Document:

exhibit104.htm

    
      
         

      

      
         

      

      
         

        
          EXHIBIT
10.4

        

      

    

    
      

       

      
        	 
      	
                Prepared
      by and Return to:

                Christopher
      R. Gibson, Esq.

                Archer
      & Greiner, P.C.

                One
      Centennial Square

                Haddonfield,
      NJ  08033

                 

              

      

      

    

     

    LEASEHOLD MORTGAGE,
ASSIGNMENT, SECURITY AGREEMENT

    AND FIXTURE
FILING

    

     

    by

     

    SAYREVILLE
SEAPORT ASSOCIATES, L.P.,

    a
Delaware limited partnership,

    as
Mortgagor,

     

    to and in
favor of

     

    NL
INDUSTRIES, INC. and NL ENVIRONMENTAL MANAGEMENT SERVICES, INC.,

    as
Mortgagee

    

     

    This
document serves as a Fixture Filing under the New Jersey Uniform Commercial
Code, N.J.S.A. 12A:9-101, et seq.

    

     

    Mortgagor's
Organizational Identification Number 4450800

     

    Location of
Property

     

    Borough:  Sayreville

    County:  Middlesex
County

    State:  New
Jersey

    

    

    Lots 1,
4, 5 and 6, Block 257.01

    Lot 1,
Block 257.02

    Lot 1,
Block 275.02

    Lot 3.04,
Block 257

    

    
      
        
           

        

         

      

      
         

        
          

        

      

      
         

      

    

    LEASEHOLD
MORTGAGE, ASSIGNMENT, SECURITY AGREEMENT

    AND
FIXTURE FILING

    

    

    THIS LEASEHOLD MORTGAGE, ASSIGNMENT,
SECURITY AGREEMENT AND
FIXTURE FILING (this "Mortgage") is made
this 15th day of October, 2008, by SAYREVILLE SEAPORT ASSOCIATES, L.P., a
Delaware limited partnership ("Mortgagor"), with its
main office at c/o O'Neill Properties Group, L.P., 2701 Renaissance
Boulevard, 4th Floor, King of Prussia, Pennsylvania 19406, in favor of NL
INDUSTRIES, INC., a New Jersey corporation and NL ENVIRONMENTAL MANAGEMENT
SERVICES, INC., a New Jersey corporation, each with offices at 5430 LBJ Freeway,
Suite 1700, Dallas, TX  75240

    (collectively,
"Mortgagee").

    

    ARTICLE
1

    

    Certain Definitions;
Granting Clauses; Secured Indebtedness

    

    Section
1.1.  Principal
Secured.  This Mortgage secures a loan made by Mortgagee on the
date hereof to Mortgagor in the principal amount of Fifteen Million and No/100
Dollars ($15,000,000.00), plus such additional amounts as Mortgagee may from
time to time advance pursuant to the terms and conditions of this Mortgage, with
respect to an obligation secured by a lien or encumbrance prior to the lien of
this Mortgage or for the protection of the lien of this Mortgage, together with
interest thereon (the “NL
Loan”).  Without limiting the scope of the definition of
Secured Indebtedness set forth in Section 1.5 hereof, this Mortgage secures
accrued and unpaid interest and the unpaid balances of advances made by
Mortgagee in accordance with the terms of this Mortgage for the payment of
taxes, assessments, maintenance charges and insurance premiums with respect to
the Property (as defined below), expenses incurred by Mortgagee for the
protection of the Property or the lien of this Mortgage, expenses incurred by
Mortgagee by reason of default by Mortgagor.

    

    Section
1.2.  Certain Definitions and
Reference Terms.  (a)  In addition to other terms
defined herein, each of the following terms shall have the meaning assigned to
it, such definitions to be applicable equally to the singular and the plural
forms of such terms and to all genders:

    

    "Amended and Restated
Agreement of Limited Partnership"  shall have the meaning set
forth in the Multi-Party Agreement.

    

    “Bank Loan Agreement”
means that certain Loan Agreement of even date herewith by and between
Mortgagor, as borrower, and Bank of America, as Administrative Agent and on
behalf of itself and on behalf of the other lenders party to the Bank Loan
Agreement.

    

    “Bank Loan” means that
certain $70,000,000.00 loan from Bank of America, as Administrative Agent and on
behalf of itself and on behalf of the other lenders party to the Bank Loan
Agreement.

    

    “Bank Loan Documents”
means the loan documents executed and delivered in connection with the Bank
Loan.

    

    “Bank Mortgage” means
that certain first priority Leasehold Mortgage, Assignment, Security Agreement
and Fixture Filing of even date herewith securing the Bank Note and from
Mortgagor to Bank of America, as Administrative Agent and on behalf of itself
and on behalf of the other lenders party to the Bank Loan
Agreement.

    

    “Bank Note” means that
certain Mortgage Note of even date herewith evidencing the Bank Loan from
Mortgagor to Bank of America as Administrative Agent and on behalf of itself and
on behalf of the other lenders party to the Bank Loan Agreement.

    

    “C Parcels Easement”
shall have the meaning set forth in the Settlement Agreement and
Release.

    

    "Ground
Lease"  That certain Ground Lease Agreement by and between
Mortgagor and SERA.

    

    "Intercreditor
Agreement" shall mean that certain Intercreditor, Subordination and
Standstill Agreement of even date herewith among Mortgagor, Mortgagee and Bank
of America, as Administrative Agent on behalf of itself and on behalf of the
other lenders party to the Bank Loan Agreement.

    

    "Mortgagor"  Sayreville  Seaport
Associates, L.P., a Delaware limited partnership, and its permitted successors
and assigns.

    

    "Multi-Party
Agreement" shall mean that certain Multi-Party Agreement of even date
herewith by and among Mortgagor, Sayreville Seaport Associates Acquisition
Company, LLC, OPG Participation, LLC, J. Brian O’Neill, Mortgagee, Sayreville
PRISA II LLC and The Prudential Insurance Company of America, an insurance
company organized under the laws of the State of New Jersey acting solely on
behalf of, for the benefit of, and with its liability limited to the assets of
its insurance company separate account known as PRISA II, except as expressly
provided in Section 18 of the Multi-Party Agreement.

    

    "NL Loan" shall have
the meaning set forth in Section 1.1.

    

    "NL Loan Documents"
shall have the meaning set forth in Section 1.5 hereof.

    

    "NL
Note"                          The
Mortgage Note dated of even date herewith made by Mortgagor in favor of NL in
the principal amount of $15,000,000.00, bearing interest as therein provided,
containing a provision for, among other things, the payment of reasonable
attorneys' fees and all other notes given in substitution therefore or in
modification, supplement, increase, renewal or extension thereof, in whole or in
part, all as the same may be from time to time renewed, extended, supplemented,
increased or modified and all other notes given in substitution therefore, or in
modification, renewal or extension thereof, in whole or in part.

    

    “Parcel B Easement”
shall have the meaning set forth in the Settlement Agreement and
Release.

    

    "Property” shall have
the meaning set forth in Section 1.3 hereof.

    

    "Prudential"  The
Prudential Insurance Company of America, a New Jersey corporation.

    

    "Redevelopment
Agreement"  shall have the meaning set forth in the Loan
Agreement.

    

    “Settlement Agreement and
Release” shall mean that certain Reinstated and Amended Settlement and
Release dated June 26, 2008 among Mortgagee, Mortgagor, the Sayreville Economic
and Redevelopment Agency (“SERA”) and the County of Middlesex, New Jersey (the
“County”), as amended by that Amendment to Reinstated and Amended Settlement
Agreement and Release dated as of September 25, 2008.

    

    (b)         Any
term used or defined in the New Jersey Uniform Commercial Code, as in effect
from time to time, and not defined in this Mortgage has the meaning given to the
term in the New Jersey Uniform Commercial Code, as in effect from time to time,
when used in this Mortgage; provided, however, if a term is defined in Title 9
of the New Jersey Uniform Commercial Code differently than in another title of
the New Jersey Uniform Commercial Code, the term has the meaning specified in
Title 9.

    

