LEASE AND ASSET AGREEMENT

     This Lease Agreement (hereinafter  alternately-the  "Lease" or "Agreement")
made  and  entered  into  January  20,  1993 by and  between  Consolidated  Rail
("Conrail"),  a  Pennsylvania  Corporation  with offices at 2001 Market  Street,
Philadelphia,  PA, CRC Properties,  Inc.  ("CRCP") a Delaware  Corporation  with
offices at 2001  Market  Street,  Philadelphia,  PA,  and New York Cross  Harbor
Railroad Terminal Corporation ("NYCH"), a New York Corporation,  with offices at
4302 First Avenue, Brooklyn, NY, 11232.

     WHEREAS,  Conrail  owns a railroad  operating  easement  granted by CRCP on
certain  parcels of realty,  hereinafter  described  on which  certain  railroad
facilities have been and are none located including,  track and float bridges at
Greenville Piers, 7ersey City, New Jersey; and

     WHEREAS,  the Interstate  Commerce  Commission  ("Commission" or "ICC") has
approved the Abandonment of Conrail's  operations over the subject facilities in
Docket AB 167 (Sub--No. 859N); and

     WHEREAS,  NYCH  currently  provides  on behalf of Conrail  on the  foresaid
parcel of realty,  rail,  lighterage  services over such facilities  pursuant to
various agreements and understanding heretofore reached between NYCH and Conrail
in connection with rail services provided by NYCH; and

     WHEREAS,  NYCH  desires to lease from Conrail and from CRCP such parcels of
realty,  easement and facilities so as to continue operations in its own name on
such parcels of. realty using such facilities under the terms and conditions set
forth herein.

         NOW THEREFORE, the parties hereto, intending to be legally bound, agree
as follows:

SECTION 1: LEASE OF PARCELS

         1.1 In consideration of the payment of $1.00 by NYCH to Conrail, the
receipt of which is hereby acknowledged, CRCP and Conrail hereby lease to NYCH
all the real property described in the attached Exhibit A which is incorporated
herein by reference subject to all, rights of Conrail and CRCP
         in and to any leases, easements, licenses, agreements (including, but
not limited to, sidetrack agreements) and privileges pertaining to leased
property, All the property, rights and interests leased in this paragraph 1.1
are hereinafter referred to as the "Rail Operating Property."

         1.2. Possession of the Railroad Operating Property under this Agreement
shall be delivered by Conrail and CRCP to NYCH without covenants or warranties
of any nature and subject to all existing laws and ordinances, and orders of
regulatory agencies, including abandonment authority granted by the ICC to
Conrail. Without limiting the generality of the foregoing, the Railroad
Operating Property shall he sub jest to any state of facts that an accurate
survey and a prudent inspection of the Railroad Operating Property would
disclose.

         1.3. NYCH expressly acknowledges -that the Railroad Operating Property
is subject to reservations  and conditions which are contained in a deed between
Conrail and CRCP, dated October 30, 1985, attached hereto as Exhibit D.

         1.4. This lease of the Railroad Operating Property shall continue in
full force and effect until December 31, 2023.

         1.5. Subject to the terms of this Agreement, and in consideration of
the payment of rent as specified in Section 2 paragraph 2.1 of this Agreement by
NYCH to Conrail,  Conrail and CRCP  hereby  lease to NYCH all the real  property
described in the attached  Exhibit B which is  incorporated  herein by reference
subject  to all  rights of  Conrail  and CRCP in and to any  leases,  easements,
licenses,  agreements (including, but not limited to, Sidetrack Agreements), and
privileges  pertaining  to the leased  property.  All the  property,  rights and
interests  leased  in this  paragraph  1.5 are  hereinafter  referred  to as the
"Terminal   Intermodal   Operating   Property   A".

         1.6   Possession   of  the Terminal-intermodal  Property  A under  this
Agreement  shall be delivered  by Conrail and CRCP to NYCH without  covenants or
warranties  of any nature and subject to all existing  laws and  ordinances  and
orders of regulatory agencies.  Without limiting the generality of the foregoing
the Terminal  Property A shall be subject to any state of facts that an accurate
survey  and a prudent  inspection  of the  Terminal-Intermodal  Property A would
disclose.

         1.7.  NYCH expressly  acknowledges that the Terminal Intermodal
Property.  A is subject to reservations  and conditions which are contained in a
deed between Conrail and CRCP attached hereto as Exhibit D.

         1.8.  This lease of the  Terminal-Intermodal Property A shall  continue
in force and effect until  December  31,  2023.
<PAGE>

         1.9.  Subject to the terms of. this Agreement,  and in consideration of
the payment of rent as specified in Section 2 paragraph 2.2 of this Agreement by
NYCH to Conrail,  Conrail and CRCP  hereby  lease to NYCH all the real  property
described in the attached  Exhibit C which is  incorporated  herein by reference
subject  to all  rights of  Conrail  and CRCP in and to  any-leases,  easement5,
licenses,  agreements (including, but not limited to sidetrack Agreements),  and
privileges  pertaining  to the leased  property.  All the  property,  rights and
interests   leased  "as   aforesaid   are   hereinafter   referred   to  as  the
"Terminal-Intermodal Operating Property B".

