FIRST AMENDMENT OF AGREEMENT OF SALE

            THIS FIRST AMENDMENT OF AGREEMENT OF SALE (this "Amendment" is made
as of June __, 2006, by and between DVL, INC. a Delaware corporation having an
address at 70 East 55th street, 7th Floor, New York, New York 10022 (the
"Seller"), and 354 BROADWAY ASSOCIATES, LLC, a New York limited liability
company, having an address at 13 Notre Dame Street, Ft. Edward, New York 12828
(the "Buyer").

      WHEREAS, Seller and Buyer entered into an Agreement of Sale dated April
27, 2006, (the "Agreement") for the purchase and sale of certain real property
located in the Town of Ft. Edward, County of Washington, State of New York, as
such Property is more fully described in the Agreement (the "Property");

      WHEREAS, Buyer has requested Seller to conduct twelve (12) soil sample
tests at the Property (the "Environmental Testing") as part of Buyer's
investigation of the environmental condition of the Property;

      WHEREAS, Seller is willing to undertake the Environtnental Testing at the
Property provided that Buyer agrees to reimburse Seller for one-half of the cost
thereof;

      WHEREAS, Buyer and Seller desire to extend the Due Diligence Expiration
Date (as defined in Section 3.01(a) of the Agreement) to afford Seller the
opportunity to undertake the Environmental Testing and Buyer the opportunity to
review the results thereof.

      WHEREAS, except for the Environmental Testing, Buyer desires to waive the
title and environmental contingencies set forth in Sections 3.01(d) and 3.02(d)
of the Agreement.

      NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and other good and valuable consideration, the mutual receipt
and legal sufficiency of which is hereby acknowledged, Buyer and Seller hereby
covenant and agree as follows:

      1.    All capitalized terms not otherwise defined herein shall have the
            meanings ascribed to them in the Agreement.

      2.    The Due Diligence Expiration Date shall be extended until the
            twentieth (20th) day following the date of execution of this
            Amendment or five (5) days after receipt by Buyer of the of the
            environmental test report described in Paragraph 5 hereunder,
            whichever is later (the "Extended Due Diligence Expiration Date).
            Wherever the term "Due Diligence Expiration Date" appears in the
            Agreement, it shall be understood to mean the Extended Due Diligence
            Expiration Date.

      3.    Within three (3) business days following the execution of this
            Amendment,

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            Buyer's and Seller's respective environmental consultants shall meet
            at the property for the purpose of delineating the location of the
            twelve (12) soil samples to be obtained from the main parking lot
            area of the Property. Buyer acknowledges that Buyer's environmental
            consultant has recommended the number and general location of the
            additional soil samples and agrees that no more than twelve (12)
            additional soil samples shall be obtained from the Property. The
            exact locations for the soil samples will be determined and marked
            by Buyer's environmental consultant in the field with stakes or
            paint and by hand on a site map prepared by Buyer's environmental
            consultant and delivered to Seller's environmental consultant.
            Notwithstanding the foregoing, Buyer acknowledges that the locations
            of the soil samples may be changed to account for any existing
            underground utility lines. Buyer acknowledges that the location of
            the soil samples will be determined by Buyer's environmental
            consultant and that Seller will not represent or warrant the
            adequacy of the soil samples or any other aspect of the
            Environmental Testing.

      4.    Seller's environmental consultant, Malcolm Pirnie, Inc., shall
            undertake the Environmental Testing in accordance with the proposal
            for additional soil sampling dated June 20, 2006, a copy of which is
            attached hereto. Buyer and Seller agree to share equally the cost of
            the Environmental Testing. Upon completion of the Environmental
            Testing, Seller shall cause the Property to be restored to
            substantially the same condition that existed prior to the
            Environmental Testing.

      5.    Seller shall provide Buyer with the results of the Environmental
            Testing promptly upon availability. Buyer shall have until the
            Extended Due Diligence Expiration Date to review the results of the
            Environmental Testing. Buyer agrees that the results of the
            Environmental Testing will be reviewed by Buyer's environmental
            consultant and acknowledges that neither Seller nor Seller's
            environmental consultant will represent or warrant the results of
            the Environmental Testing. In the event that Buyer determines, in
            Buyer's sole discretion, that the results of the Environmental
            Testing are unsatisfactory, Buyer may, on or before the Extended Due
            Diligence Expiration Date, give notice of termination of the
            Agreement to Seller, whereupon the Agreement shall be terminated,
            the Deposit plus any accrued interest shall be returned to Buyer and
            neither party shall have any further rights or obligations
            thereunder. Notwithstanding the foregoing, Buyer shall not be
            entitled to receive a refund of the Deposit until Buyer reimburses
            Seller for one-half of the cost of the Environmental Testing.

      6.    Buyer agrees to keep the Property free from all liens and to
            indemnify, defend and hold harmless Seller and Seller's officers,
            directors, agents, representatives, employees and their respective
            affiliates from all claims, actions, losses, liabilities, damages,
            costs, fines and expenses (including, but not limited to, attorneys'
            fees and costs) incured, suffered by or claimed

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            against any of them by reason of any damage to the Property or
            injury to persons caused by Buyer and/or its agents, employees or
            contractors entry upon or activities at the Property. This indemnity
            shall survive the Closing or any termination of the Agreement

      7.    Except as set forth in Paragraph 5 above, Buyer hereby waives any
            and all rights it has under Section 3.02(d) of the Agreement to
            terminate the Agreement based upon the environmental condition of
            the Property. Buyer specifically approves the Environmental Work
            Plan attached to the Agreement as Exhibit "F".

      8.    Buyer hereby waives any and all rights it has under Section 301(d)
            of the Agreement to terminate the Agreement based upon the condition
            of title to the Property. Notwithstanding the foregoing, Seller
            hereby represents to Buyer that, as of the date of this Amendment,
            Seller has not received any notice of default under the Reciprocal
            Easement Agreement dated November 7, 2003, as amended on July 12,
            2004.

      9.    Subject to the provisions of this Amendment, all of the terms.
            covenants, and conditions of the Agreement are reconfirmed and shall
            remain in full force and effect and binding upon the parties hereto,
            their heirs, administrators, and executors.

      10.   In the event of a conflict between any of the terms and provisions
            of this Amendment and the terms and provisions of the Agreement, the
            terms and provisions of this Amendment shall be controlling.

      11.   This Amendment may be executed in separate counterparts. It shall be
            fully executed when Seller and Buyer have each signed at least one
            counterpart even though no one counterpart contains the signature of
            both parties.

      IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the day and year first written above.

                                   SELLER:

                                   DVL, INC.

                                   By /s/ Charles D. Carames
                                      ------------------------
                                      Name: Charles D. Carames
                                      Title: Vice President

                                   Date: 6/28/06
                                         ---------------------

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                                   BUYER:

                                   354 BROADWAY ASSOCIATES, LLC

                                   By /s/ S. Paul Miller
                                      ------------------------
                                      Name: S. Paul Miller
                                      Title: Member

                                   Date: 6/27/06
                                         ---------------------