms. However, in such case this policy shall
continue in force for the benefit of Lender for thirty (30) days after written
notice of such cancellation is received by Lender and shall then cease.

         E.       Should legal title to and beneficial ownership of any of the
property covered under the policy become vested in Lender or its agents,
successors or assigns, insurance under the policy shall continue for the term
thereof for the benefit of Lender.

         F.       All notices herein provided to be given by the insurer to
Lender in connection with this policy and Lender's loss payable endorsement
shall be mailed to or delivered to Lender in the manner provided for the
delivery of notice under the Loan Agreement to which this Exhibit is attached.


                                       -2-



<PAGE>

                                                                          [COPY]

                                 PROMISSORY NOTE


$33,000,000.00                                             Boston, Massachusetts
July 11, 2000


1.       PROMISE TO PAY.

         FOR VALUE RECEIVED, 830 WINTER STREET LLC, a Delaware limited liability
company having an address at c/o PRAECIS PHARMACEUTICALS INCORPORATED, One
Hampshire Street, Cambridge, Massachusetts 02139 ("Borrower") promises to pay to
the order of ANGLO IRISH BANK CORPORATION PLC, ("Lender") having an address at
84 State Street, Boston, Massachusetts 02109, the principal sum of THIRTY-THREE
MILLION ($33,000,000.00) DOLLARS, or so much thereof as may be advanced, with
interest thereon, or on the amount thereof from time to time outstanding, to be
computed, as hereinafter provided, on each Loan Advance from the date of its
disbursement until such principal sum shall be fully paid. Interest and
principal shall be payable in installments as set forth in Section 4 below. The
total principal sum, or the amount thereof outstanding, together with any
accrued but unpaid interest, shall be due and payable in full on July 30, 2003,
(the "Maturity Date") which term is subject to extension or acceleration in
accordance with the Loan Agreement pursuant to which this Note has been issued.

2.       LOAN AGREEMENT.

         This Note is issued pursuant to the terms, provisions and conditions of
an agreement captioned Acquisition and Construction Loan Agreement" ("Loan
Agreement") dated as of even date between Borrower and Lender and evidences the
Loan and Loan Advances made pursuant thereto. Capitalized terms used herein
which are not otherwise specifically defined shall have the same meaning herein
as in the Loan Agreement.

3.       INTEREST RATE.

         3.1. EURODOLLAR RATE. Principal amounts outstanding under the Loan
         shall bear interest at the Eurodollar Rate, subject to the conditions
         and limitations provided for in this Note.

         3.1.1 SELECTION TO BE MADE. Borrower shall select, and thereafter may
         change the selection of, the applicable Interest Period for Eurodollar
         Advances, from the alternatives otherwise provided for in this Note, by
         giving Lender a Notice of Interest Period Selection: (i) prior to each
         Loan Advance, (ii) prior to the end of each Interest Period applicable
         to a Eurodollar Advance, or (iii) on any Business



                                      -1-
<PAGE>

         Day on which Borrower desires to convert an outstanding Variable Rate
         Advance to a Eurodollar Rate Advance.

         3.1.2 NOTICE. A "Notice of Interest Period Selection" shall be a
         written notice, given by cable, tested telex, telecopier (with
         authorized signature), or by telephone if immediately confirmed by such
         a written notice, from an Authorized Representative of Borrower which:
         (i) is irrevocable; (ii) is received by Lender not later than 10:00
         o'clock A.M. Eastern Time at least three (3) Business Days prior to the
         first day of the Interest Period to which such selection is to apply,
         and (iii) as to each selected interest period option, sets forth the
         aggregate principal amount(s) to which such interest period option(s)
         shall apply.

         3.1.3 IF NO NOTICE. If Borrower fails to select an Interest Period
         option in accordance with the foregoing prior to a Loan Advance, or
         prior to the last day of the applicable Interest Period of an
         outstanding Eurodollar Advance or if a Eurodollar Advance is not
         available, any new Loan Advance made shall be deemed to be a Variable
         Rate Advance, and on the last day of the applicable Interest Period all
         outstanding principal amounts shall be deemed converted to a Variable
         Rate Advance.

         3.3. TELEPHONIC NOTICE. Without any way limiting Borrower's obligation
         to confirm in writing any telephonic notice, Lender may act without
         liability upon the basis of telephonic notice believed by Lender in
         good faith to be from Borrower prior to receipt of written
         confirmation. In each case Borrower hereby waives the right to dispute
         Lender's record of the terms of such telephonic Notice of Interest
         Period Selection.

         3.4. LIMITS ON OPTIONS; ONE SELECTION PER MONTH. Each Eurodollar
         Advance shall be in a minimum amount of $1,000,000. At no time shall
         there be outstanding a total of more than five (5) Eurodollar Rate
         Advances at any time. If Borrower shall make more than one (1) interest
         rate selection in any thirty (30) day period, excluding conversions of
         outstanding advances made at the end of an applicable Interest Period
         of any previously outstanding Eurodollar Advance, Lender may impose and
         Borrower shall pay a reasonable processing fee for each such additional
         selection.

4.       PAYMENT OF INTEREST AND PRINCIPAL.

         4.1. PAYMENT AND CALCULATION OF INTEREST. Subject to the provisions of
         Section 5.3 of this Note dealing with payments falling due on dates
         that are not "Business Days", all interest shall be: (a) payable in
         arrears commencing July 1, 2000 and on the same day of each month
         thereafter until the principal together with all interest and other
         charges payable with respect to the Loan shall be fully paid; and (b)
         calculated on the basis of a 360 day year and the actual number of days
         elapsed.



                                      -2-
<PAGE>

         Interest at the Eurodollar Rate shall be computed from and including
         the first day of the applicable Interest Period to, but excluding, the
         last day thereof.

         4.2. AMORTIZATION INSTALLMENT PAYMENTS OF PRINCIPAL. During any
         extension period provided for in Section 4 of the Loan Agreement,
         Borrower shall pay, on the first day of each month during the
         applicable extension period, a monthly principal installment on the
         Loan equal to the "Monthly Principal Payment Amount", defined below.

                  The Monthly Principal Payment Amount shall be calculated as
         follows:

                  A. Utilizing an assumed interest rate factor equal to the
                  highest rate in effect for an Interest period as of the
                  Maturity Date which is the subject of the requested extension
                  (the "Interest Rate Factor") and the outstanding principal of
                  the Loan, together, if any, with unadvanced portions thereof
                  as of such Maturity Date (the "Principal Amount Factor"), a
                  calculation shall be made of the aggregate principal portion
                  (the "Assumed Principal Portion") of such assumed loan that
                  would be paid over the one year extension period if such
                  assumed loan was being fully amortized over a 25-year period
                  commencing as of the commencement of the extension period.

                  B. The Assumed Principal Portion shall then be divided by 12
                  and the result of such division shall be the Monthly Principal
                  Payment Amount. For example, if the Principal Amount Factor
                  was $33,000,000 and the Interest Rate Factor was 8.5% per
                  annum, the Assumed Principal Portion would be approximately
                  $416,640.96 (as calculated on the aforesaid 25-year basis) for
                  the one year extension period, which, when divided by 12,
                  would result in a $34,720.08 Monthly Principal Payment Amount.

         4.3 PAYMENT OF PRINCIPAL AT MATURITY. The entire principal balance
         shall be due and payable in full upon the Maturity Date, as the same
         may be accelerated hereunder or extended under Section 4 of the Loan
         Agreement (the "Maturity of the Loan").

         4.4. PREPAYMENT. The Loan or any portion thereof may be prepaid in full
         or in part at any time upon thirty (30) days' prior written notice to
         the holder of this Note subject to "breakage" provisions and upon
         payment of a Pre-Payment Fee, all as set forth in Section 4.10 below.
         Any partial prepayment of principal shall first be applied to any
         installment of principal then due and then be applied to the principal
         due in the reverse order of maturity, and no such partial prepayment
         shall relieve Borrower of the obligation to pay each subsequent
         installment of principal when due. Notwithstanding the foregoing, no
         Prepayment Fee shall



                                      -3-
<PAGE>

         apply to prepayments resulting from the applications by Lender of
         casualty or condemnation proceeds.

         4.5. MATURITY. At the Maturity of the Loan all accrued interest,
         principal and other charges due with respect to the Loan shall be due
         and payable in full and the principal balance and such other charges,
         but not unpaid interest, shall continue to bear interest at the Default
         Rate until so paid.

         4.6. METHOD OF PAYMENT: DATE OF CREDIT. All payments of interest,
         principal, charges, fees and other amounts due hereunder or under or in
         connection with the Loan Agreement shall be made to Lender in lawful
         money of the United States in immediately available funds by wire
         transfer to Lender pursuant to instructions provided by Lender.
         Payments shall be credited on the Business Day on which immediately
         available funds are received prior to eleven o'clock A.M. Eastern Time;
         payments received after eleven o'clock A.M. Eastern Time shall be
         credited to the Loan on the next Business Day.

         4.7. BILLINGS. Lender may submit monthly billings reflecting payments
         due; HOWEVER, any changes in the interest rate which occur between the
         date of billing and the due date may be reflected in the billing for a
         subsequent month. Neither the failure of Lender to submit a billing nor
         any error in any such billing shall excuse Borrower from the obligation
         to make full payment of all Borrower's payment obligations when due;
         provided Lender informs Borrower of any such error.

         4.8. DEFAULT RATE. Borrower shall pay upon billing therefor, an
         interest rate ("Default Rate") which is four percent (4%) per annum
         above the interest rate otherwise in effect hereunder from time to
         time: (a) while any monetary Default exists and is continuing, during
         that period between the due date and the date of payment; (b) following
         any Event of Default, unless and until the Event of Default is waived
         by Lender; and (c) after the Maturity of the Loan.

         4.9. LATE CHARGES. Borrower shall pay, upon billing therefor, a "Late
         Charge" equal to three percent (3%) of the amount of any payment of
         principal (other than principal due at the Maturity of the Loan),
         interest, or both, which is not paid in full within ten (10) days of
         the due date thereof. Late charges: (a) are payable in addition to, and
         not in limitation of, the Default Rate, (b) are intended to compensate
         Lenders for administrative and processing costs incident to late
         payments, (c) are not interest, and (d) shall not be subject to refund
         or rebate or credited against any other amount due.

         4.10. "BREAKAGE" FEES AND PRE-PAYMENT FEES. Borrower shall pay to
         Lender, immediately upon request and notwithstanding contrary
         provisions contained in any of the Loan Documents, such amounts as
         shall, in the conclusive judgment of



                                      -4-
<PAGE>

         Lender (in the absence of manifest error), compensate Lender for the
         cost or expense which it may reasonably incur as a result of any or
         prepayment (a "Prepayment"), under any circumstances whatsoever,
         whether voluntary or involuntary (including, without limitation,
         prepayments resulting from acceleration of the Loan, applications of
         insurance or condemnation proceeds and any proceeds received in respect
         of Section 5.7 of the Assignment of Leases and Rents (as defined in the
         Loan Agreement)) of all or any portion of the Loan on a date other than
         the due date thereof. Upon a Prepayment Borrower shall be liable for
         the following:

                  (A) without duplication of amounts due under clause (B),
         below, a payment equal to any administrative costs actually incurred,
         plus any amounts required to compensate for any cost or expense
         incurred by reason of the liquidation or reemployment of deposits or
         other funds acquired by Lender to fund or maintain a Eurodollar
         Advance; plus

                  (B) a "breakage" fee amount equal to the product of: (i) the
         amount of the Prepayment multiplied by (ii) the difference between the
         Adjusted LIBOR Rate, then in effect, or which would have been in effect
         (computed separately for each outstanding maturity or installment), and
         the Adjusted LIBOR Rate, as determined by Lender, having a maturity on
         or near the last day of the then applicable Interest Period (the
         "Benchmark Rate"; as computed separately for each outstanding maturity
         or installment), which product shall be multiplied by (iii) a fraction,
         the numerator of which is the number of days from the date of the
         Prepayment to the last day of the applicable Interest Period (or, if
         applicable, each Interest Period) and the denominator of which is 360
         days; HOWEVER, if or to the extent that the applicable Adjusted LIBOR
         Rate for the applicable Interest Period (computed separately for each
         maturity or installment) is equal to or less than the Benchmark Rate,
         no "breakage" fee shall be payable; plus

                  (C) If the Prepayment occurs within the first twelve (12)
         months of the term of the Loan, Borrower shall pay Lender for the
         privilege of making the Prepayment a Pre-Payment Fee equal to two
         percent (2%) of the outstanding principal balance of this Note or, if
         the Prepayment occurs after the one year anniversary of the Note but
         before the second year anniversary of the Note, Borrower shall pay
         Lender a Prepayment Fee equal to one-half percent (.5%) of the
         outstanding principal balance of this Note; provided, however, no
         Prepayment Fee under this clause (C) shall be due if the Prepayment is
         the result of the application by Lender of casualty or condemnation
         proceeds. After the second anniversary of this Note, no Prepayment Fee
         under this clause (C) shall be due.

         Once written notice of intention to prepay is given, the Loan, or the
         applicable portion thereof, shall become due and payable in full on the
         date specified in the notice of prepayment and the failure to so prepay
         the Loan on such date, together



                                      -5-
<PAGE>

         with any applicable payments and fees due under this Section 4.10,
         shall constitute an Event of Default.

5.       CERTAIN DEFINITIONS AND PROVISIONS RELATING TO INTEREST RATE.

         5.1. ADJUSTED LIBOR RATE. The Term "Adjusted LIBOR Rate" means for each
         Interest Period applicable to a Eurodollar Advance the rate per annum
         obtained by dividing (i) the LIBOR Rate for such Interest Period, by
         (ii) a percentage equal to one hundred percent (100%) minus the maximum
         reserve percentage (the "Reserve Divisor") applicable during such
         Interest Period under regulations issued from time to time by the Board
         of Governors of the Federal Reserve System or the Central Bank of
         Ireland (or successors to either of them) for determining the maximum
         reserve requirements (including, without limitation, any basic,
         supplemental, marginal and emergency reserve requirements) for Lender
         (or of any subsequent holder of this Note which is subject to such
         reserve requirements) in respect of liabilities or assets consisting of
         or including Eurocurrency liabilities having a term equal to such
         Interest Period. As of the date of this Note, the Reserve Divisor is
         zero. The Adjusted LIBOR Rate shall be adjusted automatically as of the
         effective date of any change in such applicable reserve percentage.

         5.2. BANKING DAY. Other than with reference to "London Banking Day"
         which is separately defined herein, the term "Banking Day" means a day
         on which banks are not required or authorized by law to close in
         Massachusetts or the Republic of Ireland.

         5.3. BUSINESS DAY; SAME CALENDAR MONTH. The term "Business Day" means
         any Banking Day and, if the applicable Business Day relates to the
         determination of any Eurodollar Rate, any London Banking Day. If any
         day on which a payment is due is not a Business Day, then the payment
         shall be due on the next day following which is a Business Day, unless,
         with respect to Eurodollar Advances, the effect would be to make the
         payment due in the next calendar month, in which event such payment
         shall be due on the next preceding day which is a Business Day.
         Further, if there is no corresponding day for a payment in the given
         calendar month (i.e., there is no "February 30th"), the payment shall
         be due on the last Business Day of the calendar month.