    Section 1.3.  Property.  In
consideration of the provisions of this Mortgage and the sum of TEN DOLLARS
($10.00) cash in hand paid and other good and valuable consideration, the
receipt and sufficiency of which are acknowledged by Mortgagor, Mortgagor does
hereby GRANT, BARGAIN, SELL, CONVEY, TRANSFER, ASSIGN and SET OVER to Mortgagee
the following: Mortgagor's interest in the Ground Lease (together with all
rights of Mortgagor thereunder), a memorandum which is intended to be file of
record with the County Clerk for Middlesex County immediately prior to the
recording of this Mortgage and the leasehold estate created thereby in and to
the real property described in Exhibit A which is
attached hereto and incorporated herein by reference (the "Land") together with
Mortgagor's interest under the Ground Lease in and to: (i) any and all
buildings, structures, improvements, alterations or appurtenances now or
hereafter situated or to be situated on the Land (collectively the "Improvements"); and
(ii) all right, title and interest of Mortgagor, now owned or hereafter
acquired, in and to (1) all streets, roads, alleys, easements, rights-of-way,
licenses, rights of ingress and egress, vehicle parking rights and public
places, existing or proposed, abutting, adjacent, used in connection with or
pertaining to the Land or the Improvements; (2) any strips or gores between the
Land and abutting or adjacent properties; and (3) all water and water rights,
timber, crops and mineral interests on or pertaining to the Land (the Land,
Improvements and other rights, titles and interests referred to in this clause
(a) being herein sometimes collectively called the "Premises");
(b) Mortgagor's interest under the Ground Lease in and to all fixtures,
equipment, systems, machinery, furniture, furnishings, appliances, inventory,
goods, building and construction materials, supplies, and articles of personal
property, of every kind and character, tangible and intangible (including
software embedded therein), now owned or hereafter acquired by Mortgagor, which
are now or hereafter attached to or situated in, on or about the Land or the
Improvements, or used in or necessary to the complete and proper planning,
remediation, development, use, occupancy or operation thereof, or acquired
(whether delivered to the Land or stored elsewhere) for use or installation in
or on the Land or the Improvements, and all renewals and replacements of,
substitutions for and additions to the foregoing (the properties referred to in
this clause (b) being herein sometimes collectively called the "Accessories," all of
which are hereby declared to be permanent accessions to the Land); (c) all of
Mortgagor's right, title and interest, if any, in, under and to (i) any plans
and specifications with respect to the redevelopment of the Premises; (ii)
Mortgagor's rights, but not liability for any breach by Mortgagor, under all
commitments (including any commitments for financing to pay any of the Secured
Indebtedness, as defined below), insurance policies (or additional or
supplemental coverage related thereto, including from an insurance provider
meeting the requirements of the NL Loan Documents or from or through any state
or federal government sponsored program or entity), contracts and agreements for
the design, construction, operation or inspection of the Improvements and other
contracts and general intangibles (including but not limited to payment
intangibles, trademarks, trade names, goodwill, software and symbols) related to
the Premises or the Accessories or the operation thereof; (iii) deposits and
deposit accounts arising from or related to any transactions related to the
Premises or the Accessories (including but not limited to Mortgagor's rights in
tenants' security deposits, deposits with respect to utility services to the
Premises, and any deposits or deposit accounts or reserves hereunder or under
any other NL Loan Documents (hereinafter defined) for taxes, insurance or
otherwise), rebates or refunds of impact fees or other taxes, assessments or
charges, money, accounts, (including deposit accounts) instruments, documents,
promissory notes and chattel paper (whether tangible or electronic) arising from
or by virtue of any transactions related to the Premises or the Accessories (iv)
permits, licenses, franchises, certificates, development rights, commitments and
rights for utilities, and other rights and privileges obtained in connection
with the Premises or the Accessories; (v) leases, rents, royalties, bonuses,
issues, profits, revenues and other benefits of the Premises and the Accessories
(without derogation of Article 3 hereof); (vi) as extracted collateral produced
from or allocated to the Land including without limitation oil, gas and other
hydrocarbons and other minerals and all products processed or obtained
therefrom, and the proceeds thereof; and (vii) engineering, accounting, title,
legal, and other technical or business data concerning the Property which are in
the possession of Mortgagor or in which Mortgagor can otherwise grant a security
interest; and (d) all (i) accounts and proceeds (cash or non-cash and including
payment intangibles) of or arising from the properties, rights, titles and
interests referred to above in this Section 1.3,
including but not limited to proceeds of any sale, lease or other disposition
thereof, proceeds of each policy of insurance (or additional or supplemental
coverage related thereto, including from an insurance provider meeting the
requirements of the NL Loan Documents or from or through any state or federal
government sponsored program or entity) relating thereto (including premium
refunds), proceeds of the taking thereof or of any rights appurtenant thereto,
including change of grade of streets, curb cuts or other rights of access, by
condemnation, eminent domain or transfer in lieu thereof for public or
quasi-public use under any law, and proceeds arising out of any damage thereto;
and (ii) all letter of credit rights (whether or not the letter of credit is
evidenced by a writing) Mortgagor now has or hereafter acquires relating to the
properties, rights, titles and interests referred to in this Section 1.3;
(iii) all commercial tort claims Mortgagor now has or hereafter acquires
relating to the properties, rights, titles and interests referred to in this
Section 1.3; and (iv) other interests of every kind and character which
Mortgagor now has or hereafter acquires in, to or for the benefit of the
properties, rights, titles and interests referred to above in this Section 1.3 and all
property used or useful in connection therewith, including but not limited to
rights of ingress and egress and remainders, reversions and reversionary rights
or interests; and if the estate of Mortgagor in any of the property referred to
above in this Section
1.3 is a leasehold estate, this conveyance shall include, and the lien
and security interest created hereby shall encumber and extend to, all other or
additional title, estates, interests or rights which are now owned or may
hereafter be acquired by Mortgagor in or to the property demised under the lease
creating the leasehold estate; TO HAVE AND TO HOLD the foregoing rights,
interests and properties, and all rights, estates, powers and privileges
appurtenant thereto (herein collectively called the "Property"), unto Mortgagee,
its successors and assigns, in trust, in fee simple forever, and to the terms,
provisions and conditions herein set forth, to secure the obligations of
Mortgagor under the NL Note and each of the other Loan Documents and all other
indebtedness and matters defined as "Secured Indebtedness" in Section 1.5 of
this Mortgage, subject and subordinate to the Bank Mortgage;

    

    PROVIDED,
HOWEVER, that if Mortgagor shall promptly pay or cause to be paid to Mortgagee
with respect to the NL Loan the principal sum, including all additional advances
and all other sums payable by Mortgagor to Mortgagee under the terms of the NL
Loan Documents, and shall perform or cause to be performed all the other terms,
conditions, agreements and provisions contained in each of the NL Loan
Documents, all without fraud or delay or deduction or abatement of anything or
for any reason, then this Mortgage and the estate hereby granted shall cease,
terminate and become void and Mortgagee shall promptly deliver a mortgage
satisfaction piece to Mortgagor in recordable form.

    

    Nothing
in this Mortgage shall modify, amend or waive any of Mortgagor and Mortgagee’s
rights and obligations under the Settlement Agreement and Release.

    

    Section 1.4.  Security
Interest.  Mortgagor hereby grants to Mortgagee a security
interest in all of Mortgagor's interest in and to the Property which constitutes
personal property or fixtures, all proceeds and products thereof, and all
supporting obligations ancillary to or arising in any way in connection
therewith (herein sometimes collectively called the "Collateral") to secure the obligations
of Mortgagor under the NL Note and the other NL Loan Documents and all other
indebtedness and matters defined as Secured Indebtedness in Section 1.5 of
this Mortgage.  In addition to its rights hereunder or otherwise,
Mortgagee shall have all of the rights of a secured party under the New Jersey
Uniform Commercial Code as in effect from time to time, or under the Uniform
Commercial Code in force from time to time in any other state to the extent the
same is applicable law.

    

     

    Section 1.5.  Secured Indebtedness, Notes,
Loan Documents, Other Obligations.  This Mortgage is made to
secure and enforce the payment and performance of the following promissory note,
obligations, indebtedness, duties and liabilities and all renewals, extensions,
supplements, increases, and modifications thereof in whole or in part from time
to time:  (a) the NL Note and (b) all indebtedness, liabilities,
duties, covenants, promises and other obligations whether joint or several,
direct or indirect, fixed or contingent, liquidated or unliquidated, and the
cost of collection of all such amounts, owed by Mortgagor to Mortgagee now or
hereafter incurred or arising pursuant to or permitted by the provisions of the
NL Note and this Mortgage, or any other document now or hereafter evidencing,
governing, guaranteeing, securing or otherwise executed in connection with the
NL Loan evidenced by the NL Note, including but not limited to any loan or
credit agreement, letter of credit or reimbursement agreement, tri-party
financing agreement, the Intercreditor Agreement, the Multi-Party Agreement, or
among Mortgagor and Mortgagee pertaining to the repayment or use of the proceeds
of the loan evidenced by the NL Note (the NL Note and this Mortgage as either of
them may be from time to time renewed, extended, supplemented, increased or
modified, being herein sometimes collectively called the "NL Loan
Documents").  The
indebtedness referred to in this Section 1.5 is hereinafter sometimes referred
to as the "Secured
Indebtedness" or the "indebtedness secured
hereby."

     

    

    ARTICLE 2

    

    Representations, Warranties
and Covenants

    

    Section
2.1.  Mortgagor represents, warrants, and covenants as
follows:

    

    (a)       Payment and
Performance.  Mortgagor will make due and punctual payment of
the Secured Indebtedness or shall cause the same to be due and punctually
paid.  Mortgagor will timely and properly perform and comply with all
of the covenants, agreements, and conditions imposed upon it by this Mortgage
and will not permit a default to occur hereunder.  Time shall be of
the essence in this Mortgage.

    

    (b)       Title and Permitted
Encumbrances.  Mortgagor has, in Mortgagor's own right, and
Mortgagor covenants to maintain, lawful, good and marketable title to its
interest in the Ground Lease and the leasehold estate created thereby together
with all other Property subject to this Mortgage.  Mortgagor is
lawfully seized and possessed of the Property and every part thereof, and has
the right to convey its interest in the same, free and clear of all liens,
charges, claims, security interests, and encumbrances except for (i) the Bank
Mortgage; (ii) the matters, if any, set forth in Schedule B-II of the
"marked-up" title commitment of Title Insurance Company No. ____________ (last
revised October 9, 2008), which are Permitted Encumbrances (as hereinafter
defined) only to the extent the same are valid and subsisting and affect the
Property, (iii) the liens and security interests evidenced by this Mortgage,
(iv) the C Parcels Easement and the Parcel B Easement; (v) statutory liens for
real estate taxes and assessments on the Property which are not yet due and
payable without premium or penalty; (vi) other liens and security interests (if
any) in favor of Mortgagee and (vii) SERA's fee interest in the Premises (the
matters described in the foregoing clauses (i), (ii), (iii), (iv), (v), (vi) and
(vii) being herein called the "Permitted
Encumbrances").  Mortgagor, and Mortgagor's successors and
assigns, will warrant specially and forever defend title to the Property,
subject as aforesaid, to Mortgagee and its successors and assigns, against the
claims and demands of all persons claiming or to claim the same or any part
thereof by, through or under Mortgagor.  Mortgagor will punctually
pay, perform, observe and keep all covenants, obligations and conditions in or
pursuant to any Permitted Encumbrance and will not modify or permit modification
of any Permitted Encumbrance without the prior written consent of
Mortgagee.  Inclusion of any matter as a Permitted Encumbrance does
not constitute approval or waiver by Mortgagee of any existing or future
violation or other breach thereof by Mortgagor, by the Property or
otherwise.  If any right or interest of Mortgagee in the Property or
any part thereof shall be endangered or questioned or shall be attacked directly
or indirectly, Mortgagee (whether or not named as a party to legal proceedings
with respect thereto), is hereby authorized and empowered to take such steps as
in its discretion may be proper for the defense of any such legal proceedings or
the protection of such right or interest of Mortgagee, including but not limited
to the employment of independent counsel, the prosecution or defense of
litigation, and the compromise or discharge of adverse claims.  All
expenditures so made of every kind and character shall be a demand obligation
(which obligation Mortgagor hereby promises to pay) owing by Mortgagor to
Mortgagee, and Mortgagee shall be subrogated to all rights of the person
receiving such payment.

