Document:

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                                                                    Exhibit 10.4
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                   WRAP-AROUND MORTGAGE, ASSIGNMENT OF RENTS,
                      SECURITY AGREEMENT AND FIXTURE FILING

                              DATED: MARCH 6, 2009

                                      AMONG

                          NYT REAL ESTATE COMPANY LLC,
                      A NEW YORK LIMITED LIABILITY COMPANY

                               WITH AN ADDRESS AT:

                         C/O THE NEW YORK TIMES COMPANY
                                620 EIGHTH AVENUE
                            NEW YORK, NEW YORK 10018
                                (THE "BORROWER")

                                       AND

        NEW YORK STATE URBAN DEVELOPMENT CORPORATION, D/B/A/ EMPIRE
                         STATE DEVELOPMENT CORPORATION,
                 A CORPORATE GOVERNMENTAL AGENCY OF THE STATE OF
        NEW YORK CONSTITUTING A POLITICAL SUBDIVISION AND PUBLIC BENEFIT
                                   CORPORATION

                               WITH AN ADDRESS AT:
                                633 THIRD AVENUE
                            NEW YORK, NEW YORK 10017
                           ("ESDC"), AS CO- MORTGAGEE,

                                       AND

                    620 EIGHTH NYT (NY) LIMITED PARTNERSHIP,
                         A DELAWARE LIMITED PARTNERSHIP

                               WITH AN ADDRESS AT:
                            C/O W.P. CAREY & CO. LLC
                              50 ROCKEFELLER PLAZA
                            NEW YORK, NEW YORK 10020
                        ATTN.: DIRECTOR, ASSET MANAGEMENT
                        (THE "LENDER"), AS CO- MORTGAGEE,

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               THE LAND AFFECTED BY THE WITHIN INSTRUMENT LIES IN:

          BLOCK:     1012
          LOTS:      1001, 1003, 1007, 1009 THROUGH 1027, AND 1035
                     (FORMERLY PART OF LOT 1) 1007
          ADDRESSES: 620-628 8TH AVENUE,
                     263-267 AND 241-261 WEST 40TH STREET,
                     242-244 WEST 41ST STREET,
                     231-235 WEST 40TH STREET,
                     248-256, 260-262 AND 268 WEST 41ST STREET
                     634 AND 630-632 8TH AVENUE,
                     NEW YORK, NEW YORK
          COUNTY:    NEW YORK

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                              RECORD AND RETURN TO:

                                 REED SMITH LLP
                        599 LEXINGTON AVENUE, 29TH FLOOR
                            NEW YORK, NEW YORK 10022
                          ATTN: JOSEPH M. MARGER, ESQ.

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                   WRAP-AROUND MORTGAGE, ASSIGNMENT OF RENTS,
                      SECURITY AGREEMENT AND FIXTURE FILING

THIS WRAP-AROUND MORTGAGE, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE
FILING (herein "INSTRUMENT") is made this 6th day of March, 2009 (the
"EFFECTIVE DATE"), among NYT REAL ESTATE COMPANY LLC, a New York limited
liability company, whose address is c/o The New York Times Company, 620 Eighth
Avenue, New York, New York 10018 (herein "BORROWER"), NEW YORK STATE URBAN
DEVELOPMENT CORPORATION, D/B/A/ EMPIRE STATE DEVELOPMENT CORPORATION, a
corporate governmental agency of the State of New York constituting a political
subdivision and public benefit corporation, having an office at 633 Third
Avenue, New York, New York 10017 ("ESDC") as co- mortgagee, and 620 EIGHTH NYT
(NY) LIMITED PARTNERSHIP, a Delaware limited partnership, whose address is c/o
W.P. Carey & Co. LLC, 50 Rockefeller Plaza, New York, New York 10020, as
co-mortgagee (herein "LENDER").

This Instrument is made in connection with the loan (the "LOAN") evidenced by
the Lease Agreement (as defined in PARAGRAPH 1 below).

ESDC (i) is acting under this Instrument as co-mortgagee solely for the purpose
of making available to Borrower an exemption from mortgage recording tax in
recognition of the fact that this is necessary to make the Lease Agreement
financially feasible, (ii) has no beneficial interest in or discretionary
authority whatsoever as co-mortgagee hereunder or under any Loan Documents (as
hereinafter defined) and pursuant to the provisions of PARAGRAPH 40.14 of this
Instrument, effective immediately after the recording of this Instrument, is
resigning as co-mortgagee and assigning to Lender, all of its right, title and
interest in and to this Instrument and (iii) has no obligations,
responsibilities or liabilities whatsoever under this Instrument and/or any
other Loan Documents other than to (x) record this Instrument in the City
Register's Office and (y) perform its obligations under PARAGRAPH 40.14 of this
Instrument.

Capitalized terms used herein but not otherwise defined shall have the
respective meanings assigned to such terms in the Lease Agreement.

Borrower, in consideration of good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, and in order to secure the
obligations described in PARAGRAPH 1 below, irrevocably mortgages, warrants,
grants, conveys and assigns to Lender and its successors and assigns, forever,
all of Borrower's estate, right, title, interest, claim and demand in and to the
property in the County of New York, State of New York, known as consisting of
certain leasehold condominium units in the property known as 620-628 8th Avenue,
263-267 and 241-261 West 40th Street, 242-244 West 41st Street, 231-235 West
40th Street, 248-256, 260-262 and 268 West 41st Street, 634 and 630-632 8th
Avenue, New York, New York (which address is provided for reference only and
shall in no way limit the description of the real and personal property
otherwise described below), described as follows, whether now existing or
hereafter acquired (all of the property described in all parts below is called
the "PROPERTY"):

          (A) Condominium Units. The leasehold condominium units and undivided
interest in the Condominium common elements appurtenant thereto all as more
particularly described in Exhibit "A" attached hereto (collectively, the
"UNIT"), all located in the building

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known as "The New York Times Building" having a street address of 620 Eighth
Avenue, New York, New York (the "BUILDING"). The land upon which the Building is
constructed and which constitutes a part of the Condominium is herein referred
to as the "LAND"; and

          (B) Leasehold. The leasehold estate created by the Severance Lease
(the "SEVERANCE Lease") described on Exhibit "B" attached hereto; any and all
options to purchase, rights of first refusal and renewal options with respect to
the Severance Lease or any real or personal property covered thereby, or any
portion thereof or any interest therein; any and all greater estate in such real
or personal property (including but not limited to the fee estate) as may
subsequently be acquired by or released to Borrower, whether under the Severance
Lease or otherwise; any and all interest, estate and other claims, both in law
and equity, that Borrower now has or may hereafter acquire in and to any such
real or personal property; and any and all other rights and interests of
Borrower arising under or as a result of the Severance Lease; and

          (C) Improvements, Appurtenances and Fixtures. All Appurtenances
(hereinafter defined) and any structures and other improvements now or hereafter
constructed within the Unit or which are located on or about the Building and
which serve only the Unit or which otherwise constitute a part thereof under the
terms of the Condominium Documents (as defined below) (collectively, the
"IMPROVEMENTS"). All the fixtures, machinery, equipment and other property
described in Exhibit "B" hereto located within the Unit or on or about the
Building and which serve only the Unit or which otherwise constitute a part
thereof under the terms of the Condominium Documents, but specifically excluding
Borrower's Personal Property (hereinafter defined); and

          (D) Enforcement and Collection. Any and all rights of Borrower without
limitation to make claim for, collect, receive and receipt for any and all
rents, income, revenues, issues, earnest money, deposits, refunds (including but
not limited to refunds from property taxing authorities, utilities and
insurers), royalties, and profits, including mineral, oil and gas rights and
profits, insurance proceeds of any kind (whether or not Lender requires such
insurance and whether or not Lender is named as an additional insured or loss
payee of such insurance), condemnation awards and other moneys, payable or
receivable from or on account of any of the Property, including interest
thereon, or to enforce all other provisions of any other agreement (including
those described in (B) above) affecting or relating to any of the Property, to
bring any suit in equity, action at law or other proceeding for the collection
of such moneys or for the specific or other enforcement of any such agreement,
award or judgment, in the name of Borrower or otherwise, and to do any and all
things that Borrower is or may be or become entitled to do with respect thereto,
provided, however, that no obligation of Borrower under the provisions of any
such agreements, awards or judgments shall be impaired or diminished by virtue
hereof, nor shall any such obligation be imposed upon Lender; and

          (E) Accounts and Income. Any and all rights of Borrower in any and all
accounts, rights to payment, contract rights, chattel paper, documents,
instruments, licenses, contracts, agreements and general intangibles relating to
any of the Property; and

          (F) Leases. All of Borrower's rights as landlord in and to all
existing and future leases and tenancies, whether written or oral and whether
for a definite term or month to month or otherwise, now or hereafter demising
all or any portion of the Property, including all renewals and extensions
thereof and all rents, deposits and other amounts received or receivable
thereunder, and including all guaranties, supporting obligations, letters of
credit (whether tangible or electronic)

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and letter of credit rights guaranteeing or supporting any such lease or tenancy
(in accepting this Instrument Lender assumes no liability for the performance of
any such lease); and

          (G) Books and Records. All tradenames, trademarks, servicemarks,
logos, copyrights, goodwill, books and records and all other general intangibles
relating to or used in connection with the operation of the Property, but
specifically excluding Borrower's Personal Property; and

          (H) Proceeds. All proceeds resulting or arising from the foregoing.

          PROVIDED, HOWEVER, that the term "Property" shall exclude the
following which shall not be subject to the lien of this Instrument:

               (i) Any existing cause of action, or damage claim, of or against
Borrower;

               (ii) All rights and interests of Borrower with respect to any
amounts due Borrower with respect to the Property and arising prior to the
Effective Date (including but not limited to, tax refunds, casualty or
condemnation proceeds, utility deposits, rents or other income from the
Property) to the extent attributable to periods prior to the Effective Date;

               (iii) All rights and interests of Borrower with respect to and
appurtenant to the condominium units comprising Floors 21 through 27 of the
Building and their respective undivided interest in the Condominium common
elements (the "EXCLUDED UNITS");

               (iv) All trademarks, tradenames, logos and other intellectual
property rights relating to The New York Times Company and its subsidiaries and
affiliates and/or related media groups; and

               (v) All right, title and interest of Borrower in and to that
certain (i) NYTC Facility Maintenance and Management Agreement relating to the
Condominium Units and the Excluded Units between Borrower and First New York
Partners Management, LLC dated as of January 4, 2007, and (ii) that certain
Management Agreement relating to the Excluded Units between Borrower and First
New York Partners Management, LLC dated as of April __, 2008.

          Borrower covenants that Borrower is lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant, convey and assign the
Property (and that the Severance Lease is in full force and effect without
modification and without default on the part of either lessor or lessee
thereunder), that the Property is unencumbered, and that Borrower will warrant
and defend generally the title to the Property against all claims and demands,
subject to any Permitted Encumbrances (hereinafter defined).

          As used herein, the following terms shall have the following meanings:

          "APPURTENANCES" shall mean all tenements, hereditaments, easements,
rights-of-way, rights, privileges in and to the Building or the Land, including
(a) easements over other lands granted by any conditions, covenants,
restrictions, easements, declarations, licenses and other

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agreements as may now or hereafter affect the Property, (b) any streets, ways,
alleys, vaults, gores or strips of land adjoining the Land and (c) any and all
rights to the use or enjoyment of, or access to, any other portion of the
Condominium under the terms or provisions of the Condominium Documents, the
Severance Lease and/or the Ground Lease (hereinafter defined).

          "BORROWER'S PERSONAL PROPERTY" shall mean all furniture, furnishings
equipment and other personal property of Borrower, which includes, without
limitation, inventory, racking, shelving, cabling, antennae, machinery,
communication equipment, data cabinets, lockers, plug-in light fixtures, storage
racks, trash compactors, signs, desks, movable partitions, vending machines,
computer software and hardware, removable trade fixtures and equipment, even if
bolted or otherwise affixed to the floors, including, without limitation,
telecommunication switches, in each case, as now or may hereafter exist in or on
any of the Improvements and any other personal property owned by Borrower or a
sublessee of Borrower or other occupant of the Property; provided that in no
case shall Borrower's Personal Property include fixtures or built-in heating,
ventilating, air-conditioning, and electrical equipment (including power panels)
to be utilized in connection with the operation of the Property.