         5.4. DOLLARS. The term "Dollars" or "$" means lawful money of the
         United States.

         5.5. EURODOLLAR ADVANCE. The term "Eurodollar Advance" means any
         principal outstanding under this Note which pursuant to this Note bears
         interest at the Eurodollar Rate.


                                      -6-
<PAGE>

         5.6. EURODOLLAR RATE. The term "Eurodollar Rate" means the per annum
         rate equal to the Adjusted LIBOR Rate plus two hundred (200) basis
         points.

         5.7. INTEREST PERIOD. The term "Interest Period" means with respect to
         each Eurodollar Advance: a period of one (1), three (3), six (6) or
         twelve (12) consecutive months, subject to availability, as selected by
         Borrower hereunder at least three (3) Business Days prior to a Loan
         Advance, or if an Advance is already outstanding, at least three (3)
         Business Days prior to the end of the current Interest Period. Each
         such Interest Period shall commence on the Business Day so selected by
         Borrower and shall end on the numerically corresponding day in the
         first, third, sixth or twelfth month thereafter, as applicable.
         PROVIDED, HOWEVER: (i) if there is no such numerically corresponding
         day, such Interest Period shall end on the last Business Day of the
         applicable month, (ii) if the last day of such an Interest Period would
         otherwise occur on a day which is not a Business Day, such Interest
         Period shall be extended to the next succeeding Business Day; but (iii)
         if such extension would otherwise cause such last day to occur in a new
         calendar month, then such last day shall occur on the next preceding
         Business Day. No Interest Period may be selected which would end beyond
         the then Maturity Date of the Loan (as actually extended).

         5.8. LIBOR RATE. The term "LIBOR Rate" shall mean, as applicable to any
         Eurodollar Advance, the rate per annum (rounded upward, if necessary,
         to the nearest 1/32 of one percent) as determined on the basis of the
         offered rates for deposits in U.S. dollars, for a period of time
         comparable to such Eurodollar Advance which appears on the Telerate
         page 3750 as of 11:00 a.m. London time on the day ("Rate Setting Date")
         that is two London Banking Days preceding the first day of such
         Eurodollar Advance.

         If the Telerate system is unavailable for determining the "LIBOR Rate",
         as aforesaid, then the LIBOR Rate shall be determined by Lender as the
         prevailing rate per annum at which deposits in U.S. dollars are offered
         to Lender by first-class banks in the interbank eurodollar market in
         which Lender regularly participates on or about 11:00 a.m. Dublin time
         on each Rate Setting Date for an amount and period of time comparable
         to such Eurodollar Advance.

         5.9. LONDON BANKING DAY. The term "London Banking Day" means any day on
         which dealings in deposits in Dollars are transacted in the London
         interbank market.

         5.10.    [Intentionally Deleted]

         5.11 PRIME RATE. The term "Prime Rate" means the per annum rate of
         interest so designated from time to time by Fleet National Bank, or its
         successors, as its



                                      -7-
<PAGE>

         prime rate. The Prime Rate is a reference rate and does not necessarily
         represent the lowest or best rate being charged to any customer.

         5.12 VARIABLE RATE. The term "Variable Rate" means a per annum rate
         equal at all times to the Prime Rate plus twenty-five (25) basis
         points, with changes therein to be effective simultaneously with any
         change in the Prime Rate.

         5.13 VARIABLE RATE ADVANCE. The term "Variable Rate Advance" means any
         principal amount outstanding under this Note which pursuant to this
         Note bears interest at the Variable Rate.

6.       ADDITIONAL PROVISIONS RELATED TO INTEREST RATE SELECTION.

6.1 In the event that (i) on any date on which the Eurodollar Rate would
otherwise be set Lender shall have determined in good faith (which determination
shall be final and conclusive) that adequate and fair means do not exist for
ascertaining the Adjusted LIBOR Rate, or (ii) at any time Lender shall have
determined in good faith (which determination shall be final and conclusive)
that:

         (a) the continuation of the Eurodollar Rate has been made impracticable
         or unlawful by (1) the occurrence of a contingency that materially and
         adversely affects the interbank eurodollar market or (2) compliance by
         the Lender in good faith with any applicable law or governmental
         regulation, guideline or order or interpretation or change thereof by
         any governmental authority charged with the interpretation or
         administration thereof or with any request or directive of any such
         governmental authority (whether or not having the force of law); or

         (b) the Eurodollar Rate shall no longer represent the effective cost to
         the Lender for U.S. dollar deposits in the interbank market for
         deposits in which it regularly participates;

then, and in any such event, Lender shall forthwith so notify the Borrower
thereof. Until the Lender notifies the Borrower that the circumstances giving
rise to such notice no longer apply, the Eurodollar Rate shall not be available,
and all Eurodollar Advances shall be converted into Variable Rate Advances
without any breakage or other costs to Borrower.

         In case any change in law, regulation, treaty or official directive or
the interpretation or application thereof by any court or by any governmental
authority charged with the administration thereof or the compliance with any
guideline or request of any central bank or other governmental authority
(whether or not having the force of law):


                                      -8-
<PAGE>

         (i) subjects the Lender to any tax with respect to payments of
         principal or interest or any other amounts payable hereunder by the
         Borrower or otherwise with respect to the transactions contemplated
         hereby (except for taxes on the overall net income of the Lender
         imposed by any nation or any political subdivision thereof), including
         any withholding tax or deduction imposed by the United States of
         America or any political subdivision thereof, or

         (ii) imposes, modifies or deems applicable any deposit insurance,
         reserve, special deposit or similar requirement against assets held by,
         or deposits in or for the account of, or loans by Lender (other than
         such reserve requirements as are already included in the definition of
         the Eurodollar Rate), or

         (iii) imposes upon Lender any other condition with respect to its
         performance under this Note,

and the result of any of the foregoing is to increase the cost to Lender, reduce
the income receivable by Lender or impose any expense upon Lender with respect
to the loan evidenced by this Note, Lender shall notify the Borrower thereof in
accordance with the provisions of the Loan Agreement. The Borrower agrees to pay
to Lender the amount of such increase in cost, reduction in income or additional
expense as and when such cost, reduction or expense is incurred or determined,
within ten (10) days of presentation by Lender of a statement in the amount and
setting forth Lender's explanation for and calculation thereof, which statement
shall be deemed true and correct absent manifest error. Failure to make any such
payment shall be an Event of Default.

         6.2 ILLEGALITY. Notwithstanding any other provision of this Note, if
         the introduction of or change in or in the interpretation of any law,
         treaty, statute, regulation or interpretation thereof shall make it
         unlawful, or any central bank or government authority shall assert by
         directive, guideline or otherwise, that it is unlawful, for Lender to
         make or maintain Eurodollar Advances or to continue to fund or maintain
         Eurodollar Advances then, on written notice thereof and demand by
         Lender to Borrower, (a) the obligation of Lender to make Eurodollar
         Advances and to convert or continue any Loan Advances as Eurodollar
         Advances shall terminate, and (b) Borrower shall convert all principal
         outstanding under this Note into Variable Rate Advances. Borrower
         agrees, promptly upon demand, to compensate Lender for any reasonable
         costs incurred by Lender in making any conversion required by this
         Section 6.2 to be made prior to the expiration of an applicable
         Interest Period for a Eurodollar Advance.

         6.4. VARIABLE RATE ADVANCES. Each Variable Rate Advance shall continue
         as a Variable Rate Advance until the Maturity of the Loan, unless
         sooner converted by Borrower pursuant to Section 3.1.1 hereof, in whole
         or in part, to a Eurodollar Advance, subject to the limitations and
         conditions set forth in this Note.


                                      -9-
<PAGE>

         6.5. EXTENSION OF EURODOLLAR ADVANCES. At the end of each applicable
         Interest Period, the applicable Eurodollar Advance shall be converted
         to a Variable Rate Advance unless Borrower selects another Eurodollar
         Interest Period option in accordance with the provisions of this Note.

7.       ACCELERATION: EVENT OF DEFAULT.

         At the option of the holder, this Note and the indebtedness evidenced
hereby shall become immediately due and payable without further notice or
demand, and notwithstanding any prior waiver of any breach or default, or other
indulgence, upon the occurrence at any time of any one or more of the following
events, each of which shall be an "Event of Default" hereunder and under the
Loan Agreement and each other Loan Document: (i) default continuing uncured
beyond the applicable notice and grace period, if any, set forth in the Loan
Agreement, in making any payment of interest, principal, other charges or
payments due hereunder; (ii) default continuing uncured beyond the applicable
notice and grace period, if any, set forth therein under the Security Deed, or
the Assignment of Leases and Rents or any other Loan Document, each as the same
may from time to time hereafter be amended; (iii) an Event of Default as defined
in or as set forth in the Loan Agreement or any other Loan Document, each as the
same may from time to time hereafter be amended; or (iv) an event which pursuant
to any express provision of the Loan Agreement, or of any other Loan Document,
gives Lender the right to accelerate the Loan.

8.       CERTAIN WAIVERS, CONSENTS AND AGREEMENTS.

         Each and every party liable hereon or for the indebtedness evidenced
hereby whether as maker, endorser, guarantor, surety or otherwise hereby: (a)
waives presentment, demand, protest, suretyship defenses and defenses in the
nature thereof, (b) waives any defenses based upon and specifically assents to
any and all extensions and postponements of the time for payment, changes in
terms and conditions and all other indulgences and forbearances which may be
granted by the holder to any party now or hereafter liable hereunder or for the
indebtedness evidenced hereby; (c) agrees to any substitution, exchange,
release, surrender or other delivery of any security or collateral now or
hereafter held hereunder or in connection with the Loan Agreement, or any of the
other Loan Documents, and to the addition or release of any other party or
person primarily or secondarily liable; (d) agrees that if any security or
collateral given to secure this Note or the indebtedness evidenced hereby or to
secure any of the obligations set forth or referred to in the Loan Agreement, or
any of the other Loan Documents, shall be found to be unenforceable in full or
to any extent, or if Lender or any other party shall fail to duly perfect or
protect such collateral, the same shall not relieve or release any party liable
hereon or thereon nor vitiate any other security or collateral given for any
obligations evidenced hereby or thereby; (e) agrees to pay all reasonable third
party costs and expenses incurred by Lender or any other holder of this Note in
connection with the indebtedness evidenced hereby, including, without
limitation, all reasonable attorneys'



                                      -10-
<PAGE>

fees and costs: (i) for the administration and implementation of the Loan; (ii)
for the collection of the indebtedness evidenced hereby and (iii) for the
enforcement of rights and remedies hereunder or under the other Loan Documents,
whether or not suit is instituted; and (f) consents to all of the terms and
conditions contained in this Note, the Loan Agreement, the Security Deed, the
Assignment of Leases and Rents, and all other instruments now or hereafter
executed evidencing or governing all or any portion of the security or
collateral for this Note and for such Loan Agreement, or any one or more of the
other Loan Documents, including, without limitation, any rights of setoff held
by holder under the Loan Documents or at law.

9.       DELAY NOT A BAR.

         No delay or omission on the part of the holder in exercising any right
hereunder or any right under any instrument or agreement now or hereafter
executed in connection herewith, or any agreement or instrument which is given
or may be given to secure the indebtedness evidenced hereby or by the Loan
Agreement, or any other agreement now or hereafter executed in connection
herewith or therewith shall operate as a waiver of any such right or of any
other right of such holder, except as expressly set forth therein, nor shall any
delay, omission or waiver on any one occasion be deemed to be a bar to or waiver
of the same or of any other right on any future occasion.

10.      PARTIAL INVALIDITY.

         The invalidity or unenforceability of any provision hereof, of the Loan
Agreement, of the other Loan Documents, or of any other instrument, agreement or
document now or hereafter executed in connection with the Loan made pursuant
hereto and thereto shall not impair or vitiate any other provision of any of
such instruments, agreements and documents, all of which provisions shall be
enforceable to the fullest extent now or hereafter permitted by law.

11.      COMPLIANCE.

         All agreements between Borrower and Lender are hereby expressly limited
so that in no contingency or event whatsoever, whether by reason of acceleration
of maturity of the indebtedness evidenced hereby or otherwise, shall the amount
paid or agreed to be paid to Lender for the use of the indebtedness evidenced
hereby exceed the maximum permissible interest rate under applicable law. As
used herein, the term "applicable law" shall mean the law in effect as of the
date hereof, PROVIDED, HOWEVER, that in the event there is a change in the law
which results in a higher permissible rate of interest, then this Note shall be
governed by such new law as of its effective date. In this regard, it is
expressly agreed that it is the intent of Borrower and Lender, in the execution,
delivery and acceptance of this Note, to contract in strict compliance with the
laws of the Commonwealth of Massachusetts from time to time in effect. If, under
or from any circumstances whatsoever, fulfillment of any provision hereof or of
any of the Loan



                                      -11-
<PAGE>

Documents or the Security Documents at the time performance of such provision
shall be due, shall involve transcending the limit of validity prescribed by
applicable law, then the obligation to be fulfilled shall automatically be
reduced to the limit of such validity, and if under or from any circumstances
whatsoever Lender should ever receive as interest an amount which would exceed
the highest lawful rate, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced hereby and not to
the payment of interest. This provision shall control every other provision of
all agreements between Borrower and the Lender.

12.      USE OF PROCEEDS.

         All proceeds of the Loan shall be used solely for the purposes more
particularly provided for and limited by the Loan Agreement.

13.      SECURITY.

         This Note is secured by a Construction Mortgage and Security Agreement,
and an Assignment of Leases and Rents to be recorded at Middlesex South County
Registry of Deeds and filed with Middlesex South County District of the Land
Court, which relate to property located at 830 Winter Street, Waltham,
Massachusetts, and as more particularly described in said mortgage, and is
further secured by other collateral as set forth in the Loan Agreement.

14.      NOTICES.

         Any notices given with respect to this Note shall be given in the
manner provided for in the Loan Agreement.

15.      GOVERNING LAW AND CONSENT TO JURISDICTION.

         15.1. SUBSTANTIAL RELATIONSHIP. It is understood and agreed that all of
         the Loan Documents were negotiated, executed and delivered in the
         Commonwealth of Massachusetts, which Commonwealth the parties agree has
         a substantial relationship to the parties and to the underlying
         transactions embodied by the Loan Documents.

         15.2. PLACE OF DELIVERY. Borrower agrees to furnish to Lender at
         Lender's office in Boston, Massachusetts all further instruments,
         certifications and documents to be furnished hereunder.

         15.3. GOVERNING LAW. This Note and each of the other Loan Documents
         shall in all respects be governed, construed, applied and enforced in
         accordance with the internal laws of the Commonwealth of Massachusetts
         without regard to principles of conflicts of law.


                                      -12-
<PAGE>

         15.4. CONSENT TO JURISDICTION. Borrower hereby consents to personal
jurisdiction in any state or Federal court located within the Commonwealth of
Massachusetts.

16.      WAIVER OF JURY TRIAL.

         BORROWER, AND LENDER MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR ANY OTHER
LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE
OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR LENDER
TO ACCEPT THIS NOTE AND MAKE THE LOAN.

