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                                                                    Exhibit 10.3

                                  GROUND LEASE

                                     between

                          BATTERY PARK CITY AUTHORITY,

                                    Landlord

                                       and

                         NEW YORK MERCANTILE EXCHANGE,

                                     Tenant


                                    Premises

                                     Site 15


                                Battery Park City
                               New York, New York

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                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

Article 1 - Definitions ..............................................

Article 2 - Premises and Term of Lease; Purchase Option ..............

Article 3 - Rent .....................................................

Article 4 - Impositions ..............................................

Article 5 - Deposits for Impositions .................................

Article 6 - Late Charges .............................................

Article 7 - Insurance ................................................

Article 8 - Use of Insurance Proceeds ................................

Article 9 - Condemnation .............................................

Article 10 - Assignment, Subletting, Mortgages, Etc. .................

Article 11 - Construction of Buildings ...............................

Article 12 - Repairs .................................................

Article 13 - Changes, Alterations and Additions ......................

Article 14 - Requirements of Public Authorities and
             of Insurance Underwriters and Policies;
             Compliance with Master Lease ............................

Article 15 - Fixtures ................................................

Article 16 - Discharge of Liens; Bonds ...............................

Article 17 - Representations; Possession .............................

Article 18 - Landlord Not Liable for Injury or Damage, Etc. ..........

Article 19 - Indemnification of Landlord and Others ..................

Article 20 - Right of Inspection, Etc. ...............................

Article 21 - Landlord's Right to Perform Tenant's Covenants ..........

Article 22 - No Abatement of Rental ..................................

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Article 23 - Permitted Use; No Unlawful Occupancy ....................

Article 24 - Events of Default, Conditional Limitations,
             Remedies, Etc. ..........................................

Article 25 - Notices .................................................

Article 26 - Construction and Maintenance of the Civic
             Facilities ..............................................

Article 27 - Streets .................................................

Article 28 - Street Widening .........................................

Article 29 - Subordination, Attornment ...............................

Article 30 - Excavations and Shoring .................................

Article 31 - Certificates by Landlord and Tenant .....................

Article 32 - Consents and Approvals ..................................

Article 33 - Surrender at End of Term ................................

Article 34 - Entire Agreement ........................................

Article 35 - Quiet Enjoyment .........................................

Article 36 - Appraisal and Arbitration ...............................

Article 37 - Invalidity of Certain Provisions ........................

Article 38 - Financial Reports .......................................

Article 39 - Recording of Memorandum .................................

Article 40 - No Discrimination .......................................

Article 41 - Miscellaneous ...........................................

Article 42 - Security Deposit ........................................

Article 43 - Mutual Termination ......................................

Article 44 - Non-Exclusive Easements .................................

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                                    EXHIBITS

Exhibit A - Description of Land

Exhibit B - Tide Matters

Exhibit C - Civic Facilities Development Schedule

Exhibit D - Affirmative Action Program

Exhibit E - Design Guidelines

Exhibit F - Sales Tax Letter

Exhibit G - Sales Tax Registry

Exhibit H - Pedestrian Easement Area


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            AGREEMENT OF LEASE (this "Lease") made as of the 18 day of May, 1995
between BATTERY PARK CITY AUTHORITY ("Landlord"), a body corporate and politic
constituting a public benefit corporation of the State of New York having an
office at One World Financial Center, New York, New York 10281 and NEW YORK
MERCANTILE EXCHANGE ("Tenant"), a corporation organized under the Not-For-Profit
Corporation Law of the State of New York having an office at Four World Trade
Center, New York, New York 10048.

                                   WITNESSETH:

            WHEREAS, the New York State Urban Development Corporation ("UDC"),
the City of New York (the "City"), the New York City Economic Development
Corporation ("EDC") and Battery Park City Authority ("BPCA") have agreed to
develop the Project (hereinafter defined) in conjunction with Tenant; and

            WHEREAS, UDC and the City have agreed to make available Five Million
and 00/100 ($5,000,000) Dollars and One Hundred and Twenty Three Million Six
Hundred and Eighty Six Thousand and 00/100 ($123,686,000) Dollars, respectively,
and EDC has agreed to disburse such funds, to be used for certain costs of the
Project, and UDC, EDC, BPCA and Tenant have entered into (and the City has
executed for the purposes provided therein) the Funding Agreement (hereinafter
defined) setting forth the terms and conditions of such funding; and

            WHEREAS, UDC, the City, EDC and BPCA have entered into the Project
Agreement (hereinafter defined) regulating the relationship between UDC, the
City, EDC and BPCA with respect to the Project.

            NOW, THEREFORE, it is hereby mutually covenanted and agreed by and
between the parties hereto that this Lease is made upon the terms, covenants and
conditions hereinafter set forth.

                                    ARTICLE 1

                                   DEFINITIONS

            The terms defined in this Article 1 shall, for all purposes of this
Lease, have the following meanings.

            "Advisory Opinion" shall have the meaning provided in Section 41.25.

            "Affiliate" shall mean (i) (a) any Person (hereinafter defined) that
has, directly or indirectly, an ownership interest in the aggregate of five
percent (5%) or greater in Tenant or (b) any Person in which Tenant or an
Affiliate of Tenant by virtue of clause (a) of this definition, has an ownership
interest in the aggregate of five percent (5%) or

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greater, and (ii) any individual who is a member of the immediate family
(whether by birth or marriage) of an individual who is an Affiliate, which
includes for purposes of this definition a spouse; a brother or sister of the
whole or half blood of such individual or his spouse; a lineal descendant or
ancestor (including an individual related by or through legal adoption) of any
of the foregoing or a trust for the benefit of any of the foregoing. During the
period that NYMEX (hereinafter defined) shall be the Tenant, the term
"Affiliate" with respect to NYMEX shall have the meaning provided in the
Occupancy Agreement (hereinafter defined).

            "Approved Remedies" shall have the meaning provided in Section
26.03(a).

            "Architect" shall mean any architect or members of the design team
retained by Tenant for the Project or components thereof and approved by
Landlord, which approval shall not be unreasonably withheld, provided, however,
the approval of any architect or member of the design team performing work not
relating to the "core and shell" of the Building or affecting any aspect of the
Design Guidelines (hereinafter defined) shall not be withheld provided such
architect or member is not a Prohibited Person (hereinafter defined). Landlord
hereby approves the following Persons: Skidmore, Owings & Merrill, Jaros, Baum &
Belles (MEPS and vertical transportation), Ysrael A. Seinuk (structural
engineer), DVI Communications, Inc. (technology consultant), Space/Management
Programs, Inc. (trading floor architect) and Electronic Systems Associates
(security consultant).

            "Base Rent" shall have the meaning provided in Section 3.01(a).

            "Benefits Account" shall have the meaning provided in Section
11.05(e).

            "BPCA" shall mean Battery Park City Authority.

            "Building" shall mean the building, including footings and
foundations, Fixtures (hereinafter defined) and other improvements and
appurtenances of every kind and description hereafter erected, constructed or
placed upon the Land (hereinafter defined) including, without limitation,
Capital Improvements (hereinafter defined) and any and all alterations and
replacements thereof, additions thereto and substitutions therefor.

            "Business Days" shall mean any day which is not a Saturday, Sunday
or a day observed as a holiday by either the State of New York or the federal
government.

            "Capital Improvement" shall have the meaning provided in Section
13.01.

            "Certificate of Occupancy" shall mean a certificate of occupancy
(temporary or permanent) issued by the Department of Buildings of New York City
pursuant to Section 645 of the New York City Charter or other similar
certificate issued by a department or agency of New York City.


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            "Certified Public Accountant" or "C.P.A." shall mean any of the
so-called "Big Six" accounting firms or another independent certified public
accountant or accounting firm selected by Tenant and approved by Landlord, such
approval not to be unreasonably withheld.

            "Civic Facilities" shall have the meaning provided in Section
26.01(a).

            "Civic Facilities Payment" shall have the meaning provided in
Section 26.04.

            "Commencement Date" shall mean the date of this Lease.

            "Commencement of Construction" shall mean the date upon which
on-site construction of the Building shall commence, including any excavation or
pile driving but not including test borings, test pilings, surveys and similar
pre-construction activities.

            "Con Ed Benefits" shall have the meaning provided in Section
11.05(e).

            "Construction Agreements" shall mean agreements for construction,
Restoration (hereinafter defined), Capital Improvement, rehabilitation,
alteration, repair or demolition performed pursuant to this Lease.

            "Construction Commencement Date" shall mean November 1, 1995.

            "Construction Documents" shall have the meaning provided in Section
11.02(c).

            "Construction Manager" shall mean any construction manager or
contractor retained by Tenant for the Project or components thereof and approved
by Landlord, which approval shall not be unreasonably withheld. Landlord hereby
approves the following Persons: Lehrer McGovern Bovis, Morse Diesel, Turner
Construction, AJ Contracting, Structure Tone and Herbert Construction.

            "Consumer Price Index" or "CPI" shall mean the Consumer Price Index
for All Urban Consumers published by the Bureau of Labor Statistics of the
United States Department of Labor, New York, N.Y. - Northeastern N.J. Area, All
Items (1982-84 =100), or any successor or substitute index thereto,
appropriately adjusted; provided that if there shall be no successor index and
the parties shall fail to agree upon a substitute index within thirty (30) days,
or if the parties shall fail to agree upon the appropriate adjustment of such
successor or substitute index within thirty (30) days, a substitute index or the
appropriate adjustment of such successor or substitute index, as the case may
be, shall be determined by arbitration pursuant to Article 36.

            "Declaration of Restrictions" shall mean that certain Declaration of
Restrictions dated as of June 15, 1983 made by Landlord, as amended by Amendment
to Declaration of Restrictions dated as of May 18, 1995 made by Landlord, as the
same may (subject to the provisions of Section 41.18 hereof) hereafter be
amended, modified or supplemented.


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            "Default" shall mean any condition or event which constitutes or,
after notice or lapse of time, or both, would constitute an Event of Default
(hereinafter defined).

            "Deficiency" shall have the meaning provided in Section 24.04(b).

            "Depository" shall mean a savings bank, a savings and loan
association or a commercial bank or trust company which would qualify as an
Institutional Lender (hereinafter defined), designated by Tenant and approved by
Landlord, which approval shall not be unreasonably withheld, to serve as
Depository pursuant to this Lease, provided all funds held by such Depository
pursuant to this Lease shall be held in New York City. In the event Tenant shall
have failed to designate a Depository within ten (10) Business Days after
request of Landlord, Landlord shall have the right to designate such Depository.

            "Design Development Plans" shall have the meaning provided in
Section 11.02(b).

            "Design Guidelines" shall mean the Design Guidelines annexed hereto
as Exhibit E, as the same may hereafter be amended, modified or supplemented by
Landlord and Tenant.

            "Due Date" shall mean, with respect to an Imposition (hereinafter
defined), the last date on which such Imposition can be paid without any fine,
penalty, interest or cost being added thereto or imposed by law for the
non-payment thereof.

            "EDC" shall mean New York City Economic Development Corporation, a
local development corporation.

            "Environmental Statutes" shall mean all federal, state and local
laws, rules and regulations, whether now existing or hereafter enacted or
promulgated, regulating, relating to or imposing liability or standards of
conduct concerning any hazardous, toxic or dangerous waste, substance or
material or the protection of the environment, including, without limitation (i)
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. Section 9601 et seq. (known as CERCLA or Superfund) as amended by the
Superfund Amendments and Reauthorization Act of 1986 (known as SARA); (ii) Solid
Waste Disposal Act, 42 U.S.C. Section 6901 et seq. (known as SWDA) as amended by
Resource Conservation and Recovery Act (known as RCRA); (iii) National
Environmental Policy Act, 42 U.S.C. Section 4321 et seq. (known as NEPA); (iv)
Toxic Substances Control Act, 15 U.S.C., Section 2601 et seq. (known as TSCA);
(v) Safe Drinking Water Act, 42 U.S.C. Section 300(f) et seq. (known as Public
Health Service Act, PHSA); (vi) Refuse Act, 33 U.S.C. Section 407 et seq.; (vii)
Clean Water Act, 33 U.S.C. Section 1251 et seq. (known as Federal Water
Pollution Control Act, FWPCA); (viii) Clean Air Act, 42 U.S.C. Section 7401 et
seq. (known as CAA); (ix) The Emergency Planning and Community Right-to-Know Act
of 1986, 42 U.S.C. Section 1101 et seq. (known as EPCRTKA); (x) the Occupational
Safety and Health Act, 29 U.S.C. Section 651 et seq. (known as OSHA); and (xi)
the New York Environmental Conservation Law, Section 1-0101 et seq. (known as
ECL).


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            "Equipment" shall mean all machinery, equipment, furniture,
furnishings and other items of tangible and intangible personal property (e.g.,
mainframe, peripheral and personal computers, computer software, and
telecommunications and audio-visual equipment) installed for use by Tenant or
Affiliates of Tenant at the Premises or at any other location in the City which
is a part of the Project, as the same may be repaired, replaced, substituted,
upgraded or improved from time to time, provided the foregoing are purchased,
leased, fabricated or maintained by or on behalf of Tenant as agent for Landlord
(as more fully described in Section 11.05 hereof).

            "ERS" shall have the meaning provided in Section 26.01(a).

            "Esplanade" shall have the meaning provided in Section 26.01(a).

            "Event of Default" shall have the meaning provided in Section 24.01.

            "Exchanges" shall mean NYMEX and its wholly owned subsidiary,
Commodity Exchange, Inc.

            "Expiration Date" shall have the meaning provided in Section 2.02.

            "Fair Market Rent" shall have the meaning provided in Section
3.01(a).

            "Financing Delay" shall have the meaning provided in Section
43.01(c).

            "Financing Letter" shall mean that certain letter dated May 18, 1995
from Tenant to Landlord, agreed to by Landlord, and accepted by EDC and UDC.

            "First Appraisal Date" shall have the meaning provided in Section
3.01(a).

            "First Period" shall have the meaning provided in Section 3.01(a).

            "Fixtures" shall mean all fixtures incorporated in the Building, as
the same may be repaired, replaced, substituted, upgraded or improved from time
to time, including, without limitation, all machinery, dynamos, boilers, heating
and lighting equipment, pumps, tanks, motors, air conditioning compressors,
pipes, conduits, fittings, ventilating and communications apparatus, elevators,
escalators, incinerators, garbage compactors, antennas, computers and sensors.
"Fixtures" shall not mean any fixture or utilities owned by any utility company.

            "Funding Agreement" shall mean that certain funding agreement of
even date herewith by and among UDC, EDC, BPCA and Tenant, and executed by the
City for the purposes provided therein, as the same may be hereafter amended,
modified or supplemented.

            "Governmental Authority (Authorities)" shall mean the United States
of America, the State of New York, New York City and any agency, department,
commission,


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board, bureau, instrumentality or political subdivision of any of the foregoing,
now existing or hereafter created, having jurisdiction over the Premises or any
portion thereof.

            "IDA" shall mean the New York City Industrial Development Agency, a
public benefit corporation of the State of New York.

            "Impositions" shall have the meaning provided in Section 4.01.

            "Improvement Approvals" shall have the meaning provided in Section
13.01(a).

            "Indemnitees" shall have the meaning provided in Section 19.01.

            "Initial Balance" shall have the meaning provided in Section
11.05(e).

            "Institutional Lender" shall mean a savings bank, a savings and loan
association, a commercial bank or trust company (whether acting individually or
in a fiduciary capacity), an insurance company organized and existing under the
laws of the United States or any state thereof, a real estate investment trust,
a religious, educational or eleemosynary institution, a governmental agency,
body or entity (including, without limitation, BPCA and IDA), an employee,
benefit, pension or retirement plan or fund, a commercial credit corporation, an
investment bank, a commercial bank or trust company acting as trustee or
fiduciary of various pension funds or tax-exempt funds, or as trustee in
connection with the issuance of any bonds by BPCA or IDA or any other debt
financing, or a corporation or other entity which is owned wholly by any other
Institutional Lender or a subtrustee of any such commercial bank or trust
company acting as such trustee, or any combination of the foregoing; provided,
that each of the above entities, or any combination of such entities, shall
qualify as an Institutional Lender for purposes of this Lease only if (a) each
such entity shall be subject to (i) the jurisdiction of the courts of the State
of New York in any actions and (ii) the supervision of (A) the Comptroller of
the Currency or the Department of Labor of the United States or the Federal Home
Loan Bank Board or the Insurance Department or the Banking Department or the
Comptroller of the State of New York, or the Board of Regents of the University
of the State of New York, or the Comptroller of New York City or any successor
to any of the foregoing agencies or officials, or (B) any agency or official
exercising comparable functions on behalf of any other state within the United
States, or (C) in the case of a commercial credit corporation, the laws and
regulations of the state of its incorporation, or (D) any federal, state or
municipal agency or public benefit corporation or public authority advancing or
insuring mortgage loans or making payments which, in any manner, assist in the
financing, development, operation and maintenance of improvements, and (b) each
such entity (other than BPCA or IDA), or combination of such entities, or the
parent or parents of such entity or entities, shall have individual or combined
assets, as the case may be, of not less than Five Hundred Million ($500,000,000)
Dollars.


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            "Involuntary Rate" shall mean the Prime Rate (hereinafter defined)
plus two percent (2%) per annum but, in no event, in excess of the maximum
permissible interest rate then in effect in the State of New York.

            "Issuing Bank" shall have the meaning provided in Section 42.02(a).

            "Land" shall mean the land described in Exhibit A hereto; provided,
however, Landlord and Tenant agree that this Lease will be amended to modify the
description contained in Exhibit A, if necessary, to (i) conform to the exact
curvature of the western wall of the Building as reflected in the "as-built"
plans of the Building delivered by Tenant in accordance with the provisions of
Section 11.04, (ii) conform to the ultimate location and perimeter of the
Building and (iii) reflect the exact size and location of the columns described
in Section 11.12.

            "Landlord", on the Commencement Date, shall mean BPCA, but
thereafter "Landlord" shall mean only the landlord at the time in question under
this Lease.

            "Landlord's Civic Facilities" shall have the meaning provided in
Section 26.01(d).

            "Landlord's Construction Obligations" shall have the meaning
provided in Section 26.03(a).

            "Landlord's Project Manager" shall have the meaning provided in
Section 11.02(e).

            "Lease" shall mean this Agreement of Lease and all amendments,
modifications and supplements thereof.

            "Lease Early Termination Date" shall have the meaning provided in
Section 2.03.

            "Lease Restrictions Expiration Date" shall mean the earlier to occur
of (i) the fifteenth anniversary of the Occupancy Date, (ii) if one or more
Public Party Delays shall have occurred, the Public Party Delay Termination
Date, (iii) if the City or State shall impose a commodities contract tax, the
earlier of (A) the date on which such tax is imposed or (B) the date on which
the bill imposing such tax becomes law or (iv) in the event NYMEX shall have
made the election provided in Section 9.6(b)(ii)(B) of the Funding Agreement,
the fifth anniversary of the Occupancy Date.

            "Lease Year" shall mean the twelve-month period beginning on the
Commencement Date and each succeeding twelve-month period during the Term
(hereinafter defined), provided, however, if the Occupancy Date (hereinafter
defined) shall not occur on the anniversary of the Commencement Date, Lease Year
shall be redetermined as of the Occupancy Date to mean the twelve-month period
beginning on the Occupancy Date and each succeeding twelve-month period during
the Term.


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            "Letter of Credit" shall have the meaning provided in Section
42.02(a).

            "Maintenance Obligations" shall have the meaning provided in Section
26.02.

            "Mapping Action" shall have the meaning provided in Section 11.12.

            "Master Development Plan" shall mean the plan annexed to the Master
Lease (hereinafter defined), as superseded and modified by the Large-Scale
Commercial Development Plan (also annexed to the Master Lease) and amendments
thereto dated as of November 9, 1992 and as of February 28, 1995, as the same
may (subject to the provisions of Section 41.18 hereof) be hereafter amended,
modified or supplemented.

            "Master Landlord", on the Commencement Date, shall mean BPCA, but
thereafter, "Master Landlord" shall mean only the lessor at the time in question
under the Master Lease.

            "Master Lease" shall mean the Restated Amended Agreement of Lease,
made as of June 10, 1980, between BPC Development Corporation, as landlord, and
BPCA, as tenant, a Memorandum of which was recorded on June 11, 1980 in the
Office of the City Register, New York County in Reel 527 at page 163, as amended
by First Amendment to Restated Amended Lease dated as of June 15, 1983 and
recorded on June 20, 1983 in said Register's Office in Reel 696 at page 424,
Second Amendment to Restated Amended Lease dated June 15, 1983 and recorded on
June 20, 1983 in said Register's Office in Reel 696 at page 432, Third Amendment
to Restated Amended Lease dated as of August 15, 1986 and recorded on October
22, 1986 in said Register's Office in Reel 1133 at page 569 and Fourth Lease
Amendment to Restated Amended Lease dated as of May 25, 1990 and recorded on May
30, 1990 in said Register's Office in Reel 1697 at page 307, as the same may
(subject to the provisions of Section 41.18 hereof) be hereafter amended,
modified or supplemented.

            "Memorandum of Understanding" shall mean the Memorandum of
Understanding, dated as of November 8, 1979, among the Governor of the State of
New York, the Mayor of New York City and the President and Chief Executive
Officer of UDC and of BPCA, as supplemented by Letter, dated November 8, 1979,
from the President and Chief Executive Officer of UDC and BPCA to the Mayor of
New York City, and as amended by the 1986 Supplemental Memorandum of
Understanding, dated as of August 15, 1986 among the Governor of the State of
New York, the Mayor of the City of New York and BPCA, and the Amendment to the
Memorandum of Understanding, dated as of January 9, 1995 among the Governor of
the State of New York, the Mayor of the City of New York and BPCA.

            "Minimum Requirement" shall have the meaning provided in the
Occupancy Agreement (hereinafter defined).


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<PAGE>   13

            "Mortgage" shall mean any mortgage which constitutes a lien on
Tenant's interest in this Lease and the leasehold estate created hereby,
provided such mortgage is held by (i) an Institutional Lender or (ii) a Person
formerly constituting Tenant, or such Persons assignee, if such mortgage is made
to such Person in connection with an assignment by Tenant of its interest in
this Lease (other than an assignment by Tenant of its interest in this Lease to
an Affiliate).

            "Mortgagee" shall mean the holder of a Mortgage.

            "New York City" or the "City shall mean The City of New York, a
municipal corporation of the State of New York.

            "Non-Disturbance and Attornment Agreement" shall have the meaning
provided in Section 10.09.

            "Non-Renewal Notice" shall have the meaning provided in Section
42.02(a).

            "North Cove Link Park" shall have the meaning provided in Section
26.01(a).

            "NYMEX" shall mean The New York Mercantile Exchange, a corporation
organized and existing under the Not-For-Profit Corporation Law of the State of
New York.

            "NYMEX Use" shall mean the use of space in the Building for Tenant's
own trading, trading support, office and administrative purposes and uses
accessory thereto for or conducted by Tenant, Affiliates of Tenant and any
Service Providers.

            "Occupancy Agreement" shall mean that certain agreement of even date
herewith by and among the City, EDC, UDC, Landlord and Tenant, as the same may
hereafter be amended, modified or supplemented.

            "Occupancy Date" shall mean the first date on which floor trading
occurs at the Premises (it being understood and agreed that Tenant's starting
up, testing and "debugging" any computer or communications systems at the
Premises, prior to any floor trading actually commencing at the Premises, or
operating such systems at the Building during a "break-in" period while floor
trading is still being carried on at 4 World Trade Center, shall not constitute
floor trading at the Premises).

            "Occupancy Requirements" shall have the meaning provided in the
Occupancy Agreement.

            "Office Portion" shall mean that portion of the Building consisting
of approximately 386,375 rentable square feet of office, retail and accessory
space.

            "Payment in Lieu of Taxes" or "PILOT" shall have the meaning
provided in Section 3.02(a).


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<PAGE>   14

            "Person" shall mean an individual, corporation, partnership, joint
venture, estate, trust, unincorporated association, any Federal, State, County
or municipal government or any bureau, department or agency thereof.

            "Premises" shall mean the Land and Building.

            "Prime Rate" shall mean the prime or base rate announced as such
from time to time by Citibank, N.A., or its successors, at its principal office.
Any interest payable under this Lease with reference to the Prime Rate shall be
adjusted on a daily basis, based upon the Prime Rate in effect at the time in
question, and shall be calculated on the basis of a three hundred and sixty
(360) day year with twelve (12) months of thirty (30) days each.

            "Prohibited Person" shall have the meaning provided in Section
10.01(c).

            "Project" shall mean, at any time and from time to time during the
term of this Lease, the construction of the Building and the improving and
equipping of the Premises, and shall include, without limitation (a) the
planning and design of the Building, (b) the acquisition and installation of
materials to be incorporated in (and the construction of) the Building, (c) the
acquisition and installation of Fixtures to be incorporated in the Building, and
(d) the acquisition, leasing, fabrication, design, installation, maintenance,
testing, "breaking-in" and future upgrades of any Equipment for use at the
Premises and for use off-site in support of Tenant's operations at the Premises,
such off-site locations however to be located in the City.

            "Project Agreement" shall mean that certain agreement of even date
herewith by and among UDC, the City, EDC and BPCA, as the same may hereafter be
amended, modified or supplemented.

            "Project Area" shall mean the premises demised pursuant to the
Master Lease.

            "Public Party Delays" shall have the meaning provided in the
Occupancy Agreement.

            "Public Party Delay Termination Date" shall have the meaning
provided in the Occupancy Agreement.

            "Qualifying Sublease" shall have the meaning provided in Section
10.09.

            "Reappraisal Date" shall have the meaning provided in Section
3.01(a).

            "Rent Insurance" shall have the meaning provided in Section
7.01(a)(iv).

            "Rental" or "Rent" shall have the meaning provided in Section 3.05.

            "Requirements" shall have the meaning provided in Section 14.01.


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<PAGE>   15

            "Restoration" shall have the meaning provided in Section 8.01.

            "Restoration Funds" shall have the meaning provided in Section
8.02(a).

            "Restore" shall have the meaning provided in Section 8.01.

            "Sales Tax" or "Sales Taxes" shall have the meaning provided in
Section 11.05(b).

            "Sales Tax Benefits" shall have the meaning provided in Section
11.05(e).

            "Scheduled Completion Date" shall have the meaning provided in
Section 11.04.

            "Schematics" shall have the meaning provided in Section 11.02(a).

            "Self-Help" shall have the meaning provided in Section 26.03(b).

            "Service Provider(s)" shall mean any entity or individual providing
services to, or involved in or supportive of the business operations of, Tenant
or its Affiliates or members or member firms, provided, however, Service
Providers shall not be deemed to include any member firms of the Exchanges.

            "Settlement Agreement" shall mean the Settlement Agreement dated as
of June 6, 1980, between the City and UDC, as supplemented by Letter, dated June
9, 1980, from Richard A. Kahan to Edward I. Koch, and amended by Amendment to
Settlement Agreement dated as of August 15, 1986 between New York City and
Landlord, Agreement for Certain Payments dated as of June 28, 1989, between New
York City and Landlord, Agreement and Consent dated as of December 30, 1989,
between New York City and Landlord, Amendment and Agreement and Consent Pursuant
to Settlement Agreement dated as of May 18, 1990 between New York City and
Landlord, Amendment and Agreement and Consent Pursuant to Settlement Agreement
dated as of October 15, 1993 between New York City and Landlord, Amendment and
Agreement and Consent Pursuant to Settlement Agreement dated as of April 10,
1995 between New York City and Landlord, and as the same may (subject to the
provisions of Section 41.18 hereof) be hereafter amended, modified or
supplemented.

            "Severance Tenants Agreement" shall mean that certain agreement
dated as of May 18, 1995 by and among WFC Tower A Company, Olympia & York Tower
B Company, WFC Tower D Company, American Express Company, Merrill Lynch/WFC/L,
Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and NYMEX, and as the
same may be hereafter amended, modified or supplemented, provided such
amendment, modification or supplement was approved by Landlord in accordance
with Section 23.06.

            "Sidewalk Easement" shall have the meaning provided in Section
11.12.


                                      -11-

<PAGE>   16

            "Storage and Staging Letter" shall mean the letter agreement of even
date herewith between Landlord and Tenant regarding storage and staging during
construction of the Building.

            "Subleases" shall have the meaning provided in Section 10.04.

            "Substantial Completion of the Building" or "Substantially
Complete(d)" shall have the meanings provided in Section 11.04.

            "Subtenants" shall have the meaning provided in Section 10.04.

            "Tax Year" shall mean each tax fiscal year of New York City.

            "Taxes" shall mean the real property taxes assessed and levied
against the Premises or any part thereof pursuant to the provisions of Chapter
58 of the Charter of New York City and Chapter 17, Title E, of the
Administrative Code of The City of New York, as the same may now or hereafter be
amended, or any statute or ordinance in lieu thereof in whole or in part and
which would otherwise be payable if the Premises or any part thereof or the
owner thereof were not exempt therefrom (but subject, in any event, to any
abatement, deferral or exemption that would be available, from time to time, if
the Premises were owned by an entity not exempt from the payment of Taxes).

            "Tenant" shall mean New York Mercantile Exchange, and, if New York
Mercantile Exchange or any successor to its interest hereunder shall in
accordance with the terms of this Lease assign or transfer its interest
hereunder or any portion thereof, the term "Tenant" shall mean such assignee or
transferee.

            "Tenant's Civic Facilities" shall have the meaning provided in
Section 26.01(c).

            "Tenant's Early Termination Notice" shall have the meaning provided
in Section 2.03.

            "Term" shall have the meaning provided in Section 2.02.

            "Title Matters" shall mean those matters affecting title to the Land
set forth in Exhibit B hereto.

            "Trading Portion" shall mean that portion of the Building consisting
of approximately 113,625 rentable square feet, consisting of a trading floor and
computer facilities and other special improvements supporting or enhancing the
trading floor and related trading activities and other support space for the
trading floor and such related trading activities.

            "Transfer" shall have the meaning provided in Section 10.01(a).


                                      -12-

<PAGE>   17

            "UDC" shall mean New York State Urban Development Corporation, a
public benefit corporation of the State of New York.

            "Unavoidable Delays" shall mean (i) with respect to Tenant or its
obligations hereunder, delays incurred by Tenant due to strikes, lockouts, work
stoppages due to labor jurisdictional disputes, acts of God, inability to obtain
labor or materials due to governmental restrictions (other than any governmental
restrictions which Tenant is bound to observe pursuant to the terms of Article
40 of this Lease), enemy action, civil commotion, fire, casualty or other causes
beyond the control of Tenant (but not including Tenant's insolvency or financial
condition), Landlord's, UDC's, EDC's or the City's failure to comply with their
obligations under the Funding Agreement in accordance with the provisions
thereof or Landlord's, UDC's, EDC's or the City's failure to fund under the
Funding Agreement in the event such funding is prevented by reason of an
injunction (as more fully described in the Funding Agreement), a Financing
Delay, Landlord's breach of its obligations under this Lease or under any other
agreement between Landlord and Tenant now or hereafter made, including, if
Landlord shall have provided a loan to Tenant as contemplated by the Financing
Letter, a breach by Landlord of its obligations under any document executed in
connection with the loan contemplated by the Financing Letter, Landlord's
failure to complete Landlord's Civic Facilities in accordance with Section
26.02, or any delays or interference caused by Landlord doing construction or
performing development activities on sites other than the Premises or on
projects other than the Project, and (ii) with respect to Landlord or its
obligations hereunder, delays incurred by Landlord due to strikes, lockouts,
work stoppages due to labor jurisdictional disputes, acts of God, inability to
obtain labor or materials due to governmental restrictions (other than any
governmental restrictions which Landlord is bound to observe pursuant to the
terms of this Lease), enemy action, civil commotion, fire, unavoidable casualty
or other similar causes beyond the control of Landlord (but not including
Landlord's insolvency or financial condition); in each case provided such party
shall have notified the other party not later than thirty (30) days after such
party knows of the occurrence of same.

                                    ARTICLE 2

                   PREMISES AND TERM OF LEASE; PURCHASE OPTION

            Section 2.01. Landlord does hereby demise and sublease to Tenant,
and Tenant does hereby hire and take from Landlord, (a) the Premises, together
with all easements, appurtenances and other rights and privileges now or
hereafter belonging or appertaining to the Premises, subject to the Title
Matters, and (b) all Equipment.

            Section 2.02. TO HAVE AND TO HOLD unto Tenant, its successors and
assigns, for a term of years (the "Term") commencing on the Commencement Date
and expiring on June 17, 2069 or on such earlier date upon which this Lease may
be terminated as hereinafter provided (the "Expiration Date").


                                      -13-

<PAGE>   18

            Section 2.03. Tenant shall have the right to terminate this Lease at
any time after the earlier to occur of (i) the fifteenth anniversary of the
Occupancy Date, (ii) if one or more Public Party Delays shall have occurred, the
Public Party Delay Termination Date, (iii) if the City or State shall impose a
commodities contract tax, the earlier of (A) the date on which such tax is
imposed or (B) the date on which the bill imposing such tax becomes law, (iv)
the termination of the Funding Agreement by Tenant in accordance with the
provisions of Section 9.6(b)(ii)(A) thereof or (v) the termination of this Lease
by Tenant in accordance with the provisions of Section 43.02 hereof (the date on
which this Lease is so terminated being called the "Lease Early Termination
Date") upon not less than one hundred and eighty (180) days prior notice to
Landlord with respect to a termination by reason of clauses (i), (ii) or (iii)
above or upon not less than forty-five (45) days prior notice to Landlord with
respect to a termination by reason of clause (iv) or (v) above ("Tenant's Early
Termination Notice"). In the event Tenant shall have delivered Tenant's Early
Termination Notice, (i) Tenant shall vacate and surrender the Premises on the
date set forth in Tenant's Early Termination Notice in the condition required
pursuant to Article 33, (ii) the Premises shall be delivered free and clear of
any Mortgages and (iii) all Rental payable by Tenant hereunder shall be
equitably apportioned as of such date and the security deposit delivered to
Landlord in accordance with Article 42 hereof shall be promptly returned to
Tenant.

            Section 2.04. If any other commercial tenant or subtenant of BPCA is
granted an option to extend its lease beyond June 17, 2069, Tenant shall be
offered an option to extend the Term on comparable terms (reflective of
differences in the circumstances applicable to the particular commercial tenant,
including, but not limited to, the nature of the location, public amenities
offered and use of the site), unless BPCA reasonably determines that no such
comparable terms can be applied to Tenant, in which event, Tenant shall have no
such extension rights.

            Section 2.05. If any other commercial tenant or subtenant of BPCA is
granted an option to purchase the fee interest relating to its leased premises,
Tenant shall be offered an option to purchase the Premises on comparable terms
(reflective of differences in the circumstances applicable to the particular
commercial tenant, including, but not limited to, the nature of the location,
public amenities offered and use of the site), unless BPCA reasonably determines
that no such comparable terms can be applied to Tenant, in which event, Tenant
shall have no such purchase option rights.

                                    ARTICLE 3

                                      RENT

            Section 3.01.

            (a) For the period beginning on the Commencement Date and continuing
thereafter throughout the Term, Tenant shall pay to Landlord, without notice or
demand, the annual sums referred to below (collectively, the "Base Rent"):


                                      -14-

<PAGE>   19

            (i)         For each Lease Year (or portion thereof) commencing on
                  the Commencement Date up to but not including the Occupancy
                  Date, an amount per annum equal to One and 00/100 ($1.00)
                  Dollar for the Trading Portion and One and 00/100 ($1.00)
                  Dollar for the Office Portion.

            (ii)        For each Lease Year commencing on the Occupancy Date and
                  continuing for a period of twenty (20) Lease Years (the "First
                  Period") an amount per annum as follows:

                  (A)   For the Trading Portion, One and 00/100 ($1.00) Dollar
                        for each such Lease Year; and

                  (B)   For the Office Portion, (x) One Million and 00/100
                        ($1,000,000) Dollars for each Lease Year commencing on
                        the Occupancy Date up to the day immediately preceding
                        the seventh anniversary of the Occupancy Date, (y) One
                        Million Five Hundred Thousand and 00/100 ($1,500,000)
                        Dollars for each Lease Year commencing on the seventh
                        anniversary of the Occupancy Date and continuing through
                        the date that is one day prior to the thirteenth
                        anniversary of the Occupancy Date and (z) Two Million
                        and 00/100 ($2,000,000) Dollars for each Lease Year
                        commencing on the thirteenth anniversary of the
                        Occupancy Date and continuing through the date that is
                        one day prior to the expiration of the First Period.