         1.10 Possession of the Terminal-Intermodal Property B under this
Agreement shall be delivered by CRCP to NYCH without  covenants or warranties of
any  nature  and  subject  to all  existing  laws and  ordinances  and orders of
regulatory  agencies.  Without  limiting the  generality of the  foregoing,  the
Terminal  -Intermodal  Property B shall be subject to any state of facts that an
accurate survey and a prudent inspection of the Terminal  Intermodal  Property B
would disclose.

        1.11. NYCH expressly  acknowledges that the Terminal  Intermodal
Property B is subject to  reservations  and conditions  which are contained in a
dead between Conrail and CRCP attached hereto as Exhibit D.

        1.12. This lease of the Terminal-Intermodal Property B shall continue in
force and effect until December 31, 2023.

        1.13. The Railroad Operating Property, the Terminal-Intermodal Property
A and the Terminal  -intermodal  Property B shall  hereinafter  be  collectively
referred to as the "Property".

SECTION 2: RENT

         2.1. Rent shall be paid by NYCH to CRCP in consideration  for the Lease
of Terminal-intermodal Property A as follows:

A. $1.00, the receipt of which is hereby ac knowledge for the period commencing
with the date of this Agreement and ending 5 years thereafter.

B. Twenty  (20)  percent of the  Adjusted  Base Rent  determined  as provided in
paragraph  2.3 of this Section 2, in advance,  in equal  quarterly  installments
commencing the first day of the sixth year after the date of this Agreement;

C. Forty (40)  percent of the  Adjusted  Base Rent  determined  as  provided  in
paragraph  2.3 of this Section 2, in advance,  in equal  quarterly  installments
commencing the first day of the seventh year after the date of this Agreement;

D. Sixty (60)  percent of the  Adjusted  Base Rent  determined  as  provided  in
paragraph  2.3 of this Section 2, in advance,  in equal  quarterly  installments
commencing the first day of the eighth year after the date of this Agreement;

E. Eighty  (80)  percent of the  Adjusted  Base Rent  determined  as provided in
paragraph  2.3 of this Section 2, in advance,  in equal  quarterly  installments
commencing the first day of the ninth year after the date of this Agreement;

F. One hundred (100) percent of the Adjusted Base Rent determined as provided in
paragraph 2.3 of this Section 2, in advance, in equal quarterly installments
commencing the first day of the tenth year after the date of the Agreement to
the end of the term of lease of the Terminal-Intermodal Operating Property A.

2. 2.      Rent shall be paid by NYCH to Conrail in consideration of the Lease
of Terminal-Intermodal Operating Property B as follows:

     Ten (10)  percent--  per  annum  of the fair  market  value  determined  as
provided  in  paragraph  2.3a,  in  advance,  in  equal  quarterly  installments
commencing  with the  date of this  agreement,  except  for the  initial  rental
payment,  which shall be made  within 5 business  days of  determining  the fair
market value on 2.3a.
<PAGE>

     2.3. The  Adjusted  Base Rent payable with respect to the lease of Terminal
-Intermodal  Operating Property A and Terminal  Intermodal  Operating Property B
shall he determined as follows:

a.  Within  execution  of this  lease  agreement,  NYCH and  Conrail  shall each
designate an appraiser  appropriately  licensed in the State of New Jersey. Each
such  appraiser  shall  prepare an  appraisal of Terminal  Intermodal  Operating
Property A and a separate appraisal of Terminal Intermodal  Operating Property B
which appraisal shall report the appraisers considered respective opinions as to
the annual fair market rental value of each  property as of the appraisal  date.
Such  appraisals  shall be completed  and delivered to NYCH and Conrail no later
than one hundred fifty days after execution of this Agreement.

b. The Annual Base Rent for each  property so  appraised  shall be 10 percent of
the  average of the  appraised  values as provided  by each  appraiser  for such
property.

C. NYCH may negotiate adjustments to the Base Rent based upon the volume of
revenue rail cars interchanged with Conrail at the Greenville Yards during the
previous calendar year. The specific terms of any such adjustments shall be as
contained in commercial agreements between NYCH and Conrail's Marketing
Department.

2.4. NYCH shall pay the rent for each property to Account Number 81-08101 to
P.O. Box 8538-230, Philadelphia, PA 19171, or to such other address as CRCP may
indicate by notice to NYCH.

2.5.  NYCH shall pay the rent without  prior demand,  setoff,  or  counterclaim.
Lessor shall apply each payment of rent when received according to the direction
of NYCH. No payment shall operate as an accord and satisfaction, notwithstanding
any statement or endorsement accompanying such payment.