          "CONDOMINIUM DOCUMENTS" shall mean collectively, (i) the Declaration
(hereinafter defined), and all the terms and provisions thereof, and (ii) the
Bylaws (hereinafter defined) and (iii) any rules or regulations adopted under
the Declaration or the Bylaws, in each case, now or hereafter in effect and as
same may be amended, restated, modified or supplemented from time to time.

          "GROUND LEASE" shall mean that certain Agreement of Lease, dated as of
December 12, 2001, between 42nd Street Development Project, Inc., as landlord,
and The New York Times Building LLC, as tenant with respect to certain land more
particularly described in Exhibit "A" attached hereto as the land area of the
Condominium and all improvements then or thereafter located thereon, as
evidenced by Memorandum of Agreement of Lease, including an Option to Purchase,
between 42nd Street Development Project, Inc. and The New York Times Building
LLC, dated December 12, 2001, recorded in the Office of the City Register, New
York County on October 24, 2003 as CRFN 2003000433122, as amended by Letter
Agreement dated April 8, 2004 (as cited in Lease Assignment made by and between
The New York Times Building LLC and 42nd St. Development Project, Inc. under
CRFN 2006000644732), as further amended by Lease Assignment (Assignment and
Assumption Agreement) made by and between The New York Times Building LLC
(assignor) and 42nd St. Development Project, Inc. (assignee) dated as of August
15, 2006 and recorded in the Office of the City Register, New York County on
November 20, 2006 as CRFN 2006000644732, and as further amended by Amended and
Restated Agreement of Lease by and between 42nd St. Development Project, Inc.
(landlord) and 42nd St. Development Project, Inc. (tenant) dated as of August
15, 2006 and recorded in the Office of the City Register, New York County on
November 20, 2006 as CRFN 2006000644736 and further amended by First Amendment
to Amended and Restated Agreement of Lease dated January 29, 2007 and recorded
in the Office of the City Register, New York County as CRFN 2007000100154, as
the same may be amended from time to time.

          "PERMITTED ENCUMBRANCES" shall mean the Permitted Encumbrances as
defined in the Lease Agreement together with the Underlying Note (hereinafter
defined) and the Underlying Mortgage (hereinafter defined).

Borrower covenants with and represents and warrants to Lender as follows:

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          1. SECURED OBLIGATIONS. This Instrument is given for the purpose of
securing the following (the "SECURED OBLIGATIONS"):

          (A) Performance and Payment. The performance of the obligations
contained herein and the payment and performance of all obligations pursuant to
the terms of a lease agreement of even date herewith made by Borrower in favor
of Lender and any and all extensions, renewals, modifications or replacements
thereof, whether the same be in greater or lesser amounts (the "LEASE
AGREEMENT"). Borrower shall pay and perform all obligations contained in the
Lease Agreement at the time and in the manner provided in the Lease Agreement
and in this Instrument. Borrower will duly and punctually perform all of the
covenants, conditions and agreements contained in the Lease Agreement, this
Instrument and the other Loan Documents (as defined below) all of which
covenants, conditions and agreements are hereby made a part of this Instrument
to the same extent and with the same force as if fully set forth herein.

          (B) Future Advances. The repayment of any and all sums advanced or
expenditures made by Lender subsequent to the execution of this Instrument and
after an Event of Default for the maintenance or preservation of the Property or
advanced or expended by Lender pursuant to any provision of this Instrument or
the other Loan Documents, together with interest thereon.

          (C) Other Amounts. All other obligations and amounts now or hereafter
owing by Borrower to Lender under this Instrument, the Lease Agreement, that
certain Assignment and Assumption of Severance Agreement of even date between
Borrower and Lender or any other document, instrument or agreement evidencing,
securing or otherwise relating to the Loan and any and all extensions, renewals,
modifications or replacements of any thereof (collectively, the "LOAN
DOCUMENTS"); provided, however, that this Instrument does not and shall not in
any event be deemed to, secure the obligations owing to Lender any guaranty of
the Loan.

          2. FUNDS FOR TAXES, INSURANCE AND OTHER CHARGES. Borrower shall cause
to be paid all Impositions and insurance premiums now or hereafter levied or
assessed or imposed against the Property or any part thereof as provided in the
Lease Agreement, and subject to Borrower's right to contest set forth in
Paragraph 14 of the Lease Agreement. Following the occurrence of an Event of
Default with respect to the timely payment of any Impositions or insurance
premiums, as the case may be, in accordance with the terms of the Lease
Agreement or the Condominium Documents, upon the written request of Landlord,
Borrower shall pay into an escrow account controlled by Landlord (or Lender, as
the case may be), funds necessary to pay Escrow Charges in accordance with the
terms of Paragraph 9(b) of the Lease Agreement.

          3. WAIVER OF NOTICE. Borrower shall not be entitled to any notices of
any nature whatsoever from Lender except with respect to matters for which this
Instrument or the Lease Agreement specifically and expressly provides for the
giving of notice by Lender to Borrower and except with respect to matters for
which Lender is required by applicable law to give notice, and Borrower hereby
expressly waives the right to receive any notice from Lender with respect to any
matter for which this Instrument or the Lease Agreement do not specifically and
expressly provide for the giving of notice by Lender to Borrower.

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          4. CHARGES; LIENS. Borrower shall pay all rents, taxes, assessments,
premiums, and Impositions attributable to the Property as provided in and
subject to the Lease Agreement. Borrower shall promptly discharge any lien which
has, or may have, priority over or equality with, the lien of this Instrument,
and Borrower shall pay, when due, the claims of all persons supplying labor or
materials to or in connection with the Property, all to the extent provided in
the Lease Agreement. Without Lender's prior written permission, Borrower shall
not allow any lien inferior to this Instrument to be perfected against the
Property.

          5. HAZARD INSURANCE. Borrower, at its sole cost and expense, shall
maintain or cause to be maintained insurance with respect to the Property for
the mutual benefit of Borrower and Lender (and any other person) as required by
Paragraph 16 of the Lease Agreement. If the Property shall be damaged or
destroyed, in whole or in part, by fire or other casualty (an "INSURED
CASUALTY"), Borrower shall, to the extent required under Paragraphs 17, 18 and
19 of the Lease Agreement, promptly repair, replace or rebuild the Property in
accordance with, and all amounts paid with respect to such Insured Casualty
under all insurance policies maintained by Borrower shall be governed by, the
terms and conditions of Paragraphs 17, 18 and 19 of the Lease Agreement. The
expenses incurred by Lender in the adjustment and collection of insurance
proceeds shall become part of the Secured Obligations and shall be secured
hereby and shall be reimbursed by Borrower to Lender in accordance with the
terms of the Lease Agreement. Any adjustment, settlement or compromise of any
claims associated with an Insured Casualty is subject to the terms of Paragraph
17 of the Lease Agreement. Notwithstanding any casualty occurring at all or any
portion of the Property, subject to the terms of Paragraphs 17, 18 and 19 of the
Lease Agreement, Borrower shall continue to pay the Secured Obligations at the
time and in the manner provided for its payment in the Lease Agreement. The
application of any claims associated with an Insured Casualty shall be governed
by Paragraphs 17, 18 and 19 of the Lease Agreement.

          6. PRESERVATION AND MAINTENANCE OF PROPERTY; LEASEHOLDS. Borrower
shall comply with its maintenance and repair obligations with respect to the
Property under the Lease Agreement. Borrower shall not be permitted to make any
alterations to the Property except as provided in the Lease Agreement.

          Borrower (i) shall comply with the provisions of the Severance Lease,
(ii) shall give immediate written notice to Lender of any default by lessor
under the Severance Lease or of any notice received by Borrower from such lessor
of any default under the Severance Lease by Borrower, and (iii) shall give
immediate written notice to Lender of the commencement of any proceedings for
the exercise of remedies under the Severance Lease by any party thereto and, if
required by Lender, shall permit Lender as Borrower's attorney-in-fact to
control and act for Borrower in any such proceedings.

          Borrower hereby expressly transfers and assigns to Lender the benefit
of all covenants contained in the Severance Lease, whether or not such covenants
run with the land; provided, however, pursuant to and in accordance with the
terms of Paragraph 4(c) of the Lease Agreement, the Borrower shall be entitled
to exercise, and shall continue to be bound by, certain rights and obligations
with respect to the Severance Lease.

          Except to the extent provided in Paragraph 4(c) of the Lease, Borrower
shall not surrender its right, title or interest in the Severance Lease and
interests herein conveyed (the "SEVERANCE LEASEHOLD ESTATE") nor terminate, or
cancel the Severance Lease creating said estate and interests, and, except to
the extent provided in Paragraph 4(c) of the Lease, Borrower shall not,

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without the express written consent of Lender, alter or amend the Severance
Lease. Borrower covenants and agrees that there shall not be a merger of the
Severance Lease, or of the leasehold estate created thereby, with the leasehold
estate covered by the Severance Lease by reason of said leasehold estate or a
merger of the Severance Lease between the lessor under the Severance Lease, or
the leasehold estate created by it, with the fee estate covered by such
Severance Lease by reason of said leasehold estate or fee estate, or any part of
either, coming into common ownership, unless Lender shall consent in writing to
such merger; if Borrower shall acquire such fee estate or leasehold estate, then
this Instrument shall simultaneously and without further action be spread so as
to become a lien on such fee estate and/or leasehold estate, as the case may be.
In the event of such acquisition by Borrower, Borrower shall execute and deliver
to Lender such further instruments, conveyances and assurances as Lender may
reasonably request in order to further confirm and assure that the fee title or
other interest so acquired by Borrower is subject to the terms, provisions and
lien of this Instrument.

          7. USE OF PROPERTY. Unless required by applicable law or unless Lender
has otherwise agreed in writing, except as otherwise provided in Paragraph 4 of
the Lease Agreement, Borrower shall not allow changes in the use for which all
or any part of the Property was intended at the time this Instrument was
executed. Borrower shall not subdivide the Property or initiate or acquiesce in
a change in the zoning classification of the Property without Lender's prior
written consent.

          8. PROTECTION OF LENDER'S SECURITY. Upon the occurrence and during the
continuance of any Event of Default beyond applicable notice and cure periods
set forth in the Lease Agreement, Lender at Lender's option may make such
appearances, disburse such sums and take such action as Lender deems necessary,
in its sole discretion, to protect Lender's interest, including, but not limited
to, (i) disbursement of attorney's fees, (ii) entry upon the Property to make
repairs, (iii) procurement of satisfactory insurance as provided in PARAGRAPH 5
hereof, (iv) exercise of any option to renew or extend the Severance Lease on
behalf of Borrower and the curing of any default of Borrower in the terms and
conditions of the Severance Lease, and, (v) the payment of any Impositions or
insurance premiums then due and payable.

          Any amounts disbursed by Lender pursuant to this PARAGRAPH 8, with
interest thereon, shall become additional indebtedness of Borrower secured by
this Instrument. Unless Borrower and Lender agree to other terms of payment,
such amounts shall be immediately due and payable and shall bear interest from
the date of disbursement at the Default Rate stated in the Lease Agreement
unless collection from Borrower of interest at such rate would be contrary to
applicable law, in which event such amounts shall bear interest at the highest
rate which may be collected from Borrower under applicable law. Borrower hereby
covenants and agrees that Lender shall be subrogated to the lien of any mortgage
or other lien discharged, in whole or in part, by the indebtedness secured
hereby. Nothing contained in this PARAGRAPH 8 shall require Lender to incur any
expense or take any action hereunder.

          9. INSPECTION. Lender may make or cause to be made such reasonable
entries upon and inspections of the Property as are permitted under (and in
accordance with) the Lease Agreement.

          10. BOOKS AND RECORDS. Borrower shall furnish to Lender its books and
records as and to the extent required by Paragraph 28 of the Lease Agreement.