            (iii) For each Lease Year commencing on the date immediately
                  following the expiration of the First Period and continuing
                  until the expiration of the Term, an amount per annum equal to
                  Four Million and 00/100 ($4,000,000) Dollars, subject,
                  however, to adjustment on the First Appraisal Date and on each
                  Reappraisal Date thereafter in the manner hereinafter provided
                  in the event that the Fair Market Rent, as determined on the
                  First Appraisal Date or on any such Reappraisal Date, as the
                  case may be, is other than $4,000,000. The Fair Market Rent
                  shall be determined as of the first day of the month next
                  succeeding the twentieth anniversary of the Occupancy Date and
                  as of each subsequent fifteenth anniversary thereafter (such
                  twentieth anniversary being referred to herein as the "First
                  Appraisal Date" and each subsequent fifteenth anniversary
                  being referred to herein as a "Reappraisal Date"). Such
                  determination of Fair Market Rent shall be by appraisal in the
                  manner provided in Article 36, unless at least six (6) months
                  prior to the First Appraisal Date or on any Reappraisal Date,
                  as the case may be, Landlord and Tenant shall have agreed upon
                  such Fair Market Rent. If the Fair Market Rent as so
                  determined on the First Appraisal Date or on any Reappraisal
                  Date,


                                      -15-

<PAGE>   20

                  as the case may be, shall be in excess of $4,000,000, the Base
                  Rent for each Lease Year for the period commencing on the
                  First Appraisal Date or such Reappraisal Date, as the case may
                  be, and continuing for a period of fifteen (15) Lease Years
                  thereafter, shall be the sum of $4,000,000 plus one-half (1/2)
                  of the difference between the Fair Market Rent and $4,000,000
                  (for example, if the Fair Market Rent is determined to be
                  $6,000,000, the Base Rent shall be equal to (A) $4,000,000
                  plus (B) $1,000,000 (or one-half of $6,000,000 less
                  $4,000,000)). If the Fair Market Rent as so determined on the
                  First Appraisal Date or on any Reappraisal Date, as the case
                  may be, shall be less than $4,000,000, the Base Rent for each
                  Lease Year for the period commencing on the First Appraisal
                  Date or such Reappraisal Date, as the case may be, and
                  continuing for a period of fifteen (15) Lease Years thereafter
                  shall be $4,000,000 less one-half (1/2) of the difference
                  between $4,000,000 and the Fair Market Rent (for example, if
                  the Fair Market Rent is determined to be $3,000,000, the Base
                  Rent shall be equal to (A) $4,000,000 minus (B) $500,000 (or
                  one-half of $4,000,000 less $3,000,000)). As used herein,
                  "Fair Market Rent" shall mean the fair market rental value of
                  the Land as of the date in question, considered as
                  unencumbered by this Lease and the Master Lease and as
                  unimproved except for Landlord's Civic Facilities and other
                  site improvements made by Landlord, provided that in
                  determining such fair market rental value, the appraiser shall
                  take into account the following assumptions: (i) the
                  improvements to be constructed on the Land may require unique
                  design aspects with respect to their use for floor trading
                  activities (for example, a lack of standard columns or a
                  typical core); and (ii) any improvement constructed on the
                  Land is subject to the requirements of the Declaration of
                  Restrictions, the Severance Tenants Agreement and the Design
                  Guidelines and must be used in a manner or for a purpose which
                  is consistent with this Lease, the Master Lease, the Master
                  Development Plan, the Certificate of Occupancy and the
                  Severance Tenants Agreement.

            (b) The Base Rent shall be payable in equal monthly installments in
advance commencing on the Commencement Date and on the first day of each month
thereafter during the Term. The Base Rent shall be payable in currency which at
the time of payment is legal tender for public and private debts in the United
States of America, and shall be payable to the office of Landlord set forth
above or at such other place in the City as Landlord shall direct by notice to
Tenant. The Base Rent due for any period of less than a full Lease Year, and any
installment of the Base Rent due for any period of less than a full month, shall
be appropriately apportioned.

            Section 3.02.


                                      -16-

<PAGE>   21

            (a) For each Tax Year or portion thereof within the Term, Tenant
shall pay to Landlord, without notice or demand, an annual sum (each such sum
being hereinafter referred to as a "Payment in Lieu of Taxes" or "PILOT") in the
amounts provided in this Section 3.02, on or before the last date or dates on
which payments of Taxes, or the applicable installments thereof, are payable
without interest or penalty under New York City law for such Tax Year. PILOT due
for any period which is less than a full Tax Year shall be appropriately
apportioned.

            (b) PILOT shall be payable as follows:

                  (i)   With respect to the Trading Portion:

                        (A) Subject to adjustment as provided in Section 10.04,
                        for each Tax Year (or portion thereof) from the
                        Commencement Date to and including the last day of the
                        First Period, PILOT shall be zero; provided, however,
                        that if Tenant shall cease to use the Trading Portion
                        for the purposes provided in this Lease and the
                        Occupancy Agreement, in addition to such other rights
                        and remedies as may be provided in this Lease or the
                        Occupancy Agreement, from and after the date that Tenant
                        shall have ceased to so use the Trading Portion, PILOT
                        shall be increased to an amount equal to Taxes (subject,
                        however, to any real property tax abatement, deferral or
                        exemption as provided in Section 3.02(b)(ii)(B) or which
                        would be available from time to time if the Premises
                        were owned by an entity not exempt from the payment of
                        Taxes); and

                        (B) For each Tax Year (or portion thereof) commencing on
                        the day next succeeding the expiration of the First
                        Period and continuing for the remainder of the Term,
                        PILOT shall be in an amount equal to Taxes assessed on
                        such Trading Portion (subject, however, to any real
                        property tax abatement, deferral or exemption which
                        would be available from time to time if the Premises
                        were owned by an entity not exempt from the payment of
                        Taxes).

                  (ii)  With respect to the Office Portion:

                        (A) Subject to adjustment as provider in Section 10.04,
                        for each Tax Year (or portion thereof) commencing on the
                        Commencement Date and continuing until the date which is
                        one day prior to the second anniversary of the Occupancy
                        Date, PILOT shall be zero;

                        (B) Subject to adjustment as provided in Section 10.04,
                        for each Tax Year (or portion thereof) commencing on the
                        day


                                      -17-

<PAGE>   22

                        next succeeding the expiration of the period referred to
                        in Section 3.02(b)(ii)(A) and continuing for a period of
                        ten (10) years thereafter, PILOT shall be in an amount
                        equal to the following percentage of Taxes:

<TABLE>
                        <S>         <C>   <C>
                        Tax Year    1     25% of Taxes;
                        Tax Year    2     32.5 % of Taxes;
                        Tax Year    3     40% of Taxes;
                        Tax Year    4     47.5% of Taxes;
                        Tax Year    5     55% of Taxes;
                        Tax Year    6     62.5% of Taxes;
                        Tax Year    7     70% of Taxes;
                        Tax Year    8     77.5% of Taxes;
                        Tax Year    9     85% of Taxes;
                        Tax Year    10    92.5% of Taxes; and
</TABLE>

                        (C) For each Tax Year (or portion thereof) commencing on
                        the day next succeeding the expiration of the period
                        referred to in Section 3.02(b)(ii)(B) and continuing for
                        the remainder of the Term, PILOT shall be in an amount
                        equal to Taxes on such Office Portion (subject, however,
                        to any real property tax abatement, deferral or
                        exemption which would be available from time to time if
                        the Premises were owned by an entity not exempt from the
                        payment of Taxes).

            (c) In determining PILOT (i) the total assessed value of the Land
shall be allocated on a pro rata basis to the Office Portion and the Trading
Portion based upon the square footage of each and (ii) the total assessed value
of the improvements shall be allocated between the Trading Portion and the
Office Portion as follows: (A) with respect to the Office Portion, the assessed
value shall be determined based upon the number of rentable square feet of
conventional office space in the Building multiplied by the then current, per
square-foot assessed value of comparable, conventional office buildings in the
Project Area and (B) the balance of the total assessed value of the improvements
shall be allocated to the Trading Portion. The parties agree that the four
building complex known as the "World Financial Center" are deemed to be
comparable, conventional office buildings in the Project Area.

            Section 3.03. Tenant shall continue to pay the full amount of PILOT
required under Section 3.02, notwithstanding that Tenant may have instituted tax
assessment reduction or other actions or proceedings pursuant to Section 4.06
hereof to reduce the assessed valuation of the Premises or any portion thereof.
If any such tax reduction or other action or proceeding shall result in a final
determination in Tenant's favor (i) Tenant shall be entitled to a credit against
future PILOT to the extent, if any, that the PILOT previously paid for the Tax
Year or Years for which such final determination(s) was (or were) made exceeds
the PILOT as so determined, and (ii) if such final


                                      -18-

<PAGE>   23

determination is made for the then current Tax Year, future payments of PILOT
for said Tax Year shall be based on the PILOT as so determined. If at the time
Tenant is entitled to receive such a credit the City of New York is paying
interest on refunds of Taxes, Tenant's credit shall include interest at the rate
then being paid by the City of New York on such refunds of Taxes. In no event,
however, shall Tenant be entitled to any refund of any such excess from
Landlord.

            Section 3.04. Tenant shall pay to Landlord the Civic Facilities
Payment in accordance with the provisions of Section 26.04.

            Section 3.05. All amounts required to be paid by Tenant pursuant to
this Lease, including, without limitation, Base Rent, PILOT, Impositions and
Civic Facilities Payments (collectively, "Rental" or "Rent"), shall constitute
rent under this Lease and shall be payable in the same manner as Base Rent.
Rental shall be absolutely net to Landlord without any abatement, deduction,
counterclaim, set-off or offset whatsoever except as specifically set forth in
this Lease, so that this Lease shall yield, net, to Landlord, Rental in each
year during the Term and that Tenant shall pay all costs, expenses and charges
of every kind and nature relating to the Premises (except Taxes, if any, and the
cost of constructing and maintaining Landlord's Civic Facilities) which may
arise or become due or payable during or after (but attributable to a period
falling within) the Term.

            Section 3.06. In the event that New York City shall, for any reason,
fail to determine the assessed value of the Premises for any Tax Year during the
Term, such assessed value shall be determined in accordance with the procedures
set forth in Article XVII of the Master Lease, provided that, in making such
determination, the appraisers shall take into consideration the equalization
rates then applicable to comparable properties situated in the Borough of
Manhattan, as well as any limitations on increases in assessed value for such
comparable properties prescribed by applicable law.

                                    ARTICLE 4

                                   IMPOSITIONS

            Section 4.01. Except as otherwise specifically provided herein,
Tenant shall pay, as hereinafter provided, all of the following items
(collectively, "Impositions") imposed by any Governmental Authority (other than
a Governmental Authority acting in its capacity as Landlord and not in its
governmental capacity): (a) real property assessments (not including Taxes), (b)
personal property taxes (except as otherwise specifically provided herein), (c)
occupancy and rent taxes (except as otherwise specifically provided herein), (d)
water, water meter and sewer rents, rates and charges, (e) excises, (f) levies,
(g) license and permit fees, (h) service charges with respect to police
protection, fire protection, street and highway construction, maintenance and
lighting, sanitation and water supply, if any, (i) fines, penalties and other
similar or like governmental charges applicable to the foregoing and any
interest or costs with respect thereto and (j) except for Taxes, any and all
other governmental levies, fees, rents, assessments or taxes and charges,
general and special,


                                      -19-

<PAGE>   24

ordinary and extraordinary, foreseen and unforeseen, of any kind and nature
whatsoever, and any interest or costs with respect thereto, which at any time
during the Term are, or, if the Premises or any part thereof or the owner
thereof were not exempt therefrom, would have been (1) assessed, levied,
confirmed, imposed upon or would have become due and payable out of or in
respect of, or would have been charged with respect to, the Premises or any
document to which Tenant is a party creating or transferring an interest or
estate in the Premises (excluding any transfer taxes (unless required by statute
to be paid by the grantee or transferee where the grantor or transferor is
exempt therefrom) or capital gains taxes imposed in connection with the
execution of this Lease), or the use and occupancy thereof by Tenant and (2)
encumbrances or liens on (i) the Premises, or (ii) the sidewalks or streets in
front of or adjoining the Premises, or (iii) any vault (other than a vault in
respect of which a utility company is obligated to pay any charge specified
above or which is exempt from any such charge by reason of use thereof by any
such utility company), passageway or space in, over or under such sidewalk or
street, or (iv) any other appurtenances of the Premises, or (v) any personal
property (except personal property which is not owned by or leased to Tenant and
except as otherwise specifically provided herein), Equipment or other facility
used in the operation thereof, or (vi) except as otherwise specifically provided
herein, the Rental (or any portion thereof) payable by Tenant hereunder, each
such Imposition, or installment thereof, during the Term to be paid not later
than five (5) Business Days prior to the Due Date thereof. However, if, by law,
any Imposition may at the option of the taxpayer be paid in installments
(whether or not interest shall accrue on the unpaid balance of such Imposition),
Tenant may exercise the option to pay the same in such installments and shall be
responsible for the payment of such installments only, together with applicable
interest, if any, provided that all such installment payments together with
applicable interest, if any, relating to periods prior to the date definitely
fixed in Article 2 hereof for the expiration of the Term shall be made prior to
the Expiration Date. Tenant shall promptly notify Landlord if Tenant shall have
elected to pay any such Imposition in installments.

            Section 4.02. Tenant, from time to time upon the request of
Landlord, shall promptly furnish to Landlord copies of official receipts of the
appropriate imposing authority, or other evidence reasonably satisfactory to
Landlord, evidencing the payment thereof.

            Section 4.03.

            (a) If the Premises shall at any time become subject to Taxes,
Landlord shall pay the Taxes on or before the due date thereof In no event shall
Tenant be obligated to pay Taxes. Landlord shall have the right to contest the
imposition of Taxes, at Landlord's expense, and pending such contest, if
permitted by applicable law, Landlord shall not be required to pay the Taxes
being so contested, unless failure to pay same would result in the imminent loss
or forfeiture of the Premises or the termination of Tenant's interest under this
Lease or if Tenant would by reason thereof be subject to any civil or criminal
penalty or liability. If Landlord shall exercise its right to contest the
imposition of Taxes, Landlord shall promptly notify Tenant of such contest, and,
at Tenant's request,


                                      -20-

<PAGE>   25

shall promptly deliver to Tenant copies of all applications, protest and other
documents submitted by Landlord to (or received by Landlord from) any
Governmental Authority. Any such proceeding by Landlord shall be commenced as
soon as is reasonably possible and shall be prosecuted to final adjudication
with reasonable dispatch. Landlord shall not, without Tenant's consent, enter
into a settlement of any such contest if such settlement would increase the
amount of PILOT payable by Tenant under this Lease or would alter the method for
computing or affect the timing for payment of PILOT. If Landlord shall have
failed to pay the Taxes as required hereunder and shall not have timely
commenced a proceeding to contest same, or shall have timely commenced a
proceeding to contest the Taxes but failure to pay the Taxes during the pendency
of such proceeding will result in the imminent loss or forfeiture of the
Premises or the termination of Tenant's interest under this Lease or Tenant
would by reason thereof be subject to any civil or criminal penalty or
liability, then Tenant may pay such unpaid Taxes together with any interest or
penalties thereon and deduct such payment from the next installment of PILOT
(and, to the extent, if any, that such payment shall exceed the next installment
of PILOT, from the next installment(s) of Base Rent) together with interest
thereon at the Involuntary Rate.

            (b) Nothing herein contained shall require Tenant to pay municipal,
state or federal income, gross receipts, inheritance, estate, succession,
profit, transfer, capital or transfer gains taxes of Landlord, or any corporate
franchise tax imposed upon Landlord or any transfer or gains tax imposed on
Landlord.

            Section 4.04. Any Imposition relating to a period a part of which is
included within the Term and a part of which is included in a period of time
before the Commencement Date or after the date fixed in Article 2 hereof for the
expiration of the Term (whether or not such Imposition shall be assessed,
levied, confirmed, imposed upon or in respect of or become a lien upon the
Premises, or shall become payable, during the Term) shall be apportioned between
Landlord and Tenant as of the Commencement Date or as of the date fixed for the
expiration of the Term, as the case may be, so that Tenant shall pay that
portion of such Imposition which that part of such fiscal period included in the
period of time after the Commencement Date or before such date fixed in Article
2 for the expiration of the Term bears to such fiscal period, and Landlord shall
pay the remainder thereof. Other than in respect of Impositions relating, in
part, to a period of time before the Commencement Date, no such apportionment of
Impositions shall be made if this Lease is terminated prior to the Expiration
Date as the result of an Event of Default.

            Section 4.05. Tenant shall have the right to contest the amount or
validity, in whole or in part, of any Imposition by appropriate proceedings
diligently conducted in good faith, in which event, notwithstanding the
provisions of Section 4.01 hereof, payment of such Imposition shall be postponed
if, and only as long as:

            (a) neither the Premises nor any part thereof, or interest therein
or any income therefrom (except to the extent covered by security deposited in
accordance with this Section 4.05) or any other assets of or funds appropriated
to Landlord would by reason of such postponement or deferment, be, in the
reasonable judgment of Landlord, in


                                      -21-

<PAGE>   26

imminent danger of being forfeited or lost or subject to any lien, encumbrance
or charge, and neither Landlord nor Tenant would by reason thereof be subject to
any civil or criminal liability; and

            (b) With respect to any Imposition in excess of $1,000,000 (as such
amount shall be increased as provided in Section 7.02(a)), Tenant shall have
deposited with Depository, cash or other security satisfactory to Landlord in an
amount equal to the amount by which (i) the amount so contested and unpaid,
together with all interest and penalties in connection therewith and all charges
that may or might be assessed against or become a charge on the Premises or any
part thereof in such proceedings exceeds (ii) $1,000,000 (as such amount shall
be increased as provided in Section 7.02(a)).

            Upon the termination of such proceedings, it shall be the obligation
of Tenant to pay the amount of such Imposition or part thereof as finally
determined in such proceedings, the payment of which may have been deferred
during the prosecution of such proceedings, together with any costs, fees
(including attorneys' fees and disbursements), interest, penalties or other
liabilities in connection therewith, and upon such payment, Depository shall
return, with interest, if any, any amount deposited with it as aforesaid,
provided, however, that Depository at Tenant's request or upon Tenant's failure
to do so in a timely manner, at Landlord's request, shall disburse said moneys
on deposit with it directly to the Governmental Authority to whom such
Imposition is payable and any remaining monies, with interest, if any, shall be
returned promptly to Tenant. If, at any time during the continuance of such
proceedings, Landlord shall, in its reasonable opinion, deem insufficient the
amount deposited as aforesaid, Tenant, within fifteen (15) days after demand,
shall make an additional deposit of such additional sums or other acceptable
security as Landlord may request, and upon failure of Tenant to do so, the
amount theretofore deposited may be applied at the request of Landlord to the
payment, removal and discharge of such Imposition and the interest and penalties
in connection therewith and any costs, fees (including attorneys' fees and
disbursements) or other liability accruing in any such proceedings, and the
balance, if any, with any interest earned thereon, shall be returned to Tenant
or the deficiency, if any, shall be paid by Tenant to Landlord within ten (10)
days after demand.

            Section 4.06. Tenant shall have the right to seek a reduction in the
valuation of the Premises assessed for Taxes and to prosecute any action or
proceeding in connection therewith, provided that no such action or proceeding
shall postpone Tenant's obligation to pay any Imposition except in accordance
with the provisions of Section 4.05 hereof. Except to the extent provided in
Section 3.03 hereof, no such action or proceeding shall affect Tenants
obligation to pay any installment of PILOT.

            Section 4.07. Landlord shall not be required to join in any
proceedings referred to in Sections 4.05 or 4.06 hereof unless the provisions of
any law, rule or regulation at the time in effect shall require that Landlord
join in such proceedings or that such proceedings be brought by or in the name
of Landlord, in which event, Landlord shall join and cooperate in such
proceedings or permit the same to be brought in its name but


                                      -22-

<PAGE>   27

shall not be liable for the payment of any costs or expenses in connection with
any such proceedings and Tenant shall reimburse Landlord for any and all costs
or expenses which Landlord may reasonably sustain or incur in connection with
any such proceedings, including reasonable attorneys' fees and disbursements. If
the provisions of such law, rule or regulation at the time in effect shall
require that Master Landlord join in such proceedings or that such proceedings
be brought by or in the name of Master Landlord, Landlord shall use reasonable
efforts to cause Master Landlord to join and cooperate in such proceedings or
permit the same to be brought in the name of Master Landlord, provided that
Master Landlord shall not be liable for the payment of any costs or expenses in
connection with any such proceedings and Tenant shall reimburse Master Landlord
for any and all costs and expenses which Master Landlord may reasonably sustain
or incur in connection with any such proceedings, including reasonable
attorneys' fees and disbursements. In the event Tenant shall institute a
proceeding referred to in Sections 4.05 or 4.06 hereof and no law, rule or
regulation in effect at the time requires that Landlord join in such proceedings
or that such proceeding be brought by and/or in the name of Landlord, Landlord,
nevertheless, shall, at Tenant's cost and subject to the reimbursement
provisions hereinabove set forth, cooperate with Tenant in such proceeding.

            Section 4.08. Any certificate, advice or bill of the appropriate
official designated by law to make or issue the same or to receive payment of
any Imposition asserting non-payment of such Imposition shall be prima facie
evidence that such Imposition is due and unpaid at the time of the making or
issuance of such certificate, advice or bill, at the time or date stated
therein.

                                    ARTICLE 5

                            DEPOSITS FOR IMPOSITIONS

            Section 5.01.

            (a) In order to assure the payment of all Impositions, Tenant, upon
the demand of Landlord at any time after the occurrence of an Event of Default
hereunder, shall deposit with Depository on the first day of each month during
the Term, an amount equal to one-twelfth (1/12th) of the annual Impositions then
in effect.

            (b) If at any time the monies so deposited by Tenant shall be
insufficient to pay the next installment of Impositions then due, Tenant shall
after demand therefor by Landlord deposit the amount of the insufficiency with
Depository to enable Depository to pay the next installment of Impositions at
least thirty (30) days prior to the Due Date thereof.

            (c) Depository shall hold the deposited monies in a segregated,
interest-bearing special account for the purpose of paying the charges for which
such amounts have been deposited as they become due, and Depository shall apply
the deposited monies for such purpose nor later than the Due Date for such
charges.


                                      -23-

<PAGE>   28

            (d) If at any time the amount of any Imposition is increased or
Landlord receives information from the entity or entities imposing such
Imposition that an Imposition will be increased, and if the monthly deposits
then being made by Tenant under this Section 5.01 would be insufficient to pay
such Imposition thirty (30) days prior to the Due Date thereof, then upon notice
from Landlord to Tenant of such fact, the monthly deposits shall thereupon be
increased and Tenant shall deposit immediately with Depository sufficient monies
for the payment of the increased Imposition. Thereafter, the monthly payments
shall be adjusted so that Depository shall receive from Tenant sufficient monies
to pay each Imposition at least thirty (30) days prior to the Due Date of such
Imposition.

            (e) For the purpose of determining whether Depository has on hand
sufficient monies to pay any particular Imposition at least thirty (30) days
prior to the Due Date thereof, deposits for each category of Imposition shall be
treated separately. Depository shall not be obligated to use monies deposited
for the payment of an Imposition not yet due and payable for the payment of an
Imposition that is due and payable.

            (f) Notwithstanding the foregoing, (i) deposited monies may be held
by Depository in a single bank account, provided such account is segregated and
interest-bearing and (ii) Depository shall, at Landlord's option and direction
and if Tenant shall fail to make any payment or perform any obligation required
under this Lease, use any monies deposited pursuant to Articles 4 or 5 for the
payment of any Rental.

            (g) If this Lease shall be terminated by reason of any Event of
Default or if dispossession occurs pursuant to Section 24.03(b), all deposited
monies under this Article 5 then held by Depository shall be paid to and applied
by Landlord in payment of any and all sums due under this Lease and Tenant shall
promptly pay the resulting deficiency. All monies deposited under this Article
5, together with interest earned thereon, if any, shall be paid to Tenant
promptly after the Expiration Date or promptly after Tenant terminates this
Lease in accordance with the provisions of Section 2.03 or Article 43 hereof.

            (h) Any interest paid on monies deposited pursuant to this Article 5
shall be applied against amounts thereafter becoming due and payable by Tenant
or returned to Tenant, as aforesaid.

            (i) Anything in this Article 5 to the contrary notwithstanding, if
the Event of Default which gave rise to Landlord having demanded that Tenant
make deposits under this Section 5.01 shall have been cured by Tenant and for a
period of six (6) consecutive months following such cure no Default shall have
occurred under this Lease, then, at any time after the expiration of such six
(6) month period, promptly upon the demand of Tenant, provided that Tenant is
not then in Default under this Lease, all monies deposited under this Article 5
then held by Depository, with the interest, if any, accrued thereon, shall be
returned to Tenant and Tenant shall not be required to make further deposits
under this Article 5 unless and until there shall occur a subsequent Event of
Default and Landlord shall make demand upon Tenant to make deposits for
Impositions.


                                      -24-

<PAGE>   29

            (j) In the event that a Mortgagee (provided such Mortgagee be an
Institutional Lender) shall require Tenant to deposit funds to insure payment of
Impositions, any amount so deposited by Tenant with such Mortgagee shall be
credited against the amount, if any, which Tenant would otherwise be required to
deposit under this Article 5.

            Section 5.02. If Landlord ceases to have any interest in the
Premises, and provided that the Person acquiring Landlord's interest in the
Premises agrees (in writing) to assume from and after the date of the transfer
all of Landlord's obligations with respect to the deposits made pursuant to
Section 5.01, Landlord promptly shall transfer to such Person all of Landlord's
rights with respect to such deposits. Upon such transfer and notice thereof to
Tenant, the transferor shall be released from all liability with respect
thereto, the transferee shall assume from and after the date of such transfer
all of Landlord's obligations with respect to such deposits and Tenant shall
look solely to the transferee with respect thereto. The provisions hereof shall
apply to each successive transfer of the deposits.

            Section 5.03. Landlord shall have no liability to Tenant arising out
of, or related to, any acts or omissions of Depository.

                                    ARTICLE 6

                                  LATE CHARGES

            In the event that any payment of Rental shall become overdue beyond
the due date thereof (or if no such date is set forth in this Lease, then such
due date for purposes of this Article 6 shall be deemed to be the date upon
which demand therefor is made), then, in addition to any costs and expenses
incurred by Landlord in connection therewith (including, without limitation,
reasonable attorneys' fees and disbursements) interest on the sums so overdue
equal to the Involuntary Rate, for the period from the due date to the date of
actual payment, shall become due and payable to Landlord as additional Rental to
be paid under this Lease. Said interest shall be payable by Tenant within ten
(10) days after demand. No failure by Landlord to insist upon the strict
performance by Tenant of its obligations to pay said interest shall constitute a
waiver by Landlord of its right to enforce the provisions of this Article 6 in
any instance thereafter occurring. The provisions of this Article 6 shall not be
construed in any way to extend the grace periods or notice periods provided for
in Article 24.

                                    ARTICLE 7

                                    INSURANCE

            Section 7.01.

            (a) Tenant shall, at all times after Substantial Completion of the
Building and thereafter throughout the Term:


                                      -25-


<PAGE>   30

            (i)         keep or cause to be kept the Building insured under an
                  "All Risk of Physical Loss" form of policy, including, without
                  limitation, coverage for loss or damage by water, flood,
                  subsidence and earthquake (excluding, at Tenant's option, from
                  such coverage normal settling only) and, when and to the
                  extent obtainable from the United States government or any
                  agency thereof, war risks; such insurance to be written on an
                  "Agreed Amount" basis, with full replacement cost, with the
                  replacement value of the Building to be determined from time
                  to time, but not less frequently than required by the insurer
                  and in any event at least once every three (3) years, it being
                  agreed that no omission on the part of Landlord to request any
                  such determination shall relieve Tenant of its obligation to
                  determine the replacement value thereof (in the absence of
                  such valuation, the FM (Factory Mutual) or IRI (Industrial
                  Risk Insurers) Indices will be applied);

            (ii)        provide and keep in force commercial general liability
                  insurance against liability for bodily injury, death and
                  property damage, it being agreed that such insurance shall (A)
                  be in an amount as may from time to time be reasonably
                  required by Landlord, but not less then Twenty-Five Million
                  Dollars ($25,000,000) combined single limit inclusive of
                  primary, umbrella and following form excess policies for
                  liability for bodily injury, death and property damage, (B)
                  include the Premises and all streets, alleys and sidewalks
                  adjoining or appurtenant to the Premises, (C) provide blanket
                  automatic contractual insurance covering the indemnification
                  provisions assumed by Tenant hereunder, including bodily
                  injury to employees or others assumed by Tenant under
                  contract, which insurance shall cover all costs, expenses
                  and/or liability (including, without limitation, attorneys'
                  fees and disbursements) arising out of or based upon any and
                  all claims, accidents, injuries and damages mentioned in
                  Article 19 and required to be insured against hereunder, and
                  (D) include the following protection:

                  (1)   Broad form liability endorsement, including (a) blanket
                        contractual liability, (b) personal injury and
                        advertising injury liability, (c) premises medical
                        payments, (d) host liquor liability, (e) fire legal
                        liability on real property, (f) broad form property
                        damage liability, including completed operations, (g)
                        incidental medical malpractice, (h) non-owned watercraft
                        liability, (i) limited world-wide coverage, (j)
                        additional interests insured, (k) extended bodily injury
                        coverage, and (l) automatic coverage on newly-acquired
                        organizations;


                                      -26-

<PAGE>   31

                  (2)   Products and completed operations;

                  (3)   Independent contractors;

                  (4)   Blanket automatic contractual liability to include
                        bodily injury to employees of others assumed by Tenant;
                        and

                  (5)   Water damage legal liability shall not be excluded.

            (iii) provide and keep in force workers' compensation insurance
                  providing statutory New York State benefits for all persons
                  employed by Tenant at or in connection with the Premises and
                  employer's liability insurance in an amount not less than that
                  required by New York State law;

            (iv)        provide and keep in force on an "Agreed Amount" basis
                  rent insurance on an "All Risk of Physical Loss" basis in an
                  amount not less than one (1) year's current Base Rent, PILOT,
                  and Civic Facilities Payment ("Rent Insurance");

            (v)         if a sprinkler system shall be located in any portion of
                  the Building, provide and keep in force sprinkler leakage
                  insurance in amounts approved by Landlord, which approval
                  shall not be unreasonably withheld (the foregoing to be
                  required only if same is excluded from the insurance required
                  to be provided and kept in force pursuant to Section
                  7.01(a)(i));

            (vi)        provide and keep in force boiler and machinery insurance
                  in an amount as may from time to time be reasonably determined
                  by Landlord but not less than Ten Million Dollars
                  ($10,000,000) per accident on a combined basis covering direct
                  property loss and loss of income and covering all steam,
                  mechanical and electrical equipment, including without
                  limitation, all boilers, unfired pressure vessels, air
                  conditioning equipment, elevators, piping and wiring;

            (vii) provide and keep in force automobile liability insurance for
                  all owned, non-owned, leased, rented and/or hired vehicles
                  insuring against liability for bodily injury and death and for
                  property damage in an amount as may from time to time be
                  reasonably determined by Landlord but not less than Five
                  Million Dollars ($5,000,000) combined single limit; and

            (viii) provide and keep in force such other insurance in such
                  amounts as may from time to time be reasonably required by
                  Landlord against


                                      -27-

<PAGE>   32

                  such other insurable hazards as at the time are commonly
                  insured against by prudent owners of like buildings and
                  improvements.

            (b) All insurance provided by Tenant as required by Section 7.01(a)
(except the insurance under Section 7.01(A)(iii)) shall name Tenant as named
insured and Landlord, Master Landlord, the City and UDC as additional insureds
to the extent, where applicable, of their respective insurable interests in the
Premises and shall be primary with respect to any other coverage which Landlord
and Master Landlord may obtain. (Landlord and Master Landlord's coverage shall
be in excess of any coverage provided in favor of Landlord or Master Landlord by
Tenant.) The coverage provided by Tenant as required by Sections 7.01(a)(i),
(ii), (v), (vi) and (vii) also shall name each Mortgagee as an insured under a
standard mortgagee clause, provided, however, any loss payable thereunder shall
be payable as provided in this Lease.

            (c) Whenever Tenant shall be required to carry insurance under this
Section 7.0, Tenant shall not be required to carry insurance in any greater
amounts or against any additional hazards than at the time are commonly carried
by prudent owners of like buildings and improvements, provided that the types or
amounts of such coverage shall never be different from or less than, as the case
may be, the types or amounts specifically required hereunder unless such types
or amounts are no longer available. Any dispute as to the amounts of additional
insurance to be carried, or the additional kinds of hazards to be insured
against, shall be resolved by arbitration pursuant to Article 36.

            Section 7.02.

            (a) The loss under all policies required by any provision of this
Lease insuring against damage to the Building by fire or other casualty shall be
payable to Depository, except that amounts of less than One Million Dollars
($1,000,000) shall be payable in trust directly to Tenant for application to the
cost of Restoration in accordance with Article 8 hereof. Such amount shall be
adjusted on the fifth (5th) anniversary of the Commencement Date and on each
fifth (5th) anniversary of the date on which an adjustment is made pursuant to
this Section 7.02(a) by adding to $1,000,000 an amount equal to the product of
(x) $1,000,000 and (y) the percent of increase, if any, in the Consumer Price
Index for the month in which the applicable anniversary date occurs over the
Consumer Price Index for the month in which the Commencement Date occurs. Any
dispute as to the calculation of such adjustment shall be determined by
arbitration pursuant to Article 36. Rent Insurance shall be carried in favor of
Landlord, but the proceeds thereof to the extent required hereunder shall be
paid to Depository and shall be applied to the Rental payable by Tenant under
this Lease until completion of such Restoration by Tenant. All insurance
required by any provision of this Lease shall be in such form and shall be
issued by such responsible companies authorized to do business in the State of
New York as are reasonably acceptable to Landlord. All policies referred to in
this Lease shall be procured, or caused to be procured, by Tenant at no expense
to Landlord. Subject to Section 7.04 hereof, duplicate originals of such
policies or certificates of insurance with respect to such policies together
with copies of such policies shall be delivered to Landlord promptly upon
receipt


                                      -28-

<PAGE>   33

from the insurance company or companies, together with proof satisfactory to
Landlord that the then current installment of the premiums thereon have been
paid, provided, that Landlord shall not, by reason of custody of such policies,
be deemed to have knowledge of the contents thereof. New or renewal policies
replacing any policies expiring during the Term or duplicate originals thereof
or certificates of insurance with respect thereto together with copies of such
policies, shall be delivered as aforesaid at least thirty (30) days before the
date of expiration, together with proof satisfactory to Landlord that the then
current installment of the premiums thereon have been paid. Premiums on policies
shall not be financed in any manner whereby the lender, on default or otherwise,
shall have the right or privilege of surrendering or canceling the policies or
reducing the amount of loss payable thereunder, provided, however, that premiums
may be paid in installments.

            (b) Tenant and Landlord shall cooperate in connection with the
collection of any insurance moneys that may be due in the event of loss, and
Tenant and Landlord shall execute and deliver such proofs of loss and other
instruments as may be required for the purpose of obtaining the recovery of any
such insurance moneys. Tenant shall promptly reimburse Landlord for any and all
reasonable costs or expenses which Landlord may sustain or incur in connection
therewith, including, without limitation, reasonable attorneys' fees and
disbursements.

            (c) Tenant shall not carry separate insurance (other than personal
injury liability insurance) concurrent in form or contributing in the event of
loss with that required by this Lease to be furnished by Tenant, unless Landlord
and Master Landlord are included therein as named insureds and each Mortgagee as
an additional insured with loss payable as provided in this Lease. Tenant
promptly shall notify Landlord of the carrying of any such separate insurance
and shall cause the policies therefor or duplicate originals thereof or
certificates of insurance with respect thereto together with copies of such
policies to be delivered as required in this Lease.

            (d) All property insurance policies as required by this Lease shall
provide in substance that all adjustments for claims with the insurers in excess
of One Million Dollars ($1,000,000) (as such amount shall be increased as
provided in Section 7.02(a)) shall be made with Landlord, Tenant and any
Mortgagee named as additional insured. Any adjustments for claims with the
insurers involving sums of less than One Million Dollars ($1,000,000) (as such
amount shall be increased as provided in Section 7.02(a)) shall be made with
Tenant.