2.6 If NYCH does not pay the rent for any property for a period of fifteen (15)
days from the day same shall have been due and payable, then NYCH shall pay a
late charge equal to three percent (3%-) of the rent payment then due.
Furthermore, if the rent is not paid within thirty (30) days from the date said
rent payment was due, NYCH shall pay interest at the rate of 1.0% per annual
above the prime rate then in effect for each month or fraction thereof for which
rent is not paid on the amount of any such rent unpaid.

2.7. NYCH shall pay all taxes  (including  without  limitation  real,  transfer,
sales and use taxes),  assessments (including without limitation all assessments
for public  improvements or benefits,  whether or not to be completed during the
lease),  water,  sewer and other  rents,  rates and  charges,  excises,  levies,
license fees,  permit fees,  inspection  fees and other charges  (including  all
interest  and  penalties  thereon)  which at.  any time  during the lease may be
assessed,  levied,  confirmed  or imposed  against  the  Property or against any
improvements made by NYCH, or other property of NYCH, real or personal,  located
on the  Property.  If the Property is not taxed as a parcel but is taxed as part
of a larger  parcel,  NYCH shall pay an  equitable  portion of the taxes and the
assessments  upon the whole  tract or parcel  of which the  Property  is a part.
Conrail  and CRCP  shall  cooperate  with NYCH with  respect to  providing  such
consents,  verifications,  affidavits or- other  materials  which would have the
effect  of  reducing  taxes  for  the  Property  under  any  and  all  tax  laws
establishing special tax rates for railroads.

2.8. NYCH, at its sole cost and expense (including fees for permits and similar
documents), shall obtain, all utility services required or desired by NYCH,
including the installation of meters and sub-meters it none exist. NYCH shall be
responsible for all charges for utilities consumed by, and supplied to, NYCH by
the provider thereof. NYCH shall not obtain any utility service from any of
Conrail's facilities without first obtaining the prior written consent of
Conrail.

SECTION 3:            SALE OF CERTAIN ASSETS

3.1. CRCP agrees to sell to NYCH all of its right,  title and interest in and to
all assets  installed in or on the Property,  including  without  limitation all
in-place  main and side track  devices  appurtenant  thereto,  track  materials,
wires, pipes, conduits, poles, guys, structures,  buildings, signals and bridges
located on the Property, as of the date of execution of this Agreement,  and all
spare parts and special tools  necessary for operation and  maintenance  of such
assets  owned  by  CRCP  on  the  date  of  execution  of  this  Agreement,  and
specifically  excluding  any interest in the real  property,  including  but not
limited to those items  specified in the  attached  Exhibit E all of which shall
hereinafter be refereed to as the "Assets".'
<PAGE>

3.2. The consideration to be paid by NYCH to CRCP for purchase of the Assets
shall be $1.00 which sun is acknowledged to have been delivered as of the
execution of this Agreement.

3.3.Title to the Assets  shall be conveyed by Bill of Sale in the form  attached
hereto as Exhibit E without  covenants or  warranties of any nature except those
specifically set forth in this Agreement, and conveyance shall be subject to (1)
whatever rights the public may have to the use of any roads, alleys,  bridges or
streets on or crossing the Property,  (2) streams,  rivers, creeks and waterways
passing under, across or through the Property, (3) the reservations contained in
the deed attached as Exhibit D or in the Bill of Sale attached hereto as Exhibit
E, it any, (4) any and aLI1 existing tenancies, encumbrances, easements, rights,
trackage  rights,   licenses,   permits,   privileges,   agreements,   sidetrack
agreements, third party claims, covenants, conditions,  restrictions,  rights of
reentry,  possibilities of reverter, existing laws and ordinances, and orders of
regulatory agencies, and (5) any pipes, wires, poles, cables, culverts, drainage
courses or systems,  or other  facilities on or crossing the Property,  together
with the  rights of any person  entitled  thereto to  maintain,  repair,  renew,
replace,  use or remove the same. Said conveyance shall not, however, be subject
to  mortgage,  tax or other liens for the payment of money.  The Assets shall be
delivered  "as is" on the date of Closing  subject to any state of facts that an
accurate  survey  or a  prudent  inspection  of the  Property  or  Assets  would
disclose, except as otherwise expressly provided herein.

SECTION 4: NYCH'S OPERATION ON THE PROPERTY

4.1. Upon execution of this Agreement or as soon thereafter as practicable, NYCH
shall  commence  rail  freight  service  over the  Railroad  Operating  Property
pursuant to the terms hereof and such operating agreements as may be in force as
between  NYCH  and  Conrail.   Notwithstanding  the  foregoing,  to  the  extent
inconsistent  with the terms of this Agreement,  this lease supersedes all other
outstanding agreements or understandings among the parties.