    

    (c)       Taxes and Other
Impositions.  Mortgagor will pay, or cause to be paid, all
taxes, assessments and other charges or levies imposed upon or against or with
respect to the Property or the ownership, use, occupancy or enjoyment of any
portion thereof, or any utility service thereto, as the same become due and
payable without premium or penalty, including but not limited to all real estate
taxes assessed against the Property or any part thereof, and shall deliver
promptly to Mortgagee such evidence of the payment thereof as Mortgagee may
require.  Notwithstanding the foregoing, Mortgagor shall not be
required to pay any such taxes, assessments, charges or other levies so long as
Mortgagor shall in good faith, and at its cost and expense, contest the amount
or validity thereof, or take other appropriate action with respect thereto, in
good faith and in an appropriate manner or by appropriate proceedings; provided
that (a) Mortgagor notifies Mortgagee in advance that Mortgagor intends to
initiate such proceedings, (b) such proceedings operate to prevent the
collection of, or other realization upon, the taxes, assessments, charges or
other levies so contested, (c) there will be no sale, forfeiture or loss of the
Property during the contest, (d) Mortgagee shall not be subjected to any claim,
cost, liability or expense as a result thereof, and (e) Mortgagor provides
assurances satisfactory to Mortgagee (including, without limitation, the
establishment of an appropriate reserve account with Mortgagee) of its ability
to pay such taxes, assessments, charges and other levies in the event Mortgagor
is unsuccessful in its contest.  Each such contest shall be promptly
prosecuted to final conclusion or settlement, and Mortgagor shall indemnify and
save Mortgagee harmless against all claims, cost, liability or expense as a
result thereof or in connection therewith.  Promptly after the
settlement or conclusion of such contest or action, Mortgagor shall pay and
discharge the amounts which shall be levied, assessed or imposed or determined
to be payable, together with all penalties, fines, interests, costs and expenses
in connection therewith.

    

    (d)           Insurance.  Mortgagor
shall obtain and maintain at Mortgagor's sole expense: (1) mortgagee title
insurance issued to Mortgagee covering the Premises as required by Mortgagee,
without exception for mechanics' liens; (2) property insurance with respect to
all insurable Property, against loss or damage by fire, lightning, windstorm,
explosion, hail, tornado and such additional hazards as are presently included
in "Special Form" (also known as "all-risk") coverage and against any and all
acts of terrorism and such other insurable hazards as Mortgagee may require, in
an amount not less than 100% of the full replacement cost, including the cost of
debris removal, without deduction for depreciation and sufficient to prevent
Mortgagor and Mortgagee from becoming a coinsurer, such insurance to be in
"builder's risk" completed value (non-reporting) form during and with respect to
any construction on the Premises; (3) if and to the extent any portion of the
Improvements are, under the Flood Disaster Protection Act of 1973 ("FDPA"), as it may be amended
from time to time, in a Special Flood Hazard Area, within a Flood Zone
designated A or V in a participating community, a flood insurance policy in an
amount required by Mortgagee, but in no event less than the amount sufficient to
meet the requirements of applicable law and the FDPA, as such requirements may
from time to time be in effect; (4) general liability insurance, on an
"occurrence" basis against claims for "personal injury" liability, including
bodily injury, death or property damage liability,, for the benefit of Mortgagor
and Mortgagee as additional insured; (5) statutory workers' compensation
insurance with respect to any work on or about the Premises (including
employer’s liability insurance, if required by Mortgagee) covering all the
employees of Mortgagor and any contractor; (6) if there is a general contractor,
commercial general liability insurance, including products and completed
operations coverage, and in other respects similar to that described in clause 4
above, for the benefit of the general contractor as named insured and Mortgagor
and Mortgagee, as additional insureds, in addition to statutory workers’
compensation insurance with respect to any work on or about the Premises
(including employee’s liability insurance, if required by Mortgagee) covering
all the employees of the general contractor and any contractor, and (7); such
other insurance on the Property and endorsements as may from time to time be
reasonably required by Mortgagee (including but not limited to soft cost
coverage, automobile liability insurance, business interruption insurance or
delayed rental insurance, boiler and machinery insurance, earthquake insurance,
wind insurance, sinkhole coverage, and/or permit to occupy endorsement) and
against other insurable hazards or casualties which at the time are commonly
insured against in the case of premises similarly situated, due regard being
given to the height, type, construction, location, use and occupancy of
buildings and improvements.  All insurance policies shall be issued
and maintained by insurers, in amounts, with deductibles, limits and retentions,
and, and in forms satisfactory to Mortgagee, and shall require not less than ten
(10) days' prior written notice to Mortgagee of any cancellation for nonpayment
of premiums, and not less than thirty (30) days prior written notice to
Mortgagee of any other cancellation or any changes of coverage.  All
insurance companies must be licensed to do business in the State of New Jersey
and must have an A.M Best Company financial and performance rating of A-:IX or
better.  All insurance policies maintained, or caused to be
maintained, by Mortgagor with respect to the Property, except for public
liability insurance, shall provide that each such policy shall be primary
without right of contribution from any other insurance that may be carried by
Mortgagor or Mortgagee and that all of the provisions thereof, except the limits
of liability, shall operate in the same manner as if there were a separate
policy covering each insured.  If any insurer which has issued a
policy of title, hazard, liability or other insurance required pursuant to this
Mortgage or any other NL Loan Document becomes insolvent or the subject of any
petition, case, proceeding or other action pursuant to any Debtor Relief Law,
bankruptcy, receivership or similar proceeding or if in Mortgagee's reasonable
opinion the financial responsibility of such insurer is or becomes inadequate,
Mortgagor shall, in each instance promptly upon its discovery thereof or upon
the request of Mortgagee therefor and at Mortgagor's expense, promptly obtain
and deliver to Mortgagee a like policy (or, if and to the extent permitted by
Mortgagee, a acceptable evidence of insurance) issued by another insurer, which
insurer and policy meet the requirements of this Mortgage.  Without
limiting the discretion of Mortgagee with respect to required endorsements to
insurance policies, all such policies for loss of or damage to the Property
shall contain a standard mortgagee clause (without contribution) naming
Mortgagee as mortgagee with loss proceeds payable to Mortgagee notwithstanding
(i) any act, failure to act or negligence of or violation of any warranty,
declaration or condition contained in any such policy by any named or additional
insured; (ii) the occupation or use of the Property for purposes more hazardous
than permitted by the terms of any such policy; (iii) any foreclosure or other
action by Mortgagee under the Nl Loan Documents; or (iv) any change in title to
or ownership of the Property or any portion thereof, such proceeds to be held
for application as provided in the NL Loan Documents.  A copy of a
satisfactory certificate of insurance acceptable to Mortgagee shall be delivered
to Mortgagee at the time of execution of this Mortgage, with all premiums fully
paid current, and each renewal or substitute policy (or certificate of
insurance) shall be delivered to Mortgagee, with all premiums fully paid
current, at least ten (10) days before the termination of the policy it renews
or replaces.  Mortgagor shall pay all premiums on policies required
hereunder as they become due and payable and promptly deliver to Mortgagee
evidence satisfactory to Mortgagee of the timely payment thereof.  If
any loss occurs at any time when Mortgagor has failed to perform Mortgagor's
covenants and agreements in this paragraph with respect to any insurance payable
because of loss sustained to any part of the Property whether or not such
insurance is required by Mortgagee, Mortgagee shall nevertheless be entitled to
the benefit of all insurance covering the loss and held by or for Mortgagor, to
the same extent as if it had been made payable to Mortgagee.  Upon any
foreclosure hereof or transfer of title to the Property in extinguishment of the
whole or any part of the Secured Indebtedness, all of Mortgagor's right, title
and interest in and to the insurance policies referred to in this Section
(including unearned premiums) and all proceeds payable thereunder shall
thereupon vest in the purchaser at foreclosure or other such transferee, to the
extent permissible under such policies.  Mortgagee shall have the
right (but not the obligation) to make proof of loss for, settle and adjust any
claim under, and receive the proceeds of, all insurance for loss of or damage to
the Property, regardless of whether or not such insurance policies are required
by Mortgagee, and the expenses incurred by Mortgagee in the adjustment and
collection of insurance proceeds shall be a part of the Secured Indebtedness and
shall be due and payable to Mortgagee on demand.  Mortgagee shall not
be, under any circumstances, liable or responsible for failure to collect or
exercise diligence in the collection of any of such proceeds or for the
obtaining, maintaining or adequacy of any insurance or for failure to see to the
proper application of any amount paid over to Mortgagor.  Any such
proceeds received by Mortgagee shall, after deduction therefrom of all
reasonable expenses actually incurred by Mortgagee, including reasonable
attorneys' fees, at Mortgagee's option be (1) released to Mortgagor, or (2)
applied (upon compliance with such terms and conditions as may be required by
Mortgagee) to repair or restoration, either partly or entirely, of the Property
so damaged, or (3) applied to the payment of the Secured Indebtedness in such
order and manner as Mortgagee (subject to the terms of the Intercreditor
Agreement), in its sole discretion, may elect, whether or not due.  In
any event, the unpaid portion of the Secured Indebtedness shall remain in full
force and effect and the payment thereof shall not be
excused.  Mortgagor shall at all times comply with the requirements of
the insurance policies required hereunder and of the issuers of such policies
and of any board of fire underwriters or similar body as applicable to or
affecting the Property.