            (e) All Rent Insurance shall provide in substance that all
adjustments for claims with the insurers shall be made with Landlord and Tenant.

            (f) Tenant shall not violate or permit to be violated any of the
conditions or provisions of any insurance policy required hereunder, and Tenant
shall so perform and satisfy or cause to be performed and satisfied the
requirements of the companies writing such policies so that at all times
companies of good standing, reasonably satisfactory to Landlord, shall be
willing to write and continue such insurance.


                                      -29-

<PAGE>   34


            (g) Each policy of insurance required to be obtained by Tenant as
herein provided shall contain to the extent obtainable and whether or not an
additional premium shall be required in connection therewith (i) a provision
that no act or omission or negligence of Tenant or any other named insured or
violation of warranties, declarations or conditions by Tenant or any other named
insured shall affect or limit the obligation of the insurance company to pay the
amount of any loss sustained, (ii) an agreement by the insurer that such policy
shall not be cancelled or modified without at least thirty (30) days prior
written notice to Landlord and each Mortgagee, (iii) an agreement that the
coverage afforded by the insurance policy shall not be affected by the
performance of any work in or about the Building or the occupation or use of the
Premises by Tenant or any Subtenant for purposes more hazardous than those
permitted by the terms of such policy, (iv) a waiver by the insurer of any claim
for insurance premiums against Landlord or any named insured other than Tenant,
and (v) a waiver of subrogation by the insurers of any right to recover the
amount of any loss resulting from the negligence of Tenant, Landlord, their
agents, employees or licensees.

            (h) All liability insurance required to be provided and kept in
force by Tenant under this Lease shall be written on an "Occurrence" basis,
provided, however, that if (i) a basis other than such "Occurrence" basis shall
be adapted throughout the insurance industry and (ii) such other basis shall be
accepted by most prudent owners of like buildings and improvements, then Tenant
may provide and keep in force liability insurance written on such other basis
reasonably satisfactory to Landlord.

            Section 7.03.

            (a) Tenant, on the demand of Landlord after the occurrence of an
Event of Default hereunder, shall deposit with Depository on the first day of
each month during the Term, an amount equal to one-twelfth (1/12th) of the
annual insurance premiums to be paid in respect of any insurance required to be
carried by Tenant hereunder, as reasonably estimated by Landlord, unless such
insurance premiums are deposited with a Mortgagee (provided such Mortgagee is an
Institutional Lender). If at any time the insurance premiums shall be increased
or Landlord receives information that the insurance premiums will be increased,
with the result that the monthly deposits being paid by Tenant under this
Section 7.03(a) would be insufficient to pay such insurance premiums thirty (30)
days prior to the due date, the monthly deposits shall thereupon be increased
and Tenant shall, within thirty (30) days prior to the due date thereof, deposit
immediately with Depository sufficient monies for the payment of the increased
insurance premiums. Thereafter, the monthly deposits shall be adjusted so that
Depository shall receive from Tenant sufficient monies to pay the insurance
premiums at least thirty (30) days before the insurance premiums become due and
payable.

            (b) Anything in Section 7.03(a) to the contrary notwithstanding, if
the Event of Default which gave rise to Landlord having demanded that Tenant
make deposits under Section 7.03(a) shall have been cured by Tenant and if for a
period of six (6) consecutive months following such cure no Default shall have
occurred under this Lease, then, at any


                                      -30-

<PAGE>   35

time after the expiration of such six (6) month period, promptly upon the demand
of Tenant, provided that Tenant is not then in Default under this Lease, all
monies deposited under Section 7.03(a) then held by Depository, together with
the interest, if any, accrued thereon, promptly shall be returned to Tenant and
Tenant shall not be required to make further deposits under Section 7.03(a)
unless and until there shall occur a subsequent Event of Default and Landlord
shall make demand upon Tenant to make deposits under Section 7.03(a).

            (c) All monies deposited under this Section 7.03, together with
interest earned thereon, if any, shall be paid to Tenant promptly after the
Expiration Date or promptly after Tenant terminates this Lease in accordance
with the provisions of Section 2.03 or Article 43 hereof.

            (d) Depository shall hold the monies deposited hereunder in a
segregated, interest-bearing account (the purpose of which is to pay the charges
for which such amounts have been deposited as they become due), and Depository
shall apply the deposited monies for such purpose not later than the Due Date
for such charges.

            Section 7.04. The insurance required by this Lease, at the option of
Tenant, may be effected by blanket or umbrella policies issued to Tenant
covering the Premises and other properties owned or leased by Tenant, provided
that the policies otherwise comply with the provisions of this Lease and
specifically allocate to the Premises the coverages required hereby, without
possibility of reduction or coinsurance by reason of any other premises named
therein, and if the insurance required by this Lease shall be effected by any
such blanket or umbrella policies, Tenant shall furnish to Landlord and to each
Mortgagee certified copies or duplicate originals of such policies in place of
the originals, with schedules thereto attached showing the amount of insurance
afforded by such policies applicable to the Premises, and in addition, within
thirty (30) days after the filing thereof with any insurance ratemaking body,
copies of the schedule of all improvements affected by any such blanket or
umbrella policy of insurance.

                                    ARTICLE 8

                            USE OF INSURANCE PROCEEDS

            Section 8.01. If all or any part of the Building shall be destroyed
or damaged in whole or in part by fire or other casualty (including any casualty
for which insurance was not obtained or obtainable) of any kind or nature,
ordinary or extraordinary, foreseen or unforeseen, Tenant shall give to Landlord
immediate notice thereof, except that no notice shall be required if the
estimated cost of repairs, alterations, restorations, replacements and
rebuilding (collectively, "Restoration") shall be less than $250,000 (as such
amount shall be increased as provided in Section 7.02(a)), and Tenant shall,
whether or not such damage or destruction shall have been insured, and whether
or not insurance proceeds, if any, shall be sufficient for the purpose of such
Restoration, with reasonable diligence (subject to Unavoidable Delays) repair,
alter, restore, replace and rebuild


                                      -31-

<PAGE>   36

(collectively, "Restore") the same, at least to the extent of the value and as
nearly as possible to the condition, quality and class of the Building existing
immediately prior to such occurrence, with such changes or alterations as
Tenant, with the consent of Landlord, which consent shall not be unreasonably
withheld, shall elect to make, provided that, after the Restoration, the
Building is in substantial conformity with the Master Development Plan, the
Design Guidelines, the Declaration of Restrictions (if applicable) and, in the
event such Restoration is commenced within ten (10) years after the date the
Building has been Substantially Completed and, insofar as the Restoration
relates to the exterior of the Building, the Construction Documents. Landlord in
no event shall be obligated to Restore the Building or any portion thereof or to
pay any of the costs or expenses thereof. If Tenant shall fail or neglect to
Restore with reasonable diligence (subject to Unavoidable Delays) the Building
or the portion thereof so damaged or destroyed, or having so commenced such
Restoration, shall fail to complete the same with reasonable diligence (subject
to Unavoidable Delays) in accordance with the terms of this Lease, or if prior
to the completion of any such Restoration by Tenant, this Lease shall expire or
be terminated for any reason, Landlord may, but shall not be required to,
complete such Restoration at Tenant's expense. Each such Restoration shall be
done in accordance with the provisions of this Lease. In any case where this
Lease shall expire or be terminated prior to the completion of Restoration,
Tenant shall account to Landlord for all amounts spent in connection with any
Restoration which was undertaken and shall pay over to Landlord, within ten (10)
days after demand, the remainder, if any, of the Restoration Funds previously
received by it. Tenant's obligations under the next to last (penultimate)
sentence of this Section 8.01 shall survive the expiration or termination of
this Lease.

            Section 8.02.

            (a) Subject to the provisions of Sections 8.03, 8.04 and, if
applicable, 8.05, Depository shall pay over to Tenant from time to time, upon
the following terms, any monies which may be received by Depository from
insurance provided by Tenant (other than Rent Insurance) or cash or the proceeds
of any security deposited with Depository pursuant to Section 8.05
(collectively, the "Restoration Funds") provided, however, that Depository,
before paying such moneys over to Tenant, shall be entitled to reimburse itself
and Landlord therefrom to the extent, if any, of the necessary, reasonable and
proper expenses (including, without limitation, reasonable attorneys' fees) paid
or incurred by Depository and Landlord in the collection of such monies.
Depository shall pay to Tenant, as hereinafter provided, the Restoration Funds,
for the purpose of the Restoration.

            (b) Prior to commencing any Restoration, Tenant shall furnish
Landlord with an estimate of the cost of such Restoration, prepared by a
licensed professional engineer or registered architect selected by Tenant and
approved by Landlord, which approval shall not be unreasonably withheld.
Landlord, at Tenant's expense, may engage a licensed professional engineer or
registered architect to prepare its own estimate of the cost of such
Restoration. If there is any dispute as to the estimated cost of the
Restoration, such dispute shall be resolved by arbitration in accordance with
the provisions of Article 36.


                                      -32-

<PAGE>   37

            (c) Subject to the provisions of Sections 8.03, 8.04 and, if
applicable, 8.05, the Restoration Funds shall be paid to Tenant in installments
as the Restoration progresses, less retainage equal to ten percent (10%) of such
installment until completion of fifty percent (50%) of the Restoration and five
percent (5%) of each installment thereafter until completion of the Restoration,
upon application to be submitted by Tenant to Depository and Landlord showing
the cost of labor and materials purchased and delivered to the Premises for
incorporation in the Restoration, or incorporated therein since the last
previous application, and due and payable or paid by Tenant. If any vendor's,
mechanic's, laborer's, or materialman's lien is filed against the Premises or
any part thereof, or if any public improvement lien relating to the Restoration
of the Premises is created or permitted to be created by Tenant and is filed
against Landlord, or any assets of, or funds appropriated to, Landlord, Tenant
shall not be entitled to receive any further installment until such lien is
satisfied or discharged (by bonding or otherwise). Notwithstanding the
foregoing, the existence of any such lien shall not preclude Tenant from
receiving any installment of Restoration Funds, provided such lien will be
discharged with funds from such installment or shall have been discharged (by
bonding or otherwise).

            (d) Upon completion of and payment for the Restoration by Tenant,
the balance of the Restoration Fund shall be paid over to Tenant promptly.

            (e) Notwithstanding the foregoing, if Landlord makes the Restoration
at Tenant's expense, as provided in Section 8.01, then Depository shall pay over
the Restoration Funds to Landlord, upon request, to the extent not previously
paid to Tenant pursuant to this Section 8.02, and Tenant shall pay to Landlord,
within ten (10) days after demand, any sums in excess of the portion of the
Restoration Funds received by Landlord necessary to complete the Restoration.
Upon completion of the Restoration, Landlord shall deliver to Tenant a
certificate, in reasonable detail, setting forth the expenditures made by
Landlord for such Restoration.

            Section 8.03. The following shall be conditions precedent to each
payment made to Tenant as provided in Section 8.02 above:

            (a) There shall be submitted to Depository and Landlord the
certificate of the aforesaid engineer or architect approved by Landlord pursuant
to Section 8.02(b) stating that (i) the sum then requested to be withdrawn
either has been paid by Tenant or is due and payable to contractors,
subcontractors, materialmen, engineers, architects or other Persons (whose names
and addresses shall be stated) who have rendered or furnished services or
materials for the work and giving a brief description of such services and
materials and the principal subdivisions or categories thereof and the several
amounts so paid or due to each of said Persons in respect thereof, and stating
in reasonable detail the progress of the work up to the date of said
certificate, (ii) no part of such expenditures has been or is being made the
basis, in any previous or then pending requisition, for the withdrawal of the
Restoration Funds or has been made out of the Restoration Funds previously
received by Tenant, and (iii) the engineer or architect believes that the
balance of the Restoration Funds held by


                                      -33-

<PAGE>   38

Depository will be sufficient to pay for the completion of the Restoration in
full, and stating in reasonable detail an estimate of the cost of such
completion;

            (b) there shall be furnished to Landlord an official search, or a
certificate of a title insurance company reasonably satisfactory to Landlord, or
other evidence reasonably satisfactory to Landlord, showing that there has not
been filed any vendor's, mechanic's, laborer's or materialman's statutory or
other similar lien affecting the Premises or any part thereof, or any public
improvement lien with respect to the Premises or the Restoration created or
permitted to be created by Tenant affecting Landlord, or the assets of, or funds
appropriated to, Landlord, which has not been discharged of record (by bonding
or otherwise) except such as will be discharged upon payment of the requisite
amount out of the sum then requested to be withdrawn; and

            (c) at the time of making such payment, there is no Event of Default
on the part of Tenant.

            Section 8.04.

            (a) If any loss, damage or destruction occurs, the cost of
Restoration of which equals or exceeds One Million Dollars ($1,000,000) in the
aggregate, determined as provided in Section 8.02(b) (as such amount shall be
increased as provided in Section 7.02(a)), Tenant shall furnish to Landlord the
following:

            (i)         at least thirty (30) Business Days prior to commencement
                  of such Restoration, complete plans and specifications for the
                  Restoration, prepared by a licensed professional engineer or
                  registered architect selected by Tenant and approved by
                  Landlord, which approval shall not be unreasonably withheld
                  (provided, however, if such Restoration does not relate to the
                  "core and shell" of the Building or affect any aspect of the
                  Design Guidelines, Landlord's approval shall not be withheld
                  provided such architect is not a Prohibited Person), together
                  with the approval thereof and any required permits issued by
                  any Governmental Authority with respect to the Restoration and
                  such plans and specifications, and, at the request of
                  Landlord, any other drawings, information or samples to which
                  Landlord is entitled under Article 11, all of the foregoing to
                  be subject to Landlord's review and approval for substantial
                  conformity with the Master Development Plan, the Design
                  Guidelines, the Declaration of Restrictions (if applicable),
                  such review and approval to be conducted by Landlord within
                  the time periods and otherwise in accordance with the
                  provisions of Article 11, and, if such Restoration is
                  commenced within ten (10) years from the date the Building
                  shall have been Substantially Completed, and insofar as it
                  relates to the exterior of the Building, the Construction
                  Documents;


                                      -34-

<PAGE>   39

            (ii)        at least ten (10) Business Days prior to commencement of
                  such Restoration, (x) a contract or construction management
                  agreement reasonably satisfactory to Landlord in form
                  assignable to Landlord (subject to any prior assignment to any
                  Mortgagee), made with a reputable and responsible contractor
                  or construction manager approved by Landlord, which approval
                  shall not be unreasonably withheld, providing for the
                  completion of the Restoration in accordance with said plans
                  and specifications, free and clear of all liens, encumbrances,
                  security agreements, interests and financing statements
                  relating thereto, and (y) payment and performance bonds in
                  forms and by sureties satisfactory to Landlord, naming the
                  contractor as obligor and Landlord and Tenant and Mortgagee,
                  if applicable, as obligees, each in a penal sum equal to the
                  amount by which (A) the difference between the estimated cost
                  of the Restoration and the amount of the insurance proceeds
                  available for the Restoration exceeds (B) $1,000,000 (as such
                  amount shall be increased as provided in Section 7.02(a)) or,
                  in lieu thereof, such other security, but not more than the
                  amount of such excess, as shall be reasonably satisfactory to
                  Landlord;

            (iii) at least ten (10) Business Days prior to commencement of such
                  Restoration, an assignment to Landlord (subject to any prior
                  assignment to any Mortgagee) of the contract so furnished and
                  the bonds, if any, provided thereunder, such assignment to be
                  duly executed and acknowledged by Tenant and by its terms to
                  be effective only upon any termination of this Lease or upon
                  Landlord's re-entry upon the Premises following an Event of
                  Default prior to the complete performance of such contract,
                  such assignment also to include the benefit of all payments
                  made on account of said contract including payments made prior
                  to the effective date of such assignment, and

            (iv)        At least ten (10) Business Days prior to commencement of
                  such Restoration, insurance policies issued by responsible
                  insurers, bearing notations evidencing the payment of premiums
                  or accompanied by other evidence satisfactory to Landlord of
                  such payments, for the insurance required by Section 11.03.

            (b) Notwithstanding that the cost of Restoration is less than One
Million Dollars ($1,000,000) (as such amount shall be increased as provided in
Section 7.02(a)), such cost to be determined as provided in Section 8.02(b), to
the extent that any portion of the Restoration involves work on the exterior of
the Building or a change in the height, bulk or setback of the Building from the
height, bulk or setback existing immediately prior to the damage or destruction,
or in any other manner affects compliance with the Master Development Plan, the
Design Guidelines or the Declaration of Restrictions (if applicable),


                                      -35-

<PAGE>   40

then Tenant shall furnish to Landlord at least thirty (30) Business Days prior
to commencement of the Restoration a complete set of plans and specifications
for the Restoration, involving such work or such change, prepared by a licensed
professional engineer or registered architect approved by Landlord, which
approval shall not be unreasonably withheld, and, at Landlord's request, such
other items designated in Section 8.04(a)(i), all of the foregoing to be subject
to Landlord's review and approval as provided therein.

            (c) In the event Tenant shall desire to modify the plans and
specifications which Landlord theretofore has approved pursuant to Sections
8.04(a)(i) or 8.04(b) with respect to, or which will in any way affect, any
aspect of the exterior of the Building or the height, bulk or setback of the
Building or which will affect compliance with the Design Guidelines, the Master
Development Plan or the Declaration of Restrictions (if applicable), Tenant
shall submit the proposed modifications to Landlord. Tenant shall not be
required to submit to Landlord proposed modifications of the plans and
specifications which affect the interior of the Building. Landlord shall review
the proposed changes (other than changes to the interior of the Building) for
the sole purpose of determining whether or not they (i) conform to the Master
Development Plan, the Design Guidelines and the Declaration of Restrictions (if
applicable) and (ii) in Landlord's judgment reasonably exercised, provide for
design, finishes and materials which are comparable in quality to those provided
for in the approved plans and specifications, and shall approve such proposed
changes if they do so conform and so provide. If Landlord determines that the
proposed changes are not satisfactory in light of the above criteria, it shall
so advise Tenant, specifying in what respect the plans and specifications, as so
modified, do not conform to the Master Development Plan, the Design Guidelines
or the Declaration of Restrictions (if applicable) or do not provide for design,
finishes and materials which are comparable in quality to those provided for in
the approved plans and specifications. Within twenty (20) Business Days after
Landlord shall have so notified Tenant, Tenant shall revise the plans and
specifications so as to meet Landlord's objections and shall deliver same to
Landlord for review. Each initial review by Landlord shall be carried out within
fifteen (15) Business Days of the date of delivery of the initial plans and
specifications by Tenant, and each additional review by Landlord shall be
carried out within ten (10) Business Days of the date of delivery of Tenant's
revisions thereto, and if Landlord shall not have notified Tenant of its
determination within such fifteen (15) or ten (10) Business Day period, as the
case may be, it shall be deemed to have determined that the proposed changes are
satisfactory. Landlord shall not review portions of the approved plans and
specifications which Landlord has previously determined to be satisfactory,
provided same have not been changed by Tenant.

            Section 8.05. If the cost of any Restoration, determined as provided
in Section 8.02(b), exceeds both (i) One Million Dollars ($1,000,000) (as such
amount shall be increased as provided in Section 7.02(a)) and (ii) the net
insurance proceeds, then, prior to the commencement of such Restoration, unless
Landlord has given its approval of the payment and performance bonds provided
for in Section 8.04(a)(ii)(y) and the amounts thereof cover such excess, Tenant
shall deposit with Depository, as security for completion


                                      -36-

<PAGE>   41

of the Restoration, a bond, cash or other security satisfactory to Landlord in
the amount by which (A) such excess exceeds (B) $1,000,000 (as such amount shall
be increased as provided in Section 7.02(a)), to be held and applied by
Depository in accordance with the provisions of Section 8.02.

            Section 8.06. This Lease shall not terminate or be forfeited or be
affected in any manner, and there shall be no reduction or abatement of the
Rental payable hereunder, by reason of damage to or total, substantial or
partial destruction of the Building or any part thereof or by reason of the
untenantability of the same or any part thereof, for or due to any reason or
cause whatsoever, and Tenant, notwithstanding any law or statute present or
future, waives any and all rights to quit or surrender the Premises or any part
thereof. Tenant expressly agrees that its obligations hereunder, including,
without limitation, the payment of Rental, shall continue as though the Building
had not been damaged or destroyed and without abatement, suspension, diminution
or reduction of any kind. It is the intention of Landlord and Tenant that the
foregoing is an "express agreement to the contrary" as provided in Section 227
of the Real Property Law of the State of New York.

            Section 8.07. If for any completed Restoration Tenant has not
theretofore delivered same to Landlord, Tenant shall deliver to Landlord, within
thirty (30) days of the completion of such Restoration, a complete set of "as
built" plans thereof together with a statement in writing from a registered
architect or licensed professional engineer that such plans are complete and
correct.

                                    ARTICLE 9

                                  CONDEMNATION

            Section 9.01.

            (a) If the whole or substantially all of the Premises shall be taken
(excluding a taking of the fee interest in the Premises, or any leasehold
interest superior to that of the Tenant's, if after such taking, Tenant's rights
and obligations under this Lease are not affected) for any public or
quasi-public purpose by any lawful power or authority by the exercise of the
right of condemnation or eminent domain or by agreement among Landlord, Tenant
and those authorized to exercise such right, this Lease and the Term shall
terminate and expire on the date of such taking and the Rental payable by Tenant
hereunder shall be equitably apportioned as of the date of such taking. Landlord
shall return the security deposit or Letter of Credit to Tenant promptly, and
this Lease, the Occupancy Agreement, the Funding Agreement and any and all
obligations and liabilities of Tenant under any of the foregoing shall terminate
and expire as of the date of such taking.

            (b) The term "substantially all of the Premises" shall mean such
portion of the Premises as when so taken would leave remaining a balance of the
Premises which, due either to the area so taken or the location of the part so
taken in relation to the part not so taken, would not under economic conditions,
applicable zoning laws, building


                                      -37-

<PAGE>   42

regulations then existing or prevailing or the Master Development Plan,
Occupancy Agreement, Severance Tenants Agreement or Declaration of Restrictions
and after performance by Tenant of all covenants, agreements, terms and
provisions contained herein or by law required to be observed or performed by
Tenant, permit the Restoration of the Building so as to constitute a complete
building or buildings capable of achieving the NYMEX Use. If there be any
dispute as to whether or not "substantially all of the Premises" has been taken,
such dispute shall be resolved by arbitration in accordance with the provisions
of Article 36.

            (c) If the whole or substantially all of the Premises shall be taken
or condemned as provided in Section 9.01(a), the award, awards or damages in
respect thereof shall be apportioned as follows: (i) there shall first be paid
to Landlord so much of the award which is for or attributable to the value of
(A) the Land so taken, considered as unencumbered by this Lease and the Master
Lease and as unimproved except for Landlord's Civic Facilities and other site
improvements made by Landlord, and (B) Landlord's Civic Facilities taken in any
proceeding with respect to such taking; (ii) there shall next be paid to the
Mortgagee which holds a first lien on Tenant's interest in this Lease, so much
of the balance of such award as shall equal the unpaid principal indebtedness
secured by such Mortgage with interest thereon at the rate specified therein to
the date of payment (provided the amount of the Mortgage did not exceed the
amount by which the cost of the Project (including all costs of borrowing,
reserve funds and capitalized interest not to exceed three (3) years) exceeded
the amounts paid to Tenant under the Funding Agreement; (iii) if such taking
shall be by the United States of America or any instrumentality thereof, the
amount funded by EDC under the Funding Agreement shall be amortized over fifteen
(15) years from the date of the last advance by EDC under the Funding Agreement
and there shall next be paid to Landlord, for payment by Landlord under the
Project Agreement to UDC and EDC, respectively, the unamortized portion thereof
unless Tenant shall have elected to remain in New York City, in which event,
such portion of the award shall be paid to Tenant; (iv) there shall next be paid
to Landlord so much of the award which is for or attributable to the value of
Landlord's reversionary interest in that part of the Building taken in such
proceeding (it being agreed between Landlord and Tenant that, notwithstanding
anything herein contained to the contrary, for a period of forty (40) years from
the Scheduled Completion Date, the value of Landlord's reversionary interest in
the Building shall be deemed to be zero); and (v) subject to rights of any
Mortgagees, Tenant shall receive the balance, if any, of the award. If there be
any dispute as to which portion of the award is attributable to the Land and
Landlord's Civic Facilities and which portion is attributable to the Building,
or as to the value of Landlord's reversionary interest in the Building, such
dispute shall be resolved by arbitration in accordance with the provisions of
Article 36.

            (d) Each of the parties shall execute any and all documents that may
be reasonably required in order to facilitate collection by them of such awards.

            Section 9.02. For purposes of this Article 9, the "date of taking"
shall be deemed to be the earlier of (i) the date on which actual possession of
the whole or


                                      -38-

<PAGE>   43

substantially all of the Premises, or a part thereof, as the case may be, is
acquired by any lawful power or authority pursuant to the provisions of the
applicable federal or New York State law or (ii) the date on which title to the
Premises or the aforesaid portion thereof shall have vested in any lawful power
or authority pursuant to the provisions of the applicable federal or New York
State law.

            Section 9.03. If less than substantially all of the Premises shall
be so taken, this Lease and the Term shall continue as to the portion of the
Premises remaining without abatement of the Base Rent or diminution of any of
Tenant's obligations hereunder. Tenant, whether or not the award or awards, if
any, shall be sufficient for the purpose shall (subject to Unavoidable Delays)
proceed diligently to Restore any remaining part of the Building not so taken so
that the latter shall be a complete, operable, self-contained architectural unit
in good condition and repair in conformity with the Master Development Plan, the
Design Guidelines, the Declaration of Restrictions (if applicable) and, to the
extent reasonably practicable, in the event such Restoration is commenced within
ten (10) years from the date the Building is Substantially Completed, the
Construction Documents. In the event of any taking pursuant to this Section
9.03, the entire award for or attributable to the Land taken, considered as
unimproved and unencumbered by this Lease and the Master Lease and the fair
market value of Landlord's Civic Facilities in any proceeding with respect to
such taking, shall be first paid to Landlord, and the balance of the award, if
any, shall be paid to Depository, except that if such balance shall be less than
One Million Dollars ($1,000,000) (as such amount shall be increased as provided
in Section 7.02(a)), such balance shall be payable, in trust, to Tenant
(provided that if the Master Lease requires payment in trust to Landlord or a
Mortgagee, such balance shall be paid as provided therein) for application to
the cost of Restoration of the part of the Building not so taken. Subject to the
provisions and limitations in this Article 9, Depository shall make available to
Tenant as much of that portion of the award actually received and held by
Depository, if any, less all necessary and proper expenses paid or incurred by
Depository, the Mortgagee most senior in lien and Landlord in the condemnation
proceedings, as may be necessary to pay the cost of Restoration of the part of
the Building remaining. Such Restoration shall be done in accordance with and
subject to the provisions of Article 8. Payments to Tenant as aforesaid shall be
disbursed in the manner and subject to the conditions set forth in Article 8.
Any balance of the award held by Depository and any cash and the proceeds of any
security deposited with Depository pursuant to Section 9.04 remaining after
completion of the Restoration shall be paid to Tenant. Each of the parties shall
execute any and all documents that may be reasonably required in order to
facilitate collection by them of such awards.

            Section 9.04. With respect to any Restoration required by the terms
of Section 9.03, the cost of which, as determined in the manner set forth in
Section 8.02(b), exceeds both (i) One Million Dollars ($1,000,000) (as such
amount shall be increased as provided in Section 7.02(a)) and (ii) the balance
of the condemnation award after payment of the expenses set forth in Section
9.03, then, prior to the commencement of such Restoration, Tenant shall deposit
with Depository a bond, cash or other security satisfactory to Landlord in the
amount by which (A) such excess exceeds (B) $1,000,000 (as such


                                       39

<PAGE>   44

amount shall be increased as provided in Section 7.02(a)), to be held and
applied by Depository in accordance with the provisions of Section 9.03, as
security for the completion of the Restoration.

            Section 9.05. If the temporary use of the whole or any part of the
Premises shall be taken for any public or quasi-public purpose by any lawful
power or authority by the exercise of the right of condemnation or eminent
domain or by agreement between Tenant and those authorized to exercise such
right, Tenant shall give prompt notice thereof to Landlord and the Term shall
not be reduced or affected in any way and Tenant shall continue to pay in full
the Rental payable by Tenant hereunder without reduction or abatement, and
Tenant shall be entitled to receive for itself any award or payments for such
use, provided, however, that:

            (a) If the taking is for a period not extending beyond the Term and
if such award or payment is made less frequently than in monthly installments,
the same shall be paid to and held by Depository as a fund which Depository
shall apply from time to time to the payment of Rental, except that, if such
taking results in changes or alterations in the Building which would necessitate
an expenditure to Restore the Building to its former condition, then, a portion
of such award or payment considered by Landlord, in its reasonable opinion, as
appropriate to cover the expenses of the Restoration shall be retained by
Depository, without application as aforesaid, and applied and paid over toward
the Restoration of the Building to its former condition, substantially in the
same manner and subject to the same conditions as provided in Section 9.03; and
any portion of such award or payment which shall not be required pursuant to
this Section 9.05(a) to be applied to the Restoration of the Building or to the
payment of Rental until the end of the Term (or, if the taking is for a period
terminating prior to the end of the Term, until the end of such period) shall be
paid to Tenant; or

            (b) If the taking is for a period extending beyond the Term, such
award or payment shall be apportioned between Landlord and Tenant as of the
Expiration Date, and Landlord's and Tenant's share thereof, if paid less
frequently than in monthly installments, shall be paid to Depository and applied
in accordance with the provisions of Section 9.05(a), provided, however, that
the amount of any award or payment allowed or retained for the Restoration of
the Building and not previously applied for such purpose shall remain the
property of Landlord if this Lease shall expire prior to such Restoration.

            Section 9.06. In case of any governmental action, not resulting in
the taking or condemnation of any portion of the Premises but creating a right
to compensation therefor, such as the changing of the grade of any street upon
which the Premises abut, this Lease shall continue in full force and effect
without reduction or abatement of Rental and the award shall be paid to Landlord
to the extent of the amount, if any, necessary to restore any portion of
Landlord's Civic Facilities to their former condition and any balance remaining
shall be paid to Tenant.


                                      -40-

<PAGE>   45

            Section 9.07. In the event of a negotiated sale of all or a portion
of the Premises in lieu of condemnation, the proceeds shall be distributed as
provided in cases of condemnation.

            Section 9.08. Landlord, Tenant and any Mortgagee shall be entitled
to file a claim and otherwise participate in any condemnation or similar
proceeding and all hearings, trials and appeals in respect thereof.

            Section 9.09. Notwithstanding anything to the contrary contained in
this Article 9, in the event of any permanent or temporary taking of all or any
part of the Premises, Tenant and its Subtenants shall have the exclusive right
to assert claims for any Equipment, trade fixtures and personal property so
taken which were the property of Tenant or its Affiliates or Subtenants (but not
including any Fixtures) and for relocation expenses of Tenant or its Affiliates
or Subtenants, and all awards and damages in respect thereof shall belong to
Tenant, its Affiliates and its Subtenants, and Landlord hereby waives any and
all claims to any part thereof; provided, however, that if there shall be no
separate award or allocation for such Equipment, trade fixtures or personal
property, then such claims of Tenant, its Affiliates and its Subtenants, or
awards and damages, shall be subject and subordinate to Landlord's claims under
this Article 9.

                                   ARTICLE 10

                     ASSIGNMENT, SUBLETTING, MORTGAGES, ETC.

            Section 10.01.

            (a) Except as otherwise specifically provided in this Article 10,
prior to the Lease Restrictions Expiration Date, neither this Lease nor any
interest of Tenant in this Lease, shall be sold, assigned, or otherwise
transferred, whether by operation of law or otherwise, nor shall any of the
issued or outstanding capital stock of any corporation which, directly or
indirectly, is Tenant be (voluntarily or involuntarily) sold, assigned,
transferred, pledged or encumbered, whether by operation of law or otherwise, if
such sale, assignment, transfer, pledge or encumbrance will result in a change
of the controlling stock ownership of Tenant as held by the shareholders thereof
as of the Commencement Date, nor shall any voting trust or similar agreement be
entered into with respect to such stock, nor any reclassification or
modification of the terms of such stock take place, nor shall there be any
merger or consolidation of such corporation into or with another corporation nor
shall additional stock (or any warrants, options or debt securities convertible,
directly or indirectly, into such stock) in any such corporation be issued if
the issuance of such additional stock (or such other securities, when exercised
or converted into stock) will result in a change of the controlling stock
ownership of such corporation as held by the shareholders thereof as of the
Commencement Date, nor shall any general partner's interest in a partnership
which is Tenant be (voluntarily or involuntarily) sold, assigned or transferred
(each of the foregoing transactions with respect to stock or other securities of
a corporation or a general partner's interest in a partnership being herein
referred to as a


                                      -41-

<PAGE>   46

"Transfer"), nor shall Tenant sublet the Premises as an entirety or
substantially as an entirety (except for occupancy by the Subtenant thereunder),
without the consent of Landlord in each case and the delivery to Landlord of the
documents and information specified in Section 10.01(d) hereof. Notwithstanding
the foregoing, the buying or selling of seats on an Exchange in the normal
course of business shall not constitute a "Transfer". Notwithstanding the
foregoing, prior to the Lease Restrictions Expiration Date, NYMEX shall have the
right to reorganize, consolidate with or merge into another corporation, or
permit one or more corporations to consolidate with or merge into it, terminate
its corporate existence, or dissolve or sell or assign or otherwise transfer all
or substantially all of its stock, business or assets to another provided:

            (i) (A) NYMEX is the surviving, resulting or transferee entity, as
the case may be or (B) in the event that NYMEX is not the surviving, resulting
or transferee entity, as the case may be, provided such successor or assign (1)
is subject to service of process and duly qualified to do business in New York
State, (2) shall have delivered evidence reasonably satisfactory to Landlord
confirming and accepting all of the obligations of NYMEX under the Occupancy
Agreement and (3) is not a Prohibited Person; and

            (ii) Landlord shall have received a letter signed by the C.P.A.,
stating that (A) the surviving, resulting or transferee entity (whether NYMEX or
another entity), has a net worth at least equal to the amount of liquidated
damages which would be due under Section 5(a) of the Occupancy Agreement were a
failure to occur on the day of such reorganization, consolidation, merger, sale
or assignment and (B) such reorganization, consolidation, merger, sale or
assignment does not impair the ability of the surviving, resulting or transferee
entity to meet all such entity's obligations and liabilities.

            (b) From and after the Lease Restrictions Expiration Date, and
subject to the provisions of this Section 10.01, Tenant may assign this Lease
and any interest of Tenant in this Lease (whether by operation of law or
otherwise), sublet the Premises as an entirety or substantially as an entirety
(whether or not for occupancy by the Subtenant thereunder) or enter into or
effect any Transfer, without first obtaining Landlord's approval, provided no
Default shall have occurred and then be continuing hereunder, unless such
Default is cured simultaneously with such Transfer, assignment or subletting.

            (c) Except as otherwise specifically provided herein, in no event,
whether before or after the Lease Restrictions Expiration Date, shall Tenant
make a Transfer, assign this Lease or any portion of its interest hereunder
(whether by operation of law or otherwise) or sublet the Premises as an entirety
or substantially as an entirety (whether or not for occupancy by the Subtenant
thereunder) to any Person (hereinafter, a "Prohibited Person") in which an
ownership interest, in the aggregate, of five percent (5%) or greater is then
held, directly or indirectly, by any individual (i) who has ever been convicted
of a felony, (ii) against whom any action or proceeding is pending to enforce
rights of the State of New York or any agency, department, public authority or
public benefit corporation thereof arising out of a mortgage obligation to the
State of New York or to any such agency, department, public authority or public
benefit corporation or (iii) with respect to


                                      -42-

<PAGE>   47

whom any notice of substantial monetary default which remains uncured has been
given by the State of New York or any agency, department, public authority or
any public benefit corporation thereof arising out of a mortgage obligation to
the State of New York or to any such agency, department, public authority or
public benefit corporation. The determination by Landlord whether or not a
person is a Prohibited Person shall be made within twenty (20) days after
receipt of all requisite information and documentation required for such
determination. If Landlord shall not have notified Tenant of such determination
within such period, it shall be deemed to have determined that such Person is
not a Prohibited Person.