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          11. CONDEMNATION. In the case of any actual or threatened commencement
of any condemnation or eminent domain proceeding affecting the Property or any
portion thereof, Borrower shall comply with the terms and conditions set forth
in Paragraph 17, 18 and 19 of the Lease Agreement. Subject to the terms of
Paragraph 17 of the Lease Agreement, Lender is hereby irrevocably appointed as
Borrower's attorney in fact, coupled with an interest, with exclusive power to
collect, receive and retain any award or payment for said condemnation or
eminent domain and to make any compromise or settlement in connection with such
proceeding. Notwithstanding any taking by any public or quasi public authority
through eminent domain or otherwise (including but not limited to any transfer
made in lieu of or in anticipation of the exercise of such taking), subject to
the terms of Paragraphs 17 and 18 of the Lease Agreement, Borrower shall
continue to pay the Secured Obligations at the time and in the manner provided
for its payment in the Lease Agreement. The application of any award or payment
made in any condemnation or eminent domain proceeding shall be governed by
Paragraphs 17, 18 and 19 of the Lease Agreement.

          12. BORROWER AND LIEN NOT RELEASED. From time to time, Lender may, at
Lender's option, without giving notice to or obtaining the consent of Borrower,
Borrower's successors or assigns or of any junior lienholder or guarantors,
without liability on Lender's part and notwithstanding Borrower's breach of any
covenant or agreement of Borrower in this Instrument, extend the time for
payment of said indebtedness or any part thereof, reduce the payments thereon,
release anyone liable on any of said indebtedness, accept a renewal note or
notes therefor, modify the terms and time of payment of said indebtedness,
release from the lien of this Instrument any part of the Property, take or
release other or additional security, reconvey any part of the Property, consent
to any map or plan of the Property, consent to the granting of any easement,
join in any extension or subordination agreement, and agree in writing with
Borrower to modify the rate of interest or period of amortization of the Lease
Agreement or change the amount of the monthly installments payable thereunder.
Any actions taken by Lender pursuant to the terms of this PARAGRAPH 12 shall not
affect the obligation of Borrower or Borrower's successors or assigns to pay the
sums secured by this Instrument and to observe the covenants of Borrower
contained herein, shall not affect the guaranty of any person, corporation,
partnership or other entity for payment of the indebtedness secured hereby, and
shall not affect the lien or priority of lien hereof on the Property. Borrower
shall pay Lender a reasonable service charge, together with such title insurance
premiums and attorney's fees as may be incurred at Lender's option, for any such
action if taken at Borrower's request.

          13. FORBEARANCE BY LENDER NOT A WAIVER. Any forbearance by Lender in
exercising any right or remedy hereunder, or otherwise afforded by applicable
law, shall not be a waiver of or preclude the exercise of any right or remedy.
The acceptance by Lender of payment of any sum secured by this Instrument after
the due date of such payment shall not be a waiver of Lender's right to either
require prompt payment when due of all other sums so secured or to declare a
default for failure to make prompt payment. The procurement of insurance or the
payment of taxes or other liens or charges by Lender shall not be a waiver of
Lender's right to accelerate the maturity of the indebtedness secured by this
Instrument, nor shall Lender's receipt of any awards, proceeds or damages under
PARAGRAPHS 5 AND 11 hereof operate to cure or waive Borrower's default in
payment of sums secured by this Instrument.

          14. ESTOPPEL CERTIFICATE. Borrower shall furnish to Lender estoppel
certificates as required by Paragraph 25 of the Lease Agreement.

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          15. UNIFORM COMMERCIAL CODE SECURITY AGREEMENT. To the extent any of
the property described in this Instrument is personal property, Borrower, as
debtor, grants to Lender, as secured party, a security interest therein together
with a security interest in all other personal property of whatsoever nature
that is located on or used or to be used in connection with any of the property
described in this Instrument, and any products or proceeds of any thereof,
pursuant to the Uniform Commercial Code of the State of New York (the "UCC"), on
the terms and conditions contained herein. Borrower hereby authorizes Lender to
file any financing statement, fixture filing or similar filing to perfect the
security interests granted in this Security Instrument without Borrower's
signature. Borrower shall: (a) execute and deliver such documents as Lender
deems reasonably necessary to create, perfect and continue the security
interests contemplated by this Instrument; (b) not change its name, or, as
applicable, its chief executive office, its principal residence (or, if Borrower
is a trust or one or more trustees acting with respect to property held in
trust, the identity or principal residence of any trustee), the jurisdiction in
which it is organized, or otherwise change its location (as that term is used in
Article 9 of the UCC), without giving Lender at least thirty (30) days' prior
written notice thereof; and (c) cooperate with Lender in perfecting all security
interests granted in this Security Instrument and in obtaining such agreements
from third parties as Lender deems necessary, proper or desirable in connection
with the preservation, perfection or enforcement of any of Lender's rights under
this Instrument.

          16. LEASES. Except as otherwise provided in Paragraph 21 of the Lease
Agreement, Borrower shall not, without Lender's written consent, execute,
modify, surrender or terminate, either orally or in writing, any lease or other
agreement for the occupancy or use of all or any part of the Property, permit an
assignment or sublease of any lease or other agreement for the occupancy or use
of all or any part of the Property, or request or consent to the subordination
of any lease or other agreement for the occupancy or use of all or any part of
the Property of all or any part of the Property to any lien subordinate to this
Instrument.

          17. REMEDIES CUMULATIVE. Each remedy provided in this Instrument is
distinct and cumulative to all other rights or remedies under this Instrument or
afforded by law or equity, and may be exercised concurrently, independently, or
successively, in any order whatsoever.

          18. ACCELERATION IN CASE OF BORROWER'S INSOLVENCY. If Borrower shall
voluntarily file a petition under Title 11 of the U.S. Code (the "ACT"), as such
Act may from time to time be amended, or under any similar or successor Federal
statute relating to bankruptcy, insolvency, arrangements or reorganizations, or
under any state bankruptcy or insolvency act, or file any answer in an
involuntary proceeding admitting insolvency or inability to pay debts, or if
Borrower shall fail to obtain a vacation or stay of involuntary proceedings
brought for the reorganization, dissolution or liquidation of Borrower within
ninety (90) days of the filing of such involuntary proceeding, or if Borrower
shall be adjudged a bankrupt, or if a trustee or receiver shall be appointed for
Borrower or Borrower's property, or if the Property shall become subject to the
jurisdiction of a Federal bankruptcy court or similar state court, or if
Borrower shall make an assignment for the benefit of Borrower's creditors, or if
there is an attachment, execution or other judicial seizure of any portion of
Borrower's assets and such seizure is not discharged within fifteen (15) days,
then Lender may, at Lender's option, declare all of the sums secured by this
Instrument to be immediately due and payable without prior notice to Borrower,
and Lender may invoke any remedies permitted by PARAGRAPH 27 of this Instrument.
Any attorney's fees and other expenses incurred by Lender in connection with
Borrower's bankruptcy or any of the other

                                        9

<PAGE>

aforesaid events shall be additional indebtedness of Borrower secured by this
Instrument pursuant to PARAGRAPH 8 hereof.

          19. TRANSFERS OF THE PROPERTY OR BENEFICIAL INTERESTS IN BORROWER.
Borrower acknowledges that Lender has examined and relied on the
creditworthiness and experience of Borrower in owning and operating properties
such as the Property in agreeing to make the Loan, and that Lender will continue
to rely on Borrower's ownership of the Property as a means of maintaining the
value of the Property as security for repayment of the Secured Obligations.
Except as expressly permitted under the Lease Agreement, Borrower shall not
cause or suffer to occur or exist, directly or indirectly, voluntarily or
involuntarily, by operation of law or otherwise, any sale, transfer, mortgage,
pledge, lien or encumbrance (collectively, "TRANSFERS") of (i) all or any part
of the Property or any interest therein, including, but not limited to, the
Lease Agreement, or (ii) any direct or indirect beneficial ownership interest
(in whole or in part) in Borrower, irrespective of the number of tiers of
ownership, without the prior written consent of Lender. The occurrence of any
Transfer in violation of this PARAGRAPH 19 shall constitute an Event of Default
hereunder, whereupon Lender at its option, without being required to demonstrate
any actual impairment of its security or any increased risk of default
hereunder, may declare the Secured Obligations immediately due and payable, and
Lender may invoke any remedies permitted by PARAGRAPH 27 of this Instrument.
Lender's consent to any Transfer of the Property or any interest in Borrower
shall not be deemed to be a waiver of Lender's right to require such consent to
any future occurrence of same. Any attempted or purported Transfer of the
Property or of any direct or indirect interest in Borrower, if made in
contravention of this PARAGRAPH 19, shall be null and void and of no force and
effect.

          20. NOTICE. Any notice, demand, statement, request or consent made
hereunder shall be in writing, addressed to the intended recipient at its
address set forth in Paragraph 24 of the Lease Agreement, and shall be made and
deemed given in accordance with the terms of the Lease Agreement.

          21. SUCCESSORS AND ASSIGNS BOUND; JOINT AND SEVERAL LIABILITY; AGENTS;
CAPTIONS. The covenants and agreements herein contained shall bind, and the
rights hereunder shall inure to, the respective successors and assigns of Lender
and Borrower, subject to the provisions of PARAGRAPH 19 hereof. Lender may at
any time sell, assign, participate or securitize all or any portion of Lender's
rights and obligations under the Loan Documents but only in connection with a
transfer of Lender's rights under the Lease Agreement in accordance with and
subject to the terms of the Lease Agreement or, subject to the terms of the
Lease Agreement, by way of collateral security, to any Person (and its
respective successors and assigns) which may, on or after the date hereof, make
a Loan (as defined in the Lease Agreement) to Lender or be the holder of a Note.
All covenants and agreements of Borrower shall be joint and several. In
exercising any rights hereunder or taking any actions provided for herein,
Lender may act through its employees, agents or independent contractors as
authorized by Lender. The captions and headings of the paragraphs of this
Instrument are for convenience only and are not to be used to interpret or
define the provisions hereof.

          22. GOVERNING LAW; SEVERABILITY. This Instrument was negotiated in New
York, and made by Borrower and accepted by Lender in the State of New York, and
the proceeds were disbursed from New York, which State the parties agree has a
substantial relationship to the parties and to the underlying transaction
embodied hereby, and in all respect, including, without limiting the generality
of the foregoing, matters of construction, validity and

                                       10

<PAGE>

performance. This Instrument and the obligations arising hereunder shall be
governed by, and construed in accordance with, the laws of the State of New York
applicable to contract made and performed in such State and any applicable law
of the United States of America. To the fullest extent permitted by law,
Borrower hereby unconditionally and irrevocably waives any claim to assert that
the law of any other jurisdiction governs this Instrument, and this Instrument
shall be governed by and construed in accordance with the laws of the State of
New York pursuant to Section 5-1401 of the New York General Obligations Law. In
the event that any provision of this Instrument or the Lease Agreement conflicts
with applicable law, such conflict shall not affect other provisions of this
Instrument or the Lease Agreement which can be given effect without the
conflicting provisions, and to this end the provisions of this Instrument and
the Lease Agreement are declared to be severable.

          23. FIXTURE FILING. This Instrument constitutes a financing statement,
filed as a fixture filing in the real estate records of the county of the state
in which the real property described in Exhibit "A" is located, with respect to
any and all fixtures included within the list of improvements and fixtures
described in SECTION (C) OF THE PREAMBLES of this Instrument and to any goods or
other personal property that are now or hereafter will become a part of the
Property as fixtures.

          24. WAIVER OF MARSHALLING; WAIVER OF SETOFF AND COUNTERCLAIM; TIME OF
ESSENCE. Notwithstanding the existence of any other security interests in the
Property held by Lender or by any other party, Lender shall have the right to
determine the order in which any or all of the Property shall be subjected to
the remedies provided herein. Lender shall have the right to determine the order
in which any or all portions of the indebtedness secured hereby are satisfied
from the proceeds realized upon the exercise of the remedies provided herein.
Borrower, any party who consents to this Instrument and any party who now or
hereafter acquires a security interest in the Property and who has actual or
constructive notice hereof hereby waives any and all right to require the
marshalling of assets in connection with the exercise of any of the remedies
permitted by applicable law or provided herein. All amounts due under this
Instrument, the Lease Agreement and the other Loan Documents shall be payable
without setoff, counterclaim or any deduction whatsoever, except as otherwise
expressly provided in the Lease Agreement. Borrower hereby waives the right to
assert a setoff, counterclaim or deduction in any action or proceeding in which
Lender is a participant, or arising out of or in any way connected with this
Instrument, the Lease Agreement, any of the other Loan Documents, or the Secured
Obligations. Time is of the essence as to all of the terms, covenants and
condition of this Instrument and the other Loan Documents.