4.2. NYCH  represents  and warrants that it has, or will within 10 business days
of the  execution  of  this  agreement,  obtain  any  and  all  governmental  or
regulatory  approvals,  authorizations  or  exemptions  necessary  under  state,
Federal and local law for consummation of the transactions under this Agreement.

4.3. Conrail agrees that simultaneously with the execution of this Agreement, it
will  exercise  the  abandonment  authority  received by it In the  Matter:  ICC
Sub.-No-  859N,  Docket No. AB 167.  Conrail agrees that it will not object to a
petition to be filed by NYCH with the Interstate Commerce Commission pursuant to
the Revised  Interstate  Commerce Act 49 U.S.C.A.  ss. 10901  seeking  operating
authority over the Railroad Operating Property,  or an exemption under the terms
thereof.

4.4. During the term of this Agreement, and subject to the terms of Section 8 of
this Agreement,  NYCH shall maintain,  repair, and renew the Property and Assets
at its own expense and with its own supervision  and labor.  NYCH shall keep and
maintain  the  Property  and  Assets in  accordance  with all  applicable  laws,
ordinances and regulations.

4.5. (a) Upon  expiration or the  termination  of this Agreement by operation of
Sections 6.2 (insurance) or 7.1, NYCH shall, as promptly as possible, remove the
Assets  from the  Property,  but in no event later than (60) days from a written
request by CRCP and Conrail to do so

(b) Notwithstanding the terms of section 4.5(a), Conrail at its sole option, may
elect to repurchase  from NYCH and retain all or a portion of the Assets for one
dollar ($1.00).  However, to the extent NYCH expends sums in excess of the costs
of maintenance of any of the Assets,  or installs  additional rail facilities or
other  fixtures on the Property,  and Conrail elects to purchase from I\TYCH any
portion of the facilities or fixtures subject to such extraordinary improvement,
Conrail shall pay NYCH the  undepreciated  value of the such  improvements.  Any
Assets not  purchased by Conrail  shall be subject to the  provisions  of 4.5(a)
(removal).


SECTION 5: USE
<PAGE>

5.1 NYCH represents and warrants to Conrail and CRCP that NYCH intends to use
the Property for railroad operations and railroad-related terminal and
intermodal facilities which operations have the Standard Industrial
Classification ("S.I.C.") numbers as defined by the most recent edition of the
Standard Industrial Classification Manual published by the Federal Executive
Office of the President, Office of Management and Budget. NYCH's use of the
Property shall be restricted to the use and classifications set forth above
unless YYCH obtains CRCP prior consent to any change in use of the Property.
NYCH shall supply to CPCP an affidavit of an officer of NYCH ("Officer's
Affidavit") setting forth NYCH's S.T.C. numbers and a detailed description of
the operations and processes NYCR will undertake at the property, organized in
the form of a narrative report including a description and quantification of
hazardous substances and wastes to be generated, manufactured, refined,
transported, treated, stored, handled or disposed of at the property. Following
delivery of the Officer's Affidavit, NYCH shall notify CRCP by way of Officer's
Affidavit as to any changes in NYCH I s operation, S.I.C. number or use or,
generation of hazardous substances and wastes, by way of a supplemental
Officer's Affidavit. NYCH shall also supplement and update Officer's Affidavit
upon each anniversary of this agreement- NYCH shall not commence or alter any
operations 'at the property prior to (i) obtaining all required operating and
discharge permits or approvals, including but not limited to air pollution
control permits and pollution discharge elimination system permits from NJDEP,
from all governmental or public authorities having jurisdiction over NYCH's
operations or the property, and (ii) providing copies of permits or approvals to
CRCP.

5.2. NYCH shall not install any underground  storage tanks or related structures
on the property without the prior written approval of a Senior Vice President of
Conrail, or an authorized delegate thereof.

5.3.  NYCH shall conduct its business on the property so that it shall in no way
interfere with the use and enjoyment of property near or adjoining the property.
Such  restrictions  on NYCH's use of the property shall include the following by
way of example:

a. Radio Activity or Electrical  Disturbance  -No activities  shall be permitted
which  emit  dangerous  radio  activity  or  electrical  disturbance  which will
jeopardize  the health of any  employee or adjacent  resident  or  property,  or
otherwise adversely affect the operation of any equipment;

b. Noise - The maximum  noise level at the property  line  applicable to the use
involved shall not exceed those limits established by state law or regulation as
measured in accord with procedure  specified by the American National  Standards
institute;

c. Vibration No vibration shall be permitted which is detectable,  other than by
instrument, at the property line;

d. Glare - No direct or  reflective  glare from any lighting or process shall be
permitted where such will interfere with traffic safety or the useful  enjoyment
of adjoining properties;

e.  Smoke- No  emission  shall be  permitted  or a shade equal to or darker than
Ringlemann Chart, No. 2;

f. Odors - No emission of odorous gasses or other matter shall he permitted in a
quantity  or of a  type  that  permit  them  to be  detectable,  other  than  by
instrument, at the property line;

g. Other Forms of Air Pollution No emission of fly, ash,  dust,  smoke,  vapors,
gasses,  other  airborne  particulate  or other forms of air pollution  shall be
permitted  which  contribute  to the  deterioration  of or  detract  from use of
adjacent properties for any purposes.
<PAGE>