            (d) In each instance wherein Tenant desires to effect prior to the
Lease Restrictions Expiration Date an assignment, a sublease of the Premises as
an entirety or substantially as an entirety (except for occupancy by the
Subtenant thereunder) or a Transfer (in which event such assignment, subletting
or Transfer shall be subject to the prior consent of Landlord in accordance with
the provisions of Section 10.01(a) and (c) hereof), then, Tenant shall, prior
to the effective date of such transaction, notify Landlord of the proposed
transaction and submit to Landlord the following documents and information
(which documents may be unexecuted but shall, in all other respects, be in
substantially final form):

            (i)         in the case of an assignment, (A) a copy of the proposed
                  instrument(s) of assignment, containing, inter alia, the name,
                  address and telephone number of the assignee, redacted to
                  strike or delete confidential business terms, (B) a copy of
                  the proposed instrument(s) of assumption of Tenant's
                  obligations under this Lease by said assignee, and (C) an
                  affidavit of the assignee or an authorized officer or general
                  partner thereof, setting forth (x) in the case of a
                  partnership, the names and addresses of all general partners
                  thereof and all other partners of the assignee having a five
                  percent (5%) or greater ownership interest in the assignee and
                  (y) in the case of a corporation (other than a corporation
                  whose common stock is traded on a recognized exchange or
                  over-the-counter exchange or is registered under the
                  Securities Act of 1933, as amended) the names and addresses of
                  all persons having five percent (5%) or greater record
                  ownership of stock in, and all directors and officers of, the
                  assignee;

            (ii)        in the case of a subletting of the Premises as an
                  entirety or substantially as an entirety (except for occupancy
                  by the Subtenant thereunder), (A) a copy of the proposed
                  sublease, containing, inter alia, the name, address, and
                  telephone number of the subtenant but redacted to strike or
                  delete confidential business terms, and (B) an affidavit of
                  the subtenant or an authorized officer or general partner
                  thereof, setting forth the same information with respect to
                  the partners, shareholders, officers and directors of the
                  subtenant as is required with respect to assignees under
                  Section 10.01(d)(i);


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<PAGE>   48

            (iii) in the case of a Transfer, (A) a copy of each material,
                  proposed document by which such Transfer is to be
                  accomplished, redacted to strike or delete confidential
                  business terms, and (B) an affidavit of an authorized officer
                  or general partner of Tenant, setting forth the same
                  information with respect to the partners, shareholders,
                  officers and directors of Tenant as is required with respect
                  to assignees under Section 10.01(d)(i); and

            (iv)        in all such cases, such other documents and information
                  as Landlord may reasonably request to permit Landlord to
                  determine whether such assignment, sublease or Transfer is in
                  accordance with the provisions of this Article 10.

            Landlord shall within twenty (20) days after receipt of all
requisite information and documentation, notify Tenant whether it grants its
consent if such consent is required hereunder, specifying, in the event that
Landlord denies its consent to such transaction or determines that any such
documentation or any such information does not establish such compliance, the
reason for such denial or determination. If Landlord shall not have notified
Tenant of such denial or determination within such period, it shall be deemed to
have consented to the proposed transaction if such consent is required and to
have determined that the documents and the information submitted establish
compliance with the provisions of Section 10.0(c) and Section 10.01(d). Tenant
shall promptly deliver to Landlord executed documents substantially the same as
those previously delivered to Landlord for review.

            (e) Subject to compliance by a Mortgagee with the provisions of
Section 10.10 and Section 10.11 hereof, the foregoing requirement of consent by
Landlord shall not apply to the acquisition of the Premises by such Mortgagee,
or by any designee or nominee of such Mortgagee through the foreclosure of its
Mortgage or through a deed or instrument of transfer delivered in lieu of such
foreclosure, so long as such Mortgagee (or designee or nominee) shall, in the
instrument transferring to such Mortgagee the interest of Tenant hereunder,
assume and agree to perform all of the terms, covenants and conditions of this
Lease thereafter to be observed or performed by Tenant (excluding compliance
with the Occupancy Requirement and Minimum Requirement). Each reference in this
Section 10.01(e) to "Mortgagee" shall be deemed to include a wholly owned
subsidiary (directly or indirectly) of such Mortgagee or its direct parent,
provided such Mortgagee has delivered to Landlord a written notice advising that
such a subsidiary should be so deemed and certifying (i) that such subsidiary is
wholly owned (direct or indirect) by such Mortgagee or its direct parent and
(ii) that such subsidiary is authorized to act in the place and stead of such
Mortgagee.

            (f) Tenant shall not, without the prior consent of Landlord, which
consent may be withheld by Landlord in Landlord's sole discretion, submit
Tenant's leasehold estate in the Premises, or any part thereof, to the
provisions of Article 9-B of the Real Property Law of the State of New York, as
it may be amended.


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<PAGE>   49

            Section 10.02. No assignment of this Lease, subletting of the
Premises as an entirety or substantially as an entirety or Transfer shall have
any validity except upon compliance with the provisions of this Article 10.

            Section 10.03. Any consent by Landlord under Section 10.01 above
shall apply only to the specific transaction thereby authorized and shall not
relieve Tenant from any requirement hereunder of obtaining the consent of
Landlord to any further sale or assignment of this Lease or Transfer or
subletting of the Premises as an entirety or substantially as an entirety.

            Section 10.04. Tenant may, without Landlord's consent, at any time,
and from time to time, but subject to the provisions of the Occupancy Agreement,
including compliance with the Minimum Requirement, and this Section 10.04, enter
into agreements for the rental of space in the Building, or the occupancy of
such space pursuant to licenses or concessions for periods shorter than or equal
to the remainder of the Term at the time of such agreements (all of such
agreements being herein referred to collectively as "Subleases", and the
occupants pursuant to Subleases as "Subtenants"). In the event that Tenant, at
any time prior to the expiration of the fifteenth anniversary of the Occupancy
Date, shall have entered into a Sublease and the Subtenant thereunder shall not
be an Affiliate of Tenant or a Service Provider, then, Tenant shall pay, with
respect to such sublet premises and during the term of such Sublease, an
increase in PILOT equal to Taxes on such sublet premises (subject, however, to
any real property tax abatement, deferral or exemption which would be available
from time to time if the Premises were owned by an entity not exempt from the
payment of Taxes). Each Sublease shall obligate the Subtenant pursuant thereto
to occupy and use the premises included therein for purposes consistent with the
Requirements, the Master Lease, the Certificate of Occupancy and the Master
Development Plan. Tenant shall promptly and diligently enforce all of its rights
as the landlord under all Subleases in accordance with the terms thereof.

            Section 10.05. The fact that a violation or breach of any of the
terms, provisions or conditions of this Lease or of the Master Lease results
from or is caused by an act or omission by any Subtenant or any other occupant
of the Building shall not relieve Tenant of Tenant's obligation to cure the
same. Tenant shall take any and all reasonable steps necessary to prevent any
such violation or breach.

            Section 10.06. Landlord, after an Event of Default by Tenant, may,
subject to the rights of any Mortgagee (provided such Mortgagee is an
Institutional Lender), collect subrent and all other sums due under Subleases,
and apply the net amount collected to Rental, but no such collection shall be,
or be deemed to be, a waiver of any agreement, term, covenant or condition of
this Lease or the acceptance by Landlord of any Subtenant as tenant hereunder,
or a release of Tenant from performance by Tenant of its obligations under this
Lease.

            Section 10.07. To secure the prompt and full payment by Tenant of
the Rental and the faithful performance by Tenant of all the other terms and
conditions herein contained on its part to be kept and performed, Tenant hereby
assigns, transfers and sets


                                      -45-

<PAGE>   50

over unto Landlord, subject to any assignment of Subleases and/or rents made in
connection with any Mortgage (provided the Mortgagee thereunder is an
Institutional Lender), all of Tenant's right, title and interest in and to all
Subleases and hereby confers upon Landlord, its agents and representatives, a
right of entry in, and sufficient possession of, the Premises to permit and
insure the collection by Landlord of the rentals and other sums payable under
the Subleases. The exercise of the right of entry and qualified possession by
Landlord shall not constitute an eviction of Tenant from the Premises or any
portion thereof and, should said right of entry and possession be denied
Landlord, its agent or representative, to the extent permitted by applicable
law, Landlord, in the exercise of such right, may use all requisite force to
gain and enjoy the same without responsibility or liability to Tenant, its
servants, employees, guests or invitees, or any Person whomsoever. The
assignment made herein shall become operative and effective only if (a) an Event
of Default shall occur and remain uncured, or (b) this Lease and the Term shall
be cancelled or terminated pursuant to the terms, covenants and conditions
hereof by reason of an Event of Default, or (c) there occurs repossession under
a dispossess warrant or other re-entry or repossession by Landlord under the
provisions hereof or applicable law, and then only as to such of the Subleases
that Landlord has agreed to take over and assume.

            Section 10.08. At any time and from time to time, upon Landlord's
demand, Tenant promptly shall deliver to Landlord a schedule of all Subleases,
setting forth the names of all Subtenants. Upon the reasonable request of
Landlord, Tenant shall permit Landlord and its agents and representatives to
inspect all Subleases and, at Tenant's expense, to make copies thereof.

            Section 10.09. All Subleases shall provide that (a) they are subject
to this Lease and to the Master Lease, (b) the Subtenants will not pay rent or
other sums under the Subleases for more than one (1) month in advance (excluding
security and other deposits required under such Sublease), and (c) at Landlord's
option, on the termination of this Lease pursuant to Article 24, the Subtenants
will attorn to, or enter into a direct sublease on identical terms with,
Landlord. With respect to any Sublease of more than 5,000 square feet (a) made
to an unrelated third party (including members and member firms) at a rental not
less than the prevailing market rental, (b) which is in accordance with all of
the requirements of this Lease and (c) which confers no greater rights upon such
Subtenant than are conferred upon Tenant under this Lease nor, except with
respect to provision of basic services customarily provided to commercial
tenants in such circumstances, imposes more onerous obligations upon Landlord,
as successor landlord under the Sublease, than are imposed on Landlord in this
Lease ("Qualifying Sublease"), at the request of Tenant, Landlord and such
Subtenant shall execute an agreement (the "Non-disturbance and Attornment
Agreement") wherein Landlord agrees to recognize such Subtenant as the direct
tenant of Landlord under its Sublease upon the termination of this Lease
pursuant to Article 24, provided that at the time of such termination no default
exists under such Subtenant's Sublease which at such time would permit the
landlord thereunder to terminate the Sublease or to exercise any remedy for
dispossession provided for therein, and such Subtenant agrees to attorn to
Landlord and to recognize Landlord as such Subtenant's landlord under its


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<PAGE>   51

Sublease. The Non-disturbance and Attornment Agreement shall provide that
neither Landlord, nor anyone claiming by, through or under Landlord, shall be:

            (a) liable for any act or omission of any prior landlord (including,
without limitation, the then defaulting landlord),

            (b) subject to any offsets or defenses that such Subtenant may have
against any prior landlord (including, without limitation, the then defaulting
landlord),

            (c) except with respect to a prepayment of the next installment of
PILOT, bound by any payment that such Subtenant might have paid to any prior
landlord (including, without limitation, the then defaulting landlord), or any
other Person of (i) rent, common area charges, or any other charge payable
under such Subtenant's sublease for more than the current month or (ii) any
security deposit which shall not have been delivered to Landlord,

            (d) bound by any covenant to undertake or complete any construction
of the Building or any portion thereof demised by the Sublease,

            (e) bound by any obligation to make any payment to such Subtenant,
or

            (f) bound by any amendment to any such Sublease or modification
thereof which reduces the basic rent, additional rent, supplemental rent or
other charges payable under the Sublease (except to the extent equitably
reflecting a reduction in the space covered by the Sublease), or shortens or
lengthens the term thereof, or otherwise increases the obligations of landlord
thereunder, made without the written consent of Landlord.

            Within fifteen (15) days after Tenant submits to Landlord a copy of
a Sublease (which may be unexecuted but which shall, in all other respects be in
final form), Landlord shall notify Tenant whether same is a Qualifying Sublease.
If Landlord shall determine that such Sublease is a Qualifying Sublease, then,
promptly after notice to Tenant of such determination, Landlord and such
Subtenant each shall duly execute, acknowledge and deliver to one another one or
more counterparts of the Non-disturbance and Attornment Agreement. If Landlord
shall determine that same is not a Qualifying Sublease, Landlord shall together
with its notice to Tenant specify the reason for such determination. If there be
any dispute as to whether any Sublease is a Qualifying Sublease, such dispute
shall be resolved by arbitration in accordance with the provisions of Article
36.

            Section 10.10.

            (a) Tenant shall have the right to mortgage or otherwise encumber
Tenant's interest in this Lease. If Tenant shall so mortgage Tenant's interest
in this Lease to a Mortgagee, Tenant or such Mortgagee shall give Landlord
prompt notice of such Mortgage and furnish Landlord with a complete and correct
copy of each such Mortgage, certified as such by Tenant or such Mortgagee,
together with the name and address of such Mortgagee. After receipt of the
foregoing, Landlord shall give to such Mortgagee, at the address of


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<PAGE>   52

such Mortgagee set forth in such notice, and otherwise in the manner provided by
Article 25, a copy of each notice of Default at the same time as, and whenever,
any such notice of Default shall thereafter be given by Landlord to Tenant, and
no such notice of Default by Landlord shall be deemed to have been duly given to
Tenant unless and until a copy thereof shall have been so given to each
Mortgagee. Each Mortgagee (i) shall thereupon have a period of ten (10) days
more than given Tenant in each instance in the case of a Default in the payment
of Rental and thirty (30) days more than given to Tenant in each instance in the
case of any other Default, for remedying the Default, or causing the same to be
remedied, or causing action to remedy a Default mentioned in Section 24.01(b) or
(c) to be commenced, and (ii) shall, within such periods and otherwise as herein
provided, have the right to remedy such Default, cause the same to be remedied
or cause action to remedy a Default mentioned in Section 24.01(b) or (c) to be
commenced. Landlord shall accept performance by a Mortgagee (or its designee or
nominee) of any covenant, condition or agreement on Tenant's part to be
performed hereunder with the same force and effect as though performed by
Tenant.

            (b) Notwithstanding the provisions of Section 10.10(a) hereof, no
Default by Tenant shall be deemed to exist as long as a Mortgagee within (15)
Business Days after the expiration of the time given to Tenant pursuant to the
provisions of this Lease to remedy the event or condition which would otherwise
constitute a Default hereunder, shall have delivered to Landlord its written
agreement to take the action described in clause (i) or (ii) herein and
thereafter, in good faith, shall have commenced promptly either (i) to cure the
Default and to prosecute the same to completion, or (ii) if possession of the
Premises is required in order to cure the Default, to institute foreclosure
proceedings and obtain possession directly or through a receiver, and to
prosecute such proceedings with diligence and continuity and, upon obtaining
such possession, commence promptly to cure the Default and to prosecute the same
to completion with diligence and continuity, provided that during the period in
which such action is being taken (and any foreclosure proceedings are pending),
all of the other obligations of Tenant under this Lease, to the extent they are
reasonably susceptible to being performed by the Mortgagee, are being performed.
However, at any time after the delivery of the aforementioned agreement, the
Mortgagee may notify Landlord, in writing, that it has relinquished possession
of the Premises or that it will not institute foreclosure proceedings or, if
such proceedings have been commenced, that it has discontinued them, and in such
event, the Mortgagee shall have no further liability under such agreement from
and after the date it delivers such notice to Landlord (except for any
obligations accruing prior to the date it delivers such notice), and, thereupon,
Landlord shall have the unrestricted right to terminate this Lease and to take
any other action it deems appropriate by reason of any Default, and upon any
such termination the provisions of Section 10.11 shall apply. Notwithstanding
anything herein contained to the contrary, provided such Mortgagee shall have
otherwise complied with the provisions of this Section 10.10, such Mortgagee
shall have no obligation to cure any Defaults which are not susceptible to being
cured by such Mortgagee. Any default by Tenant under the Occupancy Agreement or
Funding Agreement shall be deemed to be a default which is not susceptible to
being cured by such Mortgagee.


                                      -48-

<PAGE>   53

            (c) Except as provided in Section 10.10(b), no Mortgagee shall
become liable under the provisions of this Lease unless and until such time as
it becomes, and then only for as long as it remains, the owner of the leasehold
estate created hereby. In the event that a Mortgagee shall become the owner of
such leasehold estate, such Mortgagee shall not be bound by any modification or
amendment of this Lease made subsequent to the date of the Mortgage and delivery
to Landlord of the notice provided in Section 10.10(a) hereof and prior to its
acquisition of such interest unless the Mortgagee shall have consented to such
modification or amendment at the time it was made or at the time of such
acquisition.

            Section 10.11.

            (a) In the case of termination of this Lease by reason of any Event
of Default, Landlord shall give prompt notice thereof to each Mortgagee whose
name and address Landlord has received pursuant to notice made in compliance
with the provisions of Section 10.10(a), at the address of such Mortgagee set
forth in such notice, and otherwise in the manner provided by Article 25.
Landlord, on written request of such Mortgagee made any time within thirty (30)
days after the giving of such notice by Landlord, shall promptly execute and
deliver a new lease of the Premises to the Mortgagee, or its designee or
nominee, for the remainder of the Term upon all the covenants, conditions,
limitations and agreements herein contained, provided that such Mortgagee (i)
shall pay to Landlord, simultaneously with the delivery of such new lease, all
unpaid Rental due under this Lease up to and including the, date of the
commencement of the term of such new lease and all expenses, including, without
limitation, reasonable attorneys' fees and disbursements and court costs,
incurred by Landlord in connection with the Default by Tenant, the termination
of this Lease and the preparation of the new lease, and (ii) shall cure all
Defaults existing under this Lease which are susceptible to being cured by such
Mortgagee. Such new lease however shall not contain provisions providing for the
cross-defaulting of such lease with the Funding Agreement or Occupancy Agreement
nor shall such lease require compliance with the Occupancy Requirement or the
Minimum Requirement.

            (b) Any such new lease and the leasehold estate thereby created
shall, subject to the same conditions contained in this Lease, continue to
maintain the same priority as this Lease with regard to any mortgage, including
any fee mortgage, on the Premises or any part thereof or any other lien, charge
or encumbrance thereon whether or not the same shall then be in existence.
Concurrently with the execution and delivery of such new lease, Landlord shall
assign to the tenant named therein all of its right, title and interest in and
to moneys (including insurance and condemnation proceeds), if any, then held by
or payable to Landlord or Depository which Tenant would have been entitled to
receive but for termination of this Lease, and any sums then held by or payable
to Depository shall be deemed to be held by or payable to it as Depository under
the new lease.

            (c) Upon the execution and delivery of a new lease under this
Section 10.11, all Subleases which theretofore have been assigned to, or made
by, Landlord shall be assigned and transferred, without recourse, by Landlord to
the tenant named in such new


                                      -49-

<PAGE>   54

lease. Between the date of termination of this Lease and the date of execution
of the new lease, if a Mortgagee shall have requested such new lease as provided
in Section 10.11(a), Landlord shall not cancel any Subleases or accept any
cancellation, termination or surrender thereof (unless such termination shall be
effected as a matter of law on the termination of this Lease) or enter into new
Subleases without the consent of the Mortgagee.

            (d) If there is more than one Mortgage, Landlord shall only
recognize the Mortgagee whose Mortgage is senior in lien and which has requested
a new lease of the Premises within the time period set forth in Section 10.11(a)
as the Mortgagee entitled to the rights afforded by this Section 10.11, provided
that either Tenant or such Mortgagee shall have given Landlord notice of such
Mortgage in compliance with the provisions of Section 10.10(a).

                                   ARTICLE 11

                            CONSTRUCTION OF BUILDING

            Section 11.01. Tenant, using a Construction Manager, shall promptly
commence (subject to Unavoidable Delays) on or before the Construction
Commencement Date and (subject to Unavoidable Delays) construct the Building in
accordance with the Requirements, Master Development Plan, the Design
Guidelines, the Declaration of Restrictions (if applicable), the Construction
Documents, and the applicable provisions of this Lease. Tenant shall, in
accordance with sound construction practice, obtain from New York City and all
other Governmental Authorities all permits, consents, certificates and approvals
required to commence construction of the Building. At the request of Tenant,
Landlord, at no cost or expense to it, shall within ten (10) days of Tenant's
request, execute and deliver any documents or instruments reasonably required to
obtain such permits, consents, certificates and approvals, provided such
documents or instruments do not impose any liability or obligation on Landlord.
Subject to the provisions of Section 11.02(i), Tenant shall not undertake
Commencement of Construction unless and until (i) Tenant shall have obtained as
aforesaid, and delivered to Landlord copies of, all necessary permits, consents,
certificates and approvals for such construction from all Governmental
Authorities which are required to have been obtained prior to Commencement of
Construction, (ii) Landlord shall have reviewed the Construction Documents in
the manner provided herein and shall have determined that they conform to the
Master Development Plan, the Design Guidelines, the Declaration of Restrictions
(if applicable), the Schematics and the Design Development Plans, and (iii)
Tenant shall have delivered to Landlord the original policies of insurance or
duplicate originals thereof, in accordance with Section 11.03(b). Tenant shall
obtain such other permits, consents, certificates and approvals as may be
required from time to time to continue and complete the construction of the
Building. At the request of either Landlord or Tenant, made at any time after
Commencement of Construction, Landlord and Tenant shall execute a certification
setting forth the date of Commencement of Construction. In the event the parties
shall be unable to agree on such date, such dispute shall be resolved by
arbitration pursuant to Article 36.


                                      -50-

<PAGE>   55

            Section 11.02.

            (a) Landlord acknowledges that Tenant has submitted to Landlord
scaled schematic drawings (the "Schematics") prepared by the Architect and in
accordance with Landlord's submission requirements for schematics, such
requirements being more particularly described in the Design Guidelines.
Landlord's review of the Schematics shall be limited to determining whether the
Schematics conform to the Master Development Plan, the Design Guidelines and the
Declaration of Restrictions (if applicable). If Landlord determines that the
Schematics do so conform, Landlord shall notify Tenant to that effect. If
Landlord determines that the Schematics do not conform to the Master Development
Plan, the Design Guidelines and the Declaration of Restrictions (if applicable),
Landlord shall so notify Tenant, specifying those respects in which the
Schematics do not so conform, and Tenant shall revise the Schematics to so
conform and shall resubmit the same to Landlord for review within fifteen (15)
Business Days of the date of Tenant's receipt of notice from Landlord that the
Schematics do not so conform. Each initial review by Landlord shall be carried
out within fifteen (15) Business Days of the date of initial submission of the
Schematics and each additional review by Landlord shall be carried out within
ten (10) Business Days of the date of submission of any revised Schematics, as
the case may be, by Tenant (and if Landlord shall not have notified Tenant of
its determination within such fifteen (15) or ten (10) Business Day period, as
the case may be, it shall be deemed to have determined that the Schematics or
revised Schematics, as the case may be, do conform to the Master Development
Plan, the Design Guidelines and the Declaration of Restrictions (if
applicable)).

            (b) As soon as practicable, but in no event later than ninety days
(90) after Landlord shall have notified Tenant that the Schematics conform to
the Master Development Plan, the Design Guidelines and the Declaration of
Restrictions (if applicable) (such date being subject to Unavoidable Delays),
Tenant shall submit to Landlord for its review, design development plans and
outline specifications for the Building (the "Design Development Plans"),
prepared by the Architect and in accordance with Landlord's submission
requirements for design development, such requirements being more particularly
described in the Design Guidelines. Any changes in the Design Development Plans
from the Schematics shall be identified in reasonable detail. Landlord's review
of the Design Development Plans shall be limited to determining whether such
plans conform to the Master Development Plan, the Design Guidelines, the
Declaration of Restrictions (if applicable) and the Schematics. If Landlord
determines that the Design Development Plans do so conform, Landlord shall
notify Tenant to that effect. If Landlord determines that the Design Development
Plans do not conform to the Master Development Plan, the Design Guidelines, the
Declaration of Restrictions (if applicable) and the Schematics, Landlord shall
so notify Tenant, specifying those respects in which the Design Development
Plans do not so conform, and Tenant shall revise the same to so conform and
shall resubmit the Design Development Plans to Landlord for review within
fifteen (15) Business Days of the date of Tenant's receipt of notice from
Landlord that the Design Development Plans do not so conform. Each initial
review by Landlord shall be carried out within fifteen (15) Business Days of the
date of initial submission of the Design Development Plans and each


                                      -51-

<PAGE>   56

additional review by Landlord shall be carried out within ten (10) Business Days
of the date of submission of any revised Design Development Plans, as the case
may be, by Tenant (and if Landlord shall not have notified Tenant of its
determination within such fifteen (15) or ten (10) Business Day period, as the
case may be, it shall be deemed to have determined that the Design Development
Plans or revised Design Development Plans, as the case may be, do conform to the
Master Development Plan, the Design Guidelines, the Declaration of Restrictions
(if applicable) and the Schematics).

            (c) As soon as practicable, but in no event later than one hundred
and eighty (180) days after Landlord shall have notified Tenant that the Design
Development Plans conform to the Master Development Plan, the Design Guidelines,
the Declaration of Restrictions (if applicable) and the Schematics (such date
being subject to Unavoidable Delays), Tenant shall submit to Landlord final
contract plans and specifications for the Building prepared by the Architect and
in accordance with Landlord's requirements for final contract plans and
specifications, such requirements being more particularly described in the
Design Guidelines. Any changes in such final contract plans and specifications
from the Design Development Plans shall be identified in reasonable detail.
Landlord's review of the final contract plans and specifications shall be
limited to determining whether such plans and specifications conform to the
Master Development Plan, the Design Guidelines, the Declaration of Restrictions
(if applicable) and the Design Development Plans. If Landlord determines that
they do so conform, Landlord shall notify Tenant to that effect. If Landlord
determines that the final contract plans and specifications do not conform to
the Master Development Plan, the Design Guidelines, the Declaration of
Restrictions (if applicable) and the Design Development Plans, Landlord shall so
notify Tenant, specifying those respects in which the final contract plans and
specifications do not so conform, and Tenant shall revise the same to so conform
and shall resubmit the final contract plans and specifications to Landlord for
review within fifteen (15) Business Days of the date of Tenant's receipt of
notice from Landlord that the final contract plans end specifications do not so
conform. Each initial review by Landlord shall be carried out within fifteen
(15) Business Days of the date of initial submission of the final contract plans
and specifications and each additional review by Landlord shall be carried out
within ten (10) Business Days of the date of submission of any revised final
contract plans and specifications, as the case may be, by Tenant (and if
Landlord shall not have notified Tenant of its determination within such fifteen
(15) or ten (10) Business Day period, as the case may be, it shall be deemed to
have determined that the final contract plans and specifications or the revised
final contract plans and specifications, as the case may be, do conform to the
Master Development Plan, the Design Guidelines, the Declaration of Restrictions
(if applicable) and the Design Development Plans). The contract plans and
specifications that have been determined (or are deemed) to conform to the
Master Development Plan, the Design Guidelines, the Declaration of Restrictions
(if applicable) and the Design Development Plans, as the same may be changed
from time to time by Tenant, to the extent such changes are approved (or deemed
approved) by Landlord as hereinafter provided, are hereinafter referred to as
the "Construction Documents".


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<PAGE>   57

            (d) In the event that Tenant shall desire to modify the Construction
Documents with respect to, or which will in any way affect, any aspect of the
exterior of the Building or a change in the height, bulk or setback of the
Building or in any other manner which affects compliance with the Master
Development Plan, the Design Guidelines or the Declaration of Restrictions (if
applicable), Tenant shall submit the proposed modifications to Landlord for
approval prior to making or implementing any such modification. All
modifications shall be identified in reasonable detail. Tenant shall not be
required to submit to Landlord proposed modifications of the Construction
Documents which affect solely the interior of the Building or which do not
affect any aspect of the exterior of the Building or a change in the height,
bulk or setback of the Building or do not affect compliance with the Master
Development Plan, the Design Guidelines or the Declaration of Restrictions (if
applicable). Landlord shall review the proposed changes to determine whether or
not they (i) conform to the Master Development Plan, the Design Guidelines and
the Declaration of Restrictions (if applicable), and (ii) in Landlord's
judgment, reasonably exercised, provide for design, finishes and materials with
respect to the exterior of the Building which are comparable in quality to those
provided for in the Construction Documents. If Landlord determines that they do
so conform and provide, Landlord shall notify Tenant to that effect. If Landlord
determines that the Construction Documents, as so revised, do not conform to the
Master Development Plan, the Design Guidelines and the Declaration of
Restrictions (if applicable) or provide for design, finishes and materials which
are not comparable in quality to those provided for in the Construction
Documents, Landlord shall so notify Tenant, specifying those respects in which
they do not so conform or provide, and Tenant shall revise the same to meet
Landlord's objections and shall resubmit them to Landlord for review within
fifteen (15) Business Days of the date of Tenant's receipt of notice from
Landlord that they do not so conform or provide. Each initial review by Landlord
shall be carried out within fifteen (15) Business Days of the date of initial
submission of the Construction Documents, as so revised, by Tenant and each
additional review by Landlord shall be carried out within ten (10) Business Days
of the date of submission of any revisions thereto (and if Landlord shall not
have notified Tenant of its determination within such fifteen (15) or ten (10)
Business Day period, as the case may be, it shall be deemed to have determined
that the proposed changes are satisfactory).

            (e) Notwithstanding the provisions of Section 11.02(d), if, after
the Commencement of Construction, Tenant makes a good faith determination that
any proposed modification which requires Landlord's approval under Section
11.02(d) is of a minor or insubstantial nature, Tenant may so advise an employee
designated by Landlord ("Landlord's Project Manager") (delivering to him or her
a written statement setting forth the proposed modification and the basis for
Tenant's determination and simultaneously delivering copies of said statement to
Landlord's President and Chief Executive Officer and Vice President for Planning
and Design). Landlord's Project Manager shall, in writing, before the expiration
of the fifth full Business Day after the receipt of said advice, either (i)
notify Tenant of approval of said proposed modification or (ii) notify Tenant
that Tenant is required to submit the proposed modification to Landlord as
provided in Section 11.02(d). In the event Landlord's Project Manager acts in
accordance with (ii) above, Landlord, after receipt from Tenant of the proposed
modification, shall endeavor to expedite its review


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<PAGE>   58

thereof and notification to Tenant of its determination. Nothing set forth in
this Section 11.02(e) shall require Landlord to notify Tenant of Landlord's
determination earlier than the expiration of the fifteen (15) or ten (10)
Business Day periods set forth in Section 11.02(d) with respect to such
modification, provided, however, that if Landlord's Project Manager shall not
have notified Tenant of either (i) or (ii) above within the five (5) Business
Day period set forth above, Landlord shall be deemed to have approved the
proposed modification.

            (f) The Construction Documents shall comply with the Requirements,
including but not limited to the Building Code of New York City. The
responsibility to assure such compliance shall be Tenant's; Landlord's
determination that the Construction Documents conform to the Master Development
Plan, the Design Guidelines and the Declaration of Restrictions (if applicable)
shall not be, nor shall it be construed to be or relied upon as, a determination
that the Construction Documents comply with the Requirements. In the event that
there shall be a conflict between the Requirements and the Master Development
Plan or the Design Guidelines, the Requirements shall prevail.

            (g) In addition to the documents referred to in Section 11.01 and
this Section 11.02, Tenant shall, at least fifteen (15) Business Days prior to
ordering the same for incorporation into the Building, submit to Landlord
samples of all materials to be used on the exterior of the Building, including
windows, and the same shall be subject to Landlord's approval for conformity to
the Design Guidelines, the Master Development Plan, the Declaration of
Restrictions (if applicable) and the Construction Documents. If Landlord shall
have failed to object to any of such materials within such fifteen (15) Business
Day period after its receipt of such materials, it shall be deemed to have
approved such materials. Landlord reserves the right to maintain its field
personnel at the Premises to observe Tenant's construction methods and
techniques (provided that such field personnel do not unreasonably interfere
with Tenant's construction activities) and Landlord shall be entitled to have
its field personnel or other designees attend Tenant's job and/or safety
meetings. No such observation or attendance by Landlord's personnel or designees
shall impose upon Landlord any responsibility for any failure by Tenant to
observe applicable Requirements or safety practices in connection with such
construction, or constitute an acceptance of any work which does not comply in
all respects with the Requirements and the provisions of this Lease.

            (h) Tenant shall not construct or permit to exist any Building on
the Land unless the Building is in compliance with the Master Development Plan,
Design Guidelines and Declaration of Restrictions (if applicable).

            (i) Notwithstanding any other provision of this Article, Landlord
acknowledges and agrees that in order to meet Tenant's construction schedule,
Tenant may be required to "fast track" certain aspects of the plans and
specifications and of the excavation and foundation and other phases of the
construction process. Landlord agrees, within the limitations of sound
construction practice, to take all actions reasonably requested from time to
time by Tenant in relation to the "fast tracking" of the construction


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<PAGE>   59

of the Building. Such cooperation may include (i) shortening the review periods
provided for in this Article 11, (ii) reviewing certain aspects of the
Schematics, Design Development Plans and Construction Documents prior to
completion and submission to Landlord of every aspect thereof and (iii)
permitting Tenant to begin excavation and foundation and other phases of the
work prior to completion and approval by Landlord of the (x) Design Development
Plans (except if Landlord determines, within ten (10) Business Days from
submission of Design Development Plans, that such work could be affected by
Landlord's review of any outstanding issues with respect to the Design
Development Plans) or (y) Construction Documents and (iv) commencing excavation
and foundation and other phases of the work before all Project approvals and all
permits, consents, certificates and approvals from all Governmental Authorities
are obtained except for such of the foregoing which are necessary for the
portion or phase of the Project which is being performed or undertaken.

            Section 11.03.

            (a) Commencing on the Commencement Date, Tenant shall provide, or
cause to be provided, and thereafter shall keep in full force and effect, until
Commencement of Construction, insurance coverage of the types and in the minimum
limits set forth in subsections (i) and (ii) of this Section 11.03(a). Prior to
the Commencement of Construction, Tenant shall provide, or cause to be provided,
and thereafter shall keep or cause to be kept in full force and effect, until
Substantial Completion of the Building, the following:

            (i)         commercial general liability insurance, naming
                  contractor or construction manager as named insured and, as
                  additional insureds, Tenant, Landlord, Master Landlord, the
                  City, EDC, UDC and each Mortgagee under a standard mortgagee
                  clause, such insurance to insure against liability for bodily
                  injury and death and for property damage in such amount as may
                  from time to time be reasonably required by Landlord (which
                  shall be not less than Twenty-Five Million Dollars
                  ($25,000,000) combined single limit (inclusive of primary
                  coverage and umbrella or excess policy coverage) nor more than
                  such amount as, at the time in question, is customarily
                  carried by prudent owners of like buildings and improvements,
                  but, in no event, less than Twenty-Five Million Dollars
                  ($25,000,000)), such insurance to include operations-premises
                  liability, contractor's protective liability on the operations
                  of all subcontractors, completed operations (to be kept in
                  force for not less than three (3) years after Substantial
                  Completion of the Building), broad form commercial liability
                  (designating the indemnity provisions of the Construction
                  Agreements and this Lease), a broad form comprehensive general
                  liability endorsement providing blanket automatic contractual
                  coverage including bodily injury to employees or others
                  assumed by the insured under contract and, if the contractor
                  is undertaking foundation,


                                      -55-

<PAGE>   60

                  excavation or demolition work, an endorsement that such
                  operations are covered and that the "XCU Exclusions" have been
                  deleted;

            (ii)        commercial automobile liability insurance for all owned,
                  non-owned, leased, rented and/or hired vehicles insuring
                  against liability for bodily injury and death and for property
                  damage in an amount not less than Ten Million Dollars
                  ($10,000,000) combined single limit, with such coverage to be
                  listed in the underlying schedule of any umbrella or following
                  form excess policy for a total limit of Twenty-Five Million
                  Dollars ($25,000,000), such insurance to name Tenant
                  (contractor if carried by contractor) as named insured and, as
                  additional insureds, Landlord, Master Landlord, EDC, UDC, any
                  general contractor or construction manager engaged by Tenant
                  (Tenant, if contractor carries such insurance) and each
                  Mortgagee under a standard mortgage clause;

            (iii)       workers' compensation insurance providing statutory New
                  York State benefits for all persons employed in connection
                  with the construction at the Premises and employer's liability
                  insurance in an amount not less than that required by New York
                  State law, with coverage to be listed in the underlying
                  schedule of any umbrella or following form excess policy; and

            (iv)        commercial all-risk builder's risk insurance written on
                  a one hundred percent (100%) of Completed value
                  (non-reporting) basis with limits as provided in Section
                  7.01(a)(i), naming, to the extent of their respective
                  insurable interests in the Premises, Tenant as named insured,
                  and, as additional insureds, Landlord, Master Landlord, any
                  contractor or construction manager engaged by Tenant and each
                  Mortgagee under a standard mortgagee clause. In addition, such
                  insurance (A) shall contain an acknowledgment by the insurance
                  company that its rights of subrogation have been waived with
                  respect to all of the insureds named in the policy and an
                  endorsement stating that "permission is granted to complete
                  and occupy", (B) if any storage location situated off the
                  Premises is used, shall include coverage for the full
                  insurable value, all materials and equipment on or about any
                  such storage location intended for use with respect to the
                  Premises, and (C) if materials, equipment, machinery or
                  supplies to be used in connection with construction are
                  shipped to the job site from places in the contiguous United
                  States, the District of Columbia or Canada, the all-risk
                  builders risk insurance will provide transit coverage.