          25. INDEMNIFICATION. Borrower shall comply with its indemnification
obligations pursuant to and in accordance with Paragraph 15 of the Lease
Agreement.

          26. ASSIGNMENT OF RENTS; APPOINTMENT OF RECEIVER; LENDER IN
POSSESSION. As part of the consideration for the indebtedness evidenced by the
Lease Agreement, Borrower hereby absolutely and unconditionally assigns and
transfers to Lender all the rents and revenues of the Property, including those
now due, past due, or to become due by virtue of any lease or other agreement
for the occupancy or use of all or any part of the Property, regardless of to
whom the rents and revenues of the Property are payable. Borrower hereby
authorizes Lender or Lender's agents to collect the aforesaid rents and revenues
and hereby directs each tenant of the Property to pay such rents to Lender or
Lender's agents; provided, however, that prior to the occurrence of any Event of
Default beyond any applicable cure or grace periods set

                                       11

<PAGE>

forth in the Lease Agreement, Borrower shall collect and receive all rents and
revenues of the Property as trustee for the benefit of Lender and Borrower, to
apply the rents and revenues so collected to the sums secured by this Instrument
in the order provided in the Lease Agreement with the balance, so long as no
such Event of Default has occurred and is continuing, to the account of
Borrower, it being intended by Borrower and Lender that this assignment of rents
constitutes an absolute assignment and not an assignment for additional security
only. Upon delivery of written notice by Lender to Borrower containing a
statement that Lender exercises its rights to such rents (the "ASSIGNMENT
NOTICE"), which Assignment Notice may be delivered at any time during the
continuance of any Event of Default beyond any applicable cure or grace periods
set forth in the Lease Agreement, and without the necessity of Lender entering
upon and taking and maintaining full control of the Property in person, by agent
or by a court-appointed receiver, Lender shall immediately be entitled to
possession of all rents and revenues of the Property as specified in this
PARAGRAPH 26 as the same become due and payable, including but not limited to
rents then due and unpaid, and all such rents shall immediately, upon the
occurrence of any Event of Default beyond any applicable cure or grace periods
set forth in the Lease Agreement, be held by Borrower as trustee for the benefit
of Lender only. Borrower agrees that commencing upon delivery of such Assignment
Notice, each tenant of the Property shall make such rents payable to and pay
such rents to Lender or Lender's agents on Lender's written demand to each
tenant therefor, delivered to each tenant personally, by mail or by delivering
such demand to each rental unit, without any liability on the part of said
tenant to inquire further as to the existence of a default by Borrower.

          Borrower hereby covenants that Borrower has not executed any prior
assignment of said rents, that Borrower has not performed, and will not perform,
any acts or has not executed, and will not execute, any instrument which would
prevent Lender from exercising its rights under this PARAGRAPH 26, and that at
the time of execution of this Instrument there has been no anticipation or
prepayment of any of the rents of the Property for more than one month prior to
the due dates of such rents. Borrower covenants that Borrower will not hereafter
collect or accept payment of any rents of the Property more than one month prior
to the due dates of such rents. Borrower further covenants that Borrower will
execute and deliver to Lender such further assignments of rents and revenues of
the Property as Lender may from time to time request.

          During the continuance of any Event of Default beyond any applicable
cure or grace periods set forth in the Lease Agreement, Lender shall be entitled
to the appointment of a receiver for the Property, without notice to Borrower or
any other person or entity and Lender may in person, by agent or by a court
appointed receiver, regardless of the adequacy of Lender's security, enter upon
and take and maintain full control of the Property in order to perform all acts
necessary and appropriate for the operation and maintenance thereof including,
but not limited to, the execution, cancellation or modification of leases, the
collection of all rents and revenues of the Property, the making of repairs to
the Property and the execution or termination of contracts providing for the
management or maintenance of the Property, all on such terms as are deemed best
to protect the security of this Instrument. In the event Lender elects to seek
the appointment of a receiver for the Property during the continuance of any
Event of Default beyond any applicable cure or grace periods set forth in the
Lease Agreement, Borrower hereby expressly consents to the appointment of such
receiver. Lender or the receiver shall be entitled to receive a reasonable fee
for so managing the Property.

          All rents and revenues collected subsequent to delivery of the
Assignment Notice shall be applied first to the costs, if any, of taking control
of and managing the Property and collecting the rents, including, but not
limited to, attorney's fees, receiver's fees, premiums on

                                       12

<PAGE>

receiver's bonds, costs of repairs to the Property, premiums on insurance
policies, taxes, assessments and other charges on the Property, and the costs of
discharging any obligation or liability of Borrower as lessor or landlord of the
Property and then to the sums secured by this Instrument. Lender or the receiver
shall have access to the books and records used in the operation and maintenance
of the Property in the manner provided in Paragraph 28 of the Lease Agreement
and shall be liable to account only for those rents actually received. Lender
shall not be liable to Borrower, anyone claiming under or through Borrower or
anyone having an interest in the Property by reason of anything done or left
undone by Lender under this PARAGRAPH 26.

          If the rents of the Property are not sufficient to meet the costs, if
any, of taking control of and managing the Property and collecting the rents,
any funds expended by Lender for such purposes shall become indebtedness of
Borrower to Lender secured by this Instrument pursuant to PARAGRAPH 8 hereof.
Unless Lender and Borrower agree in writing to other terms of payment, such
amounts shall be payable upon notice from Lender to Borrower requesting payment
thereof and shall bear interest from the date of disbursement at the rate stated
in the Lease Agreement unless payment of interest at such rate would be contrary
to applicable law, in which event such amounts shall bear interest at the
highest rate which may be collected from Borrower under applicable law.

          Any entering upon and taking and maintaining of control of the
Property by Lender or the receiver and any application of rents as provided
herein shall not cure or waive any default hereunder or invalidate any other
right or remedy of Lender under applicable law or provided herein. This
assignment of rents of the Property shall terminate at such time as this
Instrument ceases to secure indebtedness held by Lender.

          27. ACCELERATION; REMEDIES. Upon the occurrence and during the
continuance of any Event of Default, all the Secured Obligations shall become
immediately due and payable, without notice or demand, at the option of Lender
and Lender may:

          (a) Have a receiver appointed as a matter of right on an ex parte
basis without notice to Borrower and without regard to the sufficiency of the
Property or any other security for the Secured Obligations and without the
necessity of posting any bond or other security. Such receiver shall take
possession and control of the Property and shall collect and receive the rents
and revenues of the Property. If Lender elects to seek the appointment of a
receiver for the Property, Borrower, by its execution of this Instrument,
expressly consents to the appointment of such receiver, including the
appointment of a receiver ex parte if permitted by applicable law. The receiver
shall be entitled to receive a reasonable fee for managing the Property, which
fee may be deducted from the rents and revenues of the Property or may be paid
by Lender and added to the Secured Obligations. Immediately upon appointment of
a receiver, Borrower shall surrender possession of the Property to the receiver
and shall deliver to the receiver all documents, records (including records on
electronic or magnetic media), accounts, surveys, plans, and specifications
relating to the Property and all security deposits. If the rents and revenues of
the Property are not sufficient to pay the costs of taking control of and
managing the Property and collecting the rents and revenues of the Property, any
funds expended by Lender, or advanced by Lender to the receiver, for such
purposes shall become an additional part of the Secured Obligations. The
receiver may exclude Borrower and its representatives from the Property.
Borrower acknowledges and agrees that the exercise by Lender of any of the
rights conferred under this PARAGRAPH 27 shall not be construed to make Lender a
mortgagee in possession of the Property.

                                       13

<PAGE>

          (b) Foreclose this Instrument as provided in PARAGRAPH 39 or otherwise
realize upon the Property as permitted under applicable law.

          (c) Exercise any of the remedies set forth in Paragraphs 23(a)(i) and
23(b)(i) of the Lease Agreement which are incorporated herein by reference.

          (d) Avail itself of any other right or remedy available to it under
the terms of this Instrument, the other Loan Documents or applicable law.

          Notwithstanding anything under this PARAGRAPH 27 or PARAGRAPH 39 to
the contrary, the extent and the amount of any payments payable hereunder by the
Borrower to the Lender upon the occurrence and during the continuance of any
Event of Default, including, without limitation, the amount of the Secured
Obligations which may be accelerated and any damages which may be payable, shall
be governed by, and limited to the amounts recoverable under, Paragraphs
23(a)(i) and 23(b)(i) of the Lease Agreement.

          28. RELEASE. Upon satisfaction of the Secured Obligations, which shall
include, without limitation, upon conveyance of the Property to Borrower
pursuant to Paragraphs 18, 34 or 35 of the Lease Agreement and payment of all
sums due by Borrower to Lender upon such conveyance, Lender shall release or, at
Borrower's request, assign this Instrument, without recourse, warranty or
representation whatsoever to the refinancing lender. Borrower shall pay Lender's
reasonable costs incurred in discharging or assigning this Instrument and
deliver to Lender an affidavit pursuant to Section 275 of the New York Real
Property Law and such other documents and instruments as Lender may reasonably
request.

          29. RELATIONSHIP OF PARTIES. The relationship of Lender and Borrower
is solely that of debtor and creditor, and Lender has no fiduciary or other
special relationship with the Borrower, and no term or condition of any of the
Loan Documents shall be construed to be other than that of debtor and creditor.
Borrower represents and acknowledges that neither the Loan Documents nor any
course of dealing between the parties creates any partnership or joint venture
between Borrower and Lender or any other person, nor does it provide for any
shared appreciation rights or other equity participation interest.

          30. INCORPORATION OF TERMS OF LEASE AGREEMENT. All terms and
conditions of the Lease Agreement are incorporated herein as if set forth in
full in this Instrument.

          31. DEFINITION OF DEFAULT. Borrower is in default upon the occurrence
and continuance of any Event of Default as defined in the Lease Agreement.

          32. RECORDING OF MORTGAGE, ETC. Upon the execution and delivery of
this Instrument and thereafter, from time to time, Borrower will cause this
Instrument, and any security instrument creating a lien or security interest or
evidencing the lien hereof upon the Property and each instrument of further
assurance to be filed, registered or recorded in such manner and in such places
as may be required by any present or future law in order to publish notice of
and fully to protect the lien or security interest hereof upon, and the interest
of Lender in, the Property. Borrower will pay all filing, registration or
recording fees, and all expenses incident to the preparation, execution and
acknowledgment of this Instrument, any mortgage supplemental hereto, any
security instrument with respect to the Property and any instrument of further

                                       14

<PAGE>

assurance, and all federal, state, county and municipal, taxes, duties, imposts,
assessments and charges arising out of or in connection with the execution and
delivery of this Instrument, any deed of trust supplemental hereto, any security
instrument with respect to the Property or any instrument of further assurance,
except where prohibited by law so to do.

          33. BORROWER'S ADDITIONAL COVENANTS. Borrower hereby covenants, agrees
and undertakes to:

          (a) from time to time, at the request of Lender, (i) promptly correct
any defect, error or omission which may be discovered in the contents of this
Instrument, the Lease Agreement or in any other Loan Document or in the
execution or acknowledgement thereof; (ii) execute, acknowledge, deliver and
record and/or file such further documents or instruments (including, without
limitation, further mortgages, security agreements, financing statements,
continuation statements, assignments of rents or leases and environmental
indemnity agreements) and perform such further acts and provide such further
assurances as may be necessary, desirable or proper, in Lender's reasonable
opinion, to carry out more effectively the purposes of this Instrument and such
other instruments and to subject to the liens and security interests hereof and
thereof any property intended by the terms hereof or thereof to be covered
hereby or thereby, including specifically, but without limitation, any renewals,
additions, substitutions, replacements, or appurtenances to the Property;
provided that such documents or instruments do not increase Borrower's liability
or decrease Borrower's rights under the Loan Documents (other than to a
deminimus extent); and (iii) execute, acknowledge, deliver, procure, and file
and/or record any document or instrument (including specifically, but without
limitation, any financing statement) reasonably deemed advisable by Lender to
protect the liens and the security interests herein granted against the rights
or interests of third persons; provided that such documents or instruments do
not increase Borrower's liability or decrease Borrower's rights under the Loan
Documents (other than to a deminimus extent). Borrower will pay all reasonable
costs connected with any of the foregoing in this SUBPARAGRAPH (A);

          (b) continuously maintain Borrower's existence and right to do
business in the State of New York;

          (c) not execute or deliver any mortgage or pledge of any type covering
all or any portion of the Property; and

          (d) continuously comply with its single purpose, bankruptcy remote
status in accordance with the requirements of the Eighth Article of the
Borrower's Articles of Organization as of the date of this Instrument.