17.      NO ORAL CHANGE.

         Except as otherwise provided pursuant to Section 3.3 hereof, this Note
and the other Loan Documents may only be amended, terminated, extended or
otherwise modified by a writing signed by the party against which enforcement is
sought. In no event shall any oral agreements, promises, actions, inactions,
knowledge, course of conduct, course of dealing, or the like be effective to
amend, terminate, extend or otherwise modify this Note or any of the other Loan
Documents.

18.      RIGHTS OF THE HOLDER; REPLACEMENT NOTE.

         Lender shall have the right to pledge, sell, assign or grant
participation interests in and to the Loan and Loan Documents, as set forth in
the Loan Agreement.

         This Note and the rights and remedies provided for herein may be
enforced by Lender or any subsequent holder hereof. Wherever the context permits
each reference to the term "holder" herein shall mean and refer to Lender
holding this Note or any subsequent holder of this Note.

         Upon receipt of an affidavit of an officer of Lender as to the loss,
theft, destruction or mutilation of this Note or any other security document
which is not of public record, and, in the case of any such loss, theft,
destruction or mutilation, upon cancellation of such Note or other security
document, Borrower will issue, in lieu thereof, a replacement Note or other
security document in the same principal amount thereof and otherwise of like
tenor.



                                      -13-
<PAGE>

         IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed
as of the date set forth above as a sealed instrument at Boston, Massachusetts.



                                       BORROWER:

                                       830 WINTER STREET LLC,
                                       a Delaware limited liability company

                                       By:      PRAECIS PHARMACEUTICALS
                                                INCORPORATED, a Delaware
                                                corporation, its sole member


Witness: /s/ Mary E. DeLena            By: /s/ KEVIN F. MCLAUGHLIN
        ---------------------              ----------------------------------
                                           Name:    KEVIN F. MCLAUGHLIN
                                                 ----------------------------
                                           Title:   SENIOR VICE PRESIDENT
                                                 ----------------------------
                                           Hereunto duly authorized


                                                                       [COPY]




                                      -14-
<PAGE>

                  CONSTRUCTION MORTGAGE AND SECURITY AGREEMENT


830 Winter Street
Waltham, Massachusetts

         KNOW ALL MEN BY THESE PRESENTS that 830 WINTER STREET LLC, a Delaware
Limited Liability Company having an address at c/o PRAECIS PHARMACEUTICALS
INCORPORATED, One Hampshire Street, Cambridge, Massachusetts 02139 (hereinafter
called "Mortgagor" or "Borrower") for consideration paid, hereby grants,
conveys, transfers, assigns and sets-over unto ANGLO IRISH BANK CORPORATION PLC
("Lender" or "Mortgagee" herein) having a place of business at Stephen Court,
18-21 St. Stephen's Green, Dublin 2, Ireland, the Lender under an Acquisition
and Construction Loan Agreement (hereinafter called "Loan Agreement") of even
date between Borrower and Lender with MORTGAGE COVENANTS, UPON THE STATUTORY
CONDITION AND WITH THE STATUTORY POWER OF SALE the Mortgaged Property (as
defined below) to secure the Obligations (as defined below).

         The terms "Borrower" and "Mortgagor" shall include wherever the context
permits its successors and assigns (provided, however, the foregoing statement
is not intended to derogate from any restrictions set forth in the Loan
Agreement or other Loan Documents on the transfer by Borrower of its interests
in the Mortgaged Property or other Collateral or the transfer of interests in
the Borrower). The terms "Lenders" or "Mortgagee" shall include, wherever the
context permits, its respective successors and assigns as the holder for the
time being of this Construction Mortgage and Security Agreement and the Note (as
defined below) and other Obligations hereby secured.

         This Construction Mortgage and Security Agreement is granted pursuant
to the terms, provisions and conditions of the Loan Agreement. Capitalized terms
used herein which are not otherwise specifically defined shall have the same
meaning herein as in the Loan Agreement.

         The term "Mortgaged Property" shall mean and include all of the
following described property:

         A. REAL ESTATE. The land more particularly described on EXHIBIT A which
is annexed hereto and made a part hereof ("Land") together with the improvements
and other structures now or hereafter situated thereon (such improvements being
sometimes called the "Improvements") commonly known as and numbered 830 Winter
Street, Middlesex County, Waltham, Massachusetts, together with all rights,
privileges, tenements, hereditaments, appurtenances, easements, including, but
not limited to, rights and easements for access and egress and utility
connections, and other rights now or hereafter appurtenant thereto ("Real
Estate");

         B. FIXTURES. All real estate fixtures or items which by agreement of
the parties may be deemed to be such fixtures, now or hereafter owned by
Borrower, or in which Borrower has



                                      -1-
<PAGE>

or hereafter obtains an interest, and now or hereafter located in or upon the
Real Estate, or now or hereafter attached to, installed in, or used in
connection with any of the Real Estate, including, but not limited to, any and
all portable or sectional buildings, bathroom, plumbing, heating, lighting,
refrigerating, ventilating and air-conditioning apparatus and equipment, garbage
incinerators and receptacles, elevators and elevator machinery, boilers,
furnaces, stoves, tanks, motors, sprinkler and fire detection and extinguishing
systems, doorbell and alarm systems, window shades, screens, awnings, screen
doors, storm and other detachable windows and doors, mantels, partitions,
built-in cases, counters and other fixtures whether or not included in the
foregoing enumeration ("Fixtures");

         C. ADDITIONAL APPURTENANCES. All bridges, easements, rights of way,
licenses, privileges, hereditaments, permits and appurtenances hereafter
belonging to or enuring to the benefit of the Real Estate and all right, title
and interest of Borrower in and to the land lying within any street or roadway
adjoining any of the Real Estate and all right, title and interest of Borrower
in and to any vacated or hereafter vacated streets or roads adjoining any of the
Real Estate and any and all reversionary or remainder rights ("Additional
Appurtenances");

         D. AWARDS. All of the right, title and interest of Borrower in and to
any award or awards heretofore made or hereafter to be made by any municipal,
county, state or federal authorities to the present or any subsequent owners of
any of the Real Estate or the Land, or the Improvements, or the Fixtures, or the
Additional Appurtenances, or the Leases or the Personal Property, including,
without limitation, any award or awards, or settlements or payments, or other
compensation hereafter made resulting from (x) condemnation proceedings or the
taking of the Real Estate, or the Land, or the Improvements, or the Fixtures, or
the Additional Appurtenances, or the Leases or the Personal Property, or any
part thereof, under the power of eminent domain, or (y) the alteration of grade
or the location or discontinuance of any street adjoining the Land or any
portion thereof, or (z) any other injury to or decrease in value of the
Mortgaged Property ("Awards");

         E. LEASES. All leases now or hereafter entered into of the Real Estate,
or any portion thereof, and all rents, issues, profits, revenues, earnings and
royalties therefrom, and all right, title and interest of Borrower thereunder,
including, without limitation, cash, letters of credit, or securities deposited
thereunder to secure performance by the tenants or occupants of their
obligations thereunder, whether such cash, letters of credit, or securities are
to be held until the expiration of the terms of such leases or occupancy
agreements or applied to one or more of the installments of rent coming due
prior to the expiration of such terms including, without limitation, the right
to receive and collect the rents thereunder ("Leases");

         F. PERSONAL PROPERTY. All tangible and intangible personal property now
owned or at any time hereafter acquired by Borrower of every nature and
description, and used in any way in connection with the Real Estate, the
Fixtures, the Additional Appurtenances, or any other portion of the Mortgaged
Property, including, without limitation express or implied upon the generality
of the foregoing, all Equipment, Goods, Inventory, Fixtures, Accounts,
Instruments, Documents and General Intangibles (as each such capitalized term is
defined in the Uniform Commercial



                                      -2-
<PAGE>

Code in effect in the state where the Real Estate is situated) and further
including, without any such limitation, the following whether or not included in
the foregoing: materials; supplies; furnishings; chattel paper; money; bank
accounts; security deposits; utility deposits; any insurance or tax reserves
deposited with Lender; any cash collateral deposited with Agent; claims to
rebates, refunds or abatements of real estate taxes or any other taxes; contract
rights; plans and specifications; licenses, permits, approvals and other rights;
the rights of Borrower under contracts with respect to the Real Estate or any
other portion of the Mortgaged Property; signs, brochures, advertising, the
address by which the Mortgaged Property is known and any variation of the words
thereof, and good will; copyrights, service marks, and all goodwill associated
therewith; and trademarks; all proceeds paid for any damage or loss to all or
any portion of the Real Estate, the Fixtures, the Additional Appurtenances, any
other Personal Property or any other portion of the Mortgaged Property
("Insurance Proceeds"); all Awards; all Leases; all books and records; and all
proceeds, products, additions, accessions, substitutions and replacements to any
one or more of the foregoing (collectively, the "Personal Property").

         The term "Obligations" shall mean and include:

         A. The payment of the principal sum, interest at variable rates,
charges and indebtedness evidenced by a promissory note or notes ("Note") dated
as of even date herewith, including any extensions, renewals, replacement or
replacements, modifications and amendments thereof, in the aggregate original
amount of THIRTY THREE MILLION DOLLARS ($33,000,000.00) given by Borrower to the
order of Lender;

         B. The payment, performance, discharge and satisfaction of each
covenant, warranty, representation, undertaking and condition to be paid,
performed, satisfied and complied with by Borrower under and pursuant to this
Mortgage or the Loan Agreement and also by Borrower under and pursuant to each
of the other Loan Documents referred to in, or executed in connection with, the
Loan Agreement;

         C. The payment of all costs, expenses, legal fees and liabilities
incurred by Lender in connection with the enforcement of any of Lender's rights
or remedies under this Mortgage, the other Loan Documents, or any other
instrument, agreement or document which evidences or secures any other
Obligations or collateral therefor, whether now in effect or hereafter executed;
and

         D. The payment, performance, discharge and satisfaction of all other
liabilities and obligations of Borrower to Lender, whether now existing or
hereafter arising, direct or indirect, absolute or contingent, and including,
without limitation express or implied upon the generality of the foregoing, each
liability and obligation of Borrower under any one or more of the Loan Documents
and any amendment, extension, modification, replacement or recasting of any one
or more of the instruments, agreements and documents referred to herein or
therein or executed in connection with the transactions contemplated hereby or
thereby.

         This instrument is sometimes referred to as "this Mortgage".



                                      -3-
<PAGE>

         Borrower hereby grants to Lender a continuing security interest in all
of the Mortgaged Property in which a security interest may be granted under the
Uniform Commercial Code as such is in effect in the Commonwealth of
Massachusetts including, without limitation, the Fixtures and the Personal
Property, together with all proceeds and products, whether now or at any time
hereafter acquired and used in any way in connection with the development,
construction, marketing or operation of the Real Estate, or in connection with
the Land and Improvements, to secure all Obligations.

         This instrument is intended to take effect as a construction mortgage
pursuant to Massachusetts General Laws, Chapter 106, Section 9-313 and a
security agreement pursuant to Massachusetts General Laws, Chapter 106, Section
9-101 et seq. and is to be filed with the Middlesex (South) County Registry of
Deeds and the Middlesex (South) County Registry District of the Land Court as a
financing statement pursuant to said General Laws Chapter 106, Section 9-402.

         Borrower covenants, warrants, represents and agrees with Lender, its
successors and assigns, that:

         1. TITLE. Borrower has good record and marketable title to the
Mortgaged Property and has good right, full power and lawful authority to grant
and convey the same in the manner aforesaid; and that the Mortgaged Property are
free and clear of all encumbrances and exceptions, except for the Permitted
Title Exceptions, if any, as set forth on EXHIBIT B which is annexed hereto and
made a part hereof. Borrower shall make any further assurances of title that
Lender may in good faith require including, without limitation, such further
instruments as may be reasonably requested by Lender to confirm the assignment
to Lender of all Awards.

         2. PERFORMANCE OF OBLIGATIONS. Borrower shall pay the Note and interest
thereon as the same shall become due and payable, and pay and perform and
observe all of the obligations and conditions set forth in each of the Note,
this Mortgage, the Assignment of Leases and Rents, the Loan Agreement, and each
of the other Loan Documents or other agreements, if any, executed by Borrower in
connection with the Loan.

         3. PROTECTION AND MAINTENANCE. Borrower shall protect and maintain, or
cause to be maintained, in good, and substantial order, repair and tenantable
condition at all times the Improvements now standing or hereafter erected on the
Mortgaged Property, and any additions and improvements thereto, and all Personal
Property now or hereafter situated therein, and the utility services, the
parking areas and access roads, and all building fixtures and equipment and
articles of personal property now or hereafter acquired and used in connection
with the operation of the Mortgaged Property. Borrower shall promptly replace
any of the aforesaid which may become lost, destroyed or unsuitable for use with
other first-class property of similar character.


                                      -4-
<PAGE>

         4. INSURANCE COVERAGES. Borrower shall insure the Mortgaged Property
and the operation thereof with such coverages and in such amounts as are
required by the provisions of the Loan Agreement and shall at all times keep
such insurance in full force and effect and pay all premiums therefor annually,
in advance. The original or certified copies of all such policies of insurance
(or certificates or binders thereof issued by the insurer in form, content and
manner of execution reasonably satisfactory to Lender) shall be delivered to
Lender and Borrower shall deliver to the Lender a new policy or certified copy
thereof (or such a certificate) as replacement for an expiring policy (or such a
certificate) required to be deposited hereunder together with proof of payment
of the premiums therefor annually in advance at least twenty (20) days before
the date of such expiration. Borrower hereby irrevocably appoints Lender its
true and lawful attorney-in-fact, with full power of substitution, to assign any
such policy in the event of the foreclosure of this Mortgage.

         5. INSURANCE PROCEEDS. Subject to the provisions of the Loan Agreement
relating to the application of insurance proceeds, the proceeds of any hazard
insurance shall be applied to or toward the indebtedness secured hereby in such
order as Lender may determine. Notwithstanding anything in this Section 5 to the
contrary, however, if the insurer denies liability to Borrower, Borrower shall
not be relieved of any obligation under Section 3 of this Mortgage.

         6. EMINENT DOMAIN. Subject to the provisions of the Loan Agreement
relating to the application of condemnation proceeds, the Awards of damages on
account of any condemnation for public use of, or injury to, the Mortgaged
Property shall be paid to Lender; such Awards shall, at the option of Lender, be
applied to or toward the indebtedness secured hereby in such order as the Lender
may determine in accordance with the terms of the Loan Agreement, or, in the
case of a partial taking, at Lender's discretion, may be so applied or released
to Borrower upon such conditions as Lender may prescribe to be applied to
restoration of that part of the Mortgaged Property which remains, but not more
than such portion of such Awards as may be required to restore or repair such
damage or injury shall be so released; and any balance remaining shall be
applied by Lender to or toward the indebtedness secured hereby in such order as
Lender may determine.