    

    (e)       Reserve for Insurance, Taxes
and Assessments.  Upon request of Mortgagee following the
occurrence of any Default, to secure the payment and performance of the Secured
Indebtedness, but not in lieu of such obligations, Mortgagor will deposit with
Mortgagee a sum equal to real estate taxes, assessments and charges (which
charges for the purpose of this paragraph shall include without limitation any
recurring charge which could result in a lien against the Property) against the
Property for the current year and the premiums for such policies of insurance
for the current year, all as reasonably estimated by Mortgagee and prorated to
the end of the calendar month following the month during which Mortgagee's
request is made, and thereafter will deposit with Mortgagee, on each date when
an installment of principal and/or interest is due on the Note, sufficient funds
(as estimated from time to time by Mortgagee) to permit Mortgagee to pay at
least fifteen (15) days prior to the date when penalties would accrue thereon,
the next maturing real estate taxes, assessments and charges and premiums for
such policies of insurance.  Mortgagee shall have the right to rely
upon tax information furnished by applicable taxing authorities in the payment
of such taxes or assessments and shall have no obligation to make any protest of
any such taxes or assessments.  Any excess over the amounts required
for such purposes shall be held by Mortgagee for future application to taxes and
assessments or refunded to Mortgagor, at Mortgagee's option, and any deficiency
in such funds so deposited shall be made up by Mortgagor upon demand of
Mortgagee.  All such funds so deposited shall bear no interest, may be
commingled with the general funds of Mortgagee and shall be applied by Mortgagee
toward the payment of such taxes, assessments, charges and premiums when
statements therefor are presented to Mortgagee by Mortgagor (which statements
shall be presented by Mortgagor to Mortgagee a reasonable time before the
applicable amount is due); provided, however, that, if a Default shall have
occurred hereunder, which remains uncured, such funds may at Mortgagee's option
be applied to the payment of the Secured Indebtedness in the order determined by
Mortgagee in its sole discretion, and that Mortgagee may (but shall have no
obligation) at any time, in its discretion, apply all or any part of such funds
toward the payment of any such taxes, assessments, charges or premiums which are
past due, together with any penalties or late charges with respect
thereto.  The conveyance or transfer of Mortgagor's interest in the
Property for any reason (including without limitation the foreclosure of a
subordinate lien or security interest or a transfer by operation of law) shall
constitute an assignment or transfer of Mortgagor's interest in and rights to
such funds held by Mortgagee under this paragraph but subject to the rights of
Mortgagee hereunder.

    

    (f)       Condemnation.  Mortgagor
shall notify Mortgagee immediately of any threatened or pending proceeding for
condemnation affecting the Property or arising out of damage to the Property,
and Mortgagor shall, at Mortgagor's expense, diligently prosecute any such
proceedings.  Mortgagee shall have the right (but not the obligation)
to participate in any such proceeding and to be represented by counsel of its
own choice.  Mortgagee shall be entitled to receive all sums which may
be awarded or become payable to Mortgagor for the condemnation of the Property,
or any part thereof, for public or quasi-public use, or by virtue of private
sale in lieu thereof, and any sums which may be awarded or become payable to
Mortgagor for injury or damage to the Property.  Mortgagor shall,
promptly upon written request of Mortgagee, execute such additional assignments
and other documents as may be necessary from time to time to permit such
participation and to enable Mortgagee to collect and receipt for any such
sums.  All such sums are hereby assigned to Mortgagee, and shall,
after deduction therefrom of all reasonable expenses actually incurred by
Mortgagee, including reasonable attorneys' fees, at Mortgagee's option be (1)
released to Mortgagor, or (2) applied (upon compliance with such reasonable
terms and conditions as may be required by Mortgagee) to repair or restoration
of the Property so affected, or (3) applied to the payment of the Secured
Indebtedness in such order and manner as Mortgagee, in its sole discretion, may
elect, whether or not due.  In any event the unpaid portion of the
Secured Indebtedness shall remain in full force and effect and the payment
thereof shall not be excused.  Mortgagee shall not be, under any
circumstances, liable or responsible for failure to collect or to exercise
diligence in the collection of any such sum or for failure to see to the proper
application of any amount paid over to Mortgagor.  Mortgagee is hereby
authorized, in the name of Mortgagor, to execute and deliver valid acquittances
for, and to appeal from, any such award, judgment or decree.  All
reasonable costs and expenses (including but not limited to attorneys' fees)
incurred by Mortgagee in connection with any condemnation shall be a demand
obligation owing by Mortgagor (which Mortgagor hereby promises to pay) to
Mortgagee pursuant to this Mortgage.

    

    (g)       Compliance with Legal
Requirements.  The Property and the use, operation and
maintenance thereof and all activities thereon do and shall at all times comply
with all applicable Legal Requirements (hereinafter
defined).  Mortgagor shall not, by act or omission, permit any
building or other improvement not subject to the lien of this Mortgage to rely
on the Property or any interest therein to fulfill any requirement of any Legal
Requirement.  No improvement upon or use of any part of the Property
constitutes a nonconforming use under any zoning law or similar law or
ordinance.  Mortgagor has obtained and shall preserve in force all
requisite zoning, utility, building, health, environmental and operating permits
from the governmental authorities having jurisdiction over the
Property.

    

    If
Mortgagor receives a written notice or claim from any person that the Property,
or any use, activity, operation or maintenance thereof or thereon, is not in
compliance with any Legal Requirement, Mortgagor will promptly furnish a copy of
such notice or claim to Mortgagee.  As of the date hereof, Mortgagor
has received no notice and has no knowledge of any such
noncompliance.  As used in this Mortgage:  (i) the term
"Legal
Requirement" means any Law (hereinafter defined), agreement, covenant,
restriction, easement or condition (including, without limitation of the
forgoing, any condition or requirement imposed by an insurance or surety
company), as any of the same now exists or may be changed or amended or come
into effect in the future, including, without limitation the Project
Environmental Agreements; and (ii) the term "Law" means any
federal, state or local law, statute, ordinance, code, rule, regulation,
license, permit, authorization, decision, order, injunction or decree, domestic
or foreign.

    

    (h)       Maintenance, Repair and
Restoration.  Mortgagor will keep the Improvements in first
class order, repair, operating condition and appearance, causing all necessary
repairs, renewals, replacements, additions and improvements to be promptly made,
and will not allow any of the Property to be misused, abused or wasted or to
deteriorate.  Notwithstanding the foregoing, Mortgagor will not,
without the prior written consent of Mortgagee, (i) remove from the Property any
fixtures or personal property covered by this Mortgage except such as is
replaced by Mortgagor by an article of equal suitability and value, owned by
Mortgagor, free and clear of any lien or security interest (except that created
by this Mortgage), or (ii) make any structural alteration to the Property or any
other alteration thereto which impairs the value thereof.  If any act
or occurrence of any kind or nature (including any condemnation or any casualty
for which insurance was not obtained or obtainable) shall result in damage to or
loss or destruction of the Property, Mortgagor shall give prompt notice thereof
to Mortgagee and, to the extent insurance and/or condemnation proceeds (if any)
shall be made available to Mortgagor for such purpose pursuant to the terms
hereof, Mortgagor shall promptly, at Mortgagor's sole cost and expense, commence
and continue diligently to completion to restore, repair, replace and rebuild
the Property as nearly as possible to its value, condition and character
immediately prior to the damage, loss or destruction.

    

    (i)       No Other
Liens.   Except for the Bank Mortgage and the Permitted
Exceptions, Mortgagor will not, without the prior written consent of Mortgagee,
create, place or permit to be created or placed, or through any act or failure
to act, acquiesce in the placing of, or allow to remain, any mortgage, voluntary
or involuntary lien, whether statutory, constitutional or contractual, security
interest, encumbrance or charge, or conditional sale or other title retention
document, against or covering the Property, or any part thereof, regardless of
whether the same are expressly or otherwise subordinate to the lien or security
interest created in this Mortgage, and should any of the foregoing become
attached hereafter in any manner to any part of the Property without the prior
written consent of Mortgagee, Mortgagor will cause the same to be promptly
discharged and released.  Subject to the terms of the Ground Lease,
Mortgagor will own all parts of the Property and will not acquire any fixtures,
equipment or other property (including software embedded therein) forming a part
of the Property pursuant to a lease, license, security agreement or similar
agreement, whereby any party has or may obtain the right to repossess or remove
same, without the prior written consent of Mortgagee.  If Mortgagee
consents to the voluntary grant by Mortgagor of any mortgage, lien, security
interest, or other encumbrance (hereinafter called "Subordinate
Mortgage") covering any of the Property or if the foregoing prohibition
is determined by a court of competent jurisdiction to be unenforceable as to a
Subordinate Mortgage, any such Subordinate Mortgage shall contain express
covenants to the effect that: (1) the Subordinate Mortgage is unconditionally
subordinate to this Mortgage and all Leases (hereinafter defined); (2) if any
action shall be instituted to foreclose or otherwise enforce the Subordinate
Mortgage, no tenant of any of the Leases (hereinafter defined) shall be named as
a party defendant, and no action shall be taken that would terminate any
occupancy or tenancy without the prior written consent of Mortgagee; (3) Rents
(hereinafter defined), if collected by or for the Mortgagee of the Subordinate
Mortgage, shall be applied first to the payment of the Secured Indebtedness then
due and expenses incurred in the ownership, operation and maintenance of the
Property in such order as Mortgagee may determine, prior to being applied to any
indebtedness secured by the Subordinate Mortgage; (4) written notice of default
under the Subordinate Mortgage and written notice of the commencement of any
action to foreclose or otherwise enforce the Subordinate Mortgage or to seek the
appointment of a receiver for all or any part of the Property shall be given to
Mortgagee with or immediately after the occurrence of any such default or
commencement; and (5) neither the Mortgagee of the Subordinate Mortgage, nor any
purchaser at foreclosure thereunder, nor anyone claiming by, through or under
any of them shall succeed to any of Mortgagor's rights hereunder without the
prior written consent of Mortgagee.

    

    (j)       Operation of
Property.  Mortgagor will operate the Property in a good and
workmanlike manner and in accordance with all Legal Requirements and will pay
all fees or charges of any kind in connection therewith.  Upon the
completion of the construction of improvements thereon, Mortgagor will keep the
Property occupied so as not to impair the insurance carried
thereon.  Mortgagor will not use or occupy or conduct any activity on,
or allow the use or occupancy of or the conduct of any activity on, the Property
in any manner which violates any Legal Requirement or which constitutes a public
or private nuisance or which makes void, voidable or cancelable, or increases
the premium of, any insurance then in force with respect
thereto.  Mortgagor will not use or permit the use of the Property in
such a manner which would result in such use becoming a nonconforming use under
applicable zoning ordinances or other Legal Requirement.  Mortgagor
will not impose any easement (except utility easements executed by Mortgagor in
connection with the development of the Property), restrictive covenant or
encumbrance upon the Property (except for the Bank Mortgage and the Permitted
Encumbrances), execute or file any subdivision plat or condominium declaration
affecting the Property or consent to the annexation of the Property to any
municipality, without the prior written consent of Mortgagee which consent shall
not be unreasonably withheld, conditioned or delayed.  Mortgagor will
not do or suffer to be done any act whereby the value of any part of the
Property may be lessened.  Mortgagor will preserve, protect, renew,
extend and retain all material rights and privileges granted for or applicable
to the Property.  Without the prior written consent of Mortgagee,
there shall be no drilling or exploration for or extraction, removal or
production of any mineral, hydrocarbon, gas, natural element, compound or
substance (including sand and gravel) from the surface or subsurface of the Land
regardless of the depth thereof or the method of mining or extraction
thereof.  Mortgagor will cause all debts and liabilities of any
character (including without limitation all debts and liabilities for labor,
material and equipment and all debts and charges for utilities servicing the
Property) incurred in the construction, maintenance, operation and development
of the Property to be promptly paid.