            In the event the proceeds received pursuant to the insurance
coverage required under Section 11.03(a)(iv) hereof shall exceed One Million
Dollars ($1,000,000)


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<PAGE>   61

(as such amount shall be increased as provided in Section 7.02(a)), such
proceeds shall be paid to Depository and disbursed in accordance with the
provisions of Sections 8.02 and 8.03 hereof. In the event such proceeds shall be
One Million Dollars ($1,000,000) (as such amount shall be increased as provided
in Section 7.02(a)) or less, such proceeds shall be payable, in trust, to Tenant
for application to the cost of completion of construction of the Building.

            (b) No construction shall be commenced until Tenant shall have
delivered to Landlord the original policies of insurance or duplicate originals
or certificates thereof together with copies of such insurance policies, as
required by this Section 11.03.

            (c) To the extent applicable, Tenant shall comply with the
provisions of Section 7.02 hereof with respect to the policies required by this
Section 11.03, including the delivery to Landlord of proof of payment of all
premiums and the obtaining of the agreement of each such insurer that such
policy shall not be cancelled or modified without at least thirty (30) days
prior written notice to Landlord, EDC, UDC and each Mortgagee.

            (d) To the extent that the insurance coverages required pursuant to
this Section 11.03 duplicate those required by Article 7 hereof, Tenant shall
not be required to maintain such coverages in duplicate, but in each instance
the more extensive coverage shall be maintained.

            Section 11.04. Construction of the Building shall be (a) commenced
on or prior to the Construction Commencement Date and prosecuted by Tenant with
all reasonable diligence and without interruption, in each case, however,
subject to Unavoidable Delays, and (b) Substantially Completed by Tenant in a
good and workmanlike manner in accordance with the approved Construction
Documents, the Master Development Plan, the Design Guidelines and the
Declaration of Restrictions (if applicable), no later than forty two (42) months
after the Construction Commencement Date, as such date may be extended for
Unavoidable Delays (the "Scheduled Completion Date"). Upon Substantial
Completion of the Building, Tenant shall furnish Landlord with (i) true copies
of the temporary Certificate(s) of Occupancy for the Building, (ii) a complete
set of "as built" plans for the Building prepared by the Architect and
accompanied by a written statement by the Architect that the "as-built" plans
are complete and correct, and (iii) a survey prepared and sealed by a registered
surveyor showing the Building and all easements and other matters of record
relating to the Premises, certified by such surveyor to Tenant, Landlord and
each Mortgagee, and bearing the certification of such surveyor that the Building
is within the property lines of the Land and does not encroach upon any easement
or violate any restriction of record. "Substantial Completion of the Building"
or "Substantially Completed" shall mean (i) substantial completion of all
construction work on the Building (but shall not include the completion of
construction of interior portions of the Building which Tenant does not intend
to occupy immediately or which Tenant intends shall be made subject to one or
more Subleases), (ii) the delivery to Landlord of true copies of the temporary
Certificate(s) of Occupancy for the portions of the Building to be initially
occupied by Tenant, Affiliates of Tenant and Service Providers, and (iii) the
delivery to


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<PAGE>   62

Landlord of a statement in writing from the Architect that, in such Architect's
opinion, the construction has been completed substantially in accordance with
the approved Construction Documents and the Design Guidelines. Notwithstanding
anything herein contained to the contrary, if Tenant shall have failed to
deliver such temporary Certificate(s) of Occupancy on or before the Scheduled
Completion Date as a result of the failure of the Department of Buildings of New
York City, or successor body of similar function, to issue the same, such
failure shall not constitute a Default hereunder provided the Architect
certifies in writing to Landlord that Tenant has completed all work necessary to
obtain such temporary Certificate(s) of Occupancy. In such event, Tenant shall
deliver a true copy of such temporary Certificate(s) of Occupancy to Landlord
promptly upon their issuance. Within six (6) months after the date of
Substantial Completion of the Building, Tenant shall furnish Landlord with
permanent Certificate(s) of Occupancy for all space in the Building duly issued
by the New York City Department of Buildings, provided, however, Tenant's
failure to obtain such permanent Certificate(s) of Occupancy within such six (6)
month period shall not be a Default hereunder if Tenant shall be diligently and
in good faith attempting to obtain same (which attempt (i) shall include, but
not be limited to, the reasonable expenditure of monies, but (ii) shall not
obligate Tenant to complete construction of any interior portion of the Building
until Tenant intends to occupy such portion or such portion has been made
subject to one or more Subleases). In any event, Tenant shall promptly furnish
Landlord with such permanent or temporary Certificate(s) of Occupancy after same
has been duly issued.

            Section 11.05.

            (a) The materials to be incorporated in the Building at any time
during the Term, including in connection with Capital Improvements, shall, upon
purchase of same and at all times thereafter, constitute the property of
Landlord, and upon construction of the Building or the incorporation of such
materials therein, title thereto shall vest in Landlord, provided, however, that
(i) Landlord shall not be liable in any manner for payment or otherwise to any
contractor, subcontractor, laborer or supplier of materials or other Person in
connection with the purchase of any such materials (other than as provided in
the Funding Agreement if applicable), (ii) Landlord shall have no obligation to
pay any compensation to Tenant by reason of its acquisition of title to such
materials and Building, (iii) Landlord shall have no obligation with respect to
the storage or care of such materials or the Building, and (iv) all materials to
be incorporated in the Building shall, immediately upon the purchase of same, be
deemed to be leased to Tenant pursuant to this Lease.

            (b) Tenant shall, subject to the provisions of this Section 11.05:
(i) purchase materials, systems and Fixtures to be incorporated and installed in
(or affixed to) the Building, including in connection with the fit-out of space
in the Building and Capital Improvements, (ii) purchase, lease and maintain
Equipment for use in the Building and for use off-site (at Tenant's facilities
at 4 World Trade Center and 22 Cortlandt Street) in support of Tenant's
operations at the Premises and (iii) repair, replace, renovate and upgrade any
of the foregoing materials, system, Fixtures and Equipment, during the period
from the Commencement Date to and including the expiration of the First Period,
all


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<PAGE>   63

without paying any sales and compensating use taxes ("Sales Tax" or,
alternatively, "Sale Taxes") in connection therewith. All such materials,
systems, Fixtures and items of Equipment shall be purchased, leased or
maintained by Tenant, acting as agent for and in the name of Landlord. The
exemption provided herein shall not apply to construction tools, supplies or
materials or to other property or equipment which is used or consumed in the
course of construction and which is not incorporated in (or affixed to) the
Building.

            (c) In order to effectuate the foregoing, Landlord shall, on the
Commencement Date, furnish to Tenant a "Sales Tax Letter" in substantially the
form annexed hereto as Exhibit F. Landlord and Tenant agree that, from and after
the Commencement Date, and until such time as the balance in the Benefits
Account (as hereinafter defined) is zero, Tenant will utilize the Sales Tax
Letter to effectuate purchases and leases of (and maintain) materials, systems,
Fixtures and Equipment, free from Sales Tax and otherwise as provided in
subparagraph (b) above.

            (d) If and only if (and only from and after the date on which) the
balance in the Benefits Account is zero, Tenant shall discontinue its use of the
Sales Tax Letter and thereafter shall pay Sales Tax on materials, systems,
Fixtures or items of Equipment that it purchases, leases or maintains (for use
at the Building and off-site, as aforesaid) directly to vendors or equipment
lessors or maintenance or service contractors, as appropriate.

            (e) There shall be established and maintained an accounting (the
"Benefits Account") of Sales Tax Benefits and Con Ed Benefits (as such terms are
hereinafter defined) in accordance with the provisions of this subparagraph (e)
as follows:

                  (i) The initial balance in the Benefits Account is $15,867,000
      (which number is an NPV number, meaning a number which has been discounted
      to August 1, 1994 at the rate of 7.5% per annum) (such number, the
      "Initial Balance").

                  (ii) The balance in the Benefits Account shall be adjusted and
      fixed on May 31, 1996, and on each May 31 thereafter, by deducting from
      the Initial Balance (in the case of the first such adjustment) and from
      the balance in the Benefits Account on each May 31 thereafter an amount
      equal to (y) the sum of all Sales Tax Benefits and Con Ed Benefits for the
      prior year (or period), discounted from each date of adjustment to August
      1, 1994 at the rate of 7.5% per annum, and (z) the amount of the Benefits
      Deficiency Amount (as defined in, and determined in accordance with the
      provisions of, that certain letter of even date herewith between UDC and
      Tenant regarding same), if any, requested by Tenant for the prior year (or
      period).

For purposes of this Lease, the term "Sales Tax Benefits" shall mean all Sales
Tax benefits actually realized by (or on behalf of) NYMEX during any year or
period relative to which adjustments to the Benefits Account are being made; and
the term "Con Ed Benefits" shall mean savings in energy costs actually realized
by Tenant as a result of Tenant's being a


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<PAGE>   64

Con Edison Business Incentive Rate (Tariff No, 9) customer (at the Premises)
during any year or period relative to which adjustments to the Benefits Account
are being made.

            (f) In the event Tenant is compelled by any Governmental Authority
to pay any Sales Tax as to which Tenant has been granted an exemption from the
payment thereof, Tenant shall receive a credit against the next installment(s)
of Base Rent in an amount equal to the amount of such taxes (including interest
and penalties) which Tenant has been compelled to pay, provided that (i) each
maintenance or repair contract relating to, and each contract of sale, purchase
order, invoice, lease, sublease, license or sublicense of, materials, Equipment
or Fixtures (including Equipment used at Tenant's facilities at 22 Cortlandt
Street and at 4 World Trade Center) shall include the language set forth in
subparagraph (h) hereof and Tenant shall have otherwise complied with the
provisions of this Section 11.05, (ii) Tenant has notified Landlord prior to
payment of such taxes and promptly upon receipt of notice of claim that a claim
has been made therefor and (iii) if permitted by applicable law, Landlord has
the opportunity to contest the imposition of same, at Landlord's expense,
provided that neither Tenant's interest in the Premises or in any Fixtures or
Equipment nor any income derived by Tenant therefrom would, by reason of such
contest, be forfeited or lost, or subject to any lien, encumbrance or charge, or
Tenant would not by reason thereof be subject to any civil or criminal
liability.

            (g) Purchases and/or leases of (and maintenance and repair contracts
relating to) materials to be installed in the Building, Fixtures and Equipment
shall be exempt from Sales Tax on the conditions that:

            (i) any materials and Fixtures shall be installed in and used at the
            Building;

            (ii) any Equipment purchased or leased or maintained by or on behalf
            of Tenant shall be used only at the Premises and/or in facilities of
            Tenant located at 22 Cortlandt Street and at 4 World Trade Center,
            New York, New York and any such Equipment shall be used only by
            Tenant and its Affiliates;

            (iii) any materials, Equipment or Fixtures purchased or leased or
            maintained as described above shall have a useful life of one (1)
            year or more;

            (iv) any maintenance and repair contracts shall only be with respect
            to: (A) materials, Equipment or Fixtures having a useful life of one
            (1) year or more, (B) the replacement of parts (other than parts
            that contain materials or substances that are consumed in the
            operation of such property [e.g., a toner cartridge] where such
            parts must be replaced whenever the substance is consumed), or (C)
            the making of


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<PAGE>   65

            repairs, but shall not include maintenance of the type as shall
            constitute janitorial services; and

            (v) in the case of rental arrangements, such arrangements shall
            constitute capital leases (meaning leases which would be so
            characterized under the Accounting Standards of the Financial
            Accounting Standards Board).

            (h) In order to be exempt from Sales Tax, each maintenance or repair
contract relating to, and each contract of sale, purchase order, invoice, lease,
sublease, license or sublicense of, materials, Equipment or Fixtures (including
Equipment used at Tenant's facilities at 22 Cortlandt Street and at 4 World
Trade Center) shall include the following language:

            "This [maintenance or repair contract, contract of sale, purchase
            order, invoice, lease, sublease, license or sublicense] relates to
            (i) the purchase or lease of materials and fixtures for installation
            in, and/or the construction of and any repairs and renovations made
            to, an office building (to include a trading facility) on a parcel
            of land referred to as Site 15, located in Battery Park City, New
            York, New York, (ii) the purchase or lease of equipment, machinery,
            furniture and furnishings for use by the New York Mercantile
            Exchange ("NYMEX") and its affiliates in said building and in
            certain facilities of NYMEX located at 22 Cortlandt Street and at 4
            World Trade Center, New York, New York, and (iii) the maintenance or
            repair of any of the foregoing (the foregoing, collectively, the
            "NYMEX Project"). The sales tax exemption provided with respect to
            this [maintenance or repair contract, contract of sale, purchase
            order, invoice, lease, sublease, license or sublicense] shall only
            be available for the NYMEX Project.

            In no event shall Battery Park City Authority have any liability
            (directly, indirectly or otherwise) or performance obligation under
            this [maintenance or repair contract, contract of sale, purchase
            order, invoice, lease, sublease, license or sublicense].

            This [maintenance or repair contract, contract of sale, purchase
            order, invoice, lease, sublease, license or sublicense] is being
            delivered by NYMEX on the understanding that no amount of sales or
            use taxes is included in the contract price."

            (i) In no event shall Landlord have any liability or performance
obligations under any maintenance or repair contract, contract of sale, purchase
order,


                                      -61-

<PAGE>   66

invoice, lease, sublease, license or sublicense entered into by or on behalf of
Tenant (as agent for Landlord) hereunder.

            (j) On or before May 31 of each year (commencing May 31, 1996) and
until the earlier to occur of (i) the date on which the balance in the Benefits
Account reaches zero, (ii) the end of the First Period, or (iii) the earlier
termination of this Lease, Tenant shall furnish to Landlord, EDC and UDC:

                        (i) a "Registry" substantially in the form attached
      hereto as Exhibit G, which Registry shall list the items of materials,
      Equipment and Fixtures that Tenant has purchased or leased (or with
      respect to which Tenant has entered into maintenance or repair contracts),
      during the prior year (or, for the first report delivered on May 31, 1996,
      for the prior period), without paying any Sales Tax thereon (or in
      connection therewith);

                        (ii) a report of the Sales Tax Benefits achieved by
      Tenant during the prior year (or, for the first report delivered on May
      31, 1996, for the prior period), which report shall set forth for each
      such preceding year each Sales Tax exemption availed of by Tenant pursuant
      to the Sales Tax Letter, the dollar amount of same, the date availed of
      (with respect to each item of leased Equipment, the Sales Tax exemption
      shall be deemed availed of on each lease payment date under the related
      lease), and the total dollar amount of all Sales Tax exemptions availed of
      by Tenant during the preceding year (or period, as applicable);

                        (iii) a report of the Sales Tax savings that could have
      been realized during the prior year (or period) had Tenant (or its
      Construction Managers or contractors) used the Sales Tax Letter to the
      maximum extent permitted hereunder; and

                        (iv) if applicable, a report of the Con Ed Benefits
      achieved by Tenant during the prior year, which report shall set forth for
      each year the amount actually paid by Tenant for energy at the Premises
      and the amount that Tenant would have paid, had the Con Ed Business
      Improvement Rate not been in effect.

Upon request by Landlord or EDC or UDC of, and reasonable notice to, Tenant,
Tenant shall make available, at reasonable times, to Landlord or EDC or UDC, as
appropriate, all books and records of Tenant as pertain to Sales Tax, Tenant's
use of the Sales Tax Letter, Tenant's electric consumption and Tenant's electric
bills at the Premises. Tenant's obligation to maintain (and make available)
records hereunder shall survive for six (6) years following the earlier to occur
of (i) the date on which the balance in the Benefits Account reaches zero, (ii)
the end of the First Period, or (iii) the earlier termination of this Lease.

            Section 11.06. Tenant may furnish and install a project sign,
designed, of a size and with such text as shall be reasonably satisfactory to
Landlord, at a location on the


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<PAGE>   67

exterior of the Premises reasonably satisfactory to Landlord and Tenant. Tenant
also shall extend to Landlord and any of its designee{s) the privilege of being
featured participants in ground-breaking and opening ceremonies to be held at
such time and in such manner as Landlord and Tenant shall agree.

            Section 11.07. Tenant shall remove from the Project Area all fill
excavated from the Land and shall dispose of such fill in accordance with all
applicable Requirements.

            Section 11.08. Tenant acknowledges that it is aware that
construction activities of other developers and of Landlord are in progress or
contemplated within the Project Area. Landlord agrees that construction of Vesey
Park shall be in accordance with the Storage and Staging Letter. Tenant shall
coordinate its construction activities, as provided in the Storage and Staging
Letter, at the Premises with other construction activities taking place in the
Project Area, and those incident to the construction of Landlord's Civic
Facilities and civic facilities in other portions of the Project Area. Landlord
acknowledges and agrees that any delays in Tenant's construction of the Building
attributable to other construction activity in the Project Area may constitute
an Unavoidable Delay, provided Tenant shall have complied with Tenant's
obligations under this Article 11 but, in no event, shall Landlord or Master
Landlord be liable for any such delays in Tenant's construction of the Building
attributable to other construction activity in the Project Area, if any. In
addition, Tenant shall (i) cause any and all work which Tenant is required to or
does perform on, under or adjacent to any portion of any street situated in
whole or in part in the Project Area to be performed in accordance with all
applicable Requirements and in a manner which does not wrongfully obstruct or
hinder ingress to or egress from any portion of the Project Area, (ii) not
cause, permit or suffer the storage of construction materials or the placement
of vehicles not then being operated in connection with construction activities
on any portion of any such street, except as may be permitted by applicable
Requirements and the Storage and Staging Letter, (iii) undertake its
construction activities in accordance with normal New York City construction
rules and (iv) promptly repair or, if required by Landlord, replace any portion
of Landlord's Civic Facilities damaged by the act or omission of Tenant or any
agent, contractor or employee of Tenant, any such repair or replacement, as the
case may be, to be performed (A) by using materials identical to those used by
Landlord, or, if Tenant, despite its best efforts, is unable to procure such
materials, using materials in quality and appearance similar to those used by
Landlord and reasonably approved by Landlord, and (B) in accordance with the
Civic Facilities Drawings and Specifications. In the event Tenant shall have
failed to promptly repair or replace such portion of Landlord's Civic Facilities
as hereinabove provided, Landlord shall have the right to do so at Tenant's
expense and Tenant shall, within ten (10) days after demand, reimburse Landlord
for such costs and expenses incurred by Landlord. In the event Tenant shall fail
to promptly comply with the provisions of subparagraph (ii) of this Section
11.08, Landlord shall have the right after notice to Tenant to remove such
construction materials or vehicles at Tenant's expense and Tenant shall, within
ten (10) days after demand, reimburse Landlord for such costs and expenses
incurred by Landlord. At the request of Landlord, Tenant shall promptly enclose
the Land, the Storage/Storage Area and the Supplemental Staging Area (as such
terms are defined in the


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<PAGE>   68

Storage and Staging Letter) with an 8-foot high chain-mesh fence so as to
separate the Premises from the remainder of the Project Area. During
construction, Tenant shall maintain Tenant's fence in good condition. Upon
Substantial Completion of the Building or as otherwise provided in the Storage
and Staging Letter, Tenant shall remove Tenant's fence and, if constructed,
Landlord shall remove its fence from around the Premises. Subject to applicable
Requirements, Tenant shall have the right to remove Tenant's fence at an earlier
date.

            Section 11.09. Tenant shall use reasonable efforts to cause its
contractors and all other workers at the Premises connected with Tenant's
construction to work harmoniously with each other, and with the other
contractors and workers in the Project Area, and Tenant shall not engage in,
permit or suffer, any conduct which may disrupt such harmonious relationship.
Landlord shall use reasonable efforts to cause its contractors and workers in
the Project Area to work harmoniously with Tenant's contractors and workers.
Tenant shall use its reasonable efforts to cause its contractors to minimize any
interference with the use, occupancy and enjoyment of the Project Area by other
occupants thereof.

            Section 11.10. Tenant shall construct the Building in a manner which
does not unreasonably interfere with, delay or impede the activities of
Landlord, its contractors, and other contractors and developers within the
Project Area. Landlord acknowledges and confirms that Tenant has been granted
certain rights pursuant to the Storage and Staging Letter, as more particularly
described therein. If, in Landlord's reasonable judgment, Tenant shall fail to
comply with its obligations under this Section 11.10, Landlord may, in addition
to any other remedies it may have hereunder, order Tenant (and Tenant's
contractors and other Persons connected with Tenant's construction within the
Project Area) to cease those activities which Landlord believes unreasonably
interfere with, delay or impede Landlord or such other contractors or
developers. No delay or other loss or hindrance of Tenant arising from any such
order by Landlord or from the actions or omissions of any other such contractor
or developer shall form the basis for any claim by Tenant against Landlord or
excuse Tenant from the full and timely performance of its obligations under this
Lease except as otherwise expressly set forth in this Lease.

            Section 11.11. All persons employed by Tenant with respect to
construction of the Building shall be paid, without subsequent deduction or
rebate unless expressly authorized by law, not less than the minimum hourly rate
required by law.

            Section 11.12. Landlord has informed Tenant that Landlord intends to
grant to the City of New York at the completion of the mapping action pending
with respect to North End Avenue (the "Mapping Action"), a sidewalk easement or
otherwise provide a public sidewalk area (the "Sidewalk Easement") within the
area shown on Exhibit A. Landlord hereby grants to Tenant the right to construct
and maintain during the Term of this Lease foundations below grade and
supporting columns for the Building within the area of the Sidewalk Easement
provided that such foundations and supporting columns are constructed in
compliance with the Design Guidelines.


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<PAGE>   69

            Section 11.13. Landlord hereby agrees to insert in all leases
entered into by Landlord prior to the Substantial Completion of the Building
provisions substantially similar to Section 11.08, 11.09 and 11.10.

                                   ARTICLE 12

                                     REPAIRS

            Section 12.01. Unless Landlord shall be obligated to maintain and
repair any of the foregoing in accordance with the provisions of Article 26,
Tenant shall, at its sole cost and expense, put and keep in good condition and
repair the Premises, including, without limitation, the Building, roofs,
foundations and appurtenances thereto, all sidewalks on Vesey Street and North
End Avenue adjacent to the Premises, vaults (other than vaults which are under
the control of, or are maintained or repaired by, a utility company), sidewalk
hoists, water, sewer and gas connections, pipes and mains which are located on
or service the Premises (unless the City of New York or a public utility company
is obligated to maintain or repair same) and all Fixtures, and shall put, keep
and maintain the Building in good and safe order and condition, and make all
repairs therein and thereon, interior and exterior, structural and
nonstructural, ordinary and extraordinary, foreseen and unforeseen, necessary or
appropriate to keep the same in good and safe order and condition, and whether
or not necessitated by wear, tear, obsolescence or defects, latent or otherwise,
provided, however, that Tenant's obligations with respect to Restoration
resulting from a casualty or condemnation shall be as provided in Article 8 and
9 hereof. Tenant shall not commit or suffer, and shall use all reasonable
precaution to prevent, waste, damage or injury to the Premises. When used in
this Section 12.01, the term "repairs" shall include all necessary replacements,
alterations and additions. All repairs made by Tenant shall be at least equal in
quality and class to the original work and shall be made in compliance with (a)
all Requirements of Governmental Authorities (including, but not limited to,
Local Law No. 5, 1973, as amended, and Local Law 58, 1988, as amended), (b) the
requirements of the New York Board of Fire Underwriters or any successor
thereto, and (c) the Building Code of New York City, as then in force.

            Section 12.02. Except as otherwise specifically provided in Article
26, Tenant, at its sole cost and expense, shall keep or cause to be kept clean
and free from dirt, snow, ice, rubbish, obstructions and encumbrances, the
sidewalks on Vesey Street and North End Avenue adjacent to the Premises,
grounds, chutes and sidewalk hoists comprising, in front of, or adjacent to, the
Premises.

            Section 12.03. Except as otherwise specifically provided in Article
26, Landlord shall not be required to furnish any services, utilities or
facilities whatsoever to the Premises, nor shall Landlord have any duty or
obligation to make any alteration, change, improvement, replacement, Restoration
or repair to, nor to demolish, the Building. Tenant assumes the full and sole
responsibility for the condition, operation. repair, alteration, improvement,
replacement, maintenance and management of the Premises. Tenant shall not clean
nor require, permit, suffer nor allow any window in the Building to


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<PAGE>   70

be cleaned from the outside in violation of Section 202 of the Labor Law or of
the rules of the Industrial Board or other state, county or municipal department
board or body having jurisdiction.

                                   ARTICLE 13

                       CHANGES, ALTERATIONS AND ADDITIONS

            Section 13.01. From and after Substantial Completion of the
Building, Tenant shall not demolish, replace or materially alter the Building,
or any part thereof (except as provided to the contrary with respect to Fixtures
in Article 15), or make any addition thereto, whether voluntarily or in
connection with repairs required by this Lease (collectively, "Capital
Improvement"), unless Tenant shall comply with the following requirements and,
if applicable, with the additional requirements set forth in Section 13.02:

            (a) No Capital Improvement shall be undertaken until Tenant shall
have procured from all Governmental Authorities and paid for all permits,
consents, certificates and approvals for the proposed Capital Improvement which
are required to be obtained prior to the commencement of the proposed Capital
Improvement (collectively, "Improvement Approvals"). Landlord shall join or
otherwise cooperate in the application for any such Improvement Approvals,
provided such application is made without cost, expense or liability (contingent
or otherwise) to Landlord. True copies of all such Improvement Approvals shall
be delivered by Tenant to Landlord prior to commencement of the proposed Capital
Improvement.

            (b) All Capital Improvements, when completed, shall be of such a
character as not to materially reduce the value of the Premises below its value
immediately before construction of such Capital Improvement. Landlord
acknowledges and agrees that Capital Improvements which convert some or all of
the Trading Portion to office use or convert some or all of the Office Portion
to trading floor use shall not be deemed to reduce the value of the Premises.

            (c) All Capital Improvements shall be made with reasonable diligence
and continuity (subject to Unavoidable Delays) and in a good and workmanlike
manner and in compliance with (i) all Improvement Approvals, (ii) the Master
Development Plan, the Design Guidelines, the Declaration of Restrictions (if
applicable) and, if required pursuant to Section 13.02(a) or (b), the plans and
specifications for such Capital Improvement as approved by Landlord, (iii) the
orders, rules, regulations and requirements of any Board of Fire Underwriters or
any similar body having jurisdiction, and (iv) all other Requirements.

            (d) No construction of any Capital Improvements shall be commenced
until Tenant shall have delivered to Landlord original insurance policies, or
certificates of insurance with respect to such policies together with copies of
such policies, issued by responsible insurers authorized to do business in the
State of New York as are reasonably acceptable to Landlord, bearing notations
evidencing the payment of premiums or


                                      -66-


<PAGE>   71


installments thereof then due or accompanied by other evidence satisfactory to
Landlord of such payments, for the insurance required by Section 11.03, unless
Landlord shall reasonably determine that the Capital Improvement does not
warrant the insurance required by Section 11.03 in which case Landlord shall in
its discretion specify such lesser types and levels of insurance appropriate to
such Capital Improvement. If, under the provisions of any casualty, liability or
other insurance policy or policies then covering the Premises or any part
thereof, any consent to such Capital Improvement by the insurance company or
companies issuing such policy or policies shall be required to continue and keep
such policy or policies in full force and effect, Tenant, prior to the
commencement of construction of such Capital Improvement, shall obtain such
consents and pay any additional premiums or charges therefor that may be imposed
by said insurance company or companies.

            Section 13.02.

            (a) If the estimated cost of any proposed Capital Improvement shall
exceed One Million Dollars ($1,000,000) (as such amount shall be increased as
provided in Section 7.02(a)), either individually or in the aggregate with other
Capital Improvements which are a related portion of a program or project of
Capital Improvements constructed in any twelve (12) month period during the
Term, Tenant shall:

            (i)         pay to Landlord, within ten (10) days after demand, the
                  reasonable fees and expenses of any architect or engineer
                  selected by Landlord to review the plans and specifications
                  describing the proposed Capital Improvement and inspect the
                  work on behalf of Landlord (it being understood and agreed
                  that Landlord shall only hire an architect or engineer to
                  review plans, and that Tenant shall pay such architect's or
                  engineer's fees, only if the plans being reviewed involve
                  structural work or work involving the exterior of the Building
                  or a change in the height, bulk or setback of the Building
                  from the height, bulk or setback existing immediately prior to
                  the Capital Improvement or in any other manner affects
                  compliance with the Master Development Plan, the Declaration
                  of Restrictions (if applicable) or the Design Guidelines); and

            (ii)        furnish to Landlord the following:

                        (w) at least forty-five (45) Business Days prior to
                        commencement of the proposed Capital Improvement,
                        complete plans and specifications for the Capital
                        Improvement, prepared by a licensed professional
                        engineer or a registered architect approved by Landlord,
                        which approval shall not be unreasonably withheld, and,
                        at the request of Landlord, any other drawings,
                        information or samples to which Landlord is entitled
                        under Article 11, all of the foregoing to be subject to
                        Landlord's review and approval for the sole purpose of
                        determining conformity with the Master


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<PAGE>   72

                        Development Plan, the Design Guidelines, the Declaration
                        of Restrictions (if applicable) and, in the event such
                        Capital Improvement is commenced within ten (10) years
                        from the date the Building shall have been Substantially
                        Completed and, insofar as such Capital Improvement
                        affects the exterior of the Building, the Construction
                        Documents;

                        (x) at least ten (10) Business Days prior to
                        commencement of the proposed Capital Improvement, (1) a
                        contract or construction management agreement reasonably
                        satisfactory to Landlord in form assignable to Landlord
                        (subject to any prior assignment to any Mortgagee), made
                        with a reputable and responsible contractor or
                        construction manager approved by Landlord, which
                        approval shall not be unreasonably withheld, providing
                        for the completion of the Capital Improvement in
                        accordance with the schedule included in the plans and
                        specifications, free and clear of all liens,
                        encumbrances, security agreements, interests and
                        financing statements, and (2) payment and performance
                        bonds or other security, in each case satisfying the
                        requirements of Section 8.04(a)(ii) hereof; and

                        (y) at least ten (10) Business Days prior to
                        commencement of the proposed Capital Improvement, an
                        assignment to Landlord (subject to any prior assignment
                        to any Mortgagee) of the contract so furnished and the
                        bonds or other security provided thereunder, such
                        assignment to be duly executed and acknowledged by
                        Tenant and by its terms to be effective only upon any
                        termination of this Lease or upon Landlord's reentry
                        upon the Premises or following any Event of Default
                        prior to the complete performance of such contract, such
                        assignment also to include the benefit of all payments
                        made on account of such contract, including payments
                        made prior to the effective date of such assignment.

            (b) Notwithstanding that the cost of any Capital Improvement is less
than One Million Dollars ($1,000,000) (as such amount shall be increased as
provided in Section 7.02(a)), such cost to be determined as provided in Section
8.02(b), to the extent that any portion of the Capital Improvement involves
structural work or work involving the exterior of the Building or a change in
the height, bulk or setback of the Building from the height, bulk or setback
existing immediately prior to the Capital Improvement or in any other manner
affects compliance with the Master Development Plan, the Declaration of
Restrictions (if applicable) or the Design Guidelines, then Tenant shall furnish
to Landlord at least thirty (30) Business Days prior to commencement of the
Capital Improvement, complete plans and specifications for the Capital
Improvement, prepared by a licensed


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<PAGE>   73

professional engineer or registered architect approved by Landlord, which
approval shall not be unreasonably withheld, and, at Landlord's request, such
other items designated in Section 13.02(a)(ii)(w) hereof, all of the foregoing
to be subject to Landlord's review and approval as provided therein. In
addition, Tenant shall pay to Landlord the reasonable fees and expenses of any
independent architect or engineer selected by Landlord to review the plans and
specifications describing the proposed Capital Improvement and inspect the work
on behalf of Landlord.

            (c) Landlord shall notify Tenant of Landlord's determination with
respect to any request for approval required under this Section 13.02 within
fifteen (15) Business Days of the later of (i) Landlord's receipt of such
request from Tenant or (ii) Landlord's receipt of the plans and specifications
and the drawings, information or samples which Landlord shall have requested in
accordance with Section 13.02(a)(ii)(w). Landlord's failure to so notify Tenant
within said time period shall be deemed to constitute approval of the proposed
Capital Improvement by Landlord.

            (d) In the event that Tenant shall desire to modify the plans and
specifications which Landlord theretofore has approved pursuant to Section
13.02(a)(ii)(w) or 13.02(b) with respect to, or which will in any way affect,
any aspect of the exterior of the Building or the height, bulk or setback
thereof or which will affect compliance with the Design Guidelines, the
Declaration of Restrictions (if applicable) or the Master Development Plan,
Tenant shall submit the proposed modifications to Landlord. Tenant shall not be
required to submit to Landlord proposed modifications of the plans and
specifications which affect solely the interior of the Building or which do not
affect any aspect of the exterior of the Building or the height, bulk or setback
thereof or which do not affect compliance with the Design Guidelines, the
Declaration of Restrictions (if applicable) or the Master Development Plan.
Landlord shall review the proposed changes for the sole purposes of determining
whether or not they (i) conform to the Master Development Plan, the Design
Guidelines and the Declaration of Restrictions (if applicable) and (ii) in
Landlord's judgment, reasonably exercised, provide for design, finishes and
materials which are comparable in quality to those provided for in the approved
plans and specifications and shall approve such proposed changes if they do so
conform and so provide. If Landlord determines that the proposed changes are not
satisfactory in light of the above criteria, it shall so advise Tenant,
specifying in what respect the plans and specifications, as so modified, do not
conform to the Master Development Plan, the Design Guidelines or the Declaration
of Restrictions (if applicable) or do not provide for design, finishes and
materials which are comparable in quality to those provided for in the approved
plans and specifications. Within fifteen (15) Business Days after Landlord shall
have so advised Tenant, Tenant shall revise the plans and specifications so as
to meet Landlord's objections and shall deliver same to Landlord for review.
Each initial review by Landlord shall be carried out within fifteen (15)
Business Days of the date of initial delivery of the plans and specifications,
as so revised (or one or more portions thereof), by Tenant and such additional
review by Landlord shall be carried out within ten (10) Business Days of the
date of delivery of any revisions thereto, and if Landlord shall not have
notified Tenant of its determination within such periods, it shall be deemed to
have determined that the proposed


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<PAGE>   74

changes are satisfactory. Landlord shall not review portions of the approved
plans and specifications which Landlord has previously determined to be
satisfactory, provided same have not been changed by Tenant.

            Section 13.03. All Capital Improvements shall be carried out under
the supervision of an architect selected by Tenant and approved by Landlord,
which approval shall not be unreasonably withheld. Upon completion of any
Capital Improvement, Tenant shall furnish to Landlord a complete set of "as
built" plans for such Capital Improvement and, where applicable, a survey
meeting the requirements of Section 11.04 hereof, together with, once same is
issued, a permanent Certificate of Occupancy therefor issued by the New York
City Department of Buildings, to the extent a modification thereof was required.

            Section 13.04. Title to all additions, alterations, improvements and
replacements made to the Building, including, without limitation, the Capital
Improvements, shall forthwith vest in Landlord as provided in Section 11.05,
without any obligation by Landlord to pay any compensation therefor to Tenant.