          34. TAXES ON SECURITY; DOCUMENTARY STAMPS; INTANGIBLES TAX. Borrower
shall pay all taxes, charges, filing, registration and recording fees, excises
and levies payable under and/or with respect to the Lease Agreement, this
Instrument or the liens created or secured by the Loan Documents, other than
income, franchise and doing business taxes imposed on Lender. If at any time the
United States of America, any State thereof or any subdivision of any such State
shall require revenue or other stamps to be affixed to the Lease Agreement or
this Instrument, or impose any other tax or charge on the same, Borrower will
pay for the same, with interest and penalties thereon, if any. Borrower hereby
agrees that, in the event that it is determined that additional documentary
stamp tax or intangible tax is due hereon or any mortgage, deed of trust or
promissory note executed in connection herewith (including,

                                       15

<PAGE>

without limitation, the Lease Agreement), Borrower shall indemnify and hold
harmless Lender for all such documentary stamp tax and/or intangible tax,
including all penalties and interest assessed or charged in connection
therewith. Borrower shall pay same within ten (10) days after demand of payment
from Lender and the payment of such sums shall be secured by this Instrument and
such sums shall bear interest at the Default Rate (as defined in the Lease
Agreement) from and after the eleventh (11th) day after demand until paid in
full. Borrower shall hold harmless and indemnify Lender, its successors and
assigns, against any liability incurred by reason of the imposition of any tax
on the making and recording of this Instrument.

          35. MAXIMUM INTEREST. In the event that any applicable law limiting
the amount of interest or other charges permitted to be collected from Borrower
is interpreted so that any charge provided for in this Instrument or in the
Lease Agreement, whether considered separately or together with other charges
levied in connection with this Instrument and the Lease Agreement, violates such
law, and Borrower is entitled to the benefit of such law, such charge is hereby
reduced to the extent necessary to eliminate such violation. The amounts, if
any, previously paid to Lender in excess of the amounts payable to Lender
pursuant to such charges as reduced shall be applied by Lender to reduce the
principal of the indebtedness evidenced by the Lease Agreement. For the purpose
of determining whether any applicable law limiting the amount of interest or
other charges permitted to be collected from Borrower has been violated, all
indebtedness which is secured by this Instrument or evidenced by the Lease
Agreement and which constitutes interest, as well as all other charges levied in
connection with such indebtedness which constitute interest, shall be deemed to
be allocated and spread over the stated term of the Lease Agreement. Unless
otherwise required by applicable law, such allocation and spreading shall be
effected in such a manner that the rate of interest computed thereby is uniform
throughout the stated term of the Lease Agreement.

          36. ATTORNEYS' FEES AND LEGAL EXPENSES. In the event of any Event of
Default under this Instrument, or in the event that any dispute arises relating
to the interpretation, enforcement or performance of any Secured Obligation,
Lender shall be entitled to collect from Borrower on demand all fees and
expenses incurred in connection therewith, including but not limited to
reasonable fees of attorneys and fees of accountants, appraisers, environmental
inspectors, consultants, expert witnesses, arbitrators, mediators and court
reporters. Without limiting the generality of the foregoing, Borrower shall pay
all such costs and expenses incurred in connection with: (a) arbitration or
other alternative dispute resolution proceedings, trial court actions and
appeals; (b) bankruptcy or other insolvency proceedings of Borrower, any
guarantor or other party liable for any of the Secured Obligations or any party
having any interest in any security for any of those obligations; (c) judicial
or nonjudicial foreclosure on, or appointment of a receiver for, any of the
Property; (d) post-judgment collection proceedings; (e) all claims,
counterclaims, cross-claims and defenses asserted in any of the foregoing
whether or not they arise out of or are related to this Instrument; (f) all
preparation for any of the foregoing; and (g) all settlement negotiations with
respect to any of the foregoing.

          37. WAIVER OF JURY TRIAL. BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT THE BORROWER MAY HAVE TO A TRIAL BY JURY IN
RESPECT TO ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONJUNCTION WITH THE LEASE AGREEMENT, THIS INSTRUMENT, ANY OTHER LOAN DOCUMENT,
ANY OTHER AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ANY
COURSE

                                       16

<PAGE>

OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
OF EITHER PARTY.

          38. TRANSFER OF LOAN. Subject to the terms of the Lease Agreement,
Lender may, at any time, and at Lender's sole cost and expense, sell, transfer
or assign the Lease Agreement, this Instrument and the Loan Documents, or any
part thereof, and any or all servicing rights with respect thereto, or grant
participations therein. Lender may forward to each purchaser, transferee,
assignee, servicer or participant (singularly, an "INVESTOR," and collectively,
the "INVESTORS") and each prospective Investor, all documents and information
which Lender now has or may hereafter acquire relating to the Loan and to
Borrower, any guarantor, any indemnitors and/or the Property, whether furnished
by Borrower, any guarantor, any indemnitors or otherwise, as Lender determines
necessary or desirable. Borrower shall furnish and Borrower consents to Lender
furnishing to such Investors or such prospective Investors any and all
information concerning the Property, the leases, the financial condition of
Borrower, any guarantor and any indemnitor as may be reasonably requested by
Lender, any Investor or any prospective Investor in connection with any sale,
transfer or participation interest.

          39. RIGHTS AND REMEDIES. Upon the occurrence of any Event of Default
beyond applicable notice and cure periods set forth in the Lease Agreement,
Lender shall have the option, without notice or demand, to declare all Secured
Obligations immediately due and payable and to proceed to foreclose on this
Instrument as now or then provided by law (in which event Lender shall be
entitled to the appointment of a receiver) pursuant to a judicial proceeding in
accordance with Article 13 of the New York Real Property Actions and Proceedings
Law ("RPAPL") or by advertisement in accordance with Article 14 of RPAPL. Any
foreclosure shall forever bar Borrower and all persons claiming under Borrower
from all right and interest in the Property. In any such proceeding Lender shall
be entitled to recover all costs and expenses (regardless of the particular
nature thereof and whether incurred prior to or during such proceeding) incident
to the realization of its rights hereunder, including court costs and reasonable
attorneys' fees. Lender shall be entitled to possession of the Property during
any period of redemption. Borrower hereby waives any right it or its successors
in interest may have in the event of acceleration or foreclosure to obtain a
partial release of the Property from the lien of this Instrument by paying less
than the entire amount then secured hereby, or to partially redeem the Property
by paying less than the amount necessary to effect full redemption. If a
deficiency remains after proper application of the proceeds of sale of the
Property, Borrower shall pay the same immediately after determination of the
amount thereof.

          40. SPECIAL NEW YORK LOCAL LAW PROVISIONS.

          40.1 INCONSISTENCIES. In the event of any inconsistencies between the
terms and conditions of this PARAGRAPH 40 and the other provisions of this
Instrument, the terms and conditions of this PARAGRAPH 40 shall control and be
binding.

          40.2 TRUST FUND. Pursuant to Section 13 of the New York Lien Law,
Borrower shall receive the advances secured hereby and shall hold the right to
receive the advances as a trust fund to be applied first for the purpose of
paying the cost of any improvement and shall apply the advances first to the
payment of the cost of any such improvement on the Property before using any
part of the total of the same for any other purpose.

                                       17

<PAGE>

          40.3 COMMERCIAL PROPERTY. Borrower represents that this Instrument
does not encumber real property principally improved or to be improved by one or
more structures containing in the aggregate not more than six residential
dwelling units, each having its own separate cooking facilities.

          40.4 INSURANCE. The provisions of Subsection 4 of Section 254 of the
New York Real Property Law covering the insurance of buildings against loss by
fire shall not apply to this Instrument. In the event of any conflict,
inconsistency or ambiguity between the provisions of PARAGRAPH 5 above and the
provisions of Subsection 4 of Section 254 of the New York Real Property Law
covering the insurance of buildings against loss by fire, the provisions of
PARAGRAPH 5 shall control.

          40.5 LEASES. Lender shall have all of the rights against lessees of
the Property set forth in Section 291-f of the Real Property Law of New York.

          40.6 STATUTORY CONSTRUCTION. The clauses and covenants contained in
this Instrument that are construed by Section 254 of the New York Real Property
Law shall be construed as provided in those paragraphs (except as provided in
PARAGRAPH 40.4). The additional clauses and covenants contained in this
Instrument shall afford rights supplemental to and not exclusive of the rights
conferred by the clauses and covenants construed by Section 254 and shall not
impair, modify, alter or defeat such rights (except as provided in PARAGRAPH
40.4), notwithstanding that such additional clauses and covenants may relate to
the same subject matter or provide for different or additional rights in the
same or similar contingencies as the clauses and covenants construed by Section
254. The rights of Lender arising under the clauses and covenants contained in
this Instrument shall be separate, distinct and cumulative and none of them
shall be in exclusion of the others. No act of Lender shall be construed as an
election to proceed under any one provision herein to the exclusion of any other
provision, anything herein or otherwise to the contrary notwithstanding. In the
event of any inconsistencies between the provisions of Section 254 and the
provisions of this Instrument, the provisions of this Instrument shall prevail.

          40.7 MAXIMUM PRINCIPAL AMOUNT SECURED. Notwithstanding anything to the
contrary contained in this Instrument, the maximum amount of principal
indebtedness secured by this Instrument or which under any contingency may be
secured by this Instrument is TWO HUNDRED FIFTY MILLION and 00/100 Dollars
($250,000,000.00), which amount represents the sum of (A) the outstanding
principal indebtedness under the Underlying Mortgage (hereinafter defined) and
(B) the new principal indebtedness created by the Lease Agreement in the amount
of SEVENTY FIVE MILLION AND 00/100 DOLLARS ($75,000,000.00), plus any amounts
expended by the Lender after an Event of Default on account of (a) taxes,
charges or assessments which may be imposed by law upon the Property; (b)
premiums on insurance policies covering the Property; (c) expenses incurred in
upholding the lien of this Instrument, including, but not limited to (i) the
expenses of any litigation to prosecute or defend the rights and lien created by
this Instrument; (ii) any amount, cost or charges to which Lender becomes
subrogated, upon payment, whether under recognized principles of law or equity,
or under express statutory authority and (iii) interest, default interest and
other charges at the rate and in the amounts set forth in the Loan Documents. In
no event shall any owner of the Property be obligated for an indebtedness of
more than the indebtedness created hereby and by the Lease Agreement and the
pre-existing indebtedness secured by the Underlying Mortgage as provided in this
PARAGRAPH 40.7.

                                       18

<PAGE>

          40.8 LIEN LAW. Borrower will, in compliance with Section 13 of the New
York Lien Law, receive the advances secured hereby and will hold the right to
receive such advances in a trust fund to be applied first for the purpose of
paying the cost of any improvement and will apply the same first to the payment
of the cost of any such improvement before using any part of the total of the
advance for any other purpose.

          40.9 CONDOMINIUM REGIME.

          (a) The Property is subject to a condominium regime pursuant to the
Declaration of Condominium (as amended to date, collectively the "DECLARATION")
of The New York Times Building LLC (the "CONDOMINIUM") specified in Exhibit A
attached hereto, dated as of August 4, 2006 made by The New York Times Building
LLC and recorded in the Office of the City Register, New York County on August
15, 2006, as CRFN 2006000460293, as amended by that certain First Amendment to
the Declaration, which First Amendment was dated as of January 29, 2007, and
recorded in the Office of the City Register, New York County on February 8, 2007
as CRFN 2007000075106, and further amended by that certain Second Amendment to
the Declaration, which Second Amendment was dated October 11, 2007, and recorded
in the Office of the City Register, New York County on January 8, 2008 as CRFN
2008000008735, and further amended by that certain Third Amendment to the
Declaration, which Third Amendment was dated March 6, 2009, and is intended to
recorded in the Office of the City Register, New York County. A Board of
Managers (the "BOARD OF MANAGERS") governs the Condominium pursuant to the
by-laws of the Condominium (the "BYLAWS") which were recorded in the like office
together with the Declaration. Borrower represents and covenants that Borrower
is in compliance with, and at all times hereafter shall maintain compliance
with, the terms of the Lease Agreement with respect to any Condominium
Documents.