    

    (k)       Financial Matters.
Mortgagor is solvent after giving effect to all borrowings contemplated by the
Bank Loan Documents and the NL Loan Documents and no proceeding under any Debtor
Relief Law (hereinafter defined) is pending (or to Mortgagor’s knowledge
threatened) by or against Mortgagor, of any Affiliate of Mortgagor as
debtor.  For the purposes of this paragraph, “Mortgagor” shall also
include any person liable directly or indirectly for the Secured Indebtedness or
any part thereof and any joint venturer, member or general partner of
Mortgagor.

    

    (l)       Status of Mortgagor; Suits
and Claims; NL Loan Documents.  If Mortgagor is a corporation,
partnership, limited liability company, or other legal entity, Mortgagor is and
will continue to be (i) duly organized, validly existing and in good standing
under the laws of its state of organization, (ii) authorized to do business in,
and in good standing in the state in which the Property is located, and (iii)
possessed of all requisite power and authority to carry on its business and to
own and operate the Property.  Each NL Loan Document executed by
Mortgagor has been duly authorized, executed and delivered by Mortgagor, and the
obligations thereunder and the performance thereof by Mortgagor in accordance
with their terms are and will continue to be within Mortgagor's power and
authority (without the necessity of joinder or consent of any other person), are
not and will not be in contravention of any Legal Requirement (subject, however,
to the effect upon enforceability of applicable bankruptcy, insolvency, and
other similar laws affecting the rights of creditors generally and the exercise
of judicial discretion in accordance with general principles of equity) or any
other document or agreement to which Mortgagor or the Property is subject, and
do not and will not result in the creation of any encumbrance against any assets
or properties of Mortgagor, or any other person liable, directly or indirectly,
for any of the Secured Indebtedness, except as expressly contemplated by the NL
Loan Documents.  There is no suit, action, claim, investigation,
inquiry, proceeding or demand pending (or, to Mortgagor's knowledge, threatened)
which affects the Property (including, without limitation, any which challenges
or otherwise pertains to Mortgagor's title to the Property) or the validity,
enforceability or priority of any of the NL Loan Documents.  There is
no judicial or administrative action, suit or proceeding pending (or, to
Mortgagor's knowledge, threatened) against Mortgagor or against any other person
liable directly or indirectly for the Secured Indebtedness, except as has been
disclosed in writing to Mortgagee in connection with the NL Loan.  The
NL Loan Documents constitute legal, valid and binding obligations of Mortgagor
enforceable in accordance with their terms, except as the enforceability thereof
may be limited by Debtor Relief Laws (hereinafter defined) and except as the
availability of certain remedies may be limited by general principles of
equity.  Mortgagor is not a "foreign person"
within the meaning of the Internal Revenue Code of 1986, as amended, Sections
1445 and 7701 (i.e. Mortgagor is not a non-resident alien, foreign
corporation, foreign partnership, foreign trust or foreign estate as those terms
are defined therein and in any regulations promulgated
thereunder).  The loan evidenced by the Note was made solely to
acquire or carry on a business or commercial enterprise, and is not for
personal, family, household or agricultural purposes, and Mortgagor is a
business or commercial organization.  Mortgagor further warrants that
the proceeds of the Notes shall be used for commercial purposes and stipulates
that the loans evidenced by the Notes shall be construed for all purposes as
commercial loans.  Mortgagor will not cause or permit any change to be
made in its name, identity, or corporate or partnership structure, unless
Mortgagor shall have notified Mortgagee of such change prior to the effective
date of such change, and shall have first taken all action required by Mortgagee
for the purpose of further perfecting or protecting the lien and security
interest of Mortgagee in the Property.  Mortgagor's principal place of
business and chief executive office, and the place where Mortgagor keeps its
books and records concerning the Property, has for the preceding four months
been and will continue to be (unless Mortgagor notifies Mortgagee of any change
in writing prior to the date of such change) the address of Mortgagor set forth
at the end of this Mortgage.  Mortgagor's organizational
identification number assigned by the state of incorporation or organization is
correctly set forth on the first page of this Mortgage.  Mortgagor
shall promptly notify Mortgagee of any change of its organizational
identification number.

    

    (m)             Further
Assurances.  Mortgagor will, promptly on request of Mortgagee,
(i) correct any defect, error or omission which may be discovered in the
contents, execution or acknowledgment of this Mortgage or any other NL Loan
Document; (ii) execute, acknowledge, deliver, procure and record and/or file
such further documents (including, without limitation, further mortgages,
security agreements, financing statements, continuation statements, and
assignments of rents or leases) and do such further acts as may be necessary or
proper to carry out more effectively the purposes of this Mortgage and the other
NL Loan Documents, to more fully identify and subject to the liens and security
interests hereof any property intended to be covered hereby (including
specifically, but without limitation, any renewals, additions, substitutions,
replacements, or appurtenances to the Property) or as reasonably deemed
advisable by Mortgagee to protect the lien or the security interest hereunder
against the rights or interests of third persons; and (iii) provide such
certificates, documents, reports, information, affidavits and other instruments
and do such further acts as may be necessary, desirable or proper in the
reasonable determination of Mortgagee to enable Mortgagee to comply with the
requirements or requests of any agency having jurisdiction over Mortgagee or any
examiners of such agencies with respect to the indebtedness secured hereby,
Mortgagor or the Property.  Mortgagor shall pay all costs connected
with any of the foregoing, which shall be a demand obligation owing by Mortgagor
(which Mortgagor hereby promises to pay) to Mortgagee pursuant to this
Mortgage.

    

    (n)       Fees and
Expenses.  Without limitation of any other provision of this
Mortgage or of any other NL Loan Documents and to the extent not prohibited by
applicable law, Mortgagor will pay, and will reimburse to Mortgagee on demand to
the extent paid by Mortgagee: (i) all appraisal fees, filing, registration and
recording fees, recordation, transfer and other taxes, brokerage fees and
commissions, abstract fees, title search or examination fees, title policy and
endorsement premiums and fees, uniform commercial code search fees, judgment and
tax lien search fees, escrow fees, reasonable attorneys' fees, architect fees,
engineer fees, construction consultant fees, environmental inspection fees,
survey fees, and all other out-of-pocket costs and expenses of every character
reasonably incurred by Mortgagor or Mortgagee in connection with the preparation
of the NL Loan Documents, the evaluation, closing and funding of the loans
evidenced by the NL Loan Documents, and any and all amendments and supplements
to this Mortgage or the NL Note or any approval, consent, waiver, release or
other matter requested or required hereunder or thereunder, or otherwise
attributable or chargeable to Mortgagor as lessee, and ultimately, owner of the
Property; and (ii) all out of pocket costs and expenses, including reasonable
attorneys' fees and expenses, incurred or expended in connection with the
exercise of any right or remedy, or the defense of any right or remedy or the
enforcement of any obligation of Mortgagor, hereunder or under any other NL Loan
Document .

    

    (o)       Taxes on NL Note or
Mortgage.  Mortgagor will promptly pay all income, franchise
and other taxes owing by Mortgagor and any stamp, documentary, recordation and
transfer taxes or other taxes (excluding income taxes imposed upon the income of
Mortgagee) (unless such payment by Mortgagor is prohibited by law) which may be
required to be paid with respect to the NL Note, this Mortgage or any other
instrument evidencing or securing any of the Secured Indebtedness.  In
the event of the enactment after this date of any law of any governmental entity
applicable to Mortgagee, the NL Note, the Property or this Mortgage deducting
from the value of property for the purpose of taxation any lien or security
interest thereon, or imposing upon Mortgagee the payment of the whole or any
part of the taxes or assessments or charges or liens herein required to be paid
by Mortgagor, or changing in any way the laws relating to the taxation of deeds
of trust or mortgages or security agreements or debts secured by deeds of trust
or mortgages or security agreements or the interest of the mortgagee or secured
party in the property covered thereby, or the manner of collection of such
taxes, so as to affect this Mortgage or the Secured Indebtedness or Mortgagee,
then, and in any such event, Mortgagor, upon demand by Mortgagee, shall pay such
taxes, assessments, charges or liens, or reimburse Mortgagee therefor; provided,
however, that if in the opinion of counsel for Mortgagee (i) it might be
unlawful to require Mortgagor to make such payment or (ii) the making of such
payment might result in the imposition of interest beyond the maximum amount
permitted by law, then and in such event, Mortgagee may elect, by notice in
writing given to Mortgagor, to declare all of the Secured Indebtedness to be and
become due and payable ninety (90) days from the giving of such
notice.

    

    (p)       Statement Concerning
Mortgage, Etc.  Mortgagor shall at any time and from time to
time furnish within fifteen (15) days of written request by Mortgagee a written
statement in such form as may be required by Mortgagee stating that to the best
of the Mortgagor's knowledge (i) this Mortgage and the other NL Loan Documents
executed by Mortgagor are valid and binding obligations of Mortgagor,
enforceable against Mortgagor in accordance with their terms; (ii) this Mortgage
and the other NL Loan Documents have not been released, subordinated or
modified; and (iii) there are no offsets or defenses against the
enforcement of this Mortgage or any other NL Loan Document.  If any of
the foregoing statements are untrue, Mortgagor shall, alternatively, specify the
reasons therefor.

    

    (q)           Covenants, Representation
and Warranties Concerning the Ground Lease.  Mortgagor
covenants, represents and warrants that:

    

    (i)           The
Ground Lease or a memorandum thereof has been duly recorded.  The
Ground Lease is in full force and effect in accordance with the terms thereof
and has not been modified.  There are no existing defaults by any
party to the Ground Lease thereunder (or events which would constitute a default
but for the giving of notice and/or the passage of time).  Mortgagor
is the owner of the leasehold estate created by the Ground Lease and has the
right and authority to mortgage the same to Mortgagee hereunder without the need
to obtain the consent of any person, including SERA or, if needed, such consent
has been obtained.  In the event that Mortgagee acquires title to
Mortgagor's interest in the Ground Lease, by foreclosure or assignment in lieu
or under a new lease, Mortgagee may assign the Ground Lease (or such new lease,
as applicable) and shall be released from all liability under the Ground Lease
(or a new lease, as applicable), from and after the date Mortgagee provides the
ground lessor under the Ground Lease with a copy of an agreement executed by the
assignee wherein such assignee agrees to assume all of the obligations of the
Mortgagee under the Ground Lease.