         7. NO WASTE; COMPLIANCE WITH LAW. Borrower shall not commit or suffer
any strip or waste of the Mortgaged Property, or any material portion thereof,
or any violation of any law, rule, regulation, ordinance, license or permit, or
the requirements of any licensing authority affecting the Mortgaged Property or
any business conducted thereon, and shall not commit or suffer any demolition,
removal or material alteration of any of the Mortgaged Property (except for the
replacement of Fixtures and Personal Property and installation of tenant
improvements in the ordinary course of business, so long as items of comparable
value and quality are installed free and clear of liens in favor of any other
party and except for the work involved in the Renovation Project under, or
otherwise permitted by, the Loan Agreement), without the express prior written
consent of Lender in each instance which consent shall not be unreasonably
withheld or delayed, and shall not violate nor suffer the violation of the
covenants and agreements, if any, of record against the Mortgaged Property, and
in all respects Borrower shall do all things necessary to comply with, and keep
in full force and effect all licenses, permits and



                                      -5-
<PAGE>

other governmental authorizations for the operation of the Mortgaged Property
for its intended purposes, including, without limitation express or implied, the
licenses, permits and authorizations referred to in the Loan Agreement.

         8. ENVIRONMENTAL AND RELATED MATTERS; INDEMNIFICATION. Borrower shall
at all times comply with all of the terms, conditions and provisions imposed on
the Borrower under the Indemnity Agreement and both before and after the
repayment of the Loan, at Borrower's sole cost and expense, indemnify, exonerate
and save harmless Lender and each other Indemnified Party (as defined in the
Indemnity Agreement), against and from all damages, losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, judgments, suits,
proceedings, costs, disbursements or expenses of any kind whatsoever, including,
without limitation, reasonable attorneys' fees and experts' fees and
disbursements which may at any time (including, without limitation, before or
after the discharge or foreclosure of this Mortgage) be imposed upon, incurred
by or asserted or awarded against Lender or any other Indemnified Party and
arising from or out of any of the matters for which indemnification is provided
by Borrower pursuant to the Indemnity Agreement and for the time period set
forth in the Indemnity Agreement or on account of any liability for damage to
person or property arising out of any act, omission, negligence, or conduct at
the Mortgaged Property, or arising or claiming to have arisen, out of any act,
omission, negligence or conduct of Borrower, or any contractor, subcontractor,
tenant, occupant or invitee thereof which is in any way related to the Mortgaged
Property.

         9. PAYMENT OF TAXES AND PREVENTION OF LIENS. Borrower shall pay before
delinquent or before any penalty for nonpayment attaches thereto, all taxes,
assessments and charges of every nature and to whomever assessed that may now or
hereafter be levied or assessed upon the Mortgaged Property or any part thereof,
or upon the rents, issues, income or profits thereof or upon the lien or estate
hereby created, whether any or all of said taxes, assessments or charges be
levied directly or indirectly or as excise taxes or as income taxes. Borrower
may apply for tax abatements and prosecute diligently and in good faith claims
for refund so long as: (i) no additional taxes, interest thereon or penalties
are incurred thereby, (ii) a sufficient tax reserve fund, if any, as reasonably
determined by Lender in good faith has been deposited with Lender, adequate to
cover any and all interest and penalties and (iii) no proceedings are instituted
to divest Borrower of title to all or any portion of the Mortgaged Property.
Borrower shall pay all sums which, if unpaid, may result in the imposition of a
lien on the Mortgaged Property before such lien may attach (except that real
estate taxes need not be paid prior to the date the same become delinquent) or
which may result in conferring upon a tenant of any part or all of the Mortgaged
Property a right to recover such sums as prepaid rent.

         10. DUE ON SALE; NO OTHER ENCUMBRANCES; NO TRANSFER OF OWNERSHIP
INTERESTS; FAILURE TO COMPLY WITH PERMITTED EXCEPTIONS. Except as otherwise
specifically provided for in, or permitted by, the Loan Agreement, or in, or
permitted by, this Mortgage, it shall be an Event of Default under the Loan
Agreement, a breach of the conditions of this Mortgage and an event permitting
Lender to accelerate all indebtedness secured hereby, if, without Lender's prior
written consent in each instance, which consent may be granted, withheld or
conditionally granted in Lender's sole discretion: (a) there is any sale,
conveyance, transfer or encumbrance of,



                                      -6-
<PAGE>

or lien imposed upon, all or any portion of the Mortgaged Property; or (b) there
is any transfer or assignment of, or grant of any security interest in, any of
the direct or indirect ownership interests in Borrower or Guarantor other than a
Permitted Transfer under Section 11.7 of the Loan Agreement; or (c) there is a
failure to comply with a material provision of, or there is a material default
under, any of the Permitted Title Exceptions unless cured within any applicable
grace period provided for in the applicable Permitted Title Exception.

         11. LENDER RIGHTS. If Borrower shall neglect or refuse: (a) to maintain
and keep in good repair the Mortgaged Property or any part thereof as required
by this Mortgage or the Loan Agreement, or (b) to maintain and pay the premiums
for insurance which may be required by this Mortgage or the Loan Agreement, or
(c) to pay and discharge all taxes of whatsoever nature, assessments and charges
of every nature and to whomever assessed, as required by this Mortgage or the
Loan Agreement, or (d) to pay the sums required to be paid by this Mortgage or
the Loan Agreement, or (e) to satisfy any other terms or conditions of this
Mortgage, or any instrument secured hereby, Lender may, at its election in each
instance, but without any obligation whatsoever to do so, upon thirty (30) days'
prior written notice (except in the case of (i) an emergency where there is
danger to person or property, or (ii) required insurance coverage would lapse,
or (iii) an Event of Default exists, in each of which events no notice shall be
required), cause such repairs or replacements to be made, obtain such insurance
or pay said taxes, assessments, charges, and sums, incur and pay reasonable
amounts in protecting its rights hereunder and the security hereby granted, pay
any balance due under any conditional agreement of sale (or lease) of any
property included as a part of the Mortgaged Property, and pay any amounts
asLender deems reasonably necessary or appropriate to satisfy any term or
condition of this Mortgage, which Borrower shall have failed to satisfy, or to
remedy any breach of such term or condition, and any amounts or expenses so paid
or incurred, together with interest thereon from the date immediately following
the fifth (5th) Business Day after an invoice setting forth such amounts and
expenses is received by Borrower, at the Default Rate as provided in the Note or
Loan Agreement. Such amounts and expenses shall be immediately due and payable
by Borrower to Lender and until paid shall be secured hereby equally and
ratably, and the same may be collected as part of said principal debt in any
suit hereon or upon the Note. No payment by Lender shall relieve Borrower from
any default hereunder or impair any right or remedy of Lender consequent
thereon.

         12. TAX RESERVE AND INSURANCE RESERVE. Borrower shall, upon the
reasonable request of Lender from time to time after an Event of Default, pay to
Lender on dates upon which installments of interest are payable under the Note
or the Loan Agreement, such amount as Lender from time to time reasonably
estimates as necessary to create and maintain a reserve fund from which to pay
before the same become due: (a) all taxes, assessments, liens and charges on or
against the Mortgaged Property, and (b) all premiums for insurance policies
which are required by this Mortgage. Such payments, if so requested, shall be
invested in an interest bearing account, to be credited to Borrower, which shall
be held by Lender as collateral for the Obligations, and so long as no Event of
Default exists hereunder or under any of the other Loan Documents, shall be paid
to or for Borrower's benefit as set forth below. Payments from such reserve fund
for said purposes shall be made by Lender prior to the dates any such payment
shall



                                      -7-
<PAGE>

become delinquent. In the event of any Event of Default under the Loan Agreement
or under the terms of this Mortgage, any part or all of such reserve fund may be
applied, at the option of Lender, to cure any such Event of Default or to any
part of the indebtedness hereby secured and, in refunding any part of said
reserve fund, Lender may deal with whomever is the record owner of such property
at that time.

         13. CERTAIN EXPENSES. If any action or proceeding is commenced,
including, without limitation, an action to foreclose this Mortgage or to
collect the debt hereby secured, to which action or proceeding Lender is made a
party by reason of the execution of this Mortgage, or by reason of any
obligation which it secures, or by reason of entry or any other action under
this Mortgage, or if in Lender's reasonable good faith judgment it becomes
necessary in connection with legal proceedings or otherwise to defend or uphold
the mortgage hereby granted or the lien hereby created or any act taken to
defend or uphold the mortgage hereby granted or the lien hereby created or any
act taken under this Mortgage all sums reasonably paid or incurred by Lender for
the expense of any litigation or otherwise, in connection with any rights
created by this Mortgage or any other Loan Document, shall be paid by Borrower,
or may at the option of Lender, if not so paid within ten (10) Business Days
after an invoice therefore is received by Borrower, be added to the debt secured
hereby and shall be secured hereby equally and ratably and shall bear interest
from the date immediately following such ten (10) Business Day period until paid
at the Default Rate set forth in the Note or the Loan Agreement.

         14. REGARDING LEASES. Except as otherwise provided in the Loan
Agreement, Borrower shall not enter into any Leases with respect to the
Mortgaged Property and shall not modify or amend any Leases without Lender's
prior written consent in each instance. As to each lease or occupancy agreement,
Borrower will perform every material obligation of the lessor and, to the extent
commercially reasonable, will use commercially reasonable efforts to enforce
every material obligation of the lessee in the leases in effect with respect to
all or any part or all of the Mortgaged Property and, except as otherwise
provided in the Loan Agreement, Borrower will not: (i) cancel any such Lease,
nor terminate or accept a surrender thereof, or reduce the rent payable
thereunder or modify or amend any such Lease; (ii) accept any prepayment of rent
thereunder (except any rent which may be required to be prepaid by the terms of
any such lease) for more than thirty (30) days; or (iii) enter into any future
Leases, without first obtaining on each occasion the prior written consent of
Lender. No portion of the Mortgaged Property shall be leased or rented for
residential purposes. As to all leases and occupancy agreements, Lender, at its
option from time to time, may require that all security deposits and similar
funds or security provided by a lessee or occupant be deposited with Lender, or
with an escrow agent satisfactory to Lender, subject to the rights of the lessee
or occupant, but otherwise subject to a security interest in favor of Lender.

         15. DECLARATION OF SUBORDINATION. At the option of Lender, which may be
exercised at any time or from time to time, by written notice to Borrower and to
any applicable tenant, this Mortgage shall become subject and subordinate, in
whole or in part (but not with respect to priority of entitlement to insurance
proceeds or condemnation proceeds), to any and all leases of all or any part of
the Mortgaged Property upon the execution by Lender and recording or filing


                                      -8-
<PAGE>

thereof, at any time hereafter in the appropriate registry of deeds wherein the
Mortgaged Property are situated of a unilateral declaration to that effect.

         16. FURTHER ASSIGNMENT BY BORROWER. Borrower hereby further assigns to
Lender as security for the Obligations the lessor's interests in any or all
leases, now or hereafter outstanding, and to the extent it may lawfully do so
Borrower's interests in all agreements, contracts, licenses and permits, now or
hereafter outstanding, affecting all or any portion of the Mortgaged Property.
Borrower shall execute, acknowledge and deliver such further or confirmatory
assignments thereof, by instruments in form satisfactory to the Lender, as
Lender may reasonably require. Borrower hereby authorizes Lender in the event of
foreclosure, to sell and assign said interests to the purchaser at foreclosure,
but, except where Lender has specifically otherwise agreed in writing, neither
such assignment nor any such future assignment shall be construed as binding
Lender to any lease, agreement, contract, license or permit so assigned, or to
impose upon Lender any obligations with respect thereto. Borrower hereby
irrevocably appoints Lender, or any person designated by Lender, the true and
lawful attorney-in-fact of Borrower, with full power of substitution, to
execute, acknowledge and deliver any such assignment on behalf of Borrower which
Borrower fails or refuses to do.

         17. UCC FILING. Borrower upon Lender's written request shall promptly
cause this Mortgage and Security Agreement and any required financing statements
to be recorded and re-recorded, registered and re-registered, filed and re-filed
at such times and places as may be required by law or reasonably deemed
advisable by Lender to create, preserve or protect the priority hereof and of
any lien created hereby upon the Mortgaged Property or any part thereof; and
Borrower shall from time to time do and cause to be done all such things as may
be reasonably required by Lender, or required by law, including all things which
may from time to time be necessary under the Uniform Commercial Code of the
Commonwealth of Massachusetts fully to create, preserve and protect the priority
hereof and of any lien created hereby upon said property. Borrower hereby
irrevocably appoints Lender, or any person designated by Lender, the true and
lawful attorney-in-fact of Borrower, with full power of substitution, to
execute, acknowledge and deliver any such things on behalf of Borrower which
Borrower fails or refuses to do.

         18. RIGHT TO DEAL WITH SUCCESSOR. Lender may, without notice to any
person, deal with any successor in interest of Borrower herein regarding this
Mortgage and the debt hereby secured in all respects as it might deal with
Borrower herein, without in any way affecting the liability hereunder or upon
the debt hereby secured of any predecessor in interest of the person so dealt
with; and no sale of the premises hereby mortgaged, nor any forbearance on the
part of Lender, nor any extension by Lender of the time for payment of the debt
hereby secured, shall operate to release, discharge, modify, change or affect
the original liability of any predecessor in interest of the equity owner at the
time of such sale, forbearance or extension.

         19. ACCELERATION OF DEBT. If there is an Event of Default under the
Note or the Loan Agreement or if an event occurs which pursuant to the Note or
the Loan Agreement entitles



                                      -9-
<PAGE>

Lender to accelerate the Loan, then, at the option of Lender, the entire
indebtedness hereby secured shall become immediately due and payable without
further notice.

         20. ADDITIONAL RIGHTS OF LENDER.

         20.1 ENTER AND PERFORM. Borrower authorizes Lender, in addition to all
other rights granted by law or by this Mortgage, or by any of the other Loan
Documents, upon the occurrence of an Event of Default under the Loan Agreement,
to enter and take possession of all or any part of the Mortgaged Property and to
use, lease, operate, manage and control the same and conduct the business
thereof, and perform lessor's obligations under any lease or Borrower's
obligations under any other agreement affecting all or any part of the Mortgaged
Property, and collect the rents, profits and all receipts of every nature
therefrom as Lender shall deem best.

         20.2 REPAIRS AND IMPROVEMENTS. Upon every such entry as set forth in
Section 20.1 above, Lender may from time to time at the expense of Borrower make
all such repairs, replacements, alterations, additions and improvements to the
Mortgaged Property as Lender may deem proper, but in no event shall Lender be
obligated to do so, and may, but shall not be obligated to, exercise all rights
and powers of Borrower, either in the name of Borrower, or otherwise as Lender
shall determine. Without limitation express or implied upon the generality of
the foregoing, Lender shall have the right to do all things necessary or
desirable in order to keep in full force and effect all applicable licenses,
permits and authorizations and any amendments thereto.

         20.3 PAY COSTS AND EXPENSES. Upon such entry as set forth in Section
20.1 above, Lender may, at its option, but without any obligation to do so, do
any one or more of the following: pay and incur all expenses necessary or deemed
by it appropriate for the holding and operating of the Mortgaged Property, the
conduct of any business thereon, the maintenance, repair, replacement,
alteration, addition and improvement of the Mortgaged Property, including
without limitation payments of taxes, assessments, insurance, wages of employees
connected with the Mortgaged Property or any business conducted thereon, charges
and reasonable compensation for services of Lender, its attorneys and
accountants and all other persons engaged or employed in connection with the
Mortgaged Property or of any business conducted thereon and, in addition,
Lender, at its option, may, but shall not be obligated to, make payments or
incur liability with respect to obligations arising prior to the date it takes
possession.