SECTION 6    INDEMNIFICATION - INSURANCE

6.1.  Personal Injury and Property  Damage.  NYCH shall be responsible  for, and
shall release,  indemnify,  defend, and save harmless Conrail and its directors,
agents and  employees  from and against,  all loss,  damage,  expenses,  claims,
demands,  liabilities and actions at law or equity (and expenses  resulting from
the handling  thereof)  arising out of incidents of personal  injury  (including
death) or incidents of loss of or damage to property other than freight loss and
damage),  which incidents  occur on or about the Property,  except to the extent
the loss,  damage or liability is caused by the fault,  failure or negligence of
Conrail or its directors, agents or employees or any third party.

6.2. (a) Insurance. Within ten business days of the execution of this Agreement,
NYCH shall obtain and furnish  Conrail and CRCP written  evidence of one or more
policies of general comprehensive liability insurance as is standard in the rail
industry,  with coverage up to $5 million,  covering the liability  specified in
Paragraph  6.1.  Such  insurance  shall  remain in  effect  for the term of this
Agreement;  and, upon reasonable request by Conrail and CRCP, NYCH shall furnish
certificates evidencing that said insurance is in force and will remain in force
until a date specified in such certificate. NYCH agrees to require its Insurers)
to provide Conrail and CRCP 30 days advance  written notice of the  cancellation
of such coverage,  and after such  cancellation,  Conrail and CRCP may terminate
this  Agreement and require NYCH to cease  operations  on the property,  without
fault or liability to Conrail and CRCP.

(b)  NYCH  shall  comply  with  the  Federal  Employer's  Liability  Act and all
applicable worker's  compensation and employer's  liability laws and regulations
affecting railroad employees.


SECTION 7: DEFAULT, WAIVER

7.1.(a) Subject to the terms of Paragraph  7.1(c),  in the event of a default by
NYCH with  respect to  Intermodal  Property A or B which  cannot be Cured by the
payment of money,  CRCP at its option,  may  terminate  the lease of that parcel
affected by the default, but not the entire Agreement unless the default affects
all of the parcels leased to NYCH. in the event of a default by NYCH that cannot
be cured  by the  payment  of  money  and that  either  is not  confined  to the
intermodal parcels or involves the Railroad Operating  Property,  CRCP, at their
sole option,  may terminate  this  Agreement in its entirety.  Such  termination
shall be preceded by a written notice of default and intent to terminate,  which
shall be  delivered  to NYCH no less  than  forty-five  (45)  days  prior to the
intended date of  termination.  If during such forty-five (45) day notice period
NYCH shall cure the default in its entirety  this  Agreement  and any lease of a
parcel under this Agreement shall not be terminated.

7.1.(b)  In the event of a default  by NYCH that can be cured by the  payment of
money,  CRCP, at its option,  may Terminate the lease of the parcel (s) affected
by the default (except that CRCP may terminate this Agreement in its entirety in
the event of a default with respect to the Railroad  Operating  Property).  Such
termination shall be preceded by ten (10 days written notice of such default and
intent to terminate,  and NYCH.  shall have an additional ten (10) days From the
date' of such notice to cure such default.

7.1.(c) If at any time during the term, of this  Agreement  there shall be filed
by or against  NYCH in any court,  pursuant to any statute  either of the United
States or of any state, a petition in bankruptcy,  or there shall be commenced a
case by or  against  NYCH under the  Bankruptcy  Code,  or a  petition  filed in
insolvency or for reorganization or for the appointment of a receiver or trustee
of all or a portion of NYCH's  property,  and within sixty (60), days thereafter
NYCH fails to secure a discharge thereof, or if NYCH makes an assignment for the
'benefit of creditors or petitions  for or enters into an  arrangement  with its
creditors  (all  the  hereinabove  collectively  referred  to  as a  "Bankruptcy
Default"),  Conrail or CRCP may terminate  this  Agreement in its  entirety,  in
which  event,  neither  NYCH nor any  person  claiming  through or under NYCH by
virtue  of any  statute  or of an  order of any  court  shall  be  entitled  to,
possession or to remain in possession  of the  Property,  and shall  immediately
surrender the Property to Conrail and CRCP. Conrail and CRCP, in addition to the
other rights and remedies  contained herein or available pursuant to any statute
or rule of law, may retain as liquidated damages any rent, security, deposit, or
monies received by it from NYCH or others on behalf of NYCH.