    

    (ii)           Mortgagor
shall not surrender the leasehold estate created under the Ground Lease or its
interest herein described, nor terminate or cancel the Ground Lease, and will
not without the express written consent of Mortgagee modify, change, supplement,
alter or amend the Ground Lease either orally or in writing, in any way, and as
further security for the performance of the covenants herein and in the Ground
Lease contained, Mortgagor hereby assigns to Mortgagee all of its rights,
privileges and prerogatives as under the Ground Lease to terminate, cancel,
modify, change, supplement, alter or amend the Ground Lease, in any way
any.  Mortgagor acknowledges and agrees that any termination,
cancellation, modification, change, supplement, alteration or amendment of the
Ground Lease, in any way, without the prior written consent thereto by Mortgagee
shall be void and of no force and effect.  Mortgagor shall furnish to
Mortgagee, simultaneously with the giving thereof as hereinafter provided in
this sentence, copies of any notices of default by the ground lessor under the
Ground Lease which Mortgagor may give SERA or any ground lessor
thereunder.  Mortgagor covenants with Mortgagee that it shall observe
and perform each and every term, covenant, agreement and condition set forth in
the Ground Lease to be observed and/or performed by Mortgagor, as tenant
thereunder.  Mortgagee shall have the right to declare the occurrence
of a Default under this Mortgage in the event of a default in or breach of the
performance by Mortgagor under the Ground Lease, of any of the terms, covenants,
or conditions contained in the Ground Lease.

    

    (iii)           If
there shall be filed by or against the Mortgagor a petition under the Bankruptcy
Code, 11 U.S.C. §101 et seq., and the Mortgagor, as lessee under the Ground
Lease, shall determine to reject the Ground Lease pursuant to Section 365(a) of
the Bankruptcy Code, the Mortgagor shall give the Mortgagee not less than ten
(10) ten days' prior notice of the date on which the Mortgagor shall apply to
the bankruptcy court for authority to reject the Ground Lease.  The
Mortgagee shall have the right, but not the obligation, to serve upon the
Mortgagor within such ten (10) day period a notice stating that (A) the
Mortgagee demands that the Mortgagor assume and assign the Ground Lease to the
Mortgagee pursuant to Section 365 of the Bankruptcy Code and (B) the Mortgagee
may, in its discretion and if deemed prudent by the Mortgagee, cure or provide
adequate assurance of prompt cure of all defaults and provide adequate assurance
of future performance under the Ground Lease.  If the Mortgagee serves
upon the Mortgagor the notice described in the preceding sentence, the Mortgagor
shall not seek to reject the Ground Lease and shall comply with the demand
provided for in clause (A) of the preceding sentence within 30 days after the
notice shall have been given.

    

    (iv)           No
release or forbearance of any of Mortgagor's obligations under the Ground Lease,
pursuant to the Ground Lease or otherwise, shall release Mortgagor from any of
the Mortgagor's obligations under this Mortgage, including obligations with
respect to the payment of rent if provided for in the Ground Lease and the
performance of all of the terms, provisions, covenants, conditions and
agreements contained in the Ground Lease, to be kept, performed and complied
with by the tenant therein.

    

    (v)           Mortgagor
will at all times fully perform and comply with all agreements, covenants, terms
and conditions imposed upon or assumed by the tenant under the Ground Lease, and
if Mortgagor shall fail so to do, Mortgagee may (but shall not be obligated to)
take any action Mortgagee deems necessary or desirable to prevent or to cure any
default by Mortgagor in the performance of or compliance with any of the
tenant's covenants or obligations under the Ground Lease.  Mortgagor
shall furnish to Mortgagee immediately upon receipt thereof copies of any
notices of default under the Ground Lease received by Mortgagor from the ground
lessor under the Ground Lease, whether or not the ground lessor is required
under the Ground Lease to give any such notices to Mortgagee, and if any such
notices are given to them orally by the ground lessor, Mortgagor shall
immediately furnish full particulars thereof to Mortgagee in
writing.  Upon receipt by Mortgagee from the ground lessor under the
Ground Lease, or upon receipt from Mortgagor, as aforesaid, of any such notice
of default under the Ground Lease, Mortgagee may rely thereon and may, but in no
case is obligated to, take any action to cure such default even though the
existence or nature of such default shall be questioned or denied by Mortgagor,
or by any party on behalf of Mortgagor.  Mortgagor hereby expressly
grants to Mortgagee and agrees that Mortgagee shall have absolute and immediate
right to enter in and upon the Premises or any part thereof to such extent and
as often as Mortgagee, in its sole discretion, deems necessary or desirable in
order to prevent or to cure any such default by Mortgagor.  Mortgagee
may pay and extend such sums of money as Mortgagee in its sole discretion deems
necessary for any such purpose, and Mortgagor hereby agrees to pay to Mortgagee,
immediately and without demand, all such sums so paid and expended by Mortgagee,
together with interest thereon from the date of each such payment at the Past
Due Rate (as such term is defined in the NL Note).  All sums so paid
and expended by Mortgagee, and the interest thereon, shall be added to and be
secured by the lien of this Mortgage.

    

    (vi)           Mortgagor
shall furnish to Mortgagee, immediately upon request, any and all information
concerning the performance by Mortgagor of its obligations under the Ground
Lease, and shall permit Mortgagee or its agent at all reasonable times to make
investigation or examination concerning such performance and
information.  Mortgagor will promptly deposit with Mortgagee (to be
held by Mortgagee at its option until the lien of this Mortgage shall be
released) any and all documentary evidence received by it showing compliance
with the provisions of the Ground Lease and 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 Ground Lease which may
concern or affect the estate of the ground lessor or tenant under the Ground
Lease or the interest of Mortgagee hereunder.  In furtherance of, and
without limiting the foregoing, Mortgagor shall provide Mortgagee with a
contemporaneous exact copy of all written communications sent to or received
from the ground lessor under the Ground Lease and shall give Mortgagee an
immediate written explanation of all oral communications sent to or received
from the ground lessor under the Ground Lease of a material nature or which
involves a claimed breach or default under the Ground Lease by either ground
lessor or the Mortgagor.  Mortgagor will take all reasonable steps,
including legal proceedings, to protect its own right, title and interest in any
of the Property and to enable Mortgagee to defend its interest
therein.  Without limitation, if any action, proceeding, motion or
notice shall be commenced or filed in respect to the Ground Lease or the
Property in connection with any case under the Bankruptcy Code, 11 U.S.C. §101
et seq., Mortgagee shall have the option, to the exclusion of Mortgagor,
exercisable upon notice from Mortgagee to Mortgagor, to conduct and control any
such litigation with counsel of Mortgagee's choice, but Mortgagee shall consult
with and advise Mortgagor, from time to time of the progress of any such
litigation.  Mortgagee may proceed in its own name or in the name of
Mortgagor in connection with any such litigation, and Mortgagor agrees to
execute any and all powers, authorizations, consents and other documents
required by the Mortgagee in connection therewith.  Mortgagor shall,
upon demand, pay to Mortgagee all costs and expenses (including reasonable
attorneys' fees) paid or incurred by Mortgagee in connection with the
prosecution or conduct of any such proceedings.  Any such costs or
expenses not paid by Mortgagor as aforesaid shall be secured by the lien of this
Mortgage and shall be added to the principal amount of the indebtedness secured
hereby.  Mortgagor shall not commence any action, suit, proceeding or
case, or file any application or make any motion, in respect of the Ground Lease
in any such case under Debtor Relief Laws (as such term is defined in the Loan
Agreement) without the prior written consent of Mortgagee.

    

    (vii)           The
lien of this Mortgage shall attach to all of Mortgagor's rights and remedies at
any time arising under or pursuant to subsection 365(h) of the Bankruptcy Code,
11 U.S.C. §365(h), including, without limitation, all of Mortgagor's rights to
remain in possession of the Premises thereunder.  Mortgagor shall not,
without Mortgagee's prior written consent, elect to treat the Ground Lease as
terminated under subsection 365(h)(1) of the Bankruptcy Code, 11 U.S.C.
§365(h)(1), and any such election made without Mortgagee's prior written consent
shall be void.

    

    (ix)           Mortgagor
hereby unconditionally assigns, transfers and sets over to Mortgagee all of its
claims and rights to the payment of damages arising from any rejection by the
ground lessor of the Ground Lease under the Bankruptcy Code, 11 U.S.C. §101
et
seq.  Mortgagee shall have the right to proceed in its own name
or in the name of Mortgagor in respect of any claim, suit, action or proceeding
relating to the rejection of the Ground Lease, including, without limitation,
the right to file and prosecute, to the exclusion of Mortgagor, any proofs of
claim, complaints, motions, applications, notices and other documents, in any
case in respect of the ground lessor under any Debtor Relief
Laws.  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
Mortgage shall have been satisfied and discharged in full.

    

    (x)           Unless
Mortgagee shall otherwise expressly consent in writing, the fee title to the
property demised by the Ground Lease and the leasehold estate shall not merge
but shall always remain separate and distinct, notwithstanding the union of such
estates either in the ground lessor or the Mortgagor or in a third party by
purchase or otherwise.

    

    (xi)           Mortgagor
hereby represents and warrants each of the following with respect to the Ground
Lease:

    

    (A)           The
Ground Lease requires the ground lessor under the Ground Lease to give notice of
any default by the Mortgagor to the Mortgagee; or the Ground Lease, or an
estoppel letter received by the Mortgagee from the ground lessor under the
Ground Lease and further provides that notice of termination given under the
Ground Lease is not effective against the Mortgagee unless a copy of the notice
has been delivered to the Mortgagee in the manner described in the Ground
Lease.

    

    (B)           The
Ground Lease or an estoppel letter received by the Mortgagee from the ground
lessor under the Ground Lease, provides Mortgagee a reasonable opportunity
(including, where necessary, sufficient time to gain possession of the interest
of the Mortgagee under the Ground Lease) to cure any default under the Ground
Lease that is curable, after the receipt of notice of any the default, before
the ground lessor may terminate the Ground Lease.