          (b) Borrower will fully and faithfully perform and comply with the
terms, conditions, and provisions of the Condominium Documents.

          (c) Borrower will use its commercially reasonable efforts, within
fifteen (15) days after written demand by Lender, to obtain from the Board of
Managers under the Condominium Documents and furnish to Lender the estoppel
certificate in recordable form of such Board of Managers either required to be
issued by such Board of Managers pursuant to the provisions of the Condominium
Documents or in form reasonably requested by Lender.

          40.10 GROUND SUBLEASEHOLD MORTGAGE PROVISIONS.

          (a) Borrower hereby represents, covenants and warrants that as to its
interest in the Property:

          (i) The Severance Lease is in full force and effect and unmodified, no
default has occurred under the Severance Lease which would affect Borrower's
sublease and there is no existing condition which, but for the passage of time
or the giving of notice, would result in a default under the terms of the
Severance Lease by the Borrower.

          (ii) All rents, additional rents, taxes, assessments, water rates,
sewer rents, impositions and other charges due or payable under the Severance
Lease have been paid to the extent they were payable prior to the date hereof.

                                       19

<PAGE>

          (iii) Borrower shall maintain the quiet and peaceful possession of
Lender of the Property and shall defend the Severance Leasehold Estate created
under the Severance Lease for the entire remainder of the term set forth therein
including all renewal options thereunder, against all and every person or
persons lawfully claiming, or who may claim the same or any part thereof, and to
the performance and observance of all of the terms, covenants, provisions and
conditions thereof.

          (iv) There is no existing default by Borrower under the provisions of
the Severance Lease or in the performance of any of the terms, covenants,
provisions or conditions thereof on the part of the lessee to be observed and
performed.

          (v) Borrower has not further encumbered the Property (other than by
the Permitted Encumbrances) or assigned the Severance Lease.

          (vi) The Severance Lease has been duly recorded as set forth herein
and permits the interest of the Borrower thereunder to be encumbered by this
Instrument, and there has not been a material change in the terms of the
Severance Lease since its recordation.

          (vii) Except for the Permitted Encumbrances, Borrower's interest in
the Severance Lease is not subject to any liens or encumbrances superior to, or
of equal priority with, this Instrument, other than the lessor under the
Severance Lease related fee interest.

          (viii) Borrower's interest in the Severance Lease is assignable upon
notice to, but without the consent of, the lessor under the Severance Lease (or,
if any such consent is required, it has been obtained prior to the date of this
Instrument) or, in the event that it is so assigned, it is further assignable
and its successors and assigns upon notice to, but without a need to obtain the
consent of, such lessor under the Severance Lease.

          (b) Except as otherwise provided in Paragraph 9 of the Lease
Agreement, Borrower hereby represents, covenants and warrants that as to its
Severance Leasehold Estate Borrower shall pay or cause to be paid all rents,
additional rents, taxes, assessments, water rates, sewer rents, impositions, and
other charges mentioned in and made payable by the Severance Lease, for which
provision has not been made hereinbefore, when and as the same shall become due
and payable, and shall use its best efforts to cause the lessor under the
Severance Lease, to the extent required by the Severance Lease, to pay any
portion of said taxes, assessments, rates, charges and impositions to be borne
by the lessor under the Severance Lease that might become liens on the Property
or Borrower's estate therein prior to or on the date when they become due, and
Borrower shall in every case take, or cause to be taken, a proper receipt for
any such item so paid by Borrower and shall deliver, or cause to be delivered to
Lender upon its request after any such payment, the original receipts or
cancelled checks for any such payments by Borrower.

          (c) Borrower hereby represents, covenants and warrants that as to its
Severance Leasehold Estate Borrower shall at all times promptly and fully
observe, keep and perform, or cause to be observed, kept and performed, all
terms, covenants, provisions and conditions contained in the Severance Lease to
be kept and performed in all respects. Borrower further covenants that it will
not do or permit anything to be done, the doing of which, or refrain from doing
anything, the omission of which, will impair or tend to impair the security of
this Instrument or will be a default under the Severance Lease. If Borrower
shall fail at all times to fully observe, perform and comply with all tenant's,
covenants, provisions and conditions under

                                       20

<PAGE>

the Severance Lease beyond applicable notice and cure periods set forth in the
Severance Lease, or do or permit anything to be done, the doing of which or
refrain from doing, the omission of which will impair the security of this
Instrument or will be a default under the Severance Lease beyond applicable
notice and cure periods set forth in the Severance Lease (severally, a
"SEVERANCE LEASE DEFAULT"), then, upon the happening of any such event, an Event
of Default shall be deemed to have occurred pursuant to Paragraph 22(a)(vii) of
the Lease Agreement and Lender, at its option, may either:

          (i) accelerate the maturity of the indebtedness secured hereby and
declare the same to be immediately due and payable and may invoke any remedies
permitted by PARAGRAPH 27 and/or PARAGRAPH 39 of this Instrument; or

          (ii) without limiting the generality of any other provision of this
Instrument or any remedy of Lender hereunder and without waiving or releasing
Borrower from any of its obligations hereunder, Lender may (but shall not be
obligated to) take any action Lender deems necessary or desirable to prevent or
to cure any default by Borrower in the performance of or compliance with any of
Borrower's covenants or obligations under the Severance Lease. Upon receipt by
Lender from the lessor under the Severance Lease of any written notice of
default by lessee thereunder, Lender may rely thereon and take any action, as
aforesaid, to cure such default even though the existence of such default or the
nature thereof be questioned or denied by Borrower or by any party on behalf of
Borrower.

          (d) Borrower hereby expressly grants to Lender, and agrees that Lender
shall have the absolute and immediate right to enter in and upon the Property or
any part thereof to such extent and as often as Lender, in its sole discretion,
deems necessary or desirable, in order to cure a Severance Lease Default by
Borrower. Lender may pay and expend such sums of money as Lender, in its sole
discretion, deems necessary for the purpose of remedying a Severance Lease
Default, and Borrower hereby agrees to pay to Lender, upon demand, all such sums
so paid and expended by Lender, together with default interest thereon and other
charges at the Default Rate set forth in the Lease Agreement, computed from the
date of payment thereof by Lender. Any such sum paid by Lender and the interest
thereon shall be a lien on the Property prior to any claim, lien, right, title
or interest in, to or on the Property attaching or accruing subsequent to the
lien of this Instrument, and shall be deemed to be secured by this Instrument
and evidenced by the Lease Agreement.

          (e) Except to the extent expressly provided in the Lease Agreement,
Borrower shall not modify, extend or in any way alter the terms of the Severance
Lease or cancel or surrender the Severance Lease, or waive, excuse, condone or
in any way release or discharge the lessor thereunder of or from the terms,
covenants, provisions and conditions by said lessor to be done and performed;
and, except to the extent expressly provided in the Lease Agreement, Borrower
does by these presents expressly release, relinquish and surrender unto Lender
all its right, power and authority to cancel, surrender, amend, modify or alter
in any way the terms and provisions of the Severance Lease and any attempt on
the part of Borrower to exercise any such right without the prior written
consent of Lender shall constitute a default under the terms hereof and the
indebtedness secured hereby shall, at the option of Lender, become due and
payable forthwith and without notice.

          (f) Borrower will promptly notify Lender in writing in the event of
the initiation of any arbitration proceeding under and pursuant to the
provisions of the Severance

                                       21

<PAGE>

Lease, it being expressly agreed that if, at the time any such arbitration
proceeding shall be initiated, a Severance Lease Default shall exist, Lender
shall have, and is hereby granted, the sole and exclusive right to designate and
appoint the arbitrator to be appointed by Borrower in such arbitration
proceeding. In addition, Borrower shall promptly deliver to Lender a copy of the
determination of the arbitrators in each such arbitration proceeding. Lender
shall have the right to participate in such arbitration proceedings in
association with Borrower or on its own behalf as an interested party;

          (h) Borrower will use its commercially reasonable efforts, within
fifteen (15) days after written demand by Lender, obtain from the lessor under
the Severance Lease and furnish to Lender the estoppel certificate in recordable
form of such lessor either required to be issued by such lessor pursuant to the
provisions of the Severance Lease or in form reasonably requested by Lender;

          (i) Borrower will, within fifteen (15) days after written demand by
Lender, furnish Lender proof reasonably satisfactory to Lender of payment of all
items which are required to be paid by Borrower pursuant to the Severance Lease.

          (j) In the event Borrower and the lessor under the Severance Lease
amend or modify the Severance Lease (but nothing herein shall be deemed or
construed as permitting Borrower to amend or modify the Severance Lease without
the express prior written consent of Lender), Borrower shall, upon the request
of Lender, (i) cause the lessor under the Severance Lease to execute a
memorandum of any such amendment or modification, provided, however, that
Borrower shall not be in default under this SUBPARAGRAPH (J) so long as Borrower
is using its best efforts to obtain such executed memorandum, (ii) execute said
memorandum, (iii) cause such memorandum to be recorded (at Borrower's sole cost
and expense), and (iv) reimburse Lender for all reasonable costs and expenses,
including reasonable attorneys' fees, incurred in connection with Lender's
review of any such amendment, modification or memorandum thereof;

          (k) Borrower will (i) upon request by Lender promptly deposit with
Lender an original executed or certified copy of the Severance Lease and any and
all documentary evidence received by it showing compliance by Borrower with the
provisions of the Severance Lease, (ii) provide Lender an exact copy of any
notice, communication, plan, specification or other instrument or document
received or given by it in any way relating to or affecting the Severance Lease
which may concern or affect the estate of the lessor or the lessee in or under
the Severance Lease or in the real estate thereby demised, (iii) give Lender
immediate notice of any receipt by it of any notice of default from the lessor
thereunder, (iv) furnish to Lender within fifteen (15) days any and all
information which it may request concerning the performance by Borrower of the
agreements, terms, conditions and covenants of the Severance Lease or of this
Instrument, and (v) permit Lender or its agents or representatives at all
reasonable times to investigate or examine Borrower concerning such performance,
and upon Borrower's failure so to do, Lender may, at its option, declare the
Indebtedness secured hereby due and payable at once.

          (l) So long as any of the Secured Obligations shall remain unpaid,
unless Lender shall otherwise in writing consent, the fee title and the
leasehold estate in the Property hereinbefore described, shall not merge but
shall always be kept separate and distinct, notwithstanding the union of said
estates either in the lessor or in the lessee, or in a third party, by purchase
or otherwise; and Borrower further covenants and agrees that, in case it shall
acquire the fee title, or any other estate, title or interest in the Property
covered by the Severance Lease,

                                       22

<PAGE>

including, without limitation, pursuant to the purchase option or right of first
refusal, if any, set forth in the Severance Lease, this Instrument shall attach
to or cover and be a lien upon such other estate so acquired, and such other
estate so acquired by Borrower shall be considered as mortgaged, assigned or
conveyed to Lender and the lien hereof spread to cover such estate with the same
force and effect as though specifically herein mortgaged, assigned or conveyed,
and spread. Upon such acquisition, Borrower, if required by Lender, at
Borrower's sole cost and expense, shall deliver to Lender, an ALTA Lender's
Title Insurance Policy issued by a title insurance company reasonably
satisfactory to Lender, insuring that this Instrument, as so spread to cover
Borrower's interest in such fee property, is valid lien on Borrower's interest
therein. It is the intention of Borrower and Lender that no documents,
instruments or agreements shall be necessary to confirm the foregoing spread of
this Instrument to cover Borrower's interest in such fee property, as aforesaid,
and that such spreader shall occur automatically upon the consummation of
Borrower's acquisition of such estate, title or interest in such leased
property. Notwithstanding the foregoing, Borrower shall make, execute,
acknowledge and deliver to Lender or so cause to be made, executed, acknowledged
and delivered to Lender in form reasonably satisfactory to Lender, all such
further or other documents, instruments, agreements or assurances as may be
reasonably required by Lender to confirm the foregoing spread of this Instrument
to cover Borrower's interest in a fee property. Borrower shall pay all
reasonable expenses incurred by Lender in connection with the preparation,
execution, acknowledgment, delivery and/or recording of any such documents,
including but without limiting the generality of the foregoing, all filing,
registration and recording fees and charges, documentary stamps, mortgage taxes,
intangible taxes, and reasonable attorneys' fees, costs and disbursements. The
provisions of this SUBPARAGRAPH (L) shall not apply in the event Lender acquires
the Property, except if Lender shall so elect;