                                   ARTICLE 14

                     REQUIREMENTS OF PUBLIC AUTHORITIES AND
                     OF INSURANCE UNDERWRITERS AND POLICIES;
                          COMPLIANCE WITH MASTER LEASE

            Section 14.01. Except as otherwise specifically provided in Article
26, Tenant promptly shall comply with any and all applicable present and future
laws, rules, orders, ordinances, regulations, statutes, requirements, permits,
consents, certificates, approvals, codes and executive orders, including,
without limitation, Environmental Statutes (collectively, "Requirements")
without regard to the nature or cost of the work required to be done,
extraordinary, as well as ordinary, of all Governmental Authorities now existing
or hereafter created, and of any and all of their departments and bureaus, of
any applicable Fire Rating Bureau or other body exercising similar functions,
affecting the Premises or any street, avenue or sidewalk comprising a part or in
front thereof or any vault in or under the same, or requiring the removal of any
encroachment, or affecting the construction, maintenance, use, operation,
management or occupancy of the Premises, whether or not the same involve or
require any structural changes or additions in or to the Premises, without
regard to whether or not such changes or additions are required on account of
any particular use to which the Premises, or any part thereof, may be put, and
without regard to the fact that Tenant is not the fee owner of the Premises.
Notwithstanding the foregoing, Tenant shall not be required to comply with
Requirements of Landlord except (i) as otherwise expressly provided in this
Lease or (ii) if New York City shall be Landlord, Requirements of New York City
acting solely in its capacity as a Governmental Authority. Tenant also shall
comply with any and all provisions and requirements of any casualty, liability
or other insurance policy required to be carried by Tenant under the provisions
of this Lease. Tenant shall have no obligation to comply with


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<PAGE>   75

Requirements with respect to, or pay for or complete, Landlord's Civic
Facilities to be performed by Landlord as provided in Article 26.

            Section 14.02. Tenant shall have the right to contest the validity
of any Requirements or the application thereof. During such contest, compliance
with any such contested Requirements may be deferred by Tenant upon condition
that, if Tenant is not an Institutional Lender, and if the cost of compliance
shall exceed $1,000,000 (subject to increase as provided in Section 7.02(a)),
then, prior to instituting such proceeding, Tenant shall furnish to Landlord a
bond, cash or other security satisfactory to Landlord, in an amount equal to the
amount by which the cost of such compliance exceeds $1,000,000 (subject to
increase as provided in Section 7.02(a)), securing compliance with the contested
Requirements and payment of all interest, penalties, fines, fees and expenses in
connection therewith. Any such proceeding instituted by Tenant shall be
commenced as soon as is reasonably possible after the issuance of any such
contested matters, or after actual notice to Tenant of the applicability of such
matters to the Premises, and shall be prosecuted to final adjudication with
reasonable dispatch. Notwithstanding the foregoing, Tenant promptly shall comply
with any such Requirements and compliance shall not be deferred if such
non-compliance shall result in the imminent loss or forfeiture of the Premises,
or any part thereof, or if Landlord shall be in danger of being subject to civil
or criminal liability or penalty by reason of non-compliance therewith.

            Section 14.03. Tenant shall not cause or create or permit to exist
or occur any condition or event relating to the Premises which would, with or
without notice or passage of time, result in an event of default under the
Master Lease (as the same exists on the date hereof). Tenant shall perform all
of Landlord's obligations as tenant under the Master Lease (as the same exists
on the date hereof) relating to the maintenance and operation of the Premises
unless, in accordance with the terms of this Lease, Landlord is specifically
obligated to perform any such obligation.

                                   ARTICLE 15

                                    FIXTURES

            Section 15.01. All Fixtures shall be and shall remain the property
of Landlord. Tenant shall not have the right, power or authority to, and shall
not, remove any Fixtures from the Premises without the consent of Landlord,
which consent shall not be unreasonably withheld, provided, however, such
consent shall not be required in connection with repairs, cleaning or other
servicing, or if (subject to Unavoidable Delays) the same is promptly replaced
by Fixtures which are at least equal in utility and value to the Fixtures being
removed. Notwithstanding the foregoing, Tenant shall not be required to replace
any Fixtures which performed a function which has become obsolete or otherwise
is no longer necessary or desirable in connection with the use or operation of
the Premises. Tenant shall keep all Fixtures in good order and repair.


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<PAGE>   76

            Section 15.02. Tenant may, at any time and from time to time,
remove, replace, repair and upgrade any Equipment, as appropriate.

                                   ARTICLE 16

                            DISCHARGE OF LIENS; BONDS

            Section 16.01. Subject to the provisions of Section 16.02 hereof,
except as otherwise expressly provided herein, Tenant shall not create or permit
to be created any lien, encumbrance or charge upon the Premises or any part
thereof, or the Project Area or any part thereof, the income therefrom or any
assets of, or funds appropriated to, Landlord, and Tenant shall not suffer any
other matter or thing whereby the estate, right and interest of Landlord in the
Premises or any part thereof might be impaired. Tenant may finance (and enter
into equipment finance leases of) any Equipment.

            Section 16.02. If any mechanic's, laborer's or materialman's lien
(other than a lien arising out of any work performed by Landlord) at any time
shall be filed in violation of the obligations of Tenant pursuant to Section
16.01 against the Premises or any part thereof or the Project Area or any part
thereof, or, if any public improvement lien created or permitted to be created
by Tenant shall be filed against any assets of, or funds appropriated to,
Landlord, Tenant, within forty-five (45) days after receipt of notice of the
filing thereof shall cause the same to be discharged of record by payment,
deposit, bond, order of a court of competent jurisdiction or otherwise. If
Tenant shall fail to cause such lien to be discharged of record within the
period aforesaid, and if such lien shall continue for an additional ten (10)
days after notice by Landlord to Tenant, then, in addition to any other right or
remedy, Landlord may, but shall not be obligated to, discharge the same either
by paying the amount claimed to be due or by procuring the discharge of such
lien by deposit or by bonding proceedings, and in any such event, Landlord shall
be entitled, if Landlord so elects, to compel the prosecution of an action for
the foreclosure of such lien by the lienor and to pay the amount of the judgment
in favor of the lienor with interest, costs and allowances. Any amount so paid
by Landlord, including all reasonable costs and expenses incurred by Landlord in
connection therewith including, without limitation, reasonable attorneys' fees
and disbursements, together with interest thereon at the Involuntary Rate, from
the respective dates of Landlord's making of the payment or incurring of the
costs and expenses, shall constitute Rental and shall be paid by Tenant to
Landlord within ten (10) days after demand. Notwithstanding the foregoing
provisions of this Section 16.02, Tenant shall not be required to discharge any
such lien if Tenant is in good faith contesting the same and has furnished a
cash deposit or a security bond or other such security satisfactory to Landlord
in an amount sufficient to pay such lien with interest and penalties.

            Section 16.03. Nothing in this Lease contained shall be deemed or
construed in any way as constituting the consent or request of Landlord, express
or implied, by inference or otherwise, to any contractor, subcontractor, laborer
or materialman for the performance of any labor or the furnishing of any
materials for any specific improvement,


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<PAGE>   77

alteration to or repair of the Premises or any part thereof, nor as giving
Tenant any right, power or authority to contract for or permit the rendering of
any services or the furnishing of materials that would give rise to the filing
of any lien against Landlord's interest in the Premises or any part thereof, the
Project Area or any part thereof, or any assets of, or funds appropriated to,
Landlord. Notice is hereby given, and Tenant shall cause all Construction
Agreements to provide, that Landlord shall not be liable for any work performed
or to be performed at the Premises for Tenant or any Subtenant or for any
materials furnished or to be furnished at the Premises for any of the foregoing,
and that no mechanic's or other lien for such work or materials shall attach to
or affect the estate or interest of Landlord in and to the Premises or any part
thereof, the Project Area or any part thereof, or any assets of, or funds
appropriated to, Landlord.

            Section 16.04. Tenant shall have no power to do any act or make any
contract which may create or be the foundation for any lien, mortgage or other
encumbrance upon the estate or assets of, or funds appropriated to, Landlord or
of any interest of Landlord in the Premises.

                                   ARTICLE 17

                           REPRESENTATIONS; POSSESSION

            Section 17.01. Tenant acknowledges that Tenant is fully familiar
with the Land, the Project Area, the physical condition thereof (including,
without limitation, the fact that the Land includes substantial portions of
landfill which may present special difficulties in the design, construction and
maintenance of the Building and Tenant's Civic Facilities), the Title Matters,
the Master Lease, the Declaration of Restrictions, the Master Development Plan,
the Memorandum of Understanding, the Settlement Agreement and the Design
Guidelines. Except for Landlord's Civic Facilities to be constructed by Landlord
as provided in Article 26, Tenant accepts the Land in its existing condition and
state of repair, and, except as otherwise expressly set forth in this Lease, no
representations, statements, or warranties, express or implied, have been made
by or on behalf of Landlord in respect of the Land, the Project Area, the status
of title thereof, the physical condition thereof, including, without limitation,
the landfill portions thereof, the zoning or other laws, regulations, rules and
orders applicable thereto, Taxes, or the use that may be made of the Land, that
Tenant has relied on no such representations, statements or warranties, and that
Landlord shall in no event whatsoever be liable for any latent or patent defects
in the Land.

            Section 17.02. Notwithstanding anything herein contained to the
contrary, Landlord represents that the Master Lease, the Design Guidelines, the
Declaration of Restrictions, the Master Development Plan, the Memorandum of
Understanding, and the Settlement Agreement have not been amended, modified or
supplemented, except as specifically set forth in the definitions contained in
Article 1 and are in full force and effect.


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<PAGE>   78

            Section 17.03. Landlord shall deliver possession of the Land on the
Commencement Date vacant and free of occupants and tenancies, subject to the
Title Matters.

                                   ARTICLE 18

                 LANDLORD NOT LIABLE FOR INJURY OR DAMAGE, ETC.

            Section 18.01. Landlord shall not in any event whatsoever be liable
for any injury or damage to Tenant or to any other Person happening on, in or
about the Premises and its appurtenances, nor for any injury or damage to the
Premises or to any property belonging to Tenant or to any other Person which may
be caused by any fire or breakage, or by the use, misuse or abuse of the
Building (including, but not limited to, any of the common areas within the
Building, Fixtures, Equipment, elevators, hatches, openings, installations,
stairways, hallways, or other common facilities), or the streets or sidewalk
area within the Premises or which may arise from any other cause whatsoever
except to the extent any of the foregoing shall have resulted from the
negligence or wrongful act of Landlord, its officers, agents, employees or
licensees; nor shall Landlord in any event be liable for the acts or failure to
act of any other tenant of any premises within the Project Area other than the
Premises, or of any agent, representative, employee, contractor or servant of
such other tenant.

            Section 18.02. Landlord shall not be liable to Tenant or to any
other Person for any failure of water supply, gas or electric current, nor for
any injury or damage to any property of Tenant or of any other Person or to the
Premises caused by or resulting from gasoline, oil, steam, gas, electricity, or
hurricane, tornado, flood, wind or similar storms or disturbances, or water,
rain or snow which may leak or flow from the street, sewer, gas mains or
subsurface area or from any part of the Premises, or leakage of gasoline or oil
from pipes, appliances, sewer or plumbing works therein, or from any other
place, nor for interference with light or other incorporeal hereditaments by
anybody, or caused by any public or quasi-public work, except to the extent any
of the foregoing shall have resulted from the negligence or wrongful act of
Landlord, its officers, agents, employees or licensees.

            Section 18.03. In addition to the provisions of Section 18.01 and
18.02, in no event shall Landlord be liable to Tenant or to any other Person for
any injury or damage to any property of Tenant or of any other Person or to the
Premises, arising out of any sinking, shifting, movement, subsidence, failure in
load-bearing capacity of, or other matter or difficulty related to, the soil, or
other surface or subsurface materials, on the Premises or in the Project Area,
it being agreed that Tenant shall assume and bear all risk of loss with respect
thereto.

            Section 18.04. In no event shall Tenant be liable to Landlord or to
any other Person for any injury or damage to Landlord or to such other Person
happening on, in or about the Premises and its appurtenances which may be caused
by Landlord's Civic


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Facilities or the existence on the date hereof of any hazardous, toxic or
dangerous waste, substance or material in the soil or subsurface, except to the
extent that the same shall have been caused in whole or in part by the
negligence or wrongful act of Tenant or any employee, agent, servant or
contractor of Tenant or Subtenant.

                                   ARTICLE 19

                     INDEMNIFICATION OF LANDLORD AND OTHERS

            Section 19.01. Tenant shall not do, or knowingly permit any
Subtenant or any employee, agent, servant or contractor of Tenant or of any
Subtenant to do, any act or thing upon the Premises or elsewhere in the Project
Area which may reasonably be likely to subject Landlord to any liability or
responsibility for injury or damage to persons or property, or to any liability
by reason of any violation of law or any other Requirement, and shall use its
best efforts to exercise such control over the Premises so as to fully protect
Landlord against any such liability. Subject in all respects to the provisions
of Section 41.06(b) hereof, Tenant, to the fullest extent permitted by law,
shall indemnify and save Landlord, any former Landlord, the State of New York,
UDC, the City, EDC, and their agents, directors, officers and employees
(collectively, the "Indemnitees"), harmless from and against any and all
liabilities, suits, obligations, fines, damages, penalties, claims, costs,
charges and expenses, including, without limitation, engineers', architects' and
attorneys' fees and disbursements, which may be imposed upon or incurred by or
asserted against any of the Indemnitees by reason of any of the following
occurring during the Term, except to the extent that the same shall have been
caused in whole or in part by the negligence or wrongful act of any of the
Indemnitees:

            (a) construction of the Building or any other work or thing done in
or on the Premises or any part thereof, provided that such indemnity relates to
items of construction that Tenant, rather than Landlord, is obligated to perform
(i.e. that such indemnity does not include or relate to Landlord's bringing
utilities and infrastructure to and constructing Landlord's Civic Facilities for
the Building or Landlord's maintaining or repairing the electrical closets in
the basement of the Building);

            (b) any use, non-use, possession, occupation, alteration, repair,
condition, operation, maintenance or management of the Premises or any part
thereof or of any street, alley, sidewalk, curb, vault, passageway or space
comprising a part of the Premises or adjacent thereto, provided such indemnity
with regard to streets, alleys, sidewalks, curbs, vaults, passageways and other
space is limited to an alteration, repair, condition, or maintenance of any
street, alley, sidewalk, curb, vault, passageway or other space done or
performed by Tenant or any agent, contractor, servant or employee of Tenant or
which Tenant is obligated to do or perform, provided, however, such indemnity
shall not relate to any pre-existing environmental condition;

            (c) any negligent or tortious act or failure to act within the
Project Area on the part of Tenant or any agent, contractor, servant or employee
of Tenant;


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            (d) any accident, injury (including death at any time resulting
therefrom) or damage to any Person or property occurring in or on the Premises
or any part thereof or in, or about any sidewalk or vault, unless such sidewalk
or vault is solely within the control of Landlord or a utility company,
provided, however, such indemnity shall not relate to any pre-exising
environmental condition;

            (e) any failure on the part of Tenant to perform or comply with any
of the covenants, agreements, terms or conditions contained in this Lease on its
part to be performed or complied with;

            (f) any lien or claim which may have arisen out of any act of Tenant
or any agent, contractor, servant or employee of Tenant against or on the
Premises or any other portion of the Project Area, or any lien or claim created
or permitted to be created by Tenant in respect of the Premises against any
assets of, or funds appropriated to any of the Indemnitees under the laws of the
State of New York or of any other Governmental Authority or any liability which
may be asserted against any of the Indemnitees with respect thereto, provided,
however, such indemnity shall not relate to any pre-existing environmental
condition;

            (g) any failure on the part of Tenant to keep, observe and perform
any of the terms, covenants, agreements, provisions, conditions or limitations
contained in the Construction Agreements or Subleases, on Tenant's part to be
kept, observed or performed;

            (h) any contest by Tenant permitted pursuant to the provisions of
this Lease, including, without limitation, Articles 4, 14 and 28 hereof; or

            (i) any action taken by any Person pursuant to any Environmental
Statute or under common law, pertaining to hazardous or toxic waste or other
substances, or in any manner arising out of or related to the presence, use,
generation, storage, disposal or transport of any hazardous materials or
environmental contaminants found in, on or under, affixed to or emanating from
the Premises, provided, however, such indemnity shall not relate to any
pre-existing environmental condition.

            Section 19.02. The obligations of Tenant under this Artiucle 19
shall not be affected in any way by the absence in any case of covering
insurance or by the failure or refusal of any insurance carrier to perform any
obligation on its part under insurance policies affecting the Premises.

            Section 19.03. If any claim, action or proceeding is made or brought
against any of the Indemnitees by reason of any event for which Tenant has
agreed to indemnify the Indemnitees in Section 19.01, then, Tenant shall resist
or defend such claim, action or proceeding (in such Indemnitee's name, if
necessary) by the attorneys for Tenant's insurance carrier (if such claim,
action or proceeding is covered by insurance maintained by Tenant) or (in all
other instances) by such attorneys as Tenant shall select and Landlord shall
approve, which approval shall not be unreasonably withheld. In such event,
Tenant shall control all decisions in respect of the litigation and settlement
of such claims.


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<PAGE>   81

Notwithstanding the foregoing, Landlord may engage its own attorneys to assist
in its defense. Provided such claim, action or proceeding is not covered by
insurance maintained by Tenant and exceeds Five Hundred Thousand Dollars
($500,000) (as such amount shall be increased as provided in Section 7.02(a))
and the attorneys engaged by Landlord are experienced in matters of the type in
question, Tenant shall pay the reasonable fees and disbursements of such
attorneys. The indemnification obligations imposed upon Tenant under Section
19.01 shall not apply to any settlement agreed to by Landlord without Tenant's
consent, nor if Landlord retains its own attorneys and such retention will
materially impair or materially diminish Tenant's insurance coverage and
Landlord has been so advised in writing by Tenant's insurer.

                                   ARTICLE 20

                            RIGHT OF INSPECTION, ETC.

            Section 20.01. Tenant shall permit Landlord and its agents or
representatives to enter the Premises at all reasonable times and upon
reasonable notice (except in cases of emergency) for the purpose of (a)
inspecting the same, (b) determining whether or not Tenant is in compliance with
its obligations hereunder, (c) constructing, maintaining and inspecting any
Civic Facilities, or maintaining and repairing the meter rooms in the basement
of the Building, and (d) making any necessary repairs to the Premises and
performing any work therein that may be necessary by reason of Tenant's failure
to make any such repairs or perform any such work, provided that, except in any
emergency, Landlord shall have given Tenant notice specifying such repairs or
work and Tenant shall have failed to make such repairs or to do such work within
sixty (60) days after the receipt of such notice (subject to Unavoidable
Delays), or if such repairs or such work cannot reasonably be completed during
such sixty (60) day period, to have commenced and be diligently pursuing the
same (subject to Unavoidable Delays).

            Section 20.02. Nothing in this Article 20 or elsewhere in this Lease
shall imply any duty upon the part of Landlord to do any work required to be
performed by Tenant hereunder and performance of any such work by Landlord shall
not constitute a waiver of Tenant's default in failing to perform the same.
Landlord, during the progress of any such work, may keep and store at the
Premises all necessary materials, tools, supplies and equipment. Landlord shall
not be liable for inconvenience, annoyance, disturbance, loss of business or
other damage of Tenant, any Subtenant or other occupant of the Building by
reason of making such repairs or the performance of any such work, or on account
of bringing materials, tools, supplies and equipment into the Premises during
the course thereof, provided Landlord shall use reasonable efforts to minimize
damage resulting from Landlord's exercise of its rights under this Article 20,
and the obligations of Tenant under this Lease shall not be affected thereby. To
the extent that Landlord undertakes such work or repairs, such work or repairs
shall be commenced and completed in a good and workmanlike manner, and with
reasonable diligence, subject to Unavoidable Delays, and in


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such a manner as not to unreasonably interfere with the conduct of business in
or use of such space.

                                   ARTICLE 21

                 LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS

            Section 21.01. If Tenant at any time shall be in Default, after
notice thereof and after applicable grace periods, if any, provided under this
Lease for Tenant or a Mortgagee, respectively, to cure or commence to cure same,
Landlord, without waiving or releasing Tenant from any obligation of Tenant
contained in this Lease, may (but shall be under no obligation to) perform such
obligation on Tenant's behalf.

            Section 21.02. All reasonable sums paid by Landlord and all
reasonable costs and expenses, including, without limitation, reasonable
attorneys' fees and disbursements, incurred by Landlord in connection with its
performance of any obligation pursuant to Section 21.01, together with interest
thereon at the Involuntary Rate from the respective dates of Landlord's making
of each such payment or incurring of each such sum, cost, expense, charge,
payment or deposit until the date of actual repayment to Landlord, shall be paid
by Tenant to Landlord within ten (10) days after Landlord shall have submitted
to Tenant a statement, in reasonable detail, substantiating the amount demanded
by Landlord. Any payment or performance by Landlord pursuant to Section 21.01
shall not be nor be deemed to be a waiver or release of breach or Default of
Tenant with respect thereto or of the right of Landlord to terminate this Lease,
institute summary proceedings or take such other action as may be permissible
hereunder or otherwise provided at law or in equity if an Event of Default by
Tenant shall have occurred.

                                   ARTICLE 22

                             NO ABATEMENT OF RENTAL

            Except as may be otherwise expressly provided herein, there shall be
no abatement, off-set, diminution or reduction of Rental payable by Tenant
hereunder or of the other obligations of Tenant hereunder under any
circumstances.

                                   ARTICLE 23

                      PERMITTED USE; NO UNLAWFUL OCCUPANCY

            Section 23.01. Subject to the provisions of law and this Lease,
Tenant shall occupy the Premises in accordance with the Certificate or
Certificates of Occupancy for the Premises, the Occupancy Agreement, the Master
Development Plan and the Design Guidelines, and for no other use or purposes.
Notwithstanding the provisions of the


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immediately preceding sentence, in the event Tenant shall have elected to
terminate the Funding Agreement pursuant to the provisions of Section
9.6(b)(ii)(B) thereof, then, for a period of five (5) years commencing on the
Occupancy Date, (i) Tenant shall use and occupy the Premises for its world
headquarters, and (ii) Tenant shall retain its headquarters, executive,
administrative and clearinghouse facilities and offices which relate to floor
trading of futures or options (not including its Host Computer (as such term is
defined in the Occupancy Agreement)) at the Premises, and all other provisions
of the Occupancy Agreement shall be of no further force or effect.

            Section 23.02. Tenant shall not use or occupy, nor permit or suffer
the Premises or any part thereof to be used or occupied for any unlawful,
illegal or extra hazardous business, use or purpose, or in such manner as to
constitute a nuisance of any kind (public or private) or that Landlord, in its
reasonable judgment, deems offensive by reason of odors, fumes, dust, smoke,
noise or other pollution, or for any purpose or in any way in violation of the
Certificates of Occupancy or of any governmental laws, ordinances, requirements,
orders, directions, rules or regulations, including, without limitation, the
Design Guidelines, or which may make void or voidable any insurance then in
force on the Premises or, without Landlord's consent, for any use which requires
a variance, waiver or special permit under the Zoning Resolution of New York
City as then in effect. Tenant shall take, immediately upon the discovery of any
such unpermitted, unlawful, illegal or extra hazardous use, all necessary
actions, legal and equitable, to compel the discontinuance of such use. If for
any reason Tenant shall fail to take such actions, and such failure shall
continue for thirty (30) days after Tenant's receipt of notice from Landlord
specifying such failure, Landlord is hereby irrevocably authorized (but not
obligated) to take all such actions in Tenant's name and on Tenant's behalf,
Tenant hereby appointing Landlord as Tenant's attorney-in-fact coupled with an
interest for all such purposes. All reasonable sums paid by Landlord and all
reasonable costs and expenses incurred by Landlord acting pursuant to the
immediately preceding sentence (including, but not limited to, reasonable
attorneys' fees and disbursements), together with interest thereon at the
Involuntary Rate from the respective dates of Landlord's making of each such
payment or incurring of each such cost, expense or charge until the date of
receipt of repayment by Landlord, shall be paid by Tenant to Landlord within ten
(10) days after demand and shall constitute Rental under this Lease.

            Section 23.03. Tenant shall not knowingly suffer or permit the
Premises or any portion thereof to be used by the public in such manner as might
reasonably tend to impair title to the Premises or any portion thereof, or in
such manner as might reasonably make possible a claim or claims of adverse usage
or adverse possession by the public, as such, or of implied dedication of the
Premises or any portion thereof.

            Section 23.04. Tenant shall take all such actions as Landlord is
required to take in connection with the use and occupancy of the Premises under
the terms of the Master Lease, as the same exists on the date hereof, and Tenant
shall not (to the extent reasonably within Tenant's control) permit any action
or condition in respect of the Premises which constitutes or would, with notice
or lapse of time or both, constitute an


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<PAGE>   84

event of default under the Master Lease (as the same exists on the date hereof).
Landlord shall perform all obligations of tenant under the Master Lease other
than those which are the obligation of Tenant under this Lease, and Landlord
shall not take or fail to take any action which constitutes or would, with
notice or lapse of time or both, constitute an event of default under the Master
Lease.

            Section 23.05.

            In the event Tenant defaults under the Funding Agreement or the
Occupancy Agreement and such default shall not have been remedied within any
applicable grace or cure period provided therein, such default shall constitute
an Event of Default hereunder permitting Landlord to terminate this Lease.
Except as otherwise provided in Section 42.01 hereof, in such event and
notwithstanding anything contained in this Lease to the contrary, Tenant shall
not be liable for, and Landlord shall not be entitled to receive, any damages by
reason of such default and termination.

            Section 23.06.

            Tenant shall not amend, modify or enter into a supplement to the
Severance Tenants Agreement without the prior consent of Landlord, which consent
shall not be unreasonably withheld; it being the agreement of Landlord and
Tenant that a breach by Tenant of the provisions of this Section 23.06 shall
constitute an Event of Default hereunder.

                                   ARTICLE 24

                   EVENTS OF DEFAULT; CONDITIONAL LIMITATIONS,
                                 REMEDIES, ETC.

            Section 24.01. Each of the following events shall be an "Event of
Default" hereunder:

            (a) if Tenant shall fail to pay any item of Rental, or any part
thereof, when the same shall become due and payable and such failure shall
continue for ten (10) days after notice from Landlord to Tenant;

            (b) if (i) Commencement of Construction shall not have occurred on
or before the Construction Commencement Date (subject to Unavoidable Delays) and
such failure shall continue for thirty (30) days after notice from Landlord to
Tenant, (ii) Substantial Completion of the Building shall not have occurred on
or before the Scheduled Completion Date (subject to Unavoidable Delays) and such
failure shall continue for sixty (60) days after notice from Landlord to Tenant
or (iii) the Occupancy Date shall not have occurred within forty eight (48)
months of the Construction Commencement Date (subject to Unavoidable Delays) and
such failure shall continue for thirty (30) days after notice from Landlord to
Tenant;


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<PAGE>   85

            (c) if Tenant shall fail to observe or perform one or more of the
other terms, conditions, covenants or agreements contained in this Lease,
including, without limitation, any of Tenant's obligations under the provisions
of Article 11. of this Lease (other than the obligations referred to in the
preceding Section 24.01(b)), and such failure shall continue for a period of
thirty (30) days after notice thereof by Landlord to Tenant specifying such
failure (unless such failure requires work to be performed, acts to be done, or
conditions to be removed which cannot by their nature or because of Unavoidable
Delays reasonably be performed, done or removed, as the case may be, within such
thirty (30) day period, in which case no Event of Default shall be deemed to
exist as long as Tenant shall have commenced curing the same within such thirty
(30) day period and shall, subject to Unavoidable Delays, diligently and
continuously prosecute the same to completion);

            (d) to the extent permitted by law, if Tenant shall admit, in
writing, that it is unable to pay its debts as such become due;

            (e) to the extent permitted by law, if Tenant shall make an
assignment for the benefit of creditors;

            (f) to the extent permitted by law, if Tenant shall file a voluntary
petition under Title 11 of the United States Code or if such petition is filed
against it, and an order for relief is entered, or if Tenant shall file any
petition or answer seeking, consenting to or acquiescing in any reorganization,
arrangement, composition, readjustment, liquidation. dissolution or similar
relief under the present or any future federal bankruptcy code or any other
present or future applicable federal, state or other statute or law, or shall
seek or consent to or acquiesce in or suffer the appointment of any trustee,
receiver, custodian, assignee, sequestrator, liquidator or other similar
official of Tenant, or of all or any substantial part of its properties or of
the Premises or any interest therein of Tenant, or if Tenant shall take any
corporate action in furtherance of any action described in Sections 24.01(d),
(e) or (f) hereof;

            (g) to the extent permitted by law, if within ninety (90) days after
the commencement of any proceeding against Tenant seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under the present or any future federal bankruptcy code or any other
present or future applicable federal, state or other statute or law, such
proceeding shall not have been dismissed; or if, within ninety (90) days after
the appointment, without the consent or acquiescence of Tenant, of any trustee,
receiver, custodian, assignee, sequestrator, liquidator or other similar
official of Tenant or of all or any substantial part of its properties or of the
Premises or any interest therein of Tenant, such appointment shall not have been
vacated or stayed on appeal or otherwise, or if, within thirty (30) days after
the expiration of any such stay, such appointment shall not have been vacated;

            (h) if this Lease or the estate of Tenant hereunder shall be
assigned, subleased, transferred, mortgaged or encumbered, or there shall be a
Transfer, without Landlord's approval to the extent required hereunder or
without compliance with the


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<PAGE>   86

provisions of this Lease applicable thereto and such transaction shall not be
made to comply or voided ab initio within thirty (30) days after notice thereof
from Landlord to Tenant;

            (i) if a levy under execution or attachment shall be made against
the Premises and such execution or attachment shall not be vacated or removed by
court order, or otherwise or bonded within a period of thirty (30) days from the
date on which Tenant shall have received notice of same;

            (j) if Tenant is a corporation, if Tenant shall at any time fail to
maintain its corporate existence in good standing, or to pay any corporate
franchise tax when and as the same shall become due and payable and such failure
shall continue for thirty (30) days after notice thereof from Landlord or any
governmental agency to Tenant;

            (k) if Tenant shall have defaulted under the Funding Agreement or
Occupancy Agreement and such default shall not have been remedied within any
applicable grace or cure period provided therein; or

            (l) if Tenant shall have amended, modified or entered into a
supplement to the Severance Tenants Agreement without the prior consent of
Landlord.

            Section 24.02. If an Event of Default (other than an Event of
Default described in Section 24.01(k) or Section 23.05) shall occur, Landlord
may elect to declare due and payable a sum equal to the amount by which the
Rental reserved in this Lease for the period which otherwise would have
constituted the unexpired portion of the Term exceeds the fair and reasonable
rental value of the Premises for the same period, both discounted to present
worth at the rate of eight percent (8%) per annum, such sum shall be due and
payable ten (10) days after notice by Landlord to Tenant of such election.
However, the aforesaid remedy shall not be applicable to a Mortgagee which
elects to cure the Default of Tenant pursuant to Section 10.10 or receives a new
lease pursuant to Section 10.11. Landlord may also elect to proceed by
appropriate judicial proceedings, either at law or in equity, to enforce
performance or observance by Tenant of the applicable provisions of this Lease
and/or to recover damages for breach thereof.

            Section 24.03.

            (a) If any Event of Default (i) described in Sections 24.01(d),
(e), (f) or (g) hereof shall occur, or (ii) described in Sections 24.01(b), (c),
(h), (i), (j), (k) or (l) shall occur and Landlord, at any time thereafter, at
its option, gives notice to Tenant stating that this Lease and the Term shall
expire and terminate on the date specified in such notice, which date shall be
not less than ten (10) days after the giving of such notice, and if, on the date
specified in such notice, Tenant shall have failed to cure the Default which was
the basis for the Event of Default, then this Lease and the Term and, except as
provided in Section 24.04(a), all rights of Tenant under this Lease shall expire
and terminate as of the date on which the Event of Default described in clause
(i) above occurred or the date specified in the notice given pursuant to clause
(ii) above, as the case may be, as if such date were the date herein definitely
fixed for the expiration of the Term and Tenant


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immediately Shall quit and surrender the Premises. Anything contained herein to
the contrary notwithstanding, if such termination shall be stayed by order of
any court having jurisdiction over any proceeding described in Section 24.01(f)
or (g) hereof, or by federal or state statute, then. following the expiration of
any such stay, or if the trustee appointed in any such proceeding, Tenant or
Tenant as debtor-in-possession shall fail to assume Tenant's obligations under
this Lease within the period prescribed therefor by law or within one hundred
twenty (120) days after entry of the order for relief or as may be allowed by
the court, or if said trustee, Tenant or Tenant as debtor-in-possession shall
fail to provide adequate protection of Landlord's right, title and interest in
and to the Premises or adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease as provided in Section
24.15 hereof, Landlord, to the extent permitted by law or by leave of the court
having jurisdiction over such proceeding, shall have the right, at its election,
to terminate this Lease on ten (10) days notice to Tenant, Tenant as
debtor-in-possession or said trustee and upon the expiration of said ten (10)
day period this Lease shall cease and expire as aforesaid and Tenant, Tenant as
debtor-in-possession and/or trustee shall immediately quit and surrender the
Premises as aforesaid.

            (b) If an Event of Default described in Section 24.01 (a) shall
occur, or this Lease shall be terminated as provided in Section 24.03(a),
Landlord, without notice, may re-enter and repossess the Premises using such
force for that purpose as may be necessary without being liable to indictment,
prosecution or damages therefor and may dispossess Tenant by summary proceedings
or otherwise.

            Section 24.04.

            If this Lease shall be terminated as provided in Section 24.03(a) or
Tenant shall be dispossessed by summary proceedings or otherwise as provided in
Section 24.03(b) hereof:

            (a) Tenant shall pay to Landlord all Rental payable by Tenant under
this Lease to the date upon which this Lease and the Term shall have expired and
come to an end or to the date of re-entry upon the Premises by Landlord, as the
case may be;

            (b) Landlord may complete all construction required to be performed
by Tenant hereunder and may repair and alter the Premises in such manner as
Landlord may deem necessary or advisable (and may apply to the foregoing all
funds, if any, then held by Depository pursuant to Articles 7, 8 or 9) without
relieving Tenant of any liability under this Lease or otherwise affecting any
such liability, and/or let or relet the Premises or any parts thereof for the
whole or any part of the remainder of the Term or for a longer period, in
Landlord's name or as agent of Tenant, and out of any rent and other sums
collected or received as a result of such reletting Landlord shall: (A) first,
pay to itself the reasonable cost and expense of terminating this Lease,
re-entering, retaking, repossessing, completing construction and repairing or
altering the Premises, or any part thereof, and the cost and expense of removing
all persons and property therefrom, including in such costs brokerage
commissions, legal expenses and reasonable attorneys' fees and disbursements,
(B) second, pay to itself the reasonable cost and expense sustained in securing
any new tenants and


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<PAGE>   88

other occupants, including in such costs brokerage commissions, legal expenses
and reasonable attorneys' fees and disbursements and other expenses of preparing
the Premises for reletting, and, if Landlord shall maintain and operate the
Premises, the reasonable cost and expense of operating and maintaining the
Premises and (C) third, pay to itself any balance remaining on account of the
liability of Tenant to Landlord. Landlord in no way shall be responsible or
liable for any failure to relet the Premises or any part thereof, or for any
failure to collect any rent due on any such reletting, and no such failure to
relet or to collect rent shall operate to relieve Tenant of any liability under
this Lease or to otherwise affect any such liability;

            (c) if Landlord shall not have declared all Rental due and payable
pursuant to Section 24.02 hereof, Tenant shall be liable for and shall pay to
Landlord, as damages, any deficiency (referred to as "Deficiency") between the
Rental reserved in this Lease for the period which otherwise would have
constituted the unexpired portion of the Term and the net amount, if any, of
rents collected under any reletting effected pursuant to the provisions of
Section 24.04(b) for any part of such period (first deducting from the rents
collected under any such reletting all of the payments to Landlord described in
Section 24.04(b) hereof); any such Deficiency shall be paid in installments by
Tenant on the days specified in this Lease for payment of installments of
Rental, and Landlord shall be entitled to recover from Tenant each Deficiency
installment as the same shall arise, and no suit to collect the amount of the
Deficiency for any installment period shall prejudice Landlord's right to
collect the Deficiency for any subsequent installment period by a similar
proceeding, provided, however, the provisions of this subparagraph (c) shall not
be applicable and Tenant shall not be responsible for the payment of any
Deficiency if the Event of Default that gave rise to the termination of the
Lease or summary proceedings was an Event of Default described in Section
24.01(k) or Section 23.05 hereof; and

            (d) if Landlord shall not have declared all Rental due and payable
pursuant to Section 24.02 hereof, and whether or not Landlord shall have
collected any Deficiency installments as aforesaid, Landlord shall be entitled
to recover from Tenant, and Tenant shall pay to Landlord, on demand, in lieu of
any further Deficiencies, as and for liquidated and agreed final damages (it
being agreed that it would be impracticable or extremely difficult to fix the
actual damage), a sum equal to the amount by which the Rental reserved in this
Lease for the period which otherwise would have constituted the unexpired
portion of the Term exceeds the then fair and reasonable rental value of the
Premises for the same period, both discounted to present worth at the rate of
eight percent (8%) per annum less the aggregate amount of Deficiencies
theretofore collected by Landlord pursuant to the provisions of Section 24.04(c)
for the same period; it being agreed that before presentation of proof of such
liquidated damages to any court, commission or tribunal, if the Premises, or any
part thereof, shall have been relet by Landlord for the period which otherwise
would have constituted the unexpired portion of the Term, or any part thereof,
the amount of rent reserved upon such reletting shall be deemed, prima facie, to
be the fair and reasonable rental value for the part or the whole of the
Premises so relet during the term of the reletting, provided, however, the
provisions of this subparagraph (d) shall not be applicable and Tenant shall not
be responsible for the payment of such damages if the


                                      -84-

<PAGE>   89

Event of Default that gave rise to the termination of this Lease or summary
proceedings was an Event of Default described in Section 24.01(k) or Section
23.05 hereof.