    

    (C)           The
Ground Lease has a term that extends not less than twenty (20) years beyond the
maturity date of the Loan.

    

    (D)           The
Ground Lease requires the ground lessor to enter into a new lease with the
Mortgagee upon termination of the Ground Lease for any reason, including
rejection of the Ground Lease in any bankruptcy proceeding, provided that the
Mortgagee cures any defaults that are susceptible to being cured by the
Mortgagee.

    

    (E)           The
Ground Lease required that within ten (10) days after written notice by
Mortgagor or Mortgagee, the ground lessor under the Ground Lease shall execute,
acknowledge and deliver to Mortgagee, a statement in writing certifying that the
Ground Lease is unmodified and in full force and effect, setting for the dates
to which the rent and other charges payable by Mortgagor have been paid, and the
amount thereof, whether the ground lessor under the Ground Lease has knowledge
of any existing default by Mortgagor or notice of default served by ground
lessor upon Mortgagor and stating the nature of any such defaults, and any other
information the Mortgagee may reasonably request.

    

    (F)           The
Ground Lease expressly acknowledges that the Mortgagee will be named as a first
mortgagee on the Mortgagor's casualty insurance policy and as an additional
insured on Mortgagor's general liability insurance.

    

    
      41

    

    (G)           The
Ground Lease does not impose restrictions on subletting that would be viewed as
commercially
unreasonable by a prudent commercial mortgage lender.

    

    (H)           The
Ground Lease provides that no amendments, changes, cancellations, alterations,
surrender, or modifications may be made to the Ground Lease without the consent
of the Mortgagee.

    

    (xii)   
In the event that the ground lessor's interest and estate in, to or under the
Ground Lease or the Premises is held or owned by the same person or entity which
holds or owns the Mortgagor's interest and estate in, to or under the Ground
Lease or the Premises, the lien, right, title and interest under and pursuant to
this Mortgage shall at the election of Mortgagee, evidenced by the filing of a
recorded instrument stating the same, automatically, without any further
documentation, extend to and shall be spread to and over the fee simple estate
in and to the Premises and shall be and constitute a fee simple
mortgage. 

    Indemnification.

    

    (r)       (i)
Mortgagor will indemnify and hold harmless Mortgagee from and against, and
reimburse Mortgagee on demand for, any and all Indemnified Matters (hereinafter
defined).  For purposes of this paragraph (r), the term "Mortgagee" shall
include the directors, officers, partners, employees and agents of Mortgagee and
any persons owned or controlled by, owning or controlling, or under common
control or affiliated with Mortgagee.  Without limitation, the
forgoing indemnities shall apply to each indemnified person with respect to
matters which in whole or in part are caused by or arise out of the negligence
of such (and/or any other) indemnified person. Any amount to be paid under this
paragraph (r) by Mortgagor to Mortgagee shall be a demand obligation owing by
Mortgagor (which Mortgagor hereby promises to pay) to Mortgagee pursuant to this
Mortgage.  Nothing in this paragraph, elsewhere in this Mortgage or in
the Note shall limit or impair any rights or remedies of Mortgagee (including
without limitation any rights of contribution or indemnification) against
Mortgagor or any other person under any other provision of this Mortgage or the
Note.

    

         (ii)             As
used herein, the term "Indemnified Matters"
means any and all claims, demands, liabilities (including strict liability),
losses, damages (including consequential damages), causes of action, judgments,
penalties, fines, costs and expenses (including without limitation, reasonable
fees and expenses of attorneys and other professional consultants and experts,
and of the investigation and defense of any claim, whether or not such claim is
ultimately defeated, and the settlement of any claim or judgment including all
value paid or given in settlement) of every kind, known or unknown, foreseeable
or unforeseeable, which may be imposed upon, asserted against or incurred or
paid by Mortgagee at any time and from time to time, whenever imposed, asserted
or incurred, because of, resulting from, in connection with, or arising out of
any transaction, act, omission, event or circumstance in any way connected with
the Property or with this Mortgage or the Note, including but not limited to any
bodily injury or death or property damage occurring in or upon or in the
vicinity of the Property through any cause whatsoever at any time on or before
the Release Date (hereinafter defined) any act performed or omitted to be
performed hereunder or under any the Note, any breach by Mortgagor of any
representation, warranty, covenant, agreement or condition contained in this
Mortgage or in the Note, any default as defined herein, any claim under or with
respect to any Lease (hereinafter defined).  The term "Release Date" as used
herein means the earlier of the following two dates: (i) the date on which the
indebtedness and obligations secured hereby have been paid and performed in full
and this Mortgage has been released or satisfied of record, or (ii) the date on
which the lien of this Mortgage is fully and finally foreclosed or a conveyance
by deed in lieu of such foreclosure is fully and finally effective, and
possession of the Property has been given to the purchaser or grantee free of
occupancy and claims to occupancy by Mortgagor and Mortgagor's heirs, devisees,
representatives, successors and assigns; provided, that if such payment,
performance, release, foreclosure or conveyance is challenged, in bankruptcy
proceedings or otherwise, the Release Date shall be deemed not to have occurred
until such challenge is rejected, dismissed or withdrawn with
prejudice.  The indemnities in this paragraph (r) shall not terminate
upon the Release Date or upon the release, satisfaction, foreclosure or other
termination of this Mortgage but will survive the Release Date, foreclosure of
this Mortgage or conveyance in lieu of foreclosure, the repayment of the Secured
Indebtedness, the discharge and satisfaction or release of this Mortgage and the
Note, any bankruptcy or other debtor relief proceeding, and any other event
whatsoever.  Notwithstanding the foregoing the indemnities in the
paragraph (r) shall terminate and be of no further force or effect in the event
that no claim for Indemnified Matters shall be asserted, or action therefor
instituted, prior to the expiration of the statutory period of limitations under
applicable Law following the Release Date.

    

    Section
2.2.  Performance by Mortgagee on
Mortgagor's Behalf.  Mortgagor agrees that, if Mortgagor fails,
after the expiration of any applicable grace and/or cure period, to perform any
act or to take any action which under any NL Loan Document Mortgagor is required
to perform or take, or to pay any money which under any NL Loan Document
Mortgagor is required to pay, and whether or not the failure then constitutes a
default hereunder or thereunder, and whether or not there has occurred any
default or defaults hereunder or the Secured Indebtedness has been accelerated,
Mortgagee, in Mortgagor's name or its own name, may, but shall not be obligated
to, after reasonable written notice to Mortgagor under the circumstances,
perform or cause to be performed such act or take such action or pay such money,
and any expenses so incurred by Mortgagee, with interest thereon at the Past Due
Rate set forth in the NL Note, and any money so paid by Mortgagee shall be a
demand obligation owing by Mortgagor to Mortgagee (which obligation Mortgagor
hereby promises to pay), shall be a part of the indebtedness secured hereby, and
Mortgagee, upon making such payment, shall be subrogated to all of the rights of
the person, entity or body politic receiving such payment.  Mortgagee
and its designees shall have the right to enter upon the Property at any time
and from time to time, after reasonable notice to Mortgagor, for any such
purposes.  No such payment or performance by Mortgagee shall waive or
cure any default or waive any right, remedy or recourse of
Mortgagee.  Any such payment may be made by Mortgagee in reliance on
any statement, invoice or claim without inquiry into the validity or accuracy
thereof.  Each amount due and owing by Mortgagor to Mortgagee pursuant
to this Mortgage shall bear interest, from the date such amount becomes due
until paid, at the Past Due Rate but never in excess of the maximum nonusurious
amount permitted by applicable law, which interest shall be payable to Mortgagee
on demand; and all such amounts, together with such interest thereon, shall
automatically and without notice be a part of the indebtedness secured
hereby.  The amount and nature of any expense by Mortgagee hereunder
and the time when paid shall be fully established by the certificate of
Mortgagee or any of Mortgagee's officers or agents.

    

    Section
2.3.  Absence of Obligations of
Mortgagee with Respect to Property.  Notwithstanding anything
in this Mortgage to the contrary, including, without limitation, the definition
of "Property" and/or the provisions of Article 3 hereof, (i) to the extent
permitted by applicable law, the Property is composed of Mortgagor's rights,
title and interests therein but not Mortgagor's obligations, duties or
liabilities pertaining thereto, (ii) Mortgagee neither assumes nor shall have
any obligations, duties or liabilities in connection with any portion of the
items described in the definition of "Property" herein, either prior to or after
obtaining title to such Property, whether by foreclosure sale, the granting of a
deed in lieu of foreclosure or otherwise, and (iii) Mortgagee may, at any time
prior to or after the acquisition of title to any portion of the Property as
above described, advise any party in writing as to the extent of Mortgagee's
interest therein and/or expressly disaffirm in writing any rights, interests,
obligations, duties and/or liabilities with respect to such Property or matters
related thereto.  Without limiting the generality of the foregoing, it
is understood and agreed that Mortgagee shall have no obligations, duties or
liabilities prior to or after acquisition of title to any portion of the
Property, as lessee under any lease or purchaser or seller under any contract or
option unless Mortgagee elects otherwise by written
notification.  Notwithstanding the foregoing, the terms of this
Section 2.3 shall not amend, modify or waive any of Mortgagee’s obligations with
respect to the Property set forth in the Settlement Agreement and
Release.

    

    Section
2.4.   Authorization to File
Financing Statements; Power of Attorney.  Mortgagor hereby
authorizes Mortgagee at any time and from time to time to file any initial
financing statements, amendments thereto and continuation statements with or
without signature of Mortgagor as authorized by applicable law, as applicable to
the Collateral required by Mortgagee to establish or maintain the validity,
perfection and priority of the security interests granted in this Mortgage. For
the purpose of such filings, Mortgagor agrees to furnish any information
reasonably requested by Mortgagee promptly upon request by
Mortgagee.  Mortgagor also ratifies its authorization for Mortgagee to
have filed any like initial financing statements, amendments thereto or
continuation statements if filed prior to the date of this
Mortgage.  Mortgagor hereby irrevocably constitutes and appoints
Mortgagee and any officer or agent of Mortgagee, with full power of
substitution, as its true and lawful attorneys-in-fact with full irrevocable
power and authority in the place and stead of Mortgagor or in Mortgagor’s own
name to execute in Mortgagor’s name any such financing statements, amendments
and continuation statements and to otherwise carry out the purposes of this
Section 2.4, to the extent that Mortgagor’s authorization above is not
sufficient.  To the extent permitted by law, Mortgagor hereby ratifies
all acts said attorneys-in-fact shall lawfully do, have done in the past or
cause to be done in the future by virtue hereof.  This power of
attorney is a power coupled with an interest and shall be
irrevocable.