          (m) Within five (5) days after Borrower's receipt of any notice of any
motion, application or effort to reject the Severance Lease by the lessor under
the Severance Lease or any trustee arising from or in connection with any case,
proceeding or other action commenced or pending by or against any lessor under
the Federal Bankruptcy Code (the "CODE") or comparable provisions contained in
any present or future federal, state, local, foreign or other statute, law, rule
or regulation, Borrower shall give notice thereof to Lender. Borrower hereby (i)
assigns to Lender any and all of Borrower's rights as lessee under Section
365(h) of the Code or any comparable provision contained in any present or
future federal, state, local, foreign or other statute, law, rule or regulation
("COMPARABLE PROVISION"), (ii) covenants that it shall not elect to treat the
Severance Lease as terminated pursuant to Section 365(h) of the Code or any
Comparable Provision without the prior written consent of Lender and (iii)
agrees that any such election by Borrower without such consent shall be null and
void;

          (n) Without limiting the generality of the foregoing, Borrower hereby
unconditionally assigns, transfers and sets over to Lender all of Borrower's
claims and rights to the payment of damages arising from any rejection by the
lessor under the Severance Lease of the Severance Lease under the Code or any
Comparable Provision. Lender shall have the right to proceed in its own name or
in the name of Borrower in respect of any claim, suit, action or proceeding
relating to the right to file and prosecute, in cooperation with Borrower, any
proofs of claim, complaints, motions, applications, notices under the Code or
any Comparable Provision. This assignment constitutes a present, irrevocable and
unconditional assignment of the foregoing claims, rights and remedies, and shall
continue in effect until all of the indebtedness and obligations secured by this
Instrument shall have been satisfied and discharged in full. Any amounts
received by Lender in damages arising out of the rejection of any Severance
Lease as

                                       23

<PAGE>

aforesaid shall be applied first to all reasonable costs and expenses of Lender
(including, without limitation, reasonable attorneys' fees) incurred in
connection with the exercise of any of its rights or remedies under this
PARAGRAPH and thereafter as otherwise provided in this Instrument;

          (o) If there shall be filed by or against Borrower a petition under
the Code or any Comparable Provision and Borrower, as sublessee under the
Severance Lease, shall determine to reject the Severance Lease, Borrower shall
give Lender not less than ten (10) days' prior notice of the date on which
Borrower shall apply to the Bankruptcy Court or other judicial body with
appropriate jurisdiction for authority to reject the Severance Lease. Lender
shall have the right, but not the obligation to serve upon Borrower within such
ten (10) day period a notice stating that (i) Lender demands that Borrower
assume and assign its interests in the Severance Lease to Lender pursuant to
Section 365 of the Code or any Comparable Provision and (ii) Lender covenants to
cure or provide adequate assurance of prompt cure of all defaults and provide
adequate assurance of future performance under the Severance Lease. If Lender
serves upon Borrower the notice described in the preceding sentence, Borrower
shall not seek to reject the Severance Lease and shall comply with the demand
provided for in clause (i) of the preceding sentence within thirty (30) days
after the notice shall have been given subject to the performance by Lender of
the covenant provided for in clause (h) of the preceding sentence. Effective
upon the entry of an order for relief in respect of Borrower under Chapter 7 of
the Code or any Comparable Provision, Borrower hereby assigns and transfers to
Lender a non-exclusive right to apply to the Bankruptcy Court or other judicial
body with appropriate jurisdiction for an order extending the period during
which the Severance Lease may be rejected or assumed;

          (p) Borrower hereby assigns and sets over to Lender, as security for
the obligations secured by this Instrument, all right, title and interest in and
to Borrower's interest in the Severance Lease, and Lender shall have the right
and power to exercise such options on behalf of Borrower at any time that
Borrower could do so if, in the sole judgment of Lender, it is appropriate to do
so in order to protect Lender's interests. Borrower hereby grants to Lender a
power of attorney to execute and deliver such extension notices on behalf of
Borrower, it being stipulated that such power of attorney is coupled with an
interest and irrevocable for so long as this Security Instrument remains in
effect. Upon the request of Lender, Borrower shall execute any documents or
instruments reasonably requested by Lender in order to confirm the existence of
the power of attorney set forth in this subsection, including, without
limitation, a separate power of attorney in recordable form with respect to the
matters covered by this subsection. Lender shall further have a power of
attorney, it being stipulated that such power of attorney is coupled with an
interest and is irrevocable for so long as this Security Instrument remains in
effect, to execute any and all other documents required by this Security
Instrument with respect to the Severance Lease, and to perform any and all acts
required of Borrower under this Instrument with respect to the Severance Lease,
if Borrower fails to do so promptly after demand by Lender. Notwithstanding
anything herein to the contrary, prior to the occurrence of any Event of Default
beyond any applicable cure or grace periods set forth in the Lease Agreement,
Borrower shall have such rights, privileges and benefits with respect to the
Severance Lease as set forth in paragraph 4(c) of the Lease Agreement.

          (q) If the Severance Lease shall be terminated prior to the natural
expiration of its term due to a default or event of default thereunder, and if,
pursuant to any provision of the Severance Lease or otherwise, Lender or its
designee shall acquire from the lessor under the Severance Lease a new lease of
the Property, Borrower shall have no right title or interest in or to such new
lease or the leasehold estate created thereby, or renewal privileges therein
contained;

                                       24

<PAGE>

          (r) Borrower has not consented and shall not consent to the
subordination of the Severance Lease to any mortgage of the fee interest in the
Property; and

          (s) The execution and delivery of this Instrument is permitted under
the Severance Lease and Borrower has complied with any appropriate and/or
required consents or notices in order to encumber its Severance Leasehold
Estate.

          (t) The Borrower shall maintain the insurance as required by the
Severance Sublease covering the Property as required by PARAGRAPH 5 hereof for
the benefit of Borrower and Lender (and such other persons required by the Lease
Agreement). Borrower will give prompt notice to Lender of termination of or
interruption in such coverage and, in that event, will provide replacement
insurance as required by the Severance Sublease and PARAGRAPH 5 hereof for the
benefit of Borrower and Lender (and such other persons required by the Lease
Agreement).

          40.11 COUNTERPARTS. This Instrument may be executed in any number of
duplicate originals and each duplicate original shall be deemed to be an
original.

          40.12 WRAP-AROUND MORTGAGE.

          (a) The Secured Obligations wrap-around and include the indebtedness
secured by that certain Mortgage, Assignment of Rents, Security Agreement and
Fixture Filing made by Borrower in favor of 620 EIGHTH LENDER NYT (NY) LIMITED
PARTNERSHIP and intended to be recorded with the Office of the City Register,
New York County prior to the recording of this Instrument, which mortgage is a
lien upon the Property (the "UNDERLYING MORTGAGE") securing a note of even date
(the "UNDERLYING NOTE") in the original principal amount of ONE HUNDRED SEVENTY
FIVE MILLION AND 00/100 DOLLARS ($175,000,000.00). The lien of this Instrument
is junior and subordinate to the lien of the Underlying Mortgage, as the same
may be amended, extended, supplemented or modified from time to time. Paragraph
31(d) of the Lease Agreement shall apply with respect to any rights or
obligations of Borrower with respect to payments made by Borrower to the holder
of the Underlying Note and the Underlying Mortgage.

          (b) The Mortgagee, by its execution of this Instrument hereby agrees
to apply the applicable portion of the payments received from the Borrower
pursuant to the terms of the Lease Agreement towards payment of any applicable
sums payable and due in accordance with the terms of the Underlying Note, as
same may be amended, restated, modified or supplemented from time to time.

          (c) Upon Lender's request, Borrower agrees to separate the
indebtedness secured by this Instrument (including, but not limited to, severing
and/or splitting this Instrument into one or more liens) so that the Secured
Obligations no longer include the indebtedness secured by the Underlying
Mortgage (i.e, de-wrapping the lien of this Instrument from the lien of the
Underlying Mortgage) and, in connection therewith, Borrower shall deliver to
Lender an affidavit (pursuant to Section 255 of the New York Real Property Law
or any other applicable law of the State of New York) and such other documents
and instruments as Lender may reasonably request, provided, however, that (i)
the maximum principal indebtedness secured by this Instrument following such
event shall not in the aggregate exceed the difference between (x) the original
maximum principal indebtedness secured by this Instrument as of the date hereof
and (y) the original maximum principal indebtedness secured by the Underlying
Mortgage as of the date

                                       25

<PAGE>

hereof (which such difference equals $75,000,000.00), (ii) such agreements do
not increase the liabilities and obligations of Borrower under any of the Loan
Document nor diminish the Borrower's rights under any of the Loan Document,
other than to a deminimus extent, and (iii) Borrower shall pay all of Lender's
costs incurred as a result of this SUBPARAGRAPH (B) to the extent provided in
Section 31(a)(ii) of the Lease.

          40.13 RECOGNIZED MORTGAGE. Notwithstanding anything herein to the
contrary, (A) insurance proceeds/condemnation awards with respect to the
Property shall not be disposed or applied in a manner inconsistent with the
terms of the Severance Lease; (B) Lender shall provide written notice to 42DP of
any defaults under this Instrument in accordance with Paragraph 31(c) of the
Severance Lease and shall permit 42DP the right to cure any such default and
upon such cure 42DP shall be subrogated to the rights of the Lender to the
extent of such cure; (C) this Instrument shall not be modified, amended,
extended or consolidated without delivering a copy thereof to 42DP; (D) this
Instrument shall not extend to, affect, or be a lien or encumbrance upon, the
estate and interest of 42DP in the Demised Premises or the Common Elements (as
such terms are defined in the Severance Lease), in the Severance Lease or any
part thereof; and (E) this Instrument shall at all times be subject and
subordinate to (i) the Severance Lease, and (ii) the Condominium Documents and
to the Board of Managers' Liens, the NYTC Board of Managers' Liens and the FC
Board of Managers' Liens (as such terms are defined in the Condominium
Documents); and (F) the Lender (and its successors and assigns) will take title
to the Property subject to the Condominium Documents.

          40.14 ASSIGNMENT.

          (a) In consideration of the making of the Loan by Lender to the
Borrower and for other good and valuable consideration, receipt and sufficiency
of which hereby are acknowledged, effective immediately after the recording of
this Instrument, automatically and without further action by ESDC, ESDC shall
and does hereby resign as co-mortgagee hereunder and assign unto Lender, all of
ESDC's right, title and interest under this Instrument as co-mortgagee, such
assignment being made without recourse, representation or warranty by ESDC, in
any case or event or for any purpose whatsoever.

          (b) By executing this Instrument, effective immediately after the
recording of this Instrument, automatically and without further action by
Lender, (i) Lender consents to and accepts ESDC's resignation pursuant to this
PARAGRAPH 40.14, (ii) Lender accepts the assignment by ESDC of all of ESDC's
right, title and interest under this Instrument as co-mortgagee hereunder and
(iii) Lender, as successor mortgagee, does assume and agree to be bound by all
of the terms and conditions of this Instrument, and all of the obligations under
this Instrument applicable to it in such capacity as mortgagee hereunder.

          (c) The foregoing assignment and assumption shall be and is
self-executing, effective immediately after the recording of this Instrument,
automatically and without more, and no further act shall be or is required by
any of the parties to this Instrument to effectuate the foregoing assignment and
assumption. In confirmation of the foregoing, the parties shall execute a
separate assignment of this Instrument, which is intended to be recorded in the
City Register's Office, after the recording of this Instrument.

          (d) The Borrower acknowledges that ESDC is entering into this
Instrument as co-mortgagee solely as an accommodation to the Borrower and Lender
and that ESDC shall have

                                       26

<PAGE>

absolutely no obligations, responsibilities or liabilities hereunder whatsoever
to the Borrower, the Lender and/or any third parties other than to record this
Instrument in the City Register's Office.

          (e) Borrower indemnifies, defends and holds ESDC and Mortgagee
harmless from and against any and all claims, losses, damages, costs, expenses,
suits and demands, including without limitation, reasonable attorneys fees,
court costs and disbursements, arising from or relating to ESDC's acting as
co-mortgagee hereunder.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                       27

<PAGE>

          IN WITNESS WHEREOF, Borrower, Lender and ESDC have executed this
Instrument or has caused the same to be executed by its representatives
thereunto duly authorized.