            Section 24.05. No termination of this Lease pursuant to Section
24.03(a) or taking possession of or reletting the Premises, or any part thereof,
pursuant to Section 24.03(b) and 24.04(b), shall relieve Tenant of its
liabilities and obligations hereunder, all of which shall survive such
expiration, termination, repossession or reletting.

            Section 24.06. To the extent not prohibited by law, and except as
provided in this lease, Tenant hereby waives and releases all rights now or
hereafter conferred by statute or otherwise which would have the effect of
limiting or modifying any of the provisions of this Article 24. Tenant shall
execute, acknowledge and deliver any instruments which Landlord may request,
whether before or after the occurrence of an Event of Default, evidencing such
waiver or release.

            Section 24.07. Suit or suits for the recovery of damages, or for a
sum equal to any installment or installments of Rental payable hereunder or any
Deficiencies or other sums payable by Tenant to Landlord pursuant to this
Article 24, may be brought by Landlord from time to time at Landlord's election,
and nothing herein contained shall be deemed to require Landlord to await the
date whereon this Lease or the Term would have expired had there been no Event
of Default by Tenant and termination.

            Section 24.08. Nothing contained in this Article 24 shall limit or
prejudice the right of Landlord to prove and obtain as liquidated damages in any
bankruptcy, insolvency, receivership, reorganization or dissolution proceeding
an amount equal to the maximum allowed by statute or rule of law governing such
proceeding and in effect at the time when such damages are to be proved, whether
or not such amount shall be greater than, equal to or less than the amount of
the damages referred to in any of the preceding Sections of this Article 24.

            Section 24.09. No receipt of moneys by Landlord from Tenant after
the termination of this Lease, or after the giving of any notice of the
termination of this Lease (unless such receipt cures the Event of Default which
was the basis for the notice), shall reinstate, continue or extend the Term or
affect any notice theretofore given to Tenant, or operate as a waiver of the
right of Landlord to enforce the payment of Rental payable by Tenant hereunder
or thereafter falling due, or operate as a waiver of the right of Landlord to
recover possession of the Premises by proper remedy, except as herein otherwise
expressly provided, it being agreed that after the service of notice to
terminate this Lease or the commencement of any suit or summary proceedings, or
after a final order or judgment for the possession of the Premises, Landlord may
demand, receive and collect any moneys due or thereafter falling due without in
any manner affecting such notice, proceeding, order, suit or judgment, all such
moneys collected being deemed payments on account of the use and operation of
the Premises or, at the election of Landlord, on account of Tenant's liability
hereunder.


                                      -85-
<PAGE>   90

            Section 24.10. Except as otherwise expressly provided herein or as
prohibited by applicable law, Tenant hereby expressly waives the service of any
notice of intention to re-enter provided for in any statute, or of the
institution of legal proceedings to that end, and Tenant, for and on behalf of
itself and all persons claiming through or under Tenant, also waives any and all
right of redemption provided by any law or statute now in force or hereafter
enacted or otherwise, or re-entry or repossession or to restore the operation of
this Lease in case Tenant shall be dispossessed by a judgment or by warrant of
any court or judge or in case of re-entry or repossession by Landlord or in case
of any expiration or termination of this Lease, and Landlord and Tenant waive
and shall waive trial by jury in any action, proceeding or counterclaim brought
by either of the parties hereto against the other on any matter whatsoever
arising out of or in any way connected with this Lease, the relationship of
Landlord and Tenant, Tenant's use or occupancy of the Premises, or any claim of
injury or damage. The terms "enter", "re-enter" "entry" or "re-entry" as used in
this Lease are not restricted to their technical legal meaning.

            Section 24.11. No failure by Landlord or any prior landlord to
insist upon the strict performance of any covenant, agreement, term or condition
of this Lease or to exercise any right or remedy consequent upon a breach
thereof, and no acceptance of full or partial Rental during the continuance of
any such breach, shall constitute a waiver of any such breach or of such
covenant, agreement, term or condition. No covenant, agreement, term or
condition of this Lease to be performed or complied with by Tenant, and no
breach thereof, shall be waived, altered or modified except by a written
instrument executed by Landlord. No waiver of any breach shall affect or alter
this Lease, but each and every covenant, agreement, term and condition of this
Lease still continue in full force and effect with respect to any other then
existing or subsequent breach thereof.

            Section 24.12. In the event of any breach or threatened breach by
Tenant of any of the covenants, agreements, terms or conditions contained in
this Lease, Landlord shall be entitled to enjoin such breach or threatened
breach and shall have the right to invoke any rights and remedies allowed at law
or in equity or by statute or otherwise as though re-entry, summary proceedings,
and other remedies were not provided for in this Lease. To the extent permitted
by law, Tenant waives any requirement for the posting of bonds or other security
in any such action. The provisions of this Section 24.12 shall not be applicable
with respect to a breach or threatened breach by Tenant of the Occupancy
Requirement or the Minimum Requirement or of Tenant's obligation hereunder to
construct and complete the Building.

            Section 24.13. Each right and remedy of Landlord provided for in
this Lease shall be cumulative and shall be in addition to every other right or
remedy provided for in this Lease or now or hereafter existing at law or in
equity or by statute or otherwise, and the exercise or beginning of the exercise
by Landlord of any one or more of the rights or remedies provided for in this
Lease or now or hereafter existing at law or in equity or by statute or
otherwise shall not preclude the simultaneous or later exercise by Landlord of
any or all other rights or remedies provided for in this Lease or now or
hereafter existing at law or in equity or by statute or otherwise.


                                      -86-
<PAGE>   91

            Section 24.14. Tenant shall pay to Landlord all costs and expenses,
including, without limitation, reasonable attorneys' fees and disbursements,
incurred by Landlord in any action or proceeding to which Landlord may be made a
party by reason of any act or omission of Tenant. Tenant also shall pay to
Landlord all costs and expenses, including, without limitation, reasonable
attorneys' fees and disbursements, incurred by Landlord in enforcing any of the
covenants and provisions of this Lease and incurred in any action brought by
Landlord against Tenant on account of the provisions hereof, and all such costs,
expenses, and reasonable attorneys' fees and disbursements may be included in
and form a part of any judgment entered in any proceeding brought by Landlord
against Tenant under this Lease. All of the sums paid or obligations incurred by
Landlord as aforesaid, with interest at the Involuntary Rate, shall be paid by
Tenant to Landlord within fifteen (15) days after demand by Landlord.

            Section 24.15. If an order for relief is entered or if a stay of
proceeding or other acts becomes effective in favor of Tenant or Tenant's
interest in this Lease in any proceeding which is commenced by or against Tenant
under the present or any future federal Bankruptcy Code or any other present or
future applicable federal, state or other statute or law, Landlord shall be
entitled to invoke any and all rights and remedies available to it under such
bankruptcy code, statute, law or this Lease, including, without limitation, such
rights and remedies as may be necessary to adequately assure the complete and
continuous future performance of Tenant's obligations under this Lease. Adequate
protection of Landlord's right, title and interest in and to the Premises, and
adequate assurance of the complete and continuous future performance of Tenant's
obligations under this Lease, shall include, without limitation, the following
requirements:

            (a) that Tenant shall comply with all of its obligations under this
Lease;

            (b) that Tenant shall pay to Landlord, on the first day of each
month occurring subsequent to the entry of such order, or on the effective date
of such stay, a sum equal to the amount by which the Premises diminished in
value during the immediately preceding monthly period, but, in no event, an
amount which is less than the aggregate Rental payable for such monthly period;

            (c) that Tenant shall continue to use the Premises in the manner
required by this Lease;

            (d) that Landlord shall be permitted to supervise the performance of
Tenant's obligations under this Lease;

            (e) that Tenant shall hire, at its sole cost and expense, such
security personnel as may be necessary to insure the adequate protection and
security of the Premises;

            (f) that Tenant shall pay to Landlord within thirty (30) days after
entry of such order or the effective date of such stay, as partial adequate
protection against future diminution in value of the Premises and adequate
assurance of the complete and continuous


                                      -87-
<PAGE>   92

future performance of Tenant's obligations under this Lease, a security deposit
as may be required by law or ordered by the court;

            (g) that Tenant has and will continue to have unencumbered assets
after the payment of all secured obligations and administrative expenses to
assure Landlord that sufficient funds will be available to fulfill the
obligations of Tenant under this Lease;

            (h) that Landlord be granted a security interest acceptable to
Landlord in Tenant's leasehold hereunder;

            (i) that if Tenant's trustee, Tenant or Tenant as
debtor-in-possession assumes this Lease and proposes to assign the same
(pursuant to Title 11 U.S.C. Section 365, as the same may be amended) to any
Person who shall have made a bona fide offer to accept an assignment of this
Lease on terms acceptable to the trustee, Tenant or Tenant as
debtor-in-possession, then notice of such proposed assignment, setting forth (i)
the name and address of such Person, (ii) all of the terms and conditions of
such offer, and (iii) the adequate assurance to be provided Landlord to assure
such Person's future performance under the Lease, including, without limitation,
the assurances referred to in Title 11 U.S.C. Section 365(b)(3) (as the same may
be amended), shall be given to Landlord by the trustee, Tenant or Tenant as
debtor-in-possession no later than twenty (20) days after receipt by the
trustee, Tenant or Tenant as debtor-in-possession of such offer, but in any
event no later than ten (10) days prior to the date that the trustee, Tenant or
Tenant as debtor-in-possession shall make application to a court of competent
jurisdiction for authority and approval to enter into such assignment and
assumption, and Landlord shall thereupon have the prior right and option, to be
exercised by notice to the trustee given at any time prior to the effective date
of such proposed assignment, to accept an assignment of this Lease upon the same
terms and conditions and for the same consideration, if any, as the bona fide
offer made by such Person, less any brokerage commissions which may be payable
out of the consideration to be paid by such Person for the assignment of this
Lease.

            Section 24.16. Nothing contained in this Article 24 shall be deemed
to modify the provisions of Sections 10.10, 10.11 or 41.06(b) hereof.

                                   ARTICLE 25

                                    NOTICES

            Section 25.01. Whenever it is provided in this Lease that a notice,
demand, request, consent, approval or other communication shall or may be given
to or served upon either of the parties by the other, or by Landlord upon any
Mortgagee, and whenever either of the parties shall desire to give or serve upon
the other any notice, demand, request, consent, approval, or other communication
with respect hereto or the Premises, each such notice, demand, request, consent,
approval, or other communication shall be in writing and, any law or statute to
the contrary notwithstanding, shall be effective for any purpose if given or
served as follows:


                                      -88-
<PAGE>   93

            (a) if by Landlord, by delivery or by mailing the same to Tenant by
registered or certified mail, postage prepaid, return receipt requested,
addressed to Tenant at Four World Trade Center, New York, New York 10048,
Attention: President with a copy to the General Counsel at the same address with
an additional copy to Winthrop, Stimpson, Putnam & Roberts, One Battery Park
Plaza, New York, New York 10004-1490, Attention: Stephen Lefkowitz, Esq. or to
such other address(es) and attorneys as Tenant may from time to time designate
by notice given to Landlord as aforesaid and, in the case of any notice required
to be given to any Mortgagee pursuant to this Lease, to each such Mortgagee at
the address of such Mortgagee set forth in the notice mentioned in the first
sentence of Section 10.10(a) hereof; and

            (b) if by Tenant, by delivering or by mailing the same to Landlord
by registered or certified mail, postage prepaid, return receipt requested,
addressed to Landlord at One World Financial Center, New York, New York 10281,
Att: President, or to such other address as Landlord may from time to time
designate by notice given to Tenant as aforesaid (with a copy, given in the
manner provided above, addressed to the attention of Landlord's General Counsel,
at the address set forth above or at such other address as Landlord may from
time to time designate by notice to Tenant as aforesaid).

            Section 25.02. Every notice, demand, request, consent, approval, or
other communication hereunder shall be deemed to have been given or served when
delivered, or if mailed, three (3) Business Days after the date that the same
shall have been deposited in the United States mails, postage prepaid, in the
manner aforesaid (except that a notice designating the name or address of a
person to whom any notice or other communication, or copy thereof, shall be sent
shall be deemed to have been given when same is received).

                                   ARTICLE 26

              CONSTRUCTION AND MAINTENANCE OF THE CIVIC FACILITIES

            Section 26.01. (a) The term "Civic Facilities" shall include the
following improvements:

      (i)         Electrical, steam, gas and telephone mains and lines bringing
                  service from such mains and lines to the Premises (including
                  electrical transformers, network protectors and second
                  telephone port of entry);(1)

      (ii)        Water mains and lines bringing service from such mains and
                  lines to the Premises;(2)

      (iii)       Sanitary and storm sewers and lines bringing service from such
                  mains and lines to the Premises;(2)


                                      -89-
<PAGE>   94

      (iv)        Fire hydrants and Emergency Response Service ("ERS") conduits
                  and boxes;(2)

      (v)         Street lighting (conduit, cable, poles, fixtures and
                  connections);(2)

      (vi)        Streets;(2)

      (vii)       Curbs;(2)

      (viii)      Temporary concrete sidewalks;

      (ix)        Permanent sidewalks, including cobble strip and paving;

      (x)         Landscaped esplanade, including appurtenances located within
                  the pierhead line of the Project Area ("Esplanade");

      (xi)        Landscaped park and public open space ("North Cove Link
                  Park"); and

      (xii)       Street trees.

            (b) Landlord and Tenant acknowledge that those improvements
described in paragraph (a), subparagraphs (i) (other than the steam main, lines
bringing steam, electrical, gas and telephone service from the mains to the
Premises, electrical transformers, network protectors, and a second telephone
port of entry), (ii) (other than lines from mains to the Premises), (iii) (other
than lines from mains to the Premises), (iv), (v), (vi), (vii), (viii), (ix)
(other than the sidewalk in the Sidewalk Easement area), (x) and (xii) have been
completed. Subject to Unavoidable Delays, (i) Landlord shall commence and
diligently complete, or cause to be commenced and substantially completed, in
accordance with the development schedule set forth in Exhibit C, the
construction or installation of Landlord's Civic Facilities and (ii) Tenant
shall commence and diligently complete in accordance with the Schedule set forth
in Exhibit C and, in accordance with the Construction Documents and the
specifications supplied by Landlord as set forth in Exhibit C, the construction
or installation of Tenant's Civic Facilities, in each case, in a good and
workmanlike manner and in compliance with normal New York City construction
rules and all applicable Requirements. Landlord represents that there are no
improvements required to be constructed as environmental mitigation in
connection with the Project, including any improvements to the New York City
subway system required by the Agreement between Landlord and the New York City
Transit Authority dated as of March 9, 1987, as amended.

            (c) The term "Tenant's Civic Facilities" shall mean (i) the
permanent sidewalk along the Sidewalk Easement to be provided at the southern
end of North End Avenue, as such permanent sidewalk is more particularly
described, referenced or enumerated in Exhibit C hereto and such further
specifications as Landlord may supply, (ii) only for maintenance and repair
purposes in the manner provided in Section 26.02, the


                                      -90-
<PAGE>   95

public sidewalks on Vesey Place and North End Avenue adjacent to the Premises
and (iii) for construction purposes only, two rooms for electrical meters and
water meters as provided in the Design Guidelines. Any repairs and maintenance
to such electrical closets shall be performed by Landlord, at Landlord's expense
(unless such damage is caused by Tenant) and Tenant hereby grants Landlord
access to the two meter rooms at all reasonable times for such purposes as
provided in Article 20 hereof.

            (d) The term "Landlord's Civic Facilities" shall mean all of the
Civic Facilities which are not included within the definition of Tenant's Civic
Facilities.

            (e) Landlord (and not Tenant) shall be entitled to receive the
benefits of any discounts in the form of reimbursements or offsets against bills
relating to capital expenditures for the steam mains and lines (but Landlord
shall not be entitled to any benefits, reimbursements or offsets for any
equipment which is not installed by Landlord) offered by any utility company
resulting from Landlord's construction of the steam mains and lines to the
Premises. Tenant shall cooperate with Landlord so that Landlord may recover from
such utility companies Landlord's costs incurred in connection with the
construction of such steam lines and mains, including, but not limited to,
accepting utility service rebilling from Landlord directly without capital cost
recovery discounts and executing appropriate documents with Landlord and such
utility companies evidencing Tenant's consent and agreement to such arrangements
provided such reimbursements to Landlord do not result in an increase in rates
payable by Tenant over that which would be payable by Tenant without accounting
for such reimbursements. If the utility company charges Tenant additional
administrative charges for rebilling, Landlord may receive the reimbursements
provided Landlord pays for such charges.

            Section 26.02. Landlord and Tenant shall take good care of and be
responsible for compliance with Requirements in respect of Landlord's Civic
Facilities or Tenant's Civic Facilities, as the case may be, and shall keep and
maintain the same in good and safe order and condition and free of accumulations
of dirt, rubbish, snow and ice, and shall make all repairs (including structural
repairs, restorations and replacements) necessary to maintain the same in
first-class condition (collectively, "Maintenance Obligations"). The obligation
of Landlord to perform Maintenance Obligations is expressly conditioned upon
Tenant's compliance with Tenant's obligations under Section 26.04. The parties
contemplate that, after the completion of construction pursuant to the Section
26.01, Maintenance Obligations for the portion of the Civic Facilities marked(1)
shall be performed by the appropriate utility companies and for those portions
of the Civic Facilities marked(2) shall be performed by New York City.
Notwithstanding the initial sentence of this Section 26.01, Maintenance
Obligations on the part of Landlord in respect of any portion of the Civic
Facilities marked(1) and(2) shall terminate on the date that the appropriate
utility company or New York City, as the case may be, shall commence performance
of Maintenance Obligations in respect of same (and shall resume on the date that
the appropriate utility company or New York City, as the case may be, shall
cease performance of Maintenance Obligations in respect of same). Landlord shall
promptly notify Tenant of any of the foregoing.


                                      -91-
<PAGE>   96

            Section 26.03.

            (a) Tenant's sole remedies for a failure by Landlord to
substantially complete Landlord's Civic Facilities as provided in Section 26.01
("Landlord's Construction Obligations") shall be (i) an extension of the
Scheduled Completion Date by an amount of time equal to the time, if any, by
which Tenant's construction of the Building has been delayed as a result of such
failure, which delay shall constitute an Unavoidable Delay, and (ii) the right
to engage in Self-Help, as defined in Section 26.03(b) and to receive the offset
against Base Rent and Civic Facilities Payment provided for in Section 26.03(c)
(collectively, the "Approved Remedies"). Landlord's failure to perform
Landlord's Construction Obligations shall not give rise to any right or remedy
except the Approved Remedies, or entitle Tenant to any discount from or offset
against any Rental except as set forth in Section 26.03(c) or to any other
damages, and no delay, non-performance or part performance by Landlord under
Section 26.01 shall release Tenant from or modify any of its obligations under
this Lease except as provided herein. Tenant's sole remedies against Landlord
for a failure by Landlord to perform its Maintenance Obligations in accordance
with Section 26.02 shall be the right to engage in Self-Help and to receive the
offset against Civic Facilities Payments provided for in Section 26.03(c), and
no such failure shall entitle Tenant to any other right, remedy or damages
against Landlord. Notwithstanding the provisions of Section 26.03(b), Tenant
shall not be entitled to exercise any of the Approved Remedies at any time that
a Default exists under this Lease. No delay, non-performance or part performance
by Landlord under Section 26.02 shall release Tenant from any of its obligations
under this Lease. The election by Tenant of any remedy specified in this Section
26.03(a) shall not preclude Tenant from pursuing any other available remedy
specifically set forth herein.

            (b) If (subject to Unavoidable Delays) Landlord fails to perform the
Landlord's Construction Obligations or thereafter to substantially complete
Landlord's Civic Facilities as provided in Section 26.01 with reasonable
diligence or if Landlord fails to perform any of Landlord's Maintenance
Obligations, Tenant (in its own name and not as agent of Landlord) shall have
the right (but shall not be obligated) to undertake Landlord's Construction
Obligations or Landlord's Maintenance Obligations, as the case may be
("Self-Help"), in accordance with the provisions of this Section 26.03(b). Prior
to engaging in Self-Help, Tenant shall give Landlord notice specifying the
nature of Landlord's failure and advising of Tenant's intention to engage in
Self-Help. If Landlord shall not have remedied the failure complained of prior
to the thirtieth (30th) day after such notice, Tenant shall be entitled to
engage in Self-Help, provided that, if such failure shall be of a nature that
the same cannot be completely remedied within said thirty (30) day period,
Tenant shall not be entitled to engage in Self-Help if Landlord commences to
remedy such failure within such period and thereafter diligently and
continuously proceeds to remedy same. In furtherance of Tenant's exercise of the
right of Self-Help set forth in this Section 26.03(b), Landlord, upon reasonable
notice, shall permit Tenant and its agents or representatives to inspect
Landlord's Civic Facilities at all reasonable times for the purpose of
determining whether or not Landlord is in compliance with Landlord's
Construction Obligations and Landlord's Maintenance Obligations. Landlord hereby
grants Tenant a right to enter upon Landlord's


                                      -92-
<PAGE>   97

Civic Facilities in order to perform Self-Help in accordance with this Section
26.03(b). Tenant shall not be liable for inconvenience, annoyance, disturbance,
loss of business or other damage to Landlord by reason of Tenant's exercise of
the right of Self-Help hereunder, provided Tenant shall use reasonable efforts
to minimize damage caused by Tenant in the exercise of its right of Self-Help.

            (c) In the event Tenant engages in Self-Help as provided in 26.03(b)
with respect to Landlord's Construction Obligations, after submission to
Landlord of a written statement of Tenant's expenses with supporting
documentation, Tenant shall have the right to offset against the next
installment(s) of Base Rent and Civic Facilities Payment an amount equal to the
reasonable expenses thereby incurred and/or theretofore paid by Tenant together
with interest thereon at the Involuntary Rate computed with respect to each
payment made by Tenant under this Section 26.03(c) from the date payment is made
or incurred until the date(s) Tenant effectuates the offset(s). In the event
Tenant engages in Self-Help as provided in Section 26.03(b) with respect to
Landlord's Maintenance Obligations, after submission to Landlord of a written
statement of Tenant's expenses with supporting documentation, Tenant shall have
the right to offset against the next installment(s) of Civic Facilities Payment
an amount equal to the reasonable expenses thereby incurred and/or theretofore
paid by Tenant together with interest thereon at the Involuntary Rate computed
with respect to each payment made by Tenant under this Section 26.03(c) from the
date payment is made or the expense is incurred until the date(s) Tenant
effectuates the offset(s).

            (d) In the event Landlord shall fail to perform Landlord's
Construction Obligations or Landlord's Maintenance Obligations, Landlord shall
incur no penalty or liability and Tenant shall have no remedies or rights other
than as expressly provided herein, it being agreed by the parties that
Landlord's failure to perform Landlord's Construction Obligations or Landlord's
Maintenance Obligations shall not be deemed a failure by Landlord to perform a
substantial obligation on Landlord's part to be performed under this Lease.

            Section 26.04.

            As its allocable share of the cost of operating, maintaining,
repairing, restoring, replacing and upgrading the Civic Facilities, Tenant, for
each Lease Year or portion thereof commencing on the first day of the first
month following the Occupancy Date and ending on the last day of the Term, shall
pay to Landlord an annual sum (the "Civic Facilities Payment") in the amount of
One Hundred and Fifty Thousand and 00/100 ($150,000) Dollars, payable in equal
monthly installments commencing on the first day of the first month following
the Occupancy Date and on the first day of each month thereafter during the
Term. The Civic Facilities Payment shall be increased in each Lease Year to an
amount which is three percent (3%) per annum in excess of the Civic Facilities
Payment for the immediately prior Lease Year. It is understood and agreed by
Tenant that the Civic Facilities Payment, including the three percent (3%)
annual escalation, is an agreed-upon fixed amount which does not necessarily
reflect the actual costs of maintaining the Civic


                                      -93-
<PAGE>   98

Facilities, the actual percentage share thereof of Tenant or the actual annual
increase in such costs, and that the Civic Facilities Payment shall neither
increase nor decrease in proportion to any increases or decreases in the actual
Civic Facilities costs.

            Section 26.05. If all or any part of Landlord's Civic Facilities
shall be destroyed or damaged in whole or in part by fire or other casualty of
any kind or nature, ordinary or extraordinary, foreseen or unforeseen, Landlord,
at no cost and expense to Tenant, whether or not such damage or destruction
shall have been insured or insurable, and whether or not insurance proceeds, if
any, shall be sufficient for the purpose shall restore or cause to be restored
with reasonable diligence (subject to Unavoidable Delays) such Civic Facilities
as nearly as practicable to the character and utility existing immediately prior
to such occurrence and using materials of equal or better quality.

            Section 26.06. If at any time during the Term there shall be a
taking by any lawful power or authority through the exercise of the right of
condemnation or eminent domain of the whole or a part of Landlord's Civic
Facilities or there shall be an agreement in lieu of a taking between Landlord
and those authorized to exercise such right, Landlord shall receive the award
attributable to the Civic Facilities so taken, as provided in Article 9, and
Landlord, at Landlord's sole cost and expense, whether or not the award or
awards, if any, payable to Landlord are sufficient for the purpose, shall
proceed with reasonable diligence (subject to Unavoidable Delays) to restore to
the extent practicable any remaining portion of the Civic Facilities not so
taken to a complete, self-contained unit. Landlord shall hold the award or
awards received by it with respect to such taking in trust for the sole purpose
of paying the cost of restoring the remaining portion of the Civic Facilities
not so taken, and Landlord shall apply such award or awards first to the payment
in full of the cost of such restoration before using any part of the same for
any other purpose. Anything contained herein to the contrary notwithstanding, in
no event shall Landlord's liability hereunder as trustee exceed the amount of
the award or awards received by Landlord, as reduced by the portion thereof
applied to the restoration. Upon completion of the restoration, Landlord may pay
over to itself the unapplied award or awards and the trust obligations hereunder
with respect to such award or awards shall terminate.

                                   ARTICLE 27

                                    STREETS

            Landlord represents and warrants that within the Project Area, the
following streets have been mapped as New York City public streets and are open
for public use: North End Avenue (south of Warren Street) and, between North End
Avenue and West Street, Warren Street, Murray Street and Vesey Street. Subject
to the provisions of the Storage and Staging Letter, generally applicable
policies and procedures for partial closures of public streets, Landlord shall
cause Vesey Street (west of North End Avenue) to be open for public use.


                                      -94-
<PAGE>   99

                                   ARTICLE 28

                                STREET WIDENING

            If at any time during the Term any Proceedings are instituted or
orders made by any Governmental Authority (other than Landlord acting in its
capacity as Landlord and not in its governmental capacity) for the widening or
other enlargement of any street contiguous to the Premises requiring removal of
any projection or encroachment on, under or above any such street, or any
changes or alterations upon the Premises, or in the sidewalks, vaults (other
than vaults which are under the control of, or are maintained or repaired by, a
utility company), gutters, curbs or appurtenances, Tenant, with reasonable
diligence (subject to unavoidable Delays) shall comply with such requirements,
and on Tenant's failure to do so, Landlord may comply with the same in
accordance with the provisions of Article 21. Tenant shall be permitted to
contest in good faith any proceeding or order for street widening instituted or
made by any Governmental Authority, provided that during the pendency of such
contest Tenant deposits with Landlord security in amount and form reasonably
satisfactory to Landlord for the performance of the work required in the event
that Tenant's contest should fail. In no event shall Tenant permit Landlord to
become liable for any civil or criminal liability or penalty as a result of
Tenant's failure to comply with reasonable diligence (subject to Unavoidable
Delays) with any of the foregoing orders. Any widening or other enlargement of
any such street and the award or damages in respect thereto shall be deemed a
partial condemnation and be subject to the provisions of Article 9.

                                   ARTICLE 29

                           SUBORDINATION; ATTORNMENT

            Section 29.01. Landlord's interest in this Lease, as this Lease may
be modified, amended or supplemented, shall not be subject or subordinate to (a)
any mortgage now or hereafter placed upon Tenant's interest in this Lease or (b)
any other liens or encumbrances hereafter affecting Tenant's interest in this
Lease.

            Section 29.02. If by reason of (a) a default under the Master Lease
or (b) a termination of the Master Lease pursuant to the terms of the Settlement
Agreement, such Master Lease and the leasehold estate of Landlord in the
Premises demised hereby are terminated, Tenant will attorn to the then holder of
the reversionary interest in the premises demised by this Lease and will
recognize such holder as Tenant's Landlord under this Lease. Tenant shall
execute and deliver, at any time and from time to time, upon the request of the
Landlord or of the Master Landlord any further instrument which may be
reasonably necessary or appropriate to evidence such attornment. Tenant waives
the provision of any statute or rule of law now or hereafter in effect which may
give or purport to give Tenant any right of election to terminate this Lease or
to surrender possession of the Premises in the event any proceeding is brought
by the Master Landlord to terminate the


                                      -95-
<PAGE>   100

same, and agrees that this Lease shall not be affected in any way whatsoever by
any such proceeding.

                                   ARTICLE 30

                            EXCAVATIONS AND SHORING

            If any excavation shall be made or contemplated to be made for
construction or other purposes upon property adjacent to the Premises, Tenant
either:

            (a) shall afford to Landlord or, at Landlord's option, to the person
or persons causing or authorized to cause such excavation the right to enter
upon the Premises in a reasonable manner for the purpose of doing such work as
may be necessary, without expense to Tenant, to preserve any of the walls or
structures of the Building from injury or damage and to support the same by
proper foundations, provided that (i) such work shall be done promptly, in a
good and workmanlike manner and subject to all applicable Requirements, (ii)
Tenant shall have an opportunity to have its representatives present during all
such work and (iii) Tenant shall be indemnified by Landlord in the event
Landlord performs such excavation, or such other person performing such
excavation, as the case may be, against any injury or damage to the Building or
persons or property therein which may result from any such work, but shall not
have any claim against Landlord for suspension, diminution, abatement, offset
or reduction of Rental payable by Tenant hereunder; or

            (b) shall do or cause to be done all such work, at Landlord's or
such other person's expense, as may be necessary to preserve any of the walls or
structures of the Building from injury or damage and to support the same by
proper foundations, provided that Tenant shall not, by reason of any such
excavation or work, have any claim against Landlord for damages or for indemnity
or for suspension, diminution, abatement, offset or reduction of Rental payable
by Tenant hereunder.

                                   ARTICLE 31

                       CERTIFICATES BY LANDLORD AND TENANT

            Section 31.01. At any time and from time to time upon not less than
ten (10) days notice by Landlord, Tenant shall execute, acknowledge and deliver
to Landlord or any other party specified by Landlord a statement certifying that
this Lease is unmodified and in full force and effect (or if there have been
modifications, that the same, as modified, is in full force and effect and
stating the modifications) and the date to which each obligation constituting
Rental has been paid, and stating whether or not to the best knowledge of
Tenant, Landlord is in default in the performance of any covenant, agreement or
condition contained in this Lease, and, if so, specifying each such default of
which Tenant may have knowledge.


                                      -96-
<PAGE>   101

            Section 31.02. At any time and from time to time upon not less than
ten (10) days notice by Tenant, Landlord shall execute, acknowledge and deliver
to Tenant or any other party specified by Tenant a statement certifying that
this Lease is unmodified and in full force and effect (or if there have been
modifications, that the same, as modified, is in full force and effect and
stating the modifications) and the date to which each obligation constituting
Rental has been paid, and stating whether or not to the best knowledge of
Landlord, Tenant is in Default in the performance of any covenant, agreement or
condition contained in this Lease, and, if so, specifying each such Default of
which Landlord may have knowledge.

            Section 31.03. At the request of Tenant, Landlord shall request a
certificate in respect of the Master Lease from Master Landlord, in accordance
with Section 20.01 of the Master Lease. If Master Landlord shall fail to deliver
such a certificate, then, in lieu thereof, Landlord shall execute, acknowledge
and deliver to Tenant a statement certifying that Landlord has not executed and
delivered to Master Landlord any instrument modifying the Master Lease (or if
Landlord has executed such an instrument, stating the modifications) and that,
to the best of Landlord's knowledge, the Master Lease is in full force and
effect and no default exists thereunder.

                                   ARTICLE 32

                             CONSENTS AND APPROVALS

            Section 32.01. Except as otherwise expressly set forth in this
Lease, all consents and approvals which may be given under this Lease shall, as
a condition of their effectiveness, be in writing. The granting of any consent
or approval by a party to perform any act requiring consent or approval under
the terms of this Lease or the failure on the part of a party to object to any
such action taken without the required consent or approval, shall not be deemed
a waiver by the party whose consent was required of its right to require such
consent or approval for any further similar act.

            Section 32.02. If, pursuant to the terms of this Lease, any consent
or approval by Landlord or Tenant is required, then unless expressly provided
otherwise in this Lease, if the party who is to give its consent or approval
shall not have notified the other party within fifteen (15) Business Days or
such other period as expressly specified in this Lease after receiving such
other party's request for a consent or approval that such consent or approval is
granted or denied, and if denied, the reasons therefor in reasonable detail,
such consent or approval shall be deemed granted. If, pursuant to the terms of
this Lease, any consent or approval by Landlord or Tenant is not to be
unreasonably withheld or is subject to a specified standard then in the event
there shall be a final determination that the consent or approval was
unreasonably withheld or that such specified standard has been met so that the
consent or approval should have been granted, the consent or approval shall be
deemed granted and such granting of the consent or approval shall be the only
remedy to the party requesting or requiring the consent or approval.


                                      -97-
<PAGE>   102

            Section 32.03. If, pursuant to the terms of this Lease, any consent
or approval by Landlord or Tenant is not to be unreasonably withheld, such
consent or approval shall, in addition, not be unreasonably delayed.

            Section 32.04. Except as specifically provided herein, no fees or
charges of any kind or amount shall be required by either party hereto as a
condition of the grant of any consent or approval which may be required under
this Lease.

                                   ARTICLE 33

                            SURRENDER AT END OF TERM

            Section 33.01. On the last day of the Term or upon any earlier
termination of this Lease, or upon a re-entry by Landlord upon the Premises
pursuant to Article 24 hereof, Tenant shall remove its personal property and
Equipment and shall well and truly surrender and deliver up to Landlord the
Premises in good order, condition and repair, reasonable wear and tear excepted,
free and clear of all lettings, occupancies, liens and encumbrances, other than
those, if any, existing at the date hereof, created by or consented to by
Landlord or which lettings and occupancies by their express terms and conditions
extend beyond the Expiration Date, and which Landlord shall have consented and
agreed, in writing, may extend beyond the Expiration Date, without any payment
or allowance whatever by Landlord. Tenant hereby waives any notice now or
hereafter required by law with respect to vacating the Premises on any such
termination date.

            Section 33.02. On the last day of the Term or upon any earlier
termination of the Lease, or upon a re-entry by Landlord upon the Premises
pursuant to Article 24 hereof, Tenant shall deliver to Landlord Tenant's
executed counterparts of all Subleases and any service and maintenance contracts
then affecting the Premises, true and complete maintenance records for the
Premises, all original licenses and permits then pertaining to the Premises,
permanent or temporary Certificates of Occupancy then in effect for the
Building, and all warranties and guarantees then in effect which Tenant has
received in connection with any work or services performed or Fixtures installed
in the Building, together with a duly executed assignment thereof to Landlord,
all financial reports, books and records required by Article 38 hereof and any
and all other documents of every kind and nature whatsoever relating to the
Premises.