         20.4 ADD TO SECURED INDEBTEDNESS. All obligations so paid or incurred
by Lender pursuant to this Section 20 shall be reimbursed or paid for by
Borrower within ten (10) Business Days after Borrower's receipt of an invoice
for the costs of the obligations so paid or incurred by Lender and prior to the
repayment thereof shall be added to the debt secured hereby and shall bear
interest at the Default Rate provided for in the Note or the Loan Agreement
commencing on the date immediately following the expiration of such ten (10)
Business Day period, and shall be secured hereby equally and ratably. Lender may
also reimburse itself therefor from the income or receipts of the Mortgaged
Property or any business conducted thereon, or from the sale of all or any
portion of the Mortgaged Property. Lender may also apply toward any of the
Obligations



                                      -10-
<PAGE>

any tax or insurance reserve account, deposit or any sum credited or due from
Lender to Borrower without first enforcing any other rights of Lender against
Borrower or against any endorser or guarantor of any of the Obligations or
against the Mortgaged Property.

         20.5 ATTORNEY-IN-FACT. Upon the occurrence of an Event of Default,
Borrower hereby irrevocably constitutes and appoints Lender, or any person
designated by Lender, for so long as this Mortgage remains undischarged of
record, as attorney-in-fact of Borrower to execute, acknowledge, seal and
deliver all instruments, agreements, deeds, certificates and other documents of
every nature and description in order to carry out or implement the exercise of
Lender's rights hereunder and under the other Loan Documents.

         21. [INTENTIONALLY DELETED]

         22. NOTICES. Any demand, notice or request by either party to the other
shall be given in the manner provided therefor in the Loan Agreement.

         23. LENDER NOT OBLIGATED; CUMULATIVE RIGHTS. Nothing in this instrument
shall be construed as obligating Lender to take any action or incur any
liability with respect to the Mortgaged Property or any business conducted
thereon, and all options given to Lender are for its benefit and shall and may
be exercised in such order and in such combination as Lender in its sole
discretion may from time to time decide.

         24. SEVERABILITY. In case any one or more of the provisions of this
Mortgage, the Note, the Assignment of Leases and Rents, the Loan Agreement, any
of the other Loan Documents, or any other agreement now or hereafter executed in
connection with any one or more of the foregoing are held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision hereof. Each of the provisions of every
such agreement, document or instrument shall be enforceable by Lender to the
fullest extent now or hereafter not prohibited by applicable law.

         25. NO WAIVER. No consent or waiver, express or implied, by Lender to
or of any Default by Borrower shall be construed as a consent or waiver to or of
any other Default at the same time or upon any future occasion.

         26. STATUTORY CONDITION AND POWER OF SALE. This Mortgage is upon the
STATUTORY CONDITION and upon the further condition that all covenants and
agreements of, and conditions imposed upon, Borrower contained herein and in the
Note, the Loan Agreement, and the other instruments and agreements evidencing or
securing the Obligations secured hereby shall be kept and fully performed, for
any breach of which (remaining uncured beyond the grace period, if any, provided
herein or therein, or in the Loan Agreement or in any other Loan Document) Agent
shall have the STATUTORY POWER OF SALE, and upon the further condition that upon
default (remaining uncured as aforesaid) Lender shall have as to the Personal
Property all the rights and remedies of a Secured Party under the Uniform
Commercial Code as now in effect in the Commonwealth of Massachusetts including,
but not limited to, the option to



                                      -11-
<PAGE>

proceed as to both the Real Estate and Personal Property under the law relating
to foreclosure of real estate mortgages, and such further remedies as from time
to time may hereafter be provided in Massachusetts for a Secured Party, and upon
the further condition that all rights of Lender under this Mortgage and the
other Loan Documents as to the Personal Property and the Real Estate may be
exercised together or separately and, at Lender's discretion, in connection with
the exercise by Lender of its rights under any one or more of the Loan
Documents.

         In exercising its power of sale under this instrument, Lender may sell
the Personal Property, or any part thereof, either separately from or together
with the Real Estate and the balance of the Mortgaged Property, or any part
thereof, either as one parcel or unit or in such separate parcels or units, all
as Lender may in its discretion elect; and may so sell the Mortgaged Property,
or the Real Estate, as one parcel or unit or in such separate parcels or units,
all as Lender may in its discretion elect; and may so sell the Mortgaged
Property or any part thereof either separately from or together with the whole
or any part of other collateral which may constitute security for any obligation
secured by the Mortgaged Property, also as Lender may in its discretion elect.
In the event of any separate sale of Personal Property, Lender will give to
Borrower reasonable notice of the time and place of any public sale or of the
time after which any private sale or other intended disposition thereof is to be
made, and such requirement of reasonable notice shall be met if such notice is
mailed postage prepaid to the address of Borrower as provided in the Loan
Agreement at least ten (10) days before the time of the sale or other
disposition.

         27. WAIVERS BY BORROWER. Borrower, to the fullest extent that Borrower
may do so, hereby: (a) agrees that Borrower will not at any time insist upon,
plead, claim or take the benefit or advantage of any law now or hereafter in
force providing for any appraisement, valuation, stay or extension, or any
redemption after foreclosure sale, and waives and releases all rights of
redemption after foreclosure sale, valuation, appraisement, stay of execution,
notice of election to mature or declare due the debt secured hereby; and (b)
waives all rights to a marshaling of the assets of Borrower, including the
Mortgaged Property, or to a sale in inverse order of alienation in the event of
a sale hereunder of the Mortgaged Property, and agrees not to assert any right
under any statute or rule of law pertaining to the marshaling of assets, sale in
inverse order of alienation, or other matters whatever to defeat, reduce or
affect the right of Lender under the terms of this Mortgage or the Note to a
sale of the Mortgaged Property for the collection of the indebtedness evidenced
by the Note without any prior or different resort for collection, or the right
of Lender to the payment of such indebtedness out of the proceeds of sale of the
Mortgaged Property in preference to every other claimant whatever.

         28. BUSINESS LOAN; NOT PERSONAL RESIDENCE; NO CONDOMINIUM OR
COOPERATIVES. Borrower covenants, warrants and represents that all of the
proceeds of the Loan secured hereby shall be used for business or commercial
purposes, none of the proceeds of the Loan secured hereby shall be used for
personal, family or household purposes, and that no individual liable for the
Loan resides or intends to reside in any portion of the Mortgaged Property.
Borrower further covenants that, without the prior written approval of Lender,
Borrower shall not convert the Mortgaged Property into any condominium,
cooperative or the like regime.



                                      -12-
<PAGE>

         29. CERTIFICATION. The undersigned hereby certify that Borrower is a
duly organized, validly existing limited liability company organized and in good
standing under the laws of Delaware and that the execution and delivery hereof
and of all of the other Loan Documents by Borrower has been duly authorized by
all required entity actions and proceedings.

         30. HEADINGS. Headings and captions in this Mortgage are for
convenience and reference only and the words and phrases contained therein shall
in no way be held to explain, modify, amplify or aid in the interpretation,
construction or meaning of any of the provisions hereof.

         31. TIME OF ESSENCE. Time shall be of the essence of each and every
provision of the Loan Agreement, the Note, this Mortgage and each of the other
Loan Documents.

         32. COUNTERPARTS. This Mortgage may be executed in several
counterparts, each of which when executed or delivered is an original, but all
of which together shall constitute one instrument. In making proof of this
Mortgage, it shall not be necessary to produce or account for more than one such
counterpart, which is executed by the party against whom enforcement of this
Mortgage is sought.

         IN WITNESS WHEREOF, Borrower has caused this Mortgage to be duly
executed and delivered at Boston, Massachusetts, as a sealed instrument as of
the 11th day of July, 2000.


Witness:                                 Borrower:
                                         830 WINTER STREET LLC,
                                         a Delaware Limited Liability Company


                                         By:  PRAECIS PHARMACEUTICALS
                                              INCORPORATED,
                                              a Delaware corporation, its sole
                                              member


/s/ Mary E. DeLena                       By:  /s/ KEVIN F. MCLAUGHLIN
---------------------------------             ----------------------------------
                                              Name:    KEVIN F. MCLAUGHLIN
                                                    ----------------------------
                                              Title:   SENIOR VICE PRESIDENT
                                                    ----------------------------
                                              Hereunto duly authorized





                                      -13-
<PAGE>


                          COMMONWEALTH OF MASSACHUSETTS


Suffolk, ss.                                                      July 10, 2000


         Then personally appeared before me the above-named KEVIN F.
MCLAUGHLIN, the SR. VICE PRESIDENT & CFO of PRAECIS PHARMACEUTICALS
INCORPORATED, the sole member of 830 Winter Street LLC (the Borrower
described above) and acknowledged the foregoing instrument to be such
person's free act and deed and the free act and deed of such corporation in
its capacity as such sole member.

                                               /s/ Lisa A. Cobbett
                                               ------------------------------
                                               Notary Public
                                               My Commission Expires: 4/24/05






                                      -14-
<PAGE>


                  EXHIBIT "A" ANNEXED TO AND MADE A PART OF THE
                                  MORTGAGE AND
                               SECURITY AGREEMENT
                         GIVEN BY 830 WINTER STREET LLC

                                LEGAL DESCRIPTION

                                [attached behind]







                                      -15-
<PAGE>


                                   EXHIBIT A

A certain parcel of land off Winter Street, in Waltham, Middlesex County,
Massachusetts, shown as Lot 9 on Land Court Plan No. 30618E, a copy of a portion
of which is filed with the Middlesex South Registry District of the Land Court
with Certificate of Title No. 214324 in Registration Book 1201, Page 174.

Together with the benefit of rights reserved in Easement dated July 14, 1997,
filed as Document No. 1036276, and recorded in Book 27478, Page 136; as
affected by Utility Easement from owners of Lots 2 and 3 on Land Court Plan #
30618C and Lots 2, 3, B and C on Plan #669 of 1997, to Boston Edison Company
and New England Telephone and Telegraph Company, d/b/a Bell Atlantic, dated
August 27, 1998, filed as Document No. 1078157; as further affected by
Reciprocal Access and Utility Easement dated March 25, 1999, filed as
Document No. 1101665 and recorded March 26, 1999, as Instrument No. 503.

Together with the benefit of grant and reservation recited in Reciprocal Access
and Utility Easement with the owner of Lots 5 and 6 on Land Court Plan No.
30618D dated March 31, 1998, filed as Document No. 1061070, and recorded in Book
28405, page 421, affecting areas shown as "Reserved Easement Area" on a plan
entitled "Easement Plan of Land in Waltham, Massachusetts", dated March 30,
1998, recorded therewith; as affected by First Amendment to Reciprocal Access
and Utility Easement and to Reciprocal Easement Agreement dated September 10,
1998, filed as Document No. 1079645, and recorded in Book 29108, Page 346; as
further affected by Reciprocal Access and Utility Easement dated March 25, 1999,
filed as Document No. 1101665 and recorded March 26, 1999, as Instrument No.
503, and by Reciprocal Easement Agreement dated March 25, 1999, filed as
Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of
Lots 5 and 6 on Land Court Plan No. 30618D dated March 31, 1998, filed as
Document No. 1061071, and recorded in Book 28405, Page 443, affecting areas
shown on a plan entitled "Easement Plan of Land in Waltham, Massachusetts",
dated March 30, 1998, recording therewith; as affected by First Amendment to
Reciprocal Access and Utility Easement and to Reciprocal Easement Agreement
dated September 10, 1998, filed as Document No. 1079645, and recorded in Book
29108, Page 346; as further affected by Reciprocal Easement Agreement dated
March 25, 1999, filed as Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of Lot
8 on Land Court Plan No. 30618E dated March 10, 1999, filed as Document No.
1099963.

Together with the benefit of Reciprocal Access and Utility Easement Agreement
with the owner of Lot 8 on Land Court Plan No. 30618E dated March 10, 1999,
filed as Document No. 1099964, and recorded March 10, 1999 as Instrument No.
1121; as further affected by Reciprocal Access and Utility Easement dated
March 25, 1999, filed as Document No. 1101665 and recorded March 26, 1999, as
Instrument No. 503.

Together with the benefit of reciprocal Access and Utility Easement, dated
March 25, 1999, filed as Document No. 1101665.

Together with the benefit of Reciprocal Easement Agreement dated March 25, 1999,
filed as Document No. 1101666.

Together with the benefit of Mutual Covenants Agreement dated March 25, 1999,
filed as Document No. 1101667.

Together with the benefit of Landscape License Agreement dated March 25, 1999,
filed as Document No. 1101668.





<PAGE>


                  EXHIBIT "B" ANNEXED TO AND MADE A PART OF THE
                         MORTGAGE AND SECURITY AGREEMENT
                         GIVEN BY 830 WINTER STREET LLC


                           PERMITTED TITLE EXCEPTIONS












                                      -16-

<PAGE>


                                   EXHIBIT B

Rights granted to owners of Lots 2 and 3 on Land Court Plan #30618C and Lots 2,
3, B and C on Plan #669 of 1997, by Easement dated July 14, 1997, filed as
Document No. 1036276, and recorded in Book 27478, Page 136, affecting areas
shown as "Access & Utility Easement", "Drainage Easement" , and "Drainage
Utility and Sign Easement" on a plan entitled "Easement Plan of Land in Waltham,
Massachusetts", dated June 16, 1997, recorded therewith: as affected by Utility
Easement from Owners of Lots 2 and 3 on Land Court Plan #30618C and Lots 2, 3, B
and C on Plan #669 of 1997, to Boston Edison Company and New England Telephone
and Telegraph Company, d/b/a Bell Atlantic, dated August 27, 1998, filed as
Document No. 1078157; as further affected by Reciprocal Access and Utility
Easement dated March 25, 1999, filed as Document No. 1101665 and recorded March
26, 1999, as Instrument No. 503.

Reciprocal Access and Utility Easement with the owner of Lots 5 and 6 on Land
Court Plan No. 30618D, dated March 31, 1998, filed as Document No. 1061070, and
recorded in Book 28405, Page 421, affecting areas shown as "South Drive Access
and Utility Easement", "Road Drainage Easement", and "MWF Drainage, Utility and
Sign Easement" on a plan entitled "Easement Plan of Land in Waltham,
Massachusetts", dated March 30, 1998, recorded therewith: as affected by First
Amendment to Reciprocal Access and Utility Easement and to Reciprocal Easement
Agreement dated September 10, 1998, filed as Document No. 1079645, and recorded
in Book 29108, Page 346, affecting areas shown as "New MWF Access and Utility
Easement", on a plan entitled "Exhibits B-1 and B-2 Showing Easements to be
created in Waltham, Massachusetts," dated August 12, 1998, recorded therewith:
as further affected by Reciprocal Access and Utility Easement dated March 25,
1999, filed as Document No. 1101665 and recorded March 26, 1999, as Instrument
No. 503, and by Reciprocal Easement Agreement dated March 25, 1999, filed as
Document No. 1101666.