7.1.(d) No delay or  failure  of  Conrail  and CPCP to insist in any one or more
instances upon strict  performance of any of the  obligations of NYCH under this
Agreement or to take  advantage of or exercise any of Conrail and CRCP's  rights
or, powers  hereunder Shall impair any such right or power or be construed to be
a waiver of any such default or of the performance of any such obligation, or be
construed to be an acquiescence in such default or a relinquishment  of any such
right or power for the  future,  but such  obligation,  right,  and power  shall
continue and remain in full force and effect.

7.1.(e) The  remedies of Conrail and CPCP set forth  herein shall be in addition
to all other remedies provided by law, and these remedies shall include, without
limitation,, the right of Conrail and CRCP to obtain specific performance and/or
injunctive relief.

7.1.(f) NYCH irrevocably waives any right it may have, or that of any successor,
either now or in the future,  to condemn any part of or interest in the Property
for any purpose  whatsoever,  The  provisions  of the  paragraph  shall  survive
termination of this Agreement.

<PAGE>


SECTION 8 ENVIRONMENTAL COMPLIANCE

8.1 NYCH  represents  that it has and,  agrees that it will, at all times during
its  occupancy of the  Property  and at its  expense,  keep the Property and all
improvements  now or  hereafter,  erected or placed  thereon,  including but not
limited to, the structures,  equipment,  and operations,  in compliance with all
federal,  state,  and local laws,  rules and regulations  designed to Prevent or
control the discharge of substances in the land, water, or air.  Notwithstanding
the  provisions  of this Section 8.1,  nothing  contained  herein shall serve to
relieve  Conrail or any of its  predecessors in title of liability for the costs
of  prevention  or control of  discharges of substances in the land water or air
caused at any time by Conrail, or its predecessors in title.

8.2 Without  limiting any other provision of this Lease,  Conrail and CRCP shall
have the right to enter and inspect the Property in order to  determine  whether
NYCH is' complying with such laws, rules and regulations, provided however, such
entry and inspection  shall not interfere with NYCH operations  conducted on the
Property.  No such  inspection or absence of inspection by Conrail or CPCP shall
be construed to relieve  NYCH of its  obligations  to comply with all such laws,
rules and regulations.

8.3 Subject to the  provisions  of Section 8.1,  NYCH shall  indemnify  and hold
Conrail  and CRCP  harmless  from and against  all suits,  actions,  procedures,
fines,  claims,  costs and expenses  arising out of, or in connection  with: (i)
NYCH's  actions  or  inaction  with  regard' to NYCHI s  obligations  under this
Section 8; and (ii) any exposure to, cleanup, remediation,  response, removal of
any hazardous  materials,  hazardous  wastes,  hazardous or toxic  substances or
related materials in the Comprehensive Environmental Response,  Compensation and
Liability  Act of 1980,  as amended  (42 U.S.C.  Sections  9601,  et seq.),  the
Hazardous Materials Transportation Act, -as amended (49 U.S.C. Sections 1801, et
seq.),  The  Resource  Conservation  and  Recovery  Act,  as amended  (42 U.S.C.
Sections.  6901, et seq.) or any other presently  applicable federal,  state and
local  environmental  laws,  statutes,  ordinances and  regulations  promulgated
thereunder governing the use, storage,  treatment,  generation,  transportation,
processing,  handling,  production or disposal of hazardous  substances  located
upon the Property.

8.4  In  the  event  any  cleanup,  response,  removal  or  remediation  of  any
environmental  condition  is  required  by a  governmental  entity  (hereinafter
collectively  referred to as  "Response  Action"),  Conrail or CRCP shall not be
liable  for any  damages,  actual or  consequential,  by reason of the  Response
Action's  interference  with  NYCH's  use of the  Property.  NYCH  shall  not he
entitled to an abatement in the rent for any interference with NYCH's use of the
Property due to a Response  Action.  NYCH shall permit  Conrail add CRCP and its
contractors full,  unrestricted and unconditional access to the Property for the
purpose  of  completing  or  engaging  in a  Response  Action  for which NYCH is
responsible  should NYCH fail to  diligently  pursue and complete  such Response
Action to the satisfaction of Conrail; provided,  however, such access shall not
unreasonably  interfere With NYCH use and occupancy of the premises.  Conrail or
CRCP's completion of any of NYCH's  obligations  hereunder shall not be deemed a
waiver of NYCH's obligations under this Agreement. Conrail shall have the right,
but not the obligation,  to conduct  reasonable  inspections of NYCH Is Response
Action and NYCH shall  provide  Conrail and CRCP all  information  requested  by
Conrail and CRCP regarding NYCH's Response Action or any environmental condition
for which -NYCH is responsible.