            Section 33.03. Any personal property of Tenant or of any Subtenant
which shall remain on the Premises for thirty (30) days after the termination of
this Lease and after the removal of Tenant or such Subtenant from the Premises,
may, at the option of Landlord, be deemed to have been abandoned by Tenant or
such Subtenant and either may be retained by Landlord as its property or be
disposed of, without accountability, in such manner as Landlord may see fit.
Landlord shall not be responsible for any loss or damage occurring to any such
property owned by Tenant or any Subtenant.


                                      -98-
<PAGE>   103

            Section 33.04. Notwithstanding the provisions of Section 33.01 and
33.02 hereof, in the event that prior to Substantial Completion of the Building
either Landlord or Tenant shall have terminated this Lease in accordance with
the provisions of Article 43 hereof or Tenant shall have terminated this Lease
in accordance with the provisions of Section 2.03 hereof, Tenant's sole
obligations under this Article 33 shall be to deliver the Premises to Landlord
in a stabilized, safe and secure condition, fenced and with all debris removed
no later than the Lease Early Termination Date.

            Section 33.05. The provisions of this Article 33 shall survive any
termination of this Lease.

                                   ARTICLE 34

                                ENTIRE AGREEMENT

            This Lease, together with the Exhibits hereto, contains all the
promises, agreements, conditions, inducements and understandings between
Landlord and Tenant relative to the Premises and there are no promises,
agreements, conditions, understandings inducements, warranties, or
representations, oral or written, expressed or implied, between them other than
as herein or therein set forth and other than as may be expressly contained in
any written agreement between the parties executed simultaneously herewith.

                                   ARTICLE 35

                                QUIET ENJOYMENT

            Landlord covenants that Tenant shall and may (subject, however, to
the exceptions, reservations, terms and conditions of this Lease) peaceably and
quietly have, hold and enjoy the Premises for the term hereby granted without
molestation or disturbance by or from Landlord or any Person claiming through
Landlord and free of any encumbrance created or suffered by Landlord, except
those encumbrances, liens or defects of title, created or suffered by Tenant and
the Title Matters.

                                   ARTICLE 36

                           APPRAISAL AND ARBITRATION

            Section 36.01. In such cases where this Lease expressly provides for
the settlement of a dispute or question by appraisal, and only in such cases,
Landlord and Tenant shall jointly select an appraiser. If within a fifteen (15)
day period the parties have not so agreed, then either party, on behalf of both,
may apply to the Supreme Court of the State of New York, New York County, for
the appointment of such appraiser and the other party shall not raise any
question as to the Court's full power and jurisdiction to entertain


                                      -99-
<PAGE>   104

the application and make the appointment. Any appraiser selected or appointed
pursuant to this Section shall be a member of the American Institute of Real
Estate Appraisers (or a successor organization), shall be an appraiser, and
shall have been doing business as such in the Borough of Manhattan for a period
of at least fifteen (15) years before the date of her/his appointment. All
appraisers chosen or appointed pursuant to this Section shall be sworn to fairly
and impartially perform their duties as appraisers hereunder. In the event of
failure, refusal or inability of any appraiser to act, a successor shall be
appointed within ten (10) days by the parties or in the event the parties shall
fail so to appoint such successor, the successor shall be appointed by the Court
in the manner hereinabove provided. The fees and expenses of all appraisers
shall be shared jointly by the parties. Each party shall be responsible for the
fees and expenses of its own attorneys and other representatives. Photocopies of
the reports of all appraisers shall be provided to all the parties. The decision
of the appraisers shall be binding upon the parties. In rendering its decision,
the appraisers shall have no power to modify or reform any of the provisions of
this Lease. Any appraisal shall be conducted in the City and County of New York.

            Section 36.02. In such cases where this Lease expressly provides for
the settlement of a dispute or question by arbitration, and only in such cases,
the party desiring arbitration shall appoint a disinterested person as
arbitrator on its behalf and give notice thereof to the other party who shall,
within fifteen (15) days thereafter, appoint a second disinterested person as
arbitrator on its behalf and give notice thereof to the first party. The two (2)
arbitrators thus appointed shall together appoint a third disinterested person
within fifteen (15) days after the appointment of the second arbitrator, and
said three (3) arbitrators shall, as promptly as possible, determine the matter
which is the subject of the arbitration and the decision of the majority of them
shall be conclusive and binding on all parties and judgment upon the award may
be entered in any court having jurisdiction. If a party who shall have the right
pursuant to the foregoing to appoint an arbitrator fails or neglects to do so,
then and in such event, the other party (or if the two (2) arbitrators appointed
by the parties shall fail to appoint a third arbitrator when required hereunder,
then either party) may apply to the American Arbitration Association (or any
organization successor thereto), or in its absence, refusal, failure or
inability to act, may apply for a court appointment of such arbitrator. The
arbitration shall be conducted in the City and County of New York and, to the
extent applicable and consistent with this Section 36.02, shall be in accordance
with the Commercial Arbitration Rules then obtaining of the American Arbitration
Association or any successor body. The expenses of arbitration shall be shared
equally by Landlord and Tenant, but each party shall be responsible for the fees
and disbursements of its own attorneys and the expenses of its own proof.
Landlord and Tenant shall sign all documents and do all other things necessary
to submit any such matter to arbitration and further shall, and hereby do, waive
any and all rights they or either of them may at any time have to revoke their
agreement hereunder to submit to arbitration and to abide by the decision
rendered thereunder. The arbitrators shall have no power to vary, modify or
reform any of the provisions of this Lease and their jurisdiction is limited
accordingly. If the arbitration takes place pursuant to Article 11 hereof or
concerns any Capital Improvement or Restoration, then each of the arbitrators
shall be a licensed professional engineer or registered architect having at
least ten (10) years' experience in the design of


                                     -100-
<PAGE>   105

commercial buildings, and, to the extent applicable and consistent with this
Section 36.02, such arbitration shall be conducted in accordance with the
Construction Arbitration Rules then obtaining of the American Arbitration
Association or any successor body of similar function.

                                   ARTICLE 37

                        INVALIDITY OF CERTAIN PROVISIONS

            If any term or provision of this Lease or the application thereof to
any Person or circumstances shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Lease shall be valid and be enforced to the fullest extent permitted by
law.

                                   ARTICLE 38

                                FINANCIAL REPORTS

            Section 38.01. Tenant, from and after the Occupancy Date, shall
furnish to Landlord as soon as reasonably practicable after the end of each
fiscal year of Tenant, and in any event within one hundred and twenty (120) days
thereafter, Tenant's annual report.

            Section 38.02. Upon Landlord's request, if at any time Tenant shall
furnish to any Mortgagee operating statements or financial reports, Tenant
promptly shall furnish to Landlord copies of all such operating statements and
financial reports. At the time at which Tenant furnishes any such operating
statements or reports, Tenant may inform Landlord of its belief that the public
disclosure of information contained therein or any part thereof would cause
substantial injury to the competitive position of Tenant's enterprise and
request that, to the extent permitted by law, Landlord attempt to avoid such
disclosure. In the event Tenant makes such request, Landlord shall use its best
efforts to avoid such disclosure (but shall incur no liability to Tenant if
Landlord reasonably believes it is complying with any provision of applicable
law requiring such disclosure). Landlord shall (i) promptly notify Tenant if it
receives any request for disclosure, (ii) keep Tenant advised of (and promptly
copy Tenant on) any communications that Landlord has with (or receives from) any
party making the request for disclosure, (iii) notify Tenant that it intends to
make any disclosure, immediately after making any such decision and at least
five (5) Business Days prior to the actual disclosure and (iv) copy Tenant on
any such disclosure.

            Section 38.03. Tenant shall keep and maintain at all times full and
correct records and books of account of the operations of the Premises in
accordance with generally accepted accounting standards and otherwise in
accordance with any applicable provisions of each Mortgage and accurately shall
record and preserve for a period of six (6) years the


                                     -101-
<PAGE>   106

record of its operations upon the Premises. Within fifteen (15) days after
request by Landlord, Tenant shall make said records and books of account
available from time to time for inspection by Landlord and Landlord's designee
during reasonable business hours at a location designated by Tenant in New York
City. At any time at which Tenant shall make said records and books of account
available for inspection, it may inform Landlord of its belief that the public
disclosure of the information contained therein or any part thereof would cause
substantial injury to the competitive position of Tenant's enterprise and
request that to the extent permitted by law Landlord attempt to avoid such
disclosure. In the event Tenant makes such request, Landlord shall use its best
efforts to avoid such disclosure (but shall incur no liability to Tenant if
Landlord reasonably believes it is complying with any provision of applicable
law requiring such disclosure). Landlord shall (i) promptly notify Tenant if it
receives any request for disclosure, (ii) keep Tenant advised of (and promptly
copy Tenant on) any communications that Landlord has with (or receives from) any
party making the request for disclosure, (iii) notify Tenant that it intends to
make any disclosure, immediately after making any such decision and at least
five (5) Business Days prior to the actual disclosure and (iv) copy Tenant on
any such disclosure.

                                   ARTICLE 39

                            RECORDING OF MEMORANDUM

            Either Landlord or Tenant may record a memorandum of this Lease or
any amendment or modification of this Lease. Each shall, upon the request of the
other, join in the execution of a memorandum of this Lease or a memorandum of
any amendment or modification of this Lease in proper form for recordation.

                                   ARTICLE 40

                               NO DISCRIMINATION

            Section 40.01. Tenant, in connection with the erection, maintenance,
repair, Restoration, alteration or replacement of, or addition to, the Building
shall (a) not discriminate nor permit discrimination against any person by
reason of race, creed, color, religion, national origin, ancestry, sex, age,
disability or marital status and (b) comply with all applicable Federal, State
and local laws, ordinances, rules and regulations from time to time in effect
prohibiting such discrimination.

            Section 40.02. Tenant shall be bound by and shall include the
following paragraphs (a) through (e) of this Section 40.02 in all Construction
Agreements, service and management agreements and agreements for the purchase of
goods and services relating to the operation of the Premises in such manner that
these provisions shall be binding upon the parties with whom such agreements are
entered into (any party being bound by such provisions shall be referred to in
this Section as "Contractor"):


                                     -102-
<PAGE>   107

            (a) Contractor shall not discriminate against employees or
applicants for employment because of race, creed, color, religion, national
origin, ancestry, sex, age, disability or marital status, shall comply with all
applicable Federal, State and local laws, ordinances, rules and regulations from
time to time in effect prohibiting such discrimination or pertaining to equal
employment opportunities, and shall undertake programs of affirmative action to
ensure that employees and applicants for employment are afforded equal
employment opportunities without discrimination. Such action shall be taken with
reference to, but not limited to, recruitment, employment, job assignment,
promotion, upgrading, demotion, transfer, layoff or termination, rates of pay or
other forms of compensation, and selection for training or retraining, including
apprenticeship and on-the-job training.

            (b) Contractor shall request each employment agency, labor union and
authorized representative of workers with which it has a collective bargaining
or other agreement or understanding, to furnish it with a written statement that
such employment agency, labor union or representative will not discriminate
because of race, creed, color, religion, national origin, ancestry, sex, age,
disability or marital status and that such agency, union or representative will
cooperate in the implementation of contractor's obligations hereunder.

            (c) Contractor shall state in all solicitations or advertisements
for employees placed by or on behalf of contractor that all qualified applicants
shall be afforded equal employment opportunities without discrimination because
of race, creed, color, religion, national origin, ancestry, sex, age, disability
or marital status.

            (d) Contractor shall comply with all of the provisions of the Civil
Rights Law of the State of New York and Sections 291-299 of the Executive Law of
the State of New York, shall upon reasonable notice furnish all information and
reports deemed reasonably necessary by Landlord and shall permit access to its
relevant books, records and accounts for the purpose of monitoring compliance
with the Civil Rights Law and such sections of the Executive Law.

            (e) Contractor shall include in all agreements with subcontractors
the foregoing provisions of Sections (a) through (d) in such a manner that said
provisions shall be binding upon the subcontractor and enforceable by
Contractor, Tenant and Landlord. Contractor shall take such action as may be
necessary to enforce the foregoing provisions. Contractor shall promptly notify
Tenant and Landlord of any litigation commenced by or against it arising out of
the application or enforcement of these provisions, and Tenant and Landlord may
intervene in any such litigation.

            Section 40.03. Tenant has reviewed and participated in the
development of the Affirmative Action Program, a copy of which is annexed hereto
as Exhibit D. Tenant shall, and shall cause each of its agents, contractors and
subcontractors to, promptly and diligently carry out its obligations under such
Program in accordance with the terms thereof. If Tenant fails to comply with its
obligations under this Section 40.03 or under Exhibit D, Landlord's sole
remedies shall be as provided in Exhibit D, provided that any


                                     -103-
<PAGE>   108

amounts payable by Tenant to Landlord under Section 9 of Exhibit D shall
constitute Rental hereunder.

                                   ARTICLE 41

                                  MISCELLANEOUS

            Section 41.01. The captions of this Lease are for convenience of
reference only and in no way define, limit or describe the scope or intent of
this Lease or in any way affect this Lease.

            Section 41.02. The Table of Contents is for the purpose of
convenience of reference only and is not to be deemed or construed in any way as
part of this Lease or as supplemental thereto or amendatory thereof.

            Section 41.03. The use herein of the neuter pronoun in any reference
to Landlord or Tenant shall be deemed to include any individual Landlord or
Tenant, and the use herein of the words "successors and assigns" or "successors
or assigns" of Landlord or Tenant shall be deemed to include the heirs, legal
representatives and assigns of any individual Landlord or Tenant.

            Section 41.04. Depository may pay to itself out of the monies held
by Depository pursuant to this Lease its reasonable charges for services
rendered hereunder. Tenant shall pay Depository any additional charges for such
services.

            Section 41.05. If more than one entity is named as or becomes Tenant
hereunder, Landlord may require the signatures of all such entities in
connection with any notice to be given or action to be taken by Tenant hereunder
except to the extent that any such entity shall designate another such entity as
its attorney-in-fact to act on its behalf, which designation shall be effective
until receipt by Landlord of notice of its revocation. Each entity named as
Tenant shall be fully liable for all of Tenant's obligations hereunder. Any
notice by Landlord to any entity named as Tenant shall be sufficient and shall
have the same force and effect as though given to all parties named as Tenant.
If all such parties designate in writing one entity to receive copies of all
notices, Landlord agrees to send copies of all notices to that entity.

            Section 41.06(a). The liability of Landlord or of any Person who has
at any time acted as Landlord hereunder for damages or otherwise shall be
limited to Landlord's interest in the Premises, including, without limitation,
the rents and profits therefrom, the proceeds of any insurance policies covering
or relating to the Premises, any awards payable in connection with any
condemnation of the Premises or any part thereof, and any other rights,
privileges, licenses, franchises, claims, causes of action or other interests,
sums or receivables appurtenant to the Premises. Neither Landlord nor any such
Person nor any of the members, directors, officers, employees, agents or
servants of either shall have any liability (personal or otherwise) hereunder
beyond Landlord's interest in the Premises, and


                                     -104-
<PAGE>   109

no other property or assets of Landlord or any such Person or any of the members
directors, officers, employees, agents or servants of either shall be subject to
levy, execution or other enforcement procedure for the satisfaction of Tenant's
remedies hereunder.

            (b) The liability of Tenant hereunder for damages or otherwise shall
be limited to Tenant's interest in the Premises, including, without limitation,
any then present or future rents or profits, any funds held by Depository
pursuant to any of the provisions of this Lease, the proceeds of any insurance
policies covering or relating to the Premises, any awards payable in connection
with any condemnation of the Premises or part thereof (it being agreed that, for
purposes of this Section 41.06(b), the interest of Tenant in such insurance
proceeds or condemnation awards shall pertain only to such portion or portions
thereof as are paid to and retained by Tenant rather than any Mortgagee and as
shall not theretofore have been expended by Tenant for Restoration). Neither
Tenant nor any Affiliate of Tenant nor any of the directors, officers, members,
partners, joint venturers, principals, shareholders, employees, agents or
servants of Tenant or any Affiliate of Tenant shall have any liability (personal
or otherwise) hereunder beyond Tenant's interest in the Premises, and no other
property or assets of Tenant or any Affiliate of Tenant or any of the directors,
officers, members, partners, joint venturers, principals, shareholders,
employees, agents or servants of Tenant or any Affiliate of Tenant shall be
subject to levy, execution or other enforcement procedure for the satisfaction
of Landlord's remedies hereunder. The exculpation of personal liability set
forth in this Section 41.06(b) is intended to be absolute, unconditional and
without exception of any kind.

            Section 41.07. Except as otherwise expressly provided in this Lease,
there shall be no merger of this Lease or the leasehold estate created hereby
with the fee estate in the Premises or any part thereof by reason of the same
Person acquiring or holding, directly or indirectly, this Lease or the leasehold
estate created hereby or any interest in this Lease or in such leasehold estate
as well as the fee estate in the Premises.

            Section 41.08. Tenant shall store all refuse from the Premises off
the streets in an enclosed area on the Premises, and in a manner reasonably
satisfactory to Landlord and in accordance with the requirements of municipal
and/or private sanitation services serving the Premises.

            Section 41.09. Each of the parties represents to the other that it
has not dealt with any broker, finder or like entity in connection with this
lease transaction. If any claim is made by any Person who shall claim to have
acted or dealt with Tenant or Landlord in connection with this transaction,
Tenant or Landlord as the case may be, will pay the brokerage commission, fee or
other compensation to which such Person is entitled, shall indemnify and hold
harmless the other party hereto against any claim asserted by such Person for
any such brokerage commission, fee or other compensation and shall reimburse
such other party for any costs or expenses including, without limitation,
reasonable attorneys' fees and disbursements, incurred by such other party in
defending itself against claims made against it for any such brokerage
commission, fee or other compensation.


                                     -105-
<PAGE>   110

            Section 41.10. This Lease may not be changed, modified, or
terminated orally, but only by a written instrument of change, modification or
termination executed by the party against whom enforcement of any change,
modification, or termination is sought.

            Section 41.11. This Lease shall be governed by and construed in
accordance with the laws of the State of New York.

            Section 41.12. The agreements, terms, covenants and conditions
herein shall be binding upon, and shall inure to the benefit of, Landlord and
Tenant and their respective successors and (except as otherwise provided herein)
assigns.

            Section 41.13. All references in this Lease to "Articles" or
"Sections" shall refer to the designated Article(s) or Section(s), as the case
may be, of this Lease.

            Section 41.14. All of Tenant's right, title and interest in all
plans and drawings required to be furnished by Tenant to Landlord under this
Lease, including, without limitation, the Schematics, the Design Development
Plans and the Construction Documents, and in any and all other plans, drawings,
specifications or models prepared in connection with construction at the
Premises, any Restoration or Capital Improvement, shall become the sole and
absolute property of Landlord upon the Expiration Date or any earlier
termination of this Lease, provided, however, Landlord shall have no right to
use such plans, drawings, specifications and models other than in connection
with any repairs, Restorations or Capital Improvements with respect to the
Building. Tenant shall deliver all such documents to Landlord promptly upon the
Expiration Date or any earlier termination of this Lease. Tenant's obligation
under this Section 41.14 shall survive the Expiration Date.

            Section 41.15. All references in this Lease to "licensed
professional engineer", "licensed surveyor" or "registered architect" shall mean
a professional engineer, surveyor or architect who is licensed or registered, as
the case may be, by the State of New York. All references in this Lease to
"rentable area" or "rental square feet" shall be determined in accordance with
the Standard Method of Floor Measurement for Office Buildings, as recommended by
the Real Estate Board of New York, Inc., as such recommendation exists on the
date hereof. Any dispute as to such determination shall be resolved by
arbitration pursuant to Article 36.

            Section 41.16. If BPCA or any successor to its interest hereunder
ceases to have any interest in the Premises as lessee under the Master Lease or
there is at any time or from time to time any sale or sales or disposition or
dispositions or transfer or transfers of Landlord's interest in the Premises as
lessee under the Master Lease, the seller or transferor shall be and hereby is
entirely freed and relieved of all agreements, covenants and obligations of
Landlord hereunder to be performed on or after the date of such sale or transfer
relative to the interest sold or transferred, and it shall be deemed and
construed without further agreement between the parties or their successors in
interest or between the parties and the Person who acquires or owns the lessee's
interest in the Premises under the Master Lease, including, without limitation,
the purchaser or transferee in any such sale,


                                     -106-
<PAGE>   111

disposition or transfer, and any fee owner of the Premises upon termination of
the Master Lease, that, subject to the provisions of Section 41.06(a), such
Person has assumed and agreed to carry out any and all agreements, covenants and
obligations of Landlord hereunder accruing from and after the date of such
acquisition, sale or transfer.

            Section 41.17. Except as otherwise specifically provided herein, if
the Tenant named herein or any successor to its interest hereunder ceases to
have any interest in the Premises or there is at any time or from time to time
any valid sale or sales or disposition or dispositions or transfer or transfers
of the Tenant's or any successor's entire interest in the Premises in accordance
with the provisions of Article 10, the Tenant named herein or any such
successor, as the case may be, shall be and hereby is entirely freed and
relieved of all agreements, covenants and obligations of Tenant hereunder to be
performed on or after the date of such sale or transfer, and it shall be deemed
and construed without further agreement between the parties or their successors
in interest or between the parties and the Person who acquires or owns the
Tenant's interest in the Premises under this Lease, including, without
limitation, the purchaser or transferee in any such sale, disposition or
transfer, that such Person has assumed and agreed to carry out any and all
agreements, covenants and obligations of Tenant hereunder to be performed from
and after the date of such acquisition, sale or transfer.

            Section 41.18. Landlord shall not enter into or cause there to be
entered into any amendment or supplement to the Master Lease, Master Development
Plan, Memorandum of Understanding, Settlement Agreement, Declaration of
Restrictions or Design Guidelines which (a) increases, decreases or materially
alters or otherwise materially affects Tenant's rights or obligations under this
Lease, (b) limits the permitted uses of the Premises or the Civic Facilities,
(c) limits Tenant's rights under this Lease to dispose of, or assign its
interest in, the premises or (d) decreases or alters the rights of a Mortgagee
under this Lease, unless the same is consented to by Tenant (or, in the case of
(d), by such Mortgagee) or is made subject and subordinate to this Lease and
such rights of such Mortgagee. In the event Landlord shall enter into or cause
to be entered into an amendment or supplement to the Master Lease, Master
Development Plan, Memorandum of Understanding, Settlement Agreement, Declaration
of Restrictions or Design Guidelines which is not in conformity with this
Section 41.18, Tenant shall not be obligated to comply with the provisions of
such amendment or supplement which do not so conform and the same shall have no
force or effect with respect to Tenant or any Mortgagee. Notwithstanding
anything herein contained to the contrary, neither Tenant nor any Mortgagee
shall have any right to approve any amendment, modification or supplement to the
Master Lease, Master Development Plan, Memorandum of Understanding, Settlement
Agreement, Declaration of Restrictions or Design Guidelines which does not
affect the Premises, including, with respect to the Declaration of Restrictions,
any amendment relating to Site 25/26 of the Project Area.

            Section 41.19. Nothing herein is intended nor shall be deemed to
create a joint venture or partnership between Landlord and Tenant, nor to make
Landlord in any way responsible for the debts or losses of Tenant.


                                     -107-
<PAGE>   112

            Section 41.20. To the extent permitted by law, Tenant shall have the
right to all depreciation deductions, investment tax credits and other similar
tax benefits attributable to any construction, demolition and Restoration
performed by Tenant or attributable to the ownership of the Building. Landlord,
from time to time, shall execute and deliver such instruments as Tenant shall
reasonably request in order to effect the provisions of this Section 41.20, and
Tenant shall pay Landlord's reasonable costs and expenses thereof. Landlord
makes no representations as to the availability of any such deductions, credits
or tax benefits.

            Section 41.21. Whenever Landlord shall have the right to approve the
architect, engineer or lawyer to be employed by Tenant, any architect, engineer
or lawyer so approved by Landlord at any time during the Term shall be deemed to
be acceptable to Landlord for employment by Tenant at any time thereafter,
unless Landlord shall have good cause for refusing to allow the continued
employment of such consultant. Whenever Tenant is required to obtain Landlord's
approval of an architect, engineer or lawyer, Tenant shall notify Landlord if it
intends to employ an architect, engineer or lawyer previously approved. In the
event that Landlord shall refuse to approve the continued employment of such
consultant, it shall so notify Tenant, specifying the reason therefor.

            Section 41.22. Tenant shall have the right to use the name "Battery
Park City" in any advertising and promotional materials in connection with the
leasing of the Building.

            Section 41.23. Landlord, upon request by Tenant and at no cost or
expense to Landlord, shall cooperate with any effort by Tenant to establish
that, by reason of ownership of the Building and Equipment by Landlord or
involvement of Landlord in the Project, no sales or compensating use tax is
payable in respect of materials incorporated (or to be incorporated) in the
Building, Fixtures, Equipment purchased or leased for use in the Premises and
for use off-site in support of Tenant's operations at the Premises and the
maintenance and upgrade of Equipment. Tenant shall promptly reimburse Landlord
for all reasonable costs or expenses which Landlord may sustain or incur while
acting pursuant to this Section 41.23.

            Section 41.24. Tenant promptly shall apply to the appropriate
authorities to obtain a separate tax lot designation for the Premises and the
tax assessment for such tax lot shall be the basis for calculating PILOT under
Section 3.02 hereof and Landlord shall cooperate with Tenant in connection
therewith. If Tenant shall not be able to obtain a separate tax lot designation,
Landlord and Tenant shall cooperate to obtain annually a separate, undivided tax
assessment and such assessment shall be the basis for calculating PILOT under
Section 3.02 hereof.

            Section 41.25. Pursuant to a Petition for Advisory Opinion dated
February 28, 1995 submitted by BPCA to the State of New York, Commissioner of
Taxation and Finance, Petition No. M950228A, BPCA received an advisory opinion
dated March 13, 1995 and pursuant to a Request for an Advisory Opinion dated
March 8, 1995 submitted by BPCA to the Department of Finance of the City of New
York, BPCA received an advisory


                                     -108-
<PAGE>   113

opinion dated March 29, 1995 (the "Advisory Opinions"), copies of which have
been delivered to Tenant, with respect to the imposition of mortgage recording
tax under Article 11 of the Tax Law of the State of New York. BPCA agrees that,
at the request of Tenant, it shall cause Mortgages (and any instruments
assigning, supplementing, amending, modifying, consolidating, spreading,
substituting, severing, restating and/or extending any Mortgages) to be recorded
as contemplated by the Advisory Opinions and cooperate with Tenant in
consummating the sublease, sub-sublease structure described in the Advisory
Opinions provided, in all cases, such Mortgages are made in compliance with the
provisions of this Lease and provided further that any such sublease,
sub-sublease structure shall not (x) involve the expenditure of additional
monies by Tenant or (y) impose any additional obligation on Tenant or (z) expose
Tenant to any liability or potential liability. Each party shall be responsible
for the payment of its attorneys fees in connection with such transaction.

                                   ARTICLE 42

                                SECURITY DEPOSIT

            Section 42.01. Tenant shall deposit with Landlord, as security for
the purposes hereinafter provided the following amounts in cash or other
security or marketable instruments or securities reasonably acceptable to
Landlord (provided, if Tenant shall have delivered marketable instruments or
securities to Landlord, such instruments or securities shall be held by a
Depository, pursuant to an escrow agreement reasonably satisfactory to Landlord)
at the time and in the manner hereinafter provided:

            (a) Tenant shall deposit from time to time in accordance with the
provisions of the Funding Agreement, amounts up to an aggregate of $10,000,000
at the time and in the manner provided in the Funding Agreement;

            (b) For the period from the Occupancy Date to and including the
fifth anniversary thereof, the security deposit shall be in the amount of
$10,000,000;

            (c) For the period from the day next succeeding the expiration of
the period referred to in subparagraph (b) above to and including the fifth
anniversary thereof, the security deposit shall be reduced to $7,500,000;

            (d) For the period from the day next succeeding the expiration of
the period referred to in subparagraph (c) above to and including the fifth
anniversary thereof, the security deposit shall be reduced to $5,000,000; and

            (e) Thereafter and continuing for the remainder of the Term, the
security deposit shall be zero.

            Notwithstanding the foregoing, in the event Tenant shall have
terminated the Funding Agreement pursuant to the provisions of Section
9.6(b)(ii)(B) thereof, provided no


                                     -109-
<PAGE>   114

Event of Default shall have occurred and be continuing, the security so
deposited shall, in all events, be promptly returned to Tenant on the date the
Building shall have been Substantially Completed. If Tenant defaults under the
Occupancy Agreement and by reason of such default Tenant is obligated for the
payment of liquidated damages thereunder, Landlord shall apply or retain the
whole or any part of the security so deposited and the interest accrued thereon,
if any, to the payment of liquidated damages required to be paid by Tenant under
the Occupancy Agreement and for no other purpose. Notwithstanding the
immediately preceding sentence, in the event Landlord shall have provided
financing for the Project as contemplated by the Financing Letter, such security
shall be applied first to the payment of any outstanding indebtedness to
Landlord under the loan evidencing such financing or any interest thereon in
accordance with the provisions of the documents evidencing and/or securing such
loan. Unless sooner applied as hereinabove provided or returned to Tenant as
provided in the first sentence of this paragraph, the security or any balance
thereof shall be returned or paid over to Tenant on the Lease Restrictions
Expiration Date. In the event of any sale, transfer or leasing of Landlord's
interest in the Building whether or not in connection with a sale, transfer or
leasing of the Land to a vendee, transferee or lessee, Landlord shall have the
right to transfer the unapplied part of the security and the interest thereon,
if any, to which Tenant is entitled, to the vendee, transferee or lessee
provided that such vendee, transferee a lessee agrees (in writing) to assume
from and after the date of the sale, assignment or transfer all of Landlord's
obligations with respect to the security and the interest thereon, if any and
Landlord shall thereupon be released by Tenant from all liability for the return
or payment thereof, and Tenant shall look solely to the new landlord for the
return or payment of the same. The provisions of the preceding sentence shall
apply to every subsequent sale, transfer or leasing of Landlord's interest in
the Building, and any successor of Landlord may, upon a sale, transfer, leasing
or other cessation of the interest of such successors in the Building, whether
in whole or in part, pay over any unapplied part of said security to any vendee,
transferee or lessee of the Building and shall thereupon be relieved of all
liability with respect thereto. Except in connection with a permitted assignment
of this Lease, Tenant shall not assign or encumber the monies deposited herein
as security or any interest thereon to which Tenant is entitled, and neither
Landlord nor its successors or assigns shall be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance. In any event, in the
absence of evidence satisfactory to Landlord of any assignment of the right to
receive the security or the remaining balance thereof, Landlord may return the
security to the original Tenant regardless of one or more assignments of this
Lease. Landlord shall deposit the security deposit in an interest bearing
account with an institution satisfying the requirements of a Depository under
this Lease and provided no Default shall have occurred and be continuing,
interest shall be paid to Tenant annually.

            Section 42.02. (a) In lieu of a cash security deposit, Tenant may
deliver to Landlord a clean, irrevocable and unconditional letter of credit
(such letter of credit, and any replacement thereof as provided herein, is
called a "Letter of Credit") issued and drawn upon any commercial bank which is
a member of the New York Clearinghouse Association reasonably approved by
Landlord with offices for banking purposes in the City of New York ("Issuing
Bank"), which Letter of Credit shall have a term of not less than one year,


                                     -110-
<PAGE>   115

be in form and content satisfactory to Landlord, be for the account of Landlord
and be in the amount, required from time to time pursuant to Section 42.01. The
Letter of Credit shall provide that:

            (i)   The Issuing Bank shall pay to Landlord or its duly authorized
                  representative an amount up to the face amount of the Letter
                  of Credit upon presentation of the Letter of Credit and a
                  sight draft in the amount to be drawn;

            (ii)  The Letter of Credit shall be deemed to be automatically
                  renewed, without amendment, for consecutive periods of one
                  yeas each during the Term, unless the Issuing Bank sends
                  written notice (the "Non-Renewal Notice") to Landlord by
                  certified or registered mail, return receipt requested, at
                  least thirty (30) days prior to the expiration date of the
                  Letter of Credit, to the effect that it elects not to have
                  such Letter of Credit renewed; and

            (iii) The Letter of Credit shall be transferable by Landlord in the
                  event of a sale, transfer or leasing of Landlord's interest in
                  the Building.

            (b) Landlord, after receipt of the Non-Renewal Notice, shall have
the right to draw the entire amount of the Letter of Credit and to hold the
proceeds as a cash security deposit pursuant to the terms of Section 42.01.
Landlord shall release such proceeds to Tenant upon delivery to Landlord of a
replacement Letter of Credit complying with the terms hereof.

                                   ARTICLE 43

                               MUTUAL TERMINATION

Section 43.01.

            (a) Tenant shall work diligently to obtain the financing required to
complete the Project as more particularly described in the Financing Letter, and
Tenant shall keep Landlord, EDC and UDC informed as to the status of its efforts
to obtain such financing. Tenant shall, at the request of Landlord, EDC and UDC,
together with its investment banker or financial advisor, meet with Landlord,
EDC and UDC to review the status of such financing. If Tenant receives a
commitment for such financing from a financing source, it shall make a copy
available to Landlord, EDC and UDC and if Tenant receives a credit rating from a
credit rating agency, it shall make a copy available to the Landlord, EDC and
UDC.

            (b) If Tenant believes, by the date which is the earlier of (i) the
date on which $65,000,000 shall have been advanced to Tenant under the Funding
Agreement or (ii) six (6) months prior to the date on which Tenant estimates
that the entire amount to be


                                     -111-
<PAGE>   116

provided for Project construction pursuant to the Funding Agreement is projected
to have been advanced to Tenant, that it will be unable to obtain such
financing, Tenant shall so advise Landlord, EDC and UDC stating the reasons
therefor and shall request that Landlord provide such financing through sale of
its revenue bonds and/or through provision of credit enhancements as described
in the Financing Letter. In such event, Landlord will work diligently to provide
and make available such financing and/or enhancements and Landlord shall keep
Tenant, EDC and UDC informed as to its efforts to do so.

            (c) In the event that neither Tenant, Landlord nor any other
governmental entity with the ability to issue bonds is able to provide financing
as described in the Financing Letter, there shall be an Unavoidable Delay for a
period of up to twelve (12) months (concurrently with any other Unavoidable
Delays during such period) from the date that substantially all funds have been
disbursed under the Funding Agreement (such twelve (12) month period being
called the "Financing Delay"). During such twelve (12) month period, Landlord
and Tenant shall continue their efforts to provide and obtain the financing
required to complete the Project.

            Section 43.02. At any time after the expiration of such twelve (12)
month period, either Landlord or Tenant shall have the right to terminate this
Lease upon not less than forty-five (45) days notice to the other. In the event
Landlord or Tenant shall have delivered such notice (i) Tenant shall vacate and
surrender the Premises on the date set forth in such notice in the condition
required pursuant to Article 33, (ii) the Premises shall be delivered free and
clear of any Mortgages and (iii) all Rental, if any, payable by Tenant hereunder
shall be equitably apportioned as of such date and the security deposit
delivered to Landlord in accordance with Article 42 hereof shall be promptly
returned to Tenant.

                                   ARTICLE 44

                             NON-EXCLUSIVE EASEMENTS

            Landlord grants to Tenant, its Subtenants, invitees and licensees,
(i) until the streets, avenues, sidewalks and curbs adjacent to the Premises and
providing access to and from the Premises shall have been dedicated to New York
City, a nonexclusive easement and right-of-way for the passage of pedestrian and
vehicular traffic over all such completed streets, avenues, sidewalks and curbs,
including, without limitation, Vesey Street west of North End Avenue and (ii) a
nonexclusive easement and right of way for pedestrian ingress and egress over
the premises more particularly described in Exhibit H hereto, in each case,
subject to such reasonable policies and procedures as may from time to time be
enacted by Landlord and which are generally applicable to all tenants of Battery
Park City and their subtenants, invitees and licensees.


                                     -112-
<PAGE>   117

IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day
and year first above written.

                                            BATTERY PARK CITY AUTHORITY


                                            By: /s/ Philip R. Pitruzello
                                               --------------------------------
                                                    Philip R. Pitruzello
                                                    President


                                            NEW YORK MERCANTILE EXCHANGE

                                            By: /s/ Daniel Rappaport
                                               --------------------------------
                                                    Daniel Rappaport
                                                    Chairman