Reciprocal Easement Agreement with the owner of Lots 5 and 6 on Land Court Plan
No. 30618D dated March 31, 1998, filed as Document No. 1061071, and recorded in
Book 28405, Page 443, affecting areas shown on a plan entitled "Easement Plan of
Land in Waltham, Massachusetts", dated March 30, 1998, recorded therewith: as
affected by First Amendment to Reciprocal Access and Utility Easement and to
Reciprocal Easement Agreement dated September 10, 1998, filed as Document No.
1079645, and recorded in Book 29108, page 346, affecting areas shown as "New MWF
Utilities and Slope Easement" and "New MWF Roadway Drainage Easement", on a plan
entitled "Easements to be created in Waltham, Massachusetts," dated August 12,
1998, recorded therewith: as further affected by Reciprocal Easement Agreement
dated March 25, 1999, filed as Document No. 1101666.

Reconfiguration Agreement dated March 31, 1998, filed as Document No. 1061073.

Reciprocal Easement Agreement with the owner of Lot 8 on Land Court Plan No.
30618E, affecting those areas shown on the Survey as "Polaroid Utility
Easement", "Common Drainage Easements A and B", "Polaroid Drainage Easements 1,
2 and 3", "Polaroid Driveway Easement" dated March 10, 1999, filed as Document
No. 1099963, as affected by First Amendment to Reciprocal Easement Agreement
dated as July ___, 2000, filed as Document ____.

Reciprocal Access and Utility Easement Agreement with the owner of Lot 8 on Land
Court Plan No. 30618E dated March 10, 1999, filed as Document No. 1099964, and
recorded March 10, 1999, as Instrument No. 1121, affecting the areas shown on
the Survey as "Auxiliary Easement Area", "MMS Sign Easement" "Drainage Easement"
and "Access and Utility Easement"; as affected by Reciprocal Access and Utility
Easement dated March 25, 1999, filed as Document No. 1101665 and recorded March
26, 1999, as Instrument No. 503.

Reciprocal Access and Utility Easement by and between Best Property Fund, LLC
and Polaroid Corporation affecting the area shown as the "BPF Reserved Easement
Area" on plans entitled "Sketch of Easement in Waltham, Massachusetts," dated
March 19, 1999, prepared by Martinage Engineering Associates, Inc., attached to
this easement which easement is dated March 25, 1999, and filed as Document
1101665.

Reciprocal Easement Agreement by and between Polaroid Corporation and Best
Property Fund, LP, affecting those areas shown on the Survey as "New MWF Slope
Easement", "New MWF Access and Utility Easement", "New MWF Roadway Drainage
Easement" "Polaroid Water/Sewer Easement", "MFW Water/Sewer Easement Area", "MWF
Drainage Easement" dated March 25, 1999, filed as Document No. 1101666.

Mutual Covenants Agreement dated March 25, 1999, filed as Document No. 1101667.

Landscape License Agreement from Polaroid Corporation to Best Property Fund,
L.P., dated March 25, 1999, filed as Document No. 1101668, affecting the area
shown on the Survey as the "BPF Landscaping Area".

<PAGE>

                  COLLATERAL ASSIGNMENT AND SECURITY AGREEMENT
                  IN RESPECT OF CONTRACTS, LICENSES AND PERMITS

1.       PARTIES.

         830 WINTER STREET LLC, a Delaware limited liability company having a
         place of business at c/o PRAECIS PHARMACEUTICALS INCORPORATED, One
         Hampshire Street, Cambridge, Massachusetts 02139 (hereinafter called
         "Borrower") hereby assigns, transfers, sets over, pledges and, if
         applicable, delivers, to ANGLO IRISH BANK CORPORATION PLC ("Lender")
         having a place of business at Stephen Court, 18-21 St. Stephen's Green,
         Dublin 2, Ireland, as Lender under an Acquisition and Construction Loan
         Agreement ("Loan Agreement") of even date between Borrower and Lender,
         and hereby grants to Lender a continuing security interest in the
         Assigned Contracts and Permits (as defined herein) to secure the
         Obligations (as defined herein).

2.       LOAN AGREEMENT; DEFINED TERMS. This collateral assignment and security
         agreement ("Assignment of Contracts" or "Collateral Assignment") is
         given pursuant to the terms, provisions and conditions of the Loan
         Agreement (wherein it is referred to as the "Assignment of Project
         Documents"). The term "Borrower" shall include, wherever the context
         permits, its successors and assigns. The term "Lender" shall include,
         wherever the context permits, its respective successors and assigns as
         the holder for the time being of this Collateral Assignment and the
         Note (as defined herein) and other Obligations hereby secured.
         Capitalized terms not otherwise specifically defined herein shall have
         the same meaning herein as in the Loan Agreement.

3.       ASSIGNED CONTRACTS AND PERMITS. The term "Assigned Contracts and
         Permits" shall mean all of the "Material" contracts, licenses, permits,
         approvals, agreements and warranties, and all of Borrower's right,
         title and interest therein, held directly or indirectly and whether now
         owned or hereafter acquired, and all proceeds and products thereof, and
         all accounts, contract rights and general intangibles related thereto,
         which are in any manner related to either or both of: (i) the land
         ("Land") located at 830 Winter Street, Middlesex County, Waltham,
         Massachusetts (more particularly described in EXHIBIT A hereto) and
         (ii) the improvements on or to be constructed on the Land, together
         with all appurtenant easement areas and rights thereto (such Land and
         improvements together with such easement areas and rights are herein
         called the "Property"). The Assigned Contracts and Permits include, but
         are not limited to, those described on EXHIBIT B which is annexed
         hereto and made a part hereof. For the purposes hereof, the term
         "Material" as applied to any contract or agreement (as opposed to, for
         example, a permit, license or approval) shall mean a contract or
         agreement whose subject matter could reasonably be viewed as involving
         rights and obligations valued at $100,000 or more.



                                      -1-
<PAGE>

4.       OBLIGATIONS. The term "Obligations" shall mean all obligations of
         Borrower to Lender and each Lender, whether now existing or hereafter
         arising, direct or indirect, under each of the following instruments,
         documents and agreements, each dated as of even date herewith and as
         the same may be hereafter modified, replaced, extended or amended: (i)
         the Loan Agreement; (ii) a $33,000,000.00 Promissory Note (the "Note");
         (iii) the Security Deed; (iv) the Assignment of Leases; (v) this
         Assignment; and (vi) each other Loan Document.

5.       COVENANTS, WARRANTIES AND REPRESENTATIONS. Borrower covenants with, and
         warrants and represents to Lender that:

         5.1      Borrower is and shall be the owner of the Assigned Contracts
                  and Permits free and clear of all pledges, liens, security
                  interests and other encumbrances of every nature whatsoever
                  except in favor of Lender;

         5.2      Borrower has the full right, power and authority to assign,
                  and to grant the pledge of and security interest in, the
                  Assigned Contracts and Permits as herein provided;

         5.3      The execution, delivery and performance of this instrument by
                  Borrower does not and will not result in the violation of any
                  mortgage, indenture, contract, instrument, agreement,
                  judgment, decree, order, statute, rule or regulation to which
                  Borrower is subject or by which it or any of its property is
                  bound;

         5.4      Borrower shall not make any other assignment of, or permit any
                  pledge, lien, security interest or encumbrance to exist with
                  respect to Borrower's interest in, the Assigned Contracts and
                  Permits except in favor of Lender, and Borrower shall not
                  otherwise transfer, assign, sell or exchange its interest in
                  the Assigned Contracts and Permits;

         5.5      A true and complete executed counterpart, or certified copy,
                  of each Assigned Contract and Permit which now exists and
                  which is evidenced by a written agreement or document has been
                  delivered to Lender and a true and complete counterpart, or
                  copy, of each Assigned Contract and Permit which becomes
                  effective or is issued in the future shall be promptly
                  delivered to Lender;

         5.6      Each Assigned Contract and Permit presently in existence is in
                  full force and effect, is valid and enforceable in accordance
                  with its terms, has not been modified, and Borrower has not
                  received or delivered any notice which alleges that a default
                  exists thereunder on the part of any party thereto. Each
                  Assigned Contract and Permit which comes into existence after
                  the date hereof shall be valid and enforceable in accordance
                  with its terms, except to the extent enforceability is limited
                  by bankruptcy, insolvency, reorganization, moratorium or other
                  laws relating to or affecting the enforcement of creditors
                  rights and except to the extent that availability of the
                  remedy of specific performance or injunctive



                                      -2-
<PAGE>

                  relief is subject to the discretion of the court before which
                  cure proceedings thereof may be brought;

         5.7      No Assigned Contract and Permit shall be amended, modified or
                  changed in any material respect, have any of its material
                  terms waived by Borrower, or canceled or terminated, without
                  Lender's prior written consent in each instance; and

         5.8      Borrower shall pay and perform all of its obligations under or
                  with respect to each Assigned Contract and Permit and not
                  permit any default by it with respect thereto to remain after
                  notice from the other party thereto of such default, if
                  applicable, and the expiration of any applicable cure period.
                  Borrower shall exercise all commercially reasonable efforts
                  necessary to enforce or secure performance by any other party
                  to any Assigned Contract and Permit.

6.       RIGHTS OF ASSIGNOR PRIOR TO DEFAULT. So long as there is no Event of
         Default, Borrower shall have and may exercise all rights as the owner
         or holder of the Assigned Contracts and Permits which are lawful and
         are not inconsistent with the provisions of the Loan Documents.
         Immediately upon the occurrence of any Event of Default, the right
         described in the preceding sentence shall, at the election of Lender
         exercised from time to time, cease and terminate, and in such event
         Lender is hereby expressly and irrevocably authorized, but not
         required, to exercise every right, option, power or authority inuring
         to Borrower under any one or more of the Assigned Contracts and Permits
         as fully as Borrower could itself.

7.       IRREVOCABLE DIRECTION. Borrower hereby irrevocably directs the
         contracting party to, or grantor or licensor of, any such Assigned
         Contract and Permit, whether identified in EXHIBIT B or otherwise, to
         the extent not prohibited by either such Assigned Contract and Permit
         or applicable law, or to the extent permitted under any recognition or
         other agreement executed by such grantor or licensor, upon demand and
         after notice from Lender of the occurrence of an Event of Default under
         any of the Loan Documents, to recognize and accept Lender as the holder
         of such Assigned Contract and Permit for any and all purposes as fully
         as it would recognize and accept Borrower and the performance of
         Borrower thereunder. Borrower does hereby constitute and appoint
         Lender, while this Assignment remains in force and effect, irrevocably,
         and with full power of substitution and revocation, its true and lawful
         attorney for and in its name, place and stead, after the occurrence of
         such an Event of Default, to demand and enforce compliance with all the
         terms and conditions of the Assigned Contracts and Permits and all
         benefits accrued thereunder, whether at law, in equity or otherwise.

8.       UCC RIGHTS AND REMEDIES. Further, and without limitation of the
         foregoing rights and remedies, upon an Event of Default Lender shall
         have the rights and remedies of a secured party under the Uniform
         Commercial Code, as enacted in Massachusetts, with respect to the
         Assigned Contracts and Permits, in addition to the rights and remedies
         otherwise provided for herein or by law or in equity or in any other
         Loan Document. The



                                      -3-
<PAGE>

         Lender shall give Borrower ten (10) days' prior written notice of the
         time and place of any public sale of any such Assigned Contract and
         Permit or the time after which any private sale or any other intended
         disposition is to be made. After deducting all expenses incurred in
         connection with the enforcement of its rights hereunder, Lender shall
         cause the proceeds of the Assigned Contracts and Permits to be applied
         to the Obligations in such order as Lender may determine and Borrower
         shall remain liable for any deficiency.

9.       INDEMNIFICATION. Borrower hereby agrees to indemnify and to defend and
         hold Lender harmless against and from all liability loss, damage and
         expense, including reasonable attorney's fees, which they may or shall
         incur by reason of this Agreement, or by reason of any action taken by
         Lender hereunder or with respect to the Assigned Contracts and Permits,
         and against and from any and all claims and demands whatsoever which
         may be asserted against Lender by reason of any alleged obligation or
         undertaking on its part to perform or discharge any of the terms,
         covenants and conditions contained in any of the Assigned Contracts and
         Permits; PROVIDED, HOWEVER, that nothing herein shall be construed to
         obligate Borrower to indemnify and hold Lender harmless from and
         against any and all claims, demands, liability, loss or damage
         asserted against, imposed on or incurred by Lender by reason of
         Lender's willful misconduct or gross negligence. Should Lender incur
         any such liability, loss, damage or expense for which it is to be
         indemnified by Borrower as aforesaid, the amount thereof, together
         with interest thereon at the Default Rate of interest under the
         Note, commencing immediately after the tenth (10th) Business Day
         following Borrower's receipt of an invoice (an "Invoice") setting
         forth the amount for which Lender is to be indemnified by Borrower,
         and including, without limitation, all related costs and reasonable
         attorney fees, shall be payable by Borrower to Lender immediately
         after the tenth (10th) Business Day following Borrower's receipt of
         an Invoice, or at the option of Lender, Lender may reimburse itself
         therefor out of any receipts, rents, income or profits of the
         Property collected by Lender before the application of such
         receipts, rents, income or profits to any other Obligations.
         Borrower's obligation to make payments to Lender under this
         indemnification is secured hereby and by the Security Deed and the
         other Loan Documents.

10.      LENDER NOT OBLIGATED. Nothing contained herein or elsewhere shall
         operate to obligate, or be construed to obligate, Lender to perform any
         of the terms, covenants or conditions contained in the Assigned
         Contracts and Permits or otherwise to impose any obligation upon Lender
         with respect to the Assigned Contracts and Permits prior to written
         notice by Lender to Borrower of Lender's election to assume Borrower's
         obligations under one or more of the Assigned Contracts and Permits.
         Prior to written notice from Lender of such election, this Agreement
         shall not operate to place upon Lender any responsibility for the
         operation, control, care, management or repair of the Property or for
         the payment, performance or observance of any obligation, requirement
         or condition under any such Assigned Contract and Permit, or under any
         agreement in respect to any such Assigned Contract and Permit, and the
         execution of this Agreement by Borrower shall constitute conclusive
         evidence that all responsibility for the operation, control, care,
         management and repair of the Property as well as the payment,
         performance



                                      -4-
<PAGE>

         or observance of any obligation, requirement or condition under the
         Assigned Contracts and Permits is and shall be that of Borrower, prior
         to written notice from Lender of such election. At all times Borrower
         retains the obligation to reimburse Lender promptly upon demand or
         otherwise pay when due all obligations incurred in connection with the
         Assigned Contracts and Permits.

11.      FURTHER ASSURANCES; UCC FILINGS. Borrower agrees to execute and deliver
         to Lender, at any time or times during which this Agreement shall be in
         effect, such further instruments as Lender in good faith may deem
         necessary to make effective this Agreement, the security interest
         created hereby and the covenants of Borrower herein contained. To
         evidence such security interest, at the request of Lender, Borrower
         shall, in a form satisfactory to Lender, execute and deliver one or
         more financing statements, and any continuation thereof, pursuant to
         the provisions of the Uniform Commercial Code as enacted in
         Massachusetts, and shall pay the cost for filing thereof.