8.5 Without limiting the other provisions of this Section 8, the following shall
be additional requirements under this Lease with respect to the environmental
condition of the Property:

a. NYCH shall,  at NYCH's own  expense,  comply with the  Environmental  Cleanup
Responsibility  Act,  N.J.S.A.  13:1K-6  et seq.,  the  regulations  promulgated
thereunder and any successor legislation and regulations  ("ECRA").  NYCH shall,
at NYCH's own expense,  make all submissions to, provide all information to, and
comply with all requirements of, the Industrial Site Evaluation or its successor
("Element")  of the New Jersey  Department  of  Environmental  Protection or its
successor ("NJDEP").

b. NYCH's  obligation  under this section 8 shall arise if there is any closing,
terminating or transferring of operations of an industrial  establishment at the
Property pursuant to ECRA, whether triggered by Conrail, CRCP or NYCH.
<PAGE>

c. Provided this Agreement is not previously cancelled or terminated by either
party or by operation of law, NYCH shall commence its submission to the Element
in anticipation of the end of the Lease Term no later than one (1) year prior to
the expiration of the Lease Term. NYCH shall promptly furnish to Conrail and
CRCP true and complete copies of all documents, submissions, correspondence and
oral or written confirmations provided by NYCH to the Element, and all
documents, reports, directives, correspondence and oral or written
communications by the Element to NYCH. NYCH shall also promptly furnish to
Conrail and CRCP true and complete copies of all sampling and test results and
reports obtained and prepared from samples and tests taken at an around the
Property. NYCH shall notify Conrail and CRCP in advance of 'all meetings
scheduled between NYCH and NJDEP, and Conrail and CRCP may attend all such
meetings.

d. Should the Element or any other division of NJDEP determine that a cleanup
plan be prepared and that a cleanup be undertaken because of a spill or
discharge of a hazardous substance or waste at the Premises, which occurred
during the term of this Lease. NYCH shall, at NYCH's own expense, promptly
prepare and submit the required plans' and financial assurances and shall
promptly carry out the approved plans. The cost of any cleanup and development
of a cleanup plan undertaken as a result of a spill or discharge of a hazardous
substance or waste at the Property prior to NYCH's initial occupancy or lease of
the Property, including the operation of the Property by NYCH's predecessor
BEDT, shall be born by Conrail or CRCP.

e. At no expense to Conrail or CRCP, NYCH shall promptly provide all information
requested  by  Conrail,  CRCP or NJDEP for  preparation  of a  non-applicability
affidavit,   de  minims  Quantity  exemption  application,   limited  conveyance
application or other  submission and shall promptly sign all such affidavits and
submissions when requested by Conrail, CRCP or NJDEP.

f. Should  NYCH's  operations  at the  Property  be outside of those  industrial
operations  covered by ECRA, NYCH shall, at NYCH's own expense,  obtain a letter
of  non-applicability or de, minims quantity exemption from the Element prior to
termination of the Lease Term and shall promptly  provide NYCH's  submission and
the  Element's  exemption  letter to Conrail and CRCP.  Should  Conrail and CRCP
obtain a letter of  non-applicability  or de minims quantity  exemption from the
Element,  then NYCH shall,  at Conrail  and CRCP's  option,  'hire a  consultant
satisfactory  to  Conrail  and  CRCP  to  undertake,  sampling  at the  Property
sufficient  to determine  whether or not NYCH's  operations  have  resulted in a
spill or discharge of a hazardous  substance or waste at or around the Property.
Should the sampling  reveal any spill or discharge c-f a hazardous  substance or
waste which  occurred  during NYCH use or occupancy of the  Property,  then NYCH
shall, at NYCH's expense,  promptly clean up the Property to the satisfaction of
Conrail, CRCP and NJDEP.

g. If NYCH fails to obtain either:  (i) a  non-applicability  letter;  (ii) a de
minims quantity exemption; (iii) a negative declaration;  or (iv) final approval
of cleanup; (collectively. referred to as "ECRA Clearance") from the Element; or
fails to clean up the Property pursuant to subparagraph (f) above,  prior to the
expiration or earlier termination of the Lease Term, then upon the expiration or
earlier termination of this Lease, Conrail and CRCP shall have the option either
to consider this Lease as having ended or to treat NYCH as a holdover  tenant in
possession of the Property.  If Conrail or CRCP considers.  this Lease as having
ended,  then NYCH shall  nevertheless  be  obligated  to  promptly  obtain  ECRA
Clearance and to fulfill the obligations set forth in subparagraph (f) above. If
Conrail and CRCP treats NYCH as a holdover  tenant in possession of the Property
then the provisions of Section 8 shall govern.