                                        NYT REAL ESTATE COMPANY LLC,
                                        a New York limited liability company

                                        By: /s/ Kenneth A. Richieri
                                            ------------------------------------
                                        Name:  Kenneth A. Richieri
                                        Title: Manager

STATE OF NEW YORK )
                  )ss.:
COUNTY OF NEW YORK)

On the 6th day of March, in the year 2009, before me, the undersigned,
personally appeared Kenneth A. Richieri, personally known to me or proved to me
on the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me he/she/they
executed the same in his/her/their/ capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.

/s/ Alaina Marie Guglielmo
-------------------------------------
Notary Public

ALAINA MARIE GUGLIELMO
Notary Public -- State of New York
No. 01GU6153040
Qualified in Westchester County
My Commission Expires Sept. 25, 2010

                                       28

<PAGE>

                                        CO-MORTGAGEE:

                                        620 EIGHTH NYT (NY) LIMITED PARTNERSHIP,
                                        a Delaware limited partnership

                                        By: 620 EIGHTH GP NYT (NY) LLC,
                                        a Delaware limited liability company,
                                        its general partner

                                        By: CPA:17 LIMITED PARTNERSHIP,
                                        a Delaware limited partnership,
                                        its sole member

                                        By: CORPORATE PROPERTY ASSOCIATES 17 -
                                        GLOBAL INCORPORATED,
                                        a Maryland corporation,
                                        its general partner

                                        By: /s/ Jason E. Fox
                                            ------------------------------------
                                        Name:  Jason E. Fox
                                        Title: Executive Director

STATE OF NEW YORK )
                  )ss.:
COUNTY OF NEW YORK)

On the 6th day of March, in the year 2009, before me, the undersigned,
personally appeared Jason E. Fox, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me he/she/they executed
the same in his/her/their/ capacity(ies), and that by his/her/their signature(s)
on the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.

/s/ Winston C. Smith
-------------------------------------
Notary Public

WINSTON C. SMITH
Notary Public -- State of New York
No. 01SM6192042
Qualified in New York County
My Commission Expires Aug. 25, 2012

                                       29

<PAGE>

                                      CO-MORTGAGEE:

                                      NEW YORK STATE URBAN  DEVELOPMENT
                                      CORPORATION,
                                      D/B/A/ EMPIRE STATE DEVELOPMENT
                                      CORPORATION

                                      By: /s/ Naresh Kapadia
                                          ------------------------------------
                                      Name: Naresh Kapadia
                                      Title: Assistant V.P. -- Planning & Design

STATE OF NEW YORK )
                  )ss.:
COUNTY OF NEW YORK)

On the 6th day of March, in the year 2009, before me, the undersigned,
personally appeared Naresh Kapadia, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me he/she/they
executed the same in his/her/their/ capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.

/s/ Yariv Katz
-------------------------------------
Notary Public

YARIV KATZ
Notary Public -- State of New York
No. 01KA6188118
Qualified in Westchester County
My Commission Expires June 2, 2012

                                       30

<PAGE>

                                    EXHIBIT A

                              Property Description

The Condominium Units (in the BUILDING located at and known as THE NEW YORK
TIMES BUILDING CONDOMINIUM and by Street Number 620-628 8TH AVENUE, NEW YORK,
NEW YORK), designated and described as Units (SEE SCHEDULE ANNEXED) (hereinafter
called the "UNITS") in the Declaration Establishing a Plan of Leasehold
Condominium Ownership of Premises made by The New York Times Building LLC, as
Declarant, under the Condominium Act of The State of New York (Article 9-B of
the Real Property Law of the State of New York), dated as of August 4, 2006 and
recorded August 15, 2006 in the Office of the Register The City of New York (the
"REGISTER"), as CRFN 2006000460293, as amended by First Amendment to Declaration
dated January 29, 2007 and recorded as CRFN 2007000075106, and Second Amendment
to Declaration dated October 11, 2007 and recorded as CRFN 2008000008734, and
Third Amendment to Declaration dated March 6, 2009 and to be recorded with the
Register (which Declaration, and any further amendments thereto, are hereinafter
collectively called the "DECLARATION"), establishing a plan for leasehold
condominium ownership of said Building and the land upon which the same is
erected (hereinafter sometimes collectively called the "PROPERTY") and also
designated and described as Tax Lots No. (SEE SCHEDULE ANNEXED), Block 1012
Section 4, Borough of MANHATTAN on the Tax Map of the Real Property Assessment
Department of the City of New York and on the floor plans of said Building
certified by Daniel Kaplan, approved by the Real Property Assessment Bureau on
August 13, 2006 and filed as Condominium Plan No. 1595 on August 15, 2006 in the
aforesaid Register's Office.

The land upon which the Building containing the Units is erected as follows:

ALL that certain plot, piece or parcel of land, situate, lying and being in the
Borough of Manhattan, County of New York, City and State of New York, bounded
and described as follows:

BEGINNING at the corner formed by the intersection of the northerly line of West
40th Street with the easterly line of 8th Avenue,

RUNNING THENCE northerly along said easterly line of 8th Avenue, 197 feet 6
inches to the corner formed by the intersection of the easterly side of 8th
Avenue with the southerly line of West 41st Street;

THENCE easterly along said southerly line of West 41st Street, 400 feet;

THENCE southerly and parallel to said easterly line of 8th Avenue, 197 feet 6
inches to the northerly line of West 40th Street;

THENCE westerly along said northerly line of West 40th Street, 400 feet to the
point or place of BEGINNING,

TOGETHER with an undivided percentage interest (SEE SCHEDULE ANNEXED) in the
Common Elements and the NYTC Limited Common Elements (as such terms are defined
in the Declaration) of the New York Times Building Condominium, recorded as CRFN
2006000460293 as amended.

                                       31

<PAGE>

                                SCHEDULE OF UNITS

<TABLE>
<CAPTION>
                           PERCENTAGE
    UNIT                  INTEREST IN
DESIGNATION   TAX LOT   COMMON ELEMENTS
-----------   -------   ---------------
<S>           <C>       <C>
     0-A        1001        0.6627%
     1-A        1003        2.0132%
     1-E        1007        0.0691%
     2-A        1009        4.7805%
     3-A        1010        4.7579%
     4-A        1011        4.5636%
     5-A        1012        1.6352%
     6-A        1013        1.7325%
     7-A        1014        1.7325%
     8-A        1015        1.7325%
     9-A        1016        1.7325%
    10-A        1017        1.7325%
    11-A        1018        1.7325%
    12-A        1019        1.7325%
    13-A        1020        1.7325%
    14-A        1021        1.7440%
    15-A        1022        1.3998%
    16-A        1023        1.7484%
    17-A        1024        1.7207%
    18-A        1025        1.7711%
    19-A        1026        1.7711%
    20-A        1027        1.7711%
    28-A        1035        0.4446%
</TABLE>

                                  32

<PAGE>

                                    EXHIBIT B

                                 Severance Lease

Agreement of Sublease dated as of December 12, 2001 between The New York Times
Building LLC, a New York limited liability company ("NYTB"), as landlord, and
NYT Real Estate Company LLC, a New York limited liability company, a memorandum
of which was recorded in the Office of the City Register of the City of New York
on October 24, 2003 as CRFN 2003000433125, as amended by NYTB's interest in
which Agreement of Sublease as landlord was assigned by Assignment and
Assumption Agreement dated as of August 15, 2006 to 42nd St. Development
Project, Inc. ("42DP"), as landlord, and recorded in the Office of the City
Register of the City of New York on November 20, 2006 as CRFN 2006000644732,
which Agreement of Sublease was amended pursuant to First Amendment to Agreement
of Sublease (NYT) dated as of August 15, 2006 between 42DP and Borrower and
recorded in the Office of the City Register of the City of New York on November
20, 2006 as CRFN 2006000644735 and by Second Amendment to Agreement of Sublease
(NYT) dated as of January 29, 2007 between 42DP and Borrower and recorded in the
Office of the City Register of the City of New York on February 22, 2007 as CRFN
2007000100157 and by Third Amendment to Agreement of Sublease (NYT) dated on or
about the date of this Mortgage between 42DP and Borrower and intended to be
recorded in the Office of the City Register of the City of New York (such
Agreement of Sublease, as so assigned and amended, the "Severance Lease").exv10w2

Exhibit 10.2

March 31, 2009

Mr. Robert Rigdon

                    Re: Amendment of Employment Agreement

Dear Robert:

     This letter will constitute an amendment to your employment agreement with us dated March 14,
2008, effective as of the date that you sign below. These amendments are:

	 	•	 	Your new position with us will be President and Chief Executive Officer.
	 
	 	•	 	Your base salary shall be $300,000 per year effective as of January 1, 2009,
payable in accordance with our current payroll practices. You shall receive a lumpsum
of $15,000 (subject to normal tax withholding) as part of your salary for the next pay
period after the effective date of this letter representing the balance of your base
salary owed to you retroactive to January 1 from the date hereof.
	 
	 	•	 	For the periods ending on January 1 and July 1 of a given year (beginning on
July 1, 2009), you may be awarded a cash performance bonus to be determined by, and to
be payable at the sole discretion of, our Compensation Committee. As a result of this
amendment, the provisions of Section 3(c) of your employment agreement will be of no
further force or effect.
	 
	 	•	 	Effective February 9, 2009, as a result of your participation in our option
exchange program, you received options to acquire 87,500 shares of common stock which
vested based on the achievement of the same performance criteria as your prior
performance based grant which was cancelled in the option exchange. This grant is
currently vested as to 25% of such shares. We will terminate this performance option
and replace it with an option to purchase 87,500 shares of our common stock, which
shall be vested as to 25% of the shares as of the effective date of this letter, and
shall vest as to an additional 25% on each of the first three anniversary dates after
such date, beginning on the first anniversary of such date. The exercise price for the
new options will be $0.66. The term of the new options is ten years from the date of
grant and the new options will be issued in accordance with the terms and conditions of
our Amended and Restated 2005 Incentive Plan, as amended.
	 
	 	•	 	We will grant you a new option to acquire 200,000 shares of our common stock,
which options shall vest as to 25% of the shares on each of the first four anniversary
dates after the date of the new grant, beginning on the first anniversary thereof. The
exercise price for the new option grants will be $0.66 per share. The term of the new
options is ten years from the date of grant and

 

	 	 	 	the new options will be issued in accordance with the terms and conditions of our
Amended and Restated 2005 Incentive Plan, as amended.

	 	•	 	Pursuant to Section 3(i) of your employment agreement, we shall reimburse you
for the cost of airline travel for your spouse to accompany you to China on your trips
for your work for us; provided that you shall only be entitled to such reimbursement
twice in any twelve-month period and such reimbursement shall be subject to our
applicable policies on airline expense reimbursement.
	 
	 	•	 	Under Section 5(a) of your employment agreement, in the event of a termination
of your employment by us without Cause (as defined in your employment agreement), we
shall, provided that you elect COBRA within the time period required by law, reimburse
your payment of your COBRA premiums through (i) the one year anniversary of your
termination or (ii) until you are eligible to participate in the health insurance plan
of another employer, whichever is sooner.
	 
	 	•	 	Under Section 6 of your employment agreement, in the event of a termination of
your employment within 60 days of a Change of Control (as defined in your employment
agreement), you will be entitled to a lump sum payment of your annual base salary then
in effect. In addition, provided that you elect COBRA within the time period required
by law, we shall reimburse your payment of your COBRA premiums through (i) the one year
anniversary of your termination or (ii) until you are eligible to participate in the
health insurance plan of another employer, whichever is sooner.

     This letter does not affect any other terms of your employment agreement. Each party
acknowledges and agrees that they will work toward an amendment and restatement of your employment
agreement to more completely reflect these amendments and any other changes which the parties deem
necessary. If you have any questions regarding this matter, please let us know.

	 	 	 	 	 
	 	SYNTHESIS ENERGY SYSTEMS, INC.

 	 
	 	/s/ Kevin Kelly
 	 
	 	Kevin Kelly 	 
	 	Chief Accounting Officer 	 
	 

	 	 	 	 	 
	ACKNOWLEDGED AND AGREED

as of March 31, 2009

 	 	 
	/s/ Robert Rigdon
 	 	 
	Robert Rigdon

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