12.      NO WAIVER; CUMULATIVE RIGHTS. Failure of Lender to avail itself of any
         of the terms, covenants, and conditions of this Agreement for any
         period of time, or at any time or times, shall not be construed or
         deemed to be a waiver of any of its rights hereunder. The rights and
         remedies of Lender under this Assignment are cumulative and are not in
         lieu of, but are in addition to, any other rights and remedies which
         Lender shall have under or by virtue of the Obligations and the Loan
         Documents. The rights and remedies of Lender hereunder may be exercised
         from time to time and as often as such exercise is deemed expedient by
         Lender.

13.      LENDER; RIGHT TO ASSIGN. Borrower agrees that upon any sale or transfer
         by Lender of the Loan Documents pursuant to Section 20 of the Loan
         Agreement and the indebtedness evidenced thereby, or upon any person
         acquiring the Property or any interest therein, Lender may deliver to
         such purchaser or transferee the Assigned Contracts and Permits and may
         assign to such purchaser or transferee the rights of Lender hereunder,
         who shall thereupon become vested with all powers and rights given to
         Lender in respect thereto (and subject to Lender's obligations
         hereunder), and Lender or such Lender shall be forever relieved and
         fully discharged from any liability or responsibility thereafter
         accruing in connection therewith. In no event shall Lender be liable
         with respect to, or on account of, the Assigned Contracts and Permits,
         except for the safekeeping of any instruments delivered to Lender
         pursuant hereto, and Lender shall specifically have no obligation to
         enforce any rights against any contractor, or grantor or issuer.

14.      TERMINATION AND REASSIGNMENT. Upon full payment and performance of the
         obligations and liabilities set forth or contained in this Assignment
         and the other Loan Documents (excluding only any liabilities which
         might arise in the future to the extent such liabilities are to survive
         under the Environmental Indemnity) and simultaneously with the
         discharge of the Security Deed, this Collateral Assignment and Security
         Agreement shall become and be void and of no effect and, in that event,
         upon the request



                                      -5-
<PAGE>

         of Borrower, Lender covenants to promptly execute and deliver to
         Borrower instruments effective to evidence the termination of this
         Agreement and the reassignment (without recourse) to Borrower of the
         Assigned Contracts and Permits and the rights, title, interest, power
         and authority assigned herein.

15.      COPIES OF DEFAULT NOTICES. Borrower agrees to provide Lender promptly,
         but in any event within five (5) Business Days after receipt or
         knowledge thereof by Borrower, with copies of any and all notices
         received by Borrower which allege, either directly or indirectly, that
         Borrower is in default of, or deficient in the performance of the terms
         of any obligation of Borrower under, any Assigned Contract and Permit,
         or that any fact or circumstance exists which could reasonably lead to
         the termination, suspension, revocation or loss of any Assigned
         Contract and Permit.

16.      NOTICES. Any notices given pursuant to this Agreement shall be
         sufficient only if given in the manner provided for in the Loan
         Agreement.

17.      SUCCESSORS AND ASSIGNS. All of the agreements, obligations,
         undertakings, representations and warranties herein made by Borrower
         shall inure to the benefit of Lender and its respective successors and
         assigns and shall bind Borrower and its successors and assigns
         (provided, however, this reference to successors and assigns of
         Borrower is not intended to derogate from any restrictions on such
         succession or assignment otherwise contained in any Loan Document).

18.      CAPTIONS AND HEADINGS. Captions and headings in this Agreement are
         intended solely for the convenience of the parties and shall not be
         considered in the determination of the meaning of any provision hereof.

19.      GOVERNING LAW/COUNTERPARTS. This instrument shall be governed by the
         laws of the Commonwealth of Massachusetts in all respects and may be
         executed in several counterparts, each of which when executed and
         delivered is an original, but all of which together shall constitute
         one instrument. In making proof of this agreement, it shall not be
         necessary to produce or account for more than one such counterpart
         which is executed by the party against whom enforcement of such
         collateral assignment is sought.




                                      -6-
<PAGE>


         IN WITNESS WHEREOF, Borrower has caused this Assignment to be duly
executed and delivered as a sealed instrument as of the 11 day of July, 2000.


WITNESS:                                   BORROWER:

                                           830 WINTER STREET LLC,
                                           a Delaware limited liability company

                                           By:  PRAECIS PHARMACEUTICALS
                                                INCORPORATED,
                                                a Delaware corporation, its sole
                                                member

/s/ Mary Beth DeLena                       By:  /s/ KEVIN F. MCLAUGHLIN
-------------------------------                 --------------------------------
                                                Name:    KEVIN F. MCLAUGHLIN
                                                      --------------------------
                                                Title:   SENIOR VICE PRESIDENT
                                                      --------------------------
                                                Hereunto duly authorized











                                      -7-
<PAGE>

                                    EXHIBIT A

                            LEGAL DESCRIPTION OF LAND

                                [Attached Behind]










                                      A-1
<PAGE>


                                   EXHIBIT A

A certain parcel of land off Winter Street, in Waltham, Middlesex County,
Massachusetts, shown as Lot 9 on Land Court Plan No. 30618E, a copy of a portion
of which is filed with the Middlesex South Registry District of the Land Court
with Certificate of Title No. 214324 in Registration Book 1201, Page 174.

Together with the benefit of rights reserved in Easement dated July 14, 1997,
filed as Document No. 1036276, and recorded in Book 27478, Page 136; as
affected by Utility Easement from owners of Lots 2 and 3 on Land Court Plan #
30618C and Lots 2, 3, B and C on Plan #669 of 1997, to Boston Edison Company
and New England Telephone and Telegraph Company, d/b/a Bell Atlantic, dated
August 27, 1998, filed as Document No. 1078157; as further affected by
Reciprocal Access and Utility Easement dated March 25, 1999, filed as
Document No. 1101665 and recorded March 26, 1999, as Instrument No. 503.

Together with the benefit of grant and reservation recited in Reciprocal Access
and Utility Easement with the owner of Lots 5 and 6 on Land Court Plan No.
30618D dated March 31, 1998, filed as Document No. 1061070, and recorded in Book
28405, page 421, affecting areas shown as "Reserved Easement Area" on a plan
entitled "Easement Plan of Land in Waltham, Massachusetts", dated March 30,
1998, recorded therewith; as affected by First Amendment to Reciprocal Access
and Utility Easement and to Reciprocal Easement Agreement dated September 10,
1998, filed as Document No. 1079645, and recorded in Book 29108, Page 346; as
further affected by Reciprocal Access and Utility Easement dated March 25, 1999,
filed as Document No. 1101665 and recorded March 26, 1999, as Instrument No.
503, and by Reciprocal Easement Agreement dated March 25, 1999, filed as
Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of
Lots 5 and 6 on Land Court Plan No. 30618D dated March 31, 1998, filed as
Document No. 1061071, and recorded in Book 28405, Page 443, affecting areas
shown on a plan entitled "Easement Plan of Land in Waltham, Massachusetts",
dated March 30, 1998, recording therewith; as affected by First Amendment to
Reciprocal Access and Utility Easement and to Reciprocal Easement Agreement
dated September 10, 1998, filed as Document No. 1079645, and recorded in Book
29108, Page 346; as further affected by Reciprocal Easement Agreement dated
March 25, 1999, filed as Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of Lot
8 on Land Court Plan No. 30618E dated March 10, 1999, filed as Document No.
1099963.

Together with the benefit of Reciprocal Access and Utility Easement Agreement
with the owner of Lot 8 on Land Court Plan No. 30618E dated March 10, 1999,
filed as Document No. 1099964, and recorded March 10, 1999 as Instrument No.
1121; as further affected by Reciprocal Access and Utility Easement dated
March 25, 1999, filed as Document No. 1101665 and recorded March 26, 1999,
as Instrument No. 503.

Together with the benefit of reciprocal Access and Utility Easement, dated
March 25, 1999, filed as Document No. 1101665.

Together with the benefit of Reciprocal Easement Agreement dated March 25, 1999,
filed as Document No. 1101666.

Together with the benefit of Mutual Covenants Agreement dated March 25, 1999,
filed as Document No. 1101667.

Together with the benefit of Landscape License Agreement dated March 25, 1999,
filed as Document No. 1101668.


<PAGE>

                                    EXHIBIT B

                 LIST OF CURRENT ASSIGNED CONTRACTS AND PERMITS

                                      None.










                                      B-1
<PAGE>

                         ASSIGNMENT OF LEASES AND RENTS

         THIS ASSIGNMENT made this 11 day of July, 2000 by 830 WINTER STREET
LLC a Delaware limited liability company having an address at c/o PRAECIS
PHARMACEUTICALS INCORPORATED, One Hampshire Street, Cambridge, Massachusetts
02139 (hereinafter called "Borrower") to ANGLO IRISH BANK CORPORATION PLC
("Lender") having a place of business at Stephen Court, 18-21 St. Stephen's
Green, Dublin 2, Ireland, as Lender under an Acquisition and Construction Loan
Agreement ("Loan Agreement") of even date between Borrower and Lender.

         The term "Borrower" shall include, wherever the context permits, its
successors and assigns (provided, however, this reference to successors and
assigns of Borrower is not intended to derogate from any restrictions on such
succession or assignment otherwise contained in any Loan Document). The term
"Lender" shall include, wherever the context permits, its successors and assigns
as the holder for the time being of this Assignment and the Note (as hereinafter
defined) and other Obligations (as hereinafter defined) hereby secured.

                          W I T N E S S E T H  T H A T:

         1. GRANT OF ASSIGNMENT. This ASSIGNMENT is granted pursuant to the
terms, provisions and conditions of the Loan Agreement. Capitalized terms used
herein which are not otherwise specifically defined shall have the same meaning
herein as in the Loan Agreement.

         Borrower, for good and valuable consideration, receipt of which is
hereby acknowledged, hereby grants, transfers and assigns to Lender, and grants
to Lender a continuing pledge of and security interest in, the entire present
and future interest of Borrower in, to and under: (a) all leases, subleases,
rental agreements or other occupancy agreements ("Leases") now or hereafter in
existence, with respect to all or any portion of the real property located at
and known as 830 Winter Street, Middlesex County, Waltham, Massachusetts
("Property"), together with any renewals or extensions thereof for the use and
occupation of all or any portion of the Property; (b) all rents, income and
profits of any kind arising from such interests in the Leases; (c) all
guaranties of and security for the Leases; and (d) all proceeds of the
foregoing.

         Borrower is the owner of the Property. A legal description of the
Property is annexed hereto as EXHIBIT A. EXHIBIT B which is annexed hereto
identifies the Leases which are presently in effect.

         2. OBLIGATIONS SECURED. THIS ASSIGNMENT is made for the purpose of
securing the "Obligations" as follows:

                  A. The payment of the principal sum, interest at variable
rates, charges and indebtedness evidenced by a promissory note or notes
(collectively, the "Note") dated as of even date herewith, including any
extensions, renewals, replacement or replacements, modifications



                                      -1-
<PAGE>

and amendments thereof, in the original amount of up to THIRTY THREE MILLION
($33,000,000.00) DOLLARS given by Borrower to the order of Lender;

                  B. The payment, performance, discharge and satisfaction of
each covenant, warranty, representation, undertaking and condition to be paid,
performed, satisfied and complied with by Borrower under and pursuant to this
Assignment, or the Loan Agreement and also by Borrower under and pursuant to
each of the other Loan Documents referred to in, or executed in connection with,
the Loan Agreement;

                  C. The payment of all costs, expenses, legal fees and
liabilities incurred by Lender in connection with the enforcement of any of
Lender's rights or remedies under this Assignment, the other Loan Documents, or
any other instrument, agreement or document which evidences or secures any other
Obligations or collateral therefor, whether now in effect or hereafter executed;
and

                  D. The payment, performance, discharge and satisfaction of all
other liabilities and obligations of Borrower to Lender, whether now existing or
hereafter arising, direct or indirect, absolute or contingent, and including,
but without limitation express or implied upon the generality of the foregoing,
each such liability and obligation of Borrower under any of the Loan Documents
and each amendment, extension, modification, replacement or recasting of any one
or more of the instruments, agreements and documents referred to herein or
therein or executed in connection with the transactions contemplated hereby or
thereby.

         3. WARRANTIES AND REPRESENTATIONS. BORROWER WARRANTS AND REPRESENTS
that it is and shall be in the future the sole owner of the entire interests
described in Section 1 above and that no rent reserved in the Leases has been or
will be in the future otherwise assigned or anticipated, and that no rent for
any period subsequent to the date of this Assignment will be collected more than
one (1) month in advance except (a) for estimated payments for real estate taxes
and operating expenses, security deposits and last month's rents taken in the
usual course of business pursuant to Leases, or (b) with the prior written
consent of Lender.

         BORROWER FURTHER WARRANTS AND REPRESENTS that as of the date hereof:
(a) the Leases identified on EXHIBIT B hereto are in full force and effect and
true and complete copies thereof together with all amendments and modifications
have been previously delivered to Lender; (b) to Borrower's knowledge, no
default exists on the part of any of the lessees or tenants or of Borrower as
lessor in the performance on the part of either of the terms, covenants,
provisions or agreements in the Leases contained; (c) Borrower has no actual
knowledge of any condition which with the giving of notice or the passage of
time or both would constitute a default on the part of any of the lessees or
Borrower under the Leases; and (d) no security deposit or advance rental payment
beyond thirty (30) days has been made by any lessee under the Leases except as
may be shown on EXHIBIT B, or as may be specifically designated in the copies of
the Leases previously furnished to Lender.



                                      -2-
<PAGE>

         4. COVENANTS. Except as may be otherwise provided for or permitted by
the Loan Agreement, BORROWER COVENANTS with Lender: (i) to observe and perform
all the obligations imposed upon the lessor under every such Lease and not to do
or permit to be done anything to impair the security thereof; (ii) except as
hereinabove set forth in Section 3 hereof, not to collect any of the rent,
income and profits arising or accruing under the Leases or from the Property
more than one (1) month in advance of the time when the same shall become due;
(iii) not to execute any other assignment of lessor's interest in the Leases or
assignment of rents arising or accruing from the Leases or from the Property
except, to the extent approved by Lender in advance and in writing, an
assignment which is collateral in nature, expressly subordinate to this
instrument and subject to an intercreditor agreement in form and substance
acceptable to Lender; (iv) not to alter, modify or change the terms of the any
Lease, or cancel or terminate the same, or accept a surrender thereof without
the prior written consent of Lender in each instance or as otherwise permitted
to occur under the Loan Agreement; (v) not to subordinate any Lease to any
mortgage or other encumbrance, or permit, consent or agree to such
subordination, without Lender's prior written consent in each instance; (vi) not
to convey or transfer or suffer or permit a conveyance or transfer of the
premises demised by any Lease or of any interest therein so as to affect
directly or indirectly a merger of the estates and rights, or a termination or
diminution of the obligations, of any lessee thereunder; (vii) not to alter,
modify or change the terms of any guaranty of any Lease, or any security for any
Lease, or cancel or terminate any such guaranty, or release or reduce any such
security, without the prior written consent of Lender in each instance; not to
consent to any assignment of or subleasing under any such Lease, unless in
accordance with its terms, without the prior written consent of Lender in each
instance; (viii) not to enter into any future Leases of all or any part of the
Property without Lender's prior written consent in each instance or Lender's
deemed consent as provided in the Loan Agreement; at Lender's request, furnish
to Lender true and complete copies of all Leases and amendments thereto; and
(ix) at Lender's further request (and in confirmation of the assignment and
transfer already made herein of future Leases) to assign and transfer to Lender
any and all subsequent Leases upon all or any part of the Property and to
execute and deliver at the request of Lender all such further assurances and
assignments in the Property as Lender in good faith shall from time to time
require.