h.  Reporting  Requirements.  NYCH shall  promptly  supply Conrail and CRCP with
copies of all notices,  reports,  correspondence and submissions made by NYCH to
the U.S. Environmental Protection Agency, NJ.DEP, the United States Occupational
Safety and Health  Administration or any other local, state or federal authority
which requires submission of any information concerning environmental matters or
hazardous wastes or substances pursuant to laws including but not limited to the
New Jersey Spill Compensation and Control Act, N.J.S.A.  58:10-23.11 et seq. and
the  regulations  promulgated  thereunder  ' (the "Spill  Act"),  the Worker and
Community  Right to Know  Act,  N.J.S.A.  34:5A-1  et seq.  and the  regulations
Promulgated thereunder,  the Hazardous Substance Discharge -- Reports and Notice
Act, N.J.S.A.  13:1K-15 et seq. and the regulations promulgated thereunder,  the
Comprehensive Environmental Response,  Compensation and Liability Act, 42 U.S.C.
S9601 et esq.  and the  regulations  promulgated  thereunder,  and the  Resource
Conservation  and  Recovery  Act, 42 U.S.C.  S9601 et seq.  and the  regulations
promulgated thereunder.
<PAGE>

8.6.  NYCH's  obligations  under this  Section 8 for the portion of the Property
operated  by NYCH  prior  to the  effective  date of this  Agreement,  as  fully
described  in  Exhibit  A  hereto,  shall  he  limited  to the  extent  NYCH can
demonstrate  that the failure of such  Property to comply with the terms of this
Section .8 were caused by Conrail, CRCP, their agents or employees or anyone for
whose acts Conrail or CRCP is liable.

For purpose of this subsection 8.6, NYCH's operation of the Property, either
prior to or pursuant to this Agreement, whether as an agent or independent
contractor, of Conrail and/or CRCP or otherwise, shall not be attributable to
Conrail or CRCP.

SECTIQN 9:       CONTENTS OF AGREEMENTS; PARTIES IN INTEREST,

NOTICE:

9. 1. Entire  Understanding.  This Agreement Sets forth the entire understanding
of the  Parties  with  respect to the subject of this  Agreement  and may not be
amended  except by written  instrument  executed by the  parties.  Any  Previous
agreements or understandings between the parties regarding the subject matter of
this  Agreement  are  merged  into  and  superseded  by  this   Agreement.   All
representations  warranties,  covenants,  terms, conditions,  stipulations,  and
provisions of this Agreement  shall he binding upon the inure to the benefit of,
and be  enforceable  by the permitted  successors  and assigns of the respective
parties.

9.2.  Best  Efforts.  Each  party  shall use its best  efforts to  expedite  the
procurement of any governmental approvals required in connection with any of the
transactions contemplated by this Agreement.

9.3.  Notices.  Unless otherwise  specified,  all notices,  requests,  consents,
demands, or other communications desired or required to be given by one party to
the other  shall  have been  deemed to have been given  only when  received  via
overnight courier or United States Mail,  certified,  return receipt  requested,
directed to the  recipient  as follows (or at such other  addresses as either of
the parties hereto may designate by written notice to the other party hereto):

                    It to CRCP;

                    CRC Properties, Inc.
                    TWO Commerce Square
                    2001 Market Street - 19B
                    Philadelphia, PA 19101-1419

                    Attention:  President


                    With a copy to:

                    Consolidated Rail Corporation Properties
                    TWO Commerce Square
                    2001 Market Street - 19C
                    Philadelphia, PA 19101-1419

                    Attention: Assistant Vice President Asset Development


                    If to NYCH:

                    New York Cross Harbor Railroad Terminal Corporation
                    4302 - First Avenue
                    Brooklyn, NY 11232

9.4.  Governing  Law.  This  Agreement and the rights and  obligations  accruing
hereunder  shall be construed  and enforced in  accordance  with the laws of New
Jersey and federal law.

9.5.  Appendices.  All appendices and Exhibits referred to in this Agreement are
intended to be, and are hereby, specifically made a part of this Agreement.

9.6.  Waiver.  No waiver by either party of any failure or refusal by, the other
party to comply  with its  obligations  under this  Agreement  shall be deemed a
waiver of any other or subsequent failure or refusal to so comply.

9.7.     Time.  Time shall be of the essence of this Agreement.

9.8. Successors and Assigns.  This Agreement shall not be assignable by NYCH, in
whole or part,  without the prior in written consent of Conrail and CRCP,  which
shall not be unreasonably withheld.
<PAGE>

9.9.   Confidentiality.   The  terms  and   conditions  of  this  Agreement  are
confidential,  and neither party hereto, without the prior consent of the other,
shall  reveal any  provisions  hereof to any third  party  (except an  employee,
attorney or consultant  entitled to know the  provisions  hereof in the ordinary
course of the  business of the party),  except to the extent  required by law or
regulation or a valid judicial or administrative order.

        IN WTTNESS WHEREOF, this Agreement has been executed on the day and year
first above written.













                            NEW YORK CROSS HARBOR RAILROAD TERMINAL CORPORATION

                            /s/ Robert R. Crawford
                            Title: Chairman of the Board

                            CONSOLIDATED RAIL CORPORATION

                            /s/ M. Virginia Ebert
                            Title: Director - Asset Management


                           CRC PROPERTIES INC.

                           /s/ John F Betak
                           Title: President