         5. FURTHER TERMS, COVENANTS AND CONDITIONS. THIS ASSIGNMENT is made on
the following terms, covenants and conditions:

                  5.1 PRIOR TO DEFAULT. So long as there is no Event of Default
(as defined in the Loan Agreement), Borrower shall have the right and license to
manage and operate the Property and to collect at the time of, but except as
hereinabove provided not more than one (1) month prior to, the date provided for
the payment thereof, all rents, income and profits arising under the Leases or
from the premises described therein and, subject to the provisions of the other
Loan Documents, to retain, use and enjoy the same.

                  5.2 AFTER DEFAULT. At any time after an Event of Default
occurs, Lender, without in any way waiving such default, may at its option,
without notice, and without regard to



                                      -3-
<PAGE>

the adequacy of the security for the Obligations secured hereby and by the
Security Deed revoke the right and license granted above to Borrower and:

                           (i) Authorize and direct the lessees named in any
                  existing Leases or any other or future lessees or occupants of
                  the Property, upon receipt from Lender of written notice to
                  the effect that Lender is then the holder of the Note and the
                  Security Deed and that an Event of Default has occurred
                  thereunder, to pay over to Lender all rents, income and
                  profits arising or accruing under the Leases or from the
                  Property and to continue to do so until otherwise notified in
                  writing by Lender. Borrower agrees that every lessee and
                  occupant shall have the right to rely upon any such statement
                  and request by Lender that lessee or occupant shall pay such
                  rents to Lender without any obligation or right to inquire as
                  to whether such Event of Default actually exists
                  notwithstanding any notice from or claim of Borrower to the
                  contrary and that Borrower shall have no right or claim
                  against lessees or occupants for any such rent so paid by
                  lessees or occupants to Lender after such notice to the lessee
                  or occupant by Lender;

                           (ii) Either in person or by a designee, with or
                  without bringing any action or proceedings, or by a receiver
                  appointed by a court, take possession of the Property and
                  have, hold, manage, lease and operate the same on such terms
                  and for such period of time as Lender may deem proper and,
                  either with or without taking possession of the Property in
                  its own name, demand, sue for, or otherwise collect and
                  receive, all rents, income and profits of the Property,
                  including those past due and unpaid, with full power (but no
                  obligation) to make from time to time all improvements,
                  alterations, renovations, repairs and replacements thereto or
                  thereof as may seem proper to Lender; and

                           (iii) Apply such rents, income and profits to the
                  payment of:

                                    (a) all reasonable expenses of managing the
                           Property including, without being limited thereto,
                           the salaries, fees and wages of a manager and such
                           other employees or designees as Lender may deem
                           necessary or desirable, and all expenses of operating
                           and maintaining the Property, including, without
                           being limited thereto, all taxes, charges, claims,
                           assessments, water rents, sewer rents and other
                           liens, and premiums for all insurance which Lender
                           may deem necessary or desirable, the payment or
                           refund of security deposits, or interest thereon, and
                           the cost of all improvements, alterations,
                           renovations, repairs or replacements, and all
                           expenses incident to taking and retaining possession
                           of the Property; and

                                    (b) all sums which Borrower is responsible
                           to pay under the Loan Documents, and the principal
                           sum, interest and indebtedness secured hereby and by
                           the Security Deed, and all other Obligations together
                           with



                                      -4-
<PAGE>

                           all reasonable costs and reasonable attorneys' fees,
                           in such order of priority as to any of the items
                           mentioned in this clause (iii), as Lender in its sole
                           discretion may determine, any statute, law, custom,
                           or use to the contrary notwithstanding.

The exercise by Lender of the option granted it in this Section 5.2 and the
collection of the rents, income and profits and the application thereof as
herein provided shall not be considered a waiver by Lender of any Default or
Event of Default under the other Loan Documents, or the Leases, or this
Assignment.

         5.3 CONTINUING EFFECT. Upon payment in full to Lender of the principal
sum, interest, indebtedness and other Obligations secured hereby and by the
Security Deed, this Assignment shall become and be void and of no effect. The
discharge of record of the Security Deed dated as of even date given by Borrower
to Lender shall constitute a discharge of this Assignment and a release of
Lender's interest in the Leases and rents assigned hereby and the reassignment
thereof (without recourse to Lender) to Borrower and all those claiming of
record by, through or under Borrower.

         5.4 NO WAIVER; CONCURRENT RIGHTS. Nothing contained in this Assignment
and no act done or omitted by Lender pursuant to the powers and rights granted
it hereunder shall be deemed to be a waiver by Lender of its rights and remedies
hereunder or any one or more of the other Loan Documents, and this Assignment is
made and accepted without prejudice to any of the rights and remedies possessed
by Lender under the terms of any of the other Loan Documents. The right of
Lender to collect said principal sums, interest and indebtedness and to enforce
any other security therefor held by it may be exercised by Lender either prior
to, simultaneously with, or subsequent to any action taken by it hereunder.

         5.5 NO LIABILITY. Lender shall not be liable for any loss sustained by
Borrower resulting from Lender's failure to let the Property after taking
possession of the Property after an Event of Default or from any other act or
omission of managing the Property after taking possession of the Property after
an Event of Default unless such loss is caused by the gross negligence or
willful misconduct of Lender. Lender shall not be obligated to perform or
discharge, nor does Lender hereby undertake to perform or discharge, any
obligation, duty or liability under the Leases, under any ground lease, or under
or by reason of this Assignment, and Borrower shall, and does hereby agree to,
indemnify Lender for, and to defend and hold Lender harmless from, any and all
liability, loss, damage or expense which may or might be incurred under or by
reason of this Assignment and from any and all claims and demands whatsoever
which may be asserted against Lender by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms, covenants or
agreements contained in the Leases or the ground lease; PROVIDED, HOWEVER, that
nothing herein shall be construed to obligate Borrower to indemnify and hold
Lender harmless from and against any and all claims, demands, liability, loss or
damage asserted against, imposed on or incurred by Lender by reason of Lender's,
its officers', directors', employees' or agents' willful misconduct or gross
negligence. Should Lender incur any such liability under the Leases or under or
by reason of this Assignment, or in



                                      -5-
<PAGE>

defense of any such claims or demands, for which it is to be indemnified by
Borrower as aforesaid, the amount thereof, together with interest thereon at the
Default Rate of interest under the Note accruing from the date immediately
following the tenth (10th) Business Day after Borrower receives an invoice for
such costs and expenses (an "Invoice") and including, without limitation, all
related costs, expenses and reasonable attorneys' fees, shall be secured hereby
and by the Security Deed and by the other collateral for the Obligations and
Borrower shall reimburse Lender therefor within ten (10) Business Days after
Borrower receives an Invoice and upon the failure of Borrower so to do, Lender
may, at its option, declare all sums secured hereby immediately due and payable.
It is further understood that this Assignment shall not operate to place
responsibility for the control, care, management or repair of said Property upon
Lender, nor for the carrying out of any of the terms and conditions of the
Leases or any ground lease; nor shall it operate to make Lender responsible or
liable for any waste committed on the Property by tenants or any other parties,
or for any dangerous or defective condition of the Property, or for any
negligence in the management, upkeep, repair or control of said Property
resulting in loss or injury or death to any tenant, licensee, employee or
stranger, except, in all cases, resulting from the gross negligence or willful
misconduct of Lender.

         5.6 EFFECT OF FORECLOSURE DEED. Unless Lender otherwise elects in the
instance of a Lease which is subordinate or remains at the election of Lender to
the Security Deed and is terminated by a foreclosure of a Security Deed, upon
the issuance of any deed or deeds pursuant to a foreclosure of the Mortgage, all
right, title and interest of Borrower in and to the Leases shall, by virtue of
this instrument and such deed or deeds, thereupon vest in and become the
absolute property of the grantee or grantees in such deed or deeds without any
further act or assignment by Borrower. Borrower hereby irrevocably appoints
Lender and its successors and assigns as its agent and attorney in fact to
execute all instruments of assignment for further assurance in favor of such
grantee or grantees in such deed or deeds as may be necessary or desirable for
such purpose.

         5.7 UPON TERMINATION OF LEASE IN BANKRUPTCY. In the event any lessee
under any of the Leases should be the subject of any proceeding under the
Federal Bankruptcy Code, as amended from time to time, or any other federal,
state or local statute which provides for the possible termination or rejection
of the Leases assigned hereby, Borrower covenants and agrees that, if any of the
Leases is so terminated or rejected, no settlement for damages shall be made
without the prior written consent of Lender, in each instance, and any check in
payment of damages for termination or rejection of any such Lease will be made
payable both to Borrower and Lender. Borrower hereby assigns any such payment to
Lender and further covenants and agrees that upon the request of Lender,
Borrower will duly endorse to the order of Lender any such check, the proceeds
of which will be applied to the indebtedness secured by this Assignment.
Borrower hereby irrevocably appoints Lender and its successors and assigns as
its attorney-in-fact to so endorse any such checks if Borrower does not do so.

         5.8 RIGHTS CONTAINED IN SECURITY DEED. This Assignment is intended to
be supplementary to, and not in substitution for, or in derogation of, any
assignment of rents to secure the Obligations contained in the Security Deed or
in any other Loan Document. In the



                                      -6-
<PAGE>

event of any conflict between this Assignment and any of the other Loan
Documents, the terms and provisions of this Assignment shall govern.

         5.9 NOTICES. Any notice or communications in connection herewith shall
be sufficiently given only if given in the manner provided for in the Loan
Agreement.

         5.10 CAPTIONS AND HEADINGS. Captions and headings in this Assignment
are intended solely for the convenience of the parties and shall not be
considered in the determination of the meaning of any provision hereof.

         5.11 GOVERNING LAW/COUNTERPARTS. This Assignment is governed in all
respects by the laws of the Commonwealth of Massachusetts and may be executed in
one or more counterparts, each of which shall be considered an original.

         IN WITNESS WHEREOF, the Borrower has caused this Assignment to be duly
executed and delivered as a sealed instrument as of the date set forth above.


WITNESS:                                BORROWER:

                                        830 WINTER STREET LLC,
                                        a Delaware limited liability company

                                        By:  PRAECIS PHARMACEUTICALS
                                             INCORPORATED,
                                             a Delaware corporation, its sole
                                             member

/s/ Mary E. DeLena                      By:  /s/ KEVIN F. MCLAUGHLIN
-------------------------------              ---------------------------------
                                             Name:   KEVIN F. MCLAUGHLIN
                                                   ---------------------------
                                             Title:  SENIOR VICE PRESIDENT
                                                   ---------------------------
                                             Hereunto duly authorized





                                      -7-
<PAGE>

                          COMMONWEALTH OF MASSACHUSETTS


Suffolk, ss.                                                     July 10, 2000


         Then personally appeared before me the above-named KEVIN F. MCLAUGHLIN,
the SR. VICE PRESIDENT & CFO of PRAECIS PHARMACEUTICALS INCORPORATED, the
sole member of 830 Winter Street LLC (the Borrower described above) and
acknowledged the foregoing instrument to be such person's free act and deed and
the free act and deed of such corporation in its capacity as sole member.



                                           /s/ Lisa A. Cobbett
                                           ------------------------------
                                           ____________, Notary Public
                                           My Commission Expires: 4-24-05






                                      -8-
<PAGE>

                                    EXHIBIT A

                                LEGAL DESCRIPTION

                                [attached behind]













                                       A-1
<PAGE>


                                   EXHIBIT A

A certain parcel of land off Winter Street, in Waltham, Middlesex County,
Massachusetts, shown as Lot 9 on Land Court Plan No. 30618E, a copy of a portion
of which is filed with the Middlesex South Registry District of the Land Court
with Certificate of Title No. 214324 in Registration Book 1201, Page 174.

Together with the benefit of rights reserved in Easement dated July 14, 1997,
filed as Document No. 1036276, and recorded in Book 27478, Page 136; as
affected by Utility Easement from owners of Lots 2 and 3 on Land Court Plan #
30618C and Lots 2, 3, B and C on Plan #669 of 1997, to Boston Edison Company
and New England Telephone and Telegraph Company, d/b/a Bell Atlantic, dated
August 27, 1998, filed as Document No. 1078157; as further affected by
Reciprocal Access and Utility Easement dated March 25, 1999, filed as
Document No. 1101665 and recorded March 26, 1999, as Instrument No. 503.

Together with the benefit of grant and reservation recited in Reciprocal Access
and Utility Easement with the owner of Lots 5 and 6 on Land Court Plan No.
30618D dated March 31, 1998, filed as Document No. 1061070, and recorded in Book
28405, page 421, affecting areas shown as "Reserved Easement Area" on a plan
entitled "Easement Plan of Land in Waltham, Massachusetts", dated March 30,
1998, recorded therewith; as affected by First Amendment to Reciprocal Access
and Utility Easement and to Reciprocal Easement Agreement dated September 10,
1998, filed as Document No. 1079645, and recorded in Book 29108, Page 346; as
further affected by Reciprocal Access and Utility Easement dated March 25, 1999,
filed as Document No. 1101665 and recorded March 26, 1999, as Instrument No.
503, and by Reciprocal Easement Agreement dated March 25, 1999, filed as
Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of
Lots 5 and 6 on Land Court Plan No. 30618D dated March 31, 1998, filed as
Document No. 1061071, and recorded in Book 28405, Page 443, affecting areas
shown on a plan entitled "Easement Plan of Land in Waltham, Massachusetts",
dated March 30, 1998, recording therewith; as affected by First Amendment to
Reciprocal Access and Utility Easement and to Reciprocal Easement Agreement
dated September 10, 1998, filed as Document No. 1079645, and recorded in Book
29108, Page 346; as further affected by Reciprocal Easement Agreement dated
March 25, 1999, filed as Document No. 1101666.

Together with the benefit of Reciprocal Easement Agreement with the owner of Lot
8 on Land Court Plan No. 30618E dated March 10, 1999, filed as Document No.
1099963.

Together with the benefit of Reciprocal Access and Utility Easement Agreement
with the owner of Lot 8 on Land Court Plan No. 30618E dated March 10, 1999,
filed as Document No. 1099964, and recorded March 10, 1999 as Instrument No.
1121; as further affected by Reciprocal Access and Utility Easement dated
March 25, 1999, filed as Document No. 1101665 and recorded March 26, 1999,
as Instrument No. 503.

Together with the benefit of reciprocal Access and Utility Easement, dated
March 25, 1999, filed as Document No. 1101665.

Together with the benefit of Reciprocal Easement Agreement dated March 25, 1999,
filed as Document No. 1101666.

Together with the benefit of Mutual Covenants Agreement dated March 25, 1999,
filed as Document No. 1101667.

Together with the benefit of Landscape License Agreement dated March 25, 1999,
filed as Document No. 1101668.


<PAGE>

                                    EXHIBIT B

                           LEASES PRESENTLY IN EFFECT


Lease dated July 11, 2000 by and between 830 Winter Street LLC, as landlord and
PRAECIS PHARMACEUTICALS INCORPORATED, as tenant.









                                      B-1