    

    

    ARTICLE 3

    

    Assignment of Rents and
Leases

    

    Section
3.1.  Assignment.  Mortgagor
hereby unconditionally, absolutely and presently sells, grants, transfers,
releases, conveys and assigns to Mortgagee all Rents (hereinafter defined) and
all of Mortgagor's rights in and under all Leases (hereinafter
defined).  This grant, transfer, assignment and conveyance of Leases
gives Mortgagee the present unconditional and absolute right and title to the
Leases and Rents and to collect and receive the Rents. So long as no Default has
occurred, which remains uncured, Mortgagor shall have a license (which license
shall terminate automatically and without further notice upon the occurrence of
a Default), in the place and stead of Mortgagee, to collect, but not prior to
accrual, the Rents under the Leases and, where applicable, subleases, such Rents
to be held in trust for Mortgagee and to otherwise deal with all Leases as
permitted by this Mortgage.  Each month, provided no Default has
occurred, which remains uncured, Mortgagor may retain such Rents as were
collected that month and may use and enjoy such Rents free of any trust for
Mortgagee.  Upon the revocation of such license, all Rents shall be
paid directly to Mortgagee and not through the Mortgagor, all without the
necessity of any further action by Mortgagee, including, without limitation, any
action to obtain possession of the Land, Improvements or any other portion of
the Property or any action for the appointment of a
receiver.  Mortgagor, during the continuance of any Default, hereby
authorizes and directs the tenants under the Leases to pay Rents to Mortgagee
upon written demand by Mortgagee, without further consent of Mortgagor, without
any obligation of such tenants to determine whether a Default has in fact
occurred and regardless of whether Mortgagee has taken possession of any portion
of the Property, and the tenants may rely upon any written statement delivered
by Mortgagee to the tenants.  Any such payments to Mortgagee shall
constitute payments to Mortgagor under the Leases, and Mortgagor hereby
irrevocably appoints Mortgagee as its attorney-in-fact to do all things which
Mortgagor might reasonably otherwise do with respect to the Property and the
Leases thereon, including, without limitation, (i) collecting Rents with or
without suit and applying the same, less expenses of collection, to any of the
obligations secured hereunder or to expenses of operating and maintaining the
Property (including reasonable reserves for anticipated expenses), at the option
of the Mortgagee, all in such manner as may be determined by Mortgagee, or at
the option of Mortgagee, holding the same as security for the payment of the
Secured Indebtedness, (ii) leasing, in the name of Mortgagor, the whole or any
part of the Property which may become vacant, and (iii) employing agents
therefor and paying such agents reasonable compensation for their services;
provided, however, that Mortgagee shall exercise such rights as attorney-in-fact
only subsequent to the occurrence of a Default under the terms of the Notes or
this Mortgage, which remains uncured.  The curing of such Default,
unless other Defaults also then exist, shall entitle Mortgagor to recover its
aforesaid license to do any such things which Mortgagor might otherwise do with
respect to the Property and the Leases thereon and to again collect such
Rents.  The powers and rights granted in this paragraph shall be in
addition to the other remedies herein provided for upon the occurrence of a
Default and may be exercised independently of or concurrently with any of said
remedies.  Nothing in the foregoing shall be construed to impose any
obligation upon Mortgagee to exercise any power or right granted in this
paragraph or to assume any liability under any Lease of any part of the Property
and no liability shall attach to Mortgagee for failure or inability to collect
any Rents under any such Lease.  The assignment contained in this
Section shall automatically become null and void upon the release or
satisfaction of record of this Mortgage.  As used herein: (i) "Lease" means each
existing or future lease, sublease (to the extent of Mortgagor's rights
thereunder) or other agreement under the terms of which any person has or
acquires any right to occupy or use the Property, or any part thereof, or
interest therein, and each existing or future guaranty of payment or performance
thereunder, and all extensions, renewals, modifications and replacements of each
such lease, sublease, agreement or guaranty; and (ii) "Rents" means all of
the rents, revenue, income, profits and proceeds derived and to be derived from
the Property or arising from the use or enjoyment of any portion thereof or from
any Lease, including but not limited to the proceeds from any negotiated lease
termination or buyout of such Lease, liquidated damages following default under
any such Lease, all proceeds payable under any policy of insurance covering loss
of rents resulting from untenantability caused by damage to any part of the
Property, all of Mortgagor's rights to recover monetary amounts from any tenant
in bankruptcy including, without limitation, rights of recovery for use and
occupancy and damage claims arising out of Lease defaults, including rejections,
under any applicable Debtor Relief Law (hereinafter defined), together with any
sums of money that may now or at any time hereafter be or become due and payable
to Mortgagor by virtue of any and all royalties, overriding royalties, bonuses,
delay rentals and any other amount of any kind or character arising under any
and all present and all future oil, gas, mineral and mining leases covering the
Property or any part thereof, and all proceeds and other amounts paid or owing
to Mortgagor under or pursuant to any and all contracts and bonds relating to
the construction or renovation of the Property.

    

    Section
3.2.  Covenants, Representations
and Warranties Concerning Leases and Rents.  Mortgagor
covenants, represents and warrants that: (a) Mortgagor has good title to, and is
the owner of the entire landlord's interest in, the Leases and Rents hereby
assigned and authority to assign them; (b) to the extent that any Leases
currently exist, all such Leases are valid and enforceable, and in full force
and effect, and are unmodified except as stated therein; (c)  neither
Mortgagor nor any tenant in the Property is in default under its Lease (and no
event has occurred which with the passage of time or notice or both would result
in a default under its Lease) or is the subject of any bankruptcy, insolvency or
similar proceeding; (d) except as provided in the NL Loan Documents and unless
otherwise stated in a Permitted Encumbrance, Mortgagor has not or will not
assign, mortgage, pledge or otherwise encumber any of the Rents or Leases and no
other person has or will acquire any right, title or interest in such Rents or
Leases; (e) no Rents have been waived, released, discounted, set off or
compromised; (f) except as stated in the Leases, Mortgagor has not received any
funds or deposits from any tenant for which credit has not already been made on
account of accrued Rents; (g) Mortgagor shall perform all of its obligations
under the Leases and enforce the tenants' obligations under the Leases to the
extent enforcement is prudent under the circumstances; (h) Mortgagor will not
without the prior written consent of Mortgagee, enter into any Lease after the
date hereof, or waive, release, discount, set off, compromise, reduce or defer
any Rent, receive or collect Rents more than one (1) month in advance, grant any
rent-free period to any tenant, reduce any Lease term or waive, release or
otherwise modify any other material obligation under any Lease, renew or extend
any Lease except in accordance with a right of the tenant thereto in such Lease,
approve or consent to an assignment of a Lease or a subletting of any part of
the premises covered by a Lease, or settle or compromise any claim against a
tenant under a Lease in bankruptcy or otherwise; (i) Mortgagor will not, except
in good faith where the tenant is in material default thereunder, terminate or
consent to the cancellation or surrender of any Lease having an unexpired term
of one (1) year or more unless promptly after the cancellation or surrender a
new Lease of such premises is made with a new tenant having a credit standing,
in Mortgagee's reasonable judgment, at least equivalent to that of the tenant
whose Lease was canceled, on substantially the same terms as the terminated or
canceled Lease; (j) Mortgagor will not execute any Lease except in accordance
with the Bank Loan Documents and for actual occupancy by the tenant thereunder;
(k) Mortgagor shall give prompt notice to Mortgagee, as soon as Mortgagor first
obtains notice, of any claim, or the commencement of any action, by any tenant
or subtenant under or with respect to a Lease regarding any claimed damage,
default, diminution of or offset against Rent, cancellation of the Lease, or
constructive eviction, excluding, however, notices of default under residential
Leases, and Mortgagor shall defend, at Mortgagor's expense, any proceeding
pertaining to any Lease, including, if Mortgagee so requests, any such
proceeding to which Mortgagee is a party; (l) Mortgagor shall as often as
requested in writing by Mortgagee, within ten (10) days of each request, deliver
to Mortgagee a complete rent roll of the Property in such detail as Mortgagee
may reasonably require and financial statements of the tenants, subtenants and
guarantors under the Leases to the extent available to Mortgagor, and deliver to
such of the tenants and others obligated under the Leases specified by Mortgagee
written notice of the assignment in Section 3.1 hereof in form and content
satisfactory to Mortgagee; (m) promptly upon written request by Mortgagee,
Mortgagor shall deliver to Mortgagee executed originals of all Leases and copies
of all records relating thereto; (n) there shall be no merger of the leasehold
estates, created by the Leases, with the fee estate of the Land without the
prior written consent of Mortgagee; and (o) Mortgagee may at any time and from
time to time by specific written instrument intended for the purpose,
unilaterally subordinate the lien of this Mortgage to any Lease, without joinder
or consent of, or notice to, Mortgagor, any tenant or any other person, and
notice is hereby given to each tenant under a Lease of such right to
subordinate.  No such subordination shall constitute a subordination
to any lien or other encumbrance, whenever arising, or improve the right of any
junior lien mortgagee; and nothing herein shall be construed as subordinating
this Mortgage to any Lease.

    

    Section
3.3.  Estoppel
Certificates.  All Leases shall require the tenant to execute
and deliver to Mortgagee an estoppel certificate in customary form within ten
(10) days after written notice from the Mortgagee.

    

    Section
3.4.  No
Liability of Mortgagee.  Mortgagee's acceptance of this
assignment shall not be deemed to constitute Mortgagee a "mortgagee in
possession," nor obligate Mortgagee to appear in or defend any proceeding
relating to any Lease or to the Property, or to take any action hereunder,
expend any money, incur any expenses, or perform any obligation or liability
under any Lease, or assume any obligation for any deposit delivered to Mortgagor
by any tenant and not as such delivered to and accepted by
Mortgagee.  Mortgagee shall not be liable for any injury or damage to
person or property in or about the Property, or for Mortgagee's failure to
collect or to exercise diligence in collecting Rents, but shall be accountable
only for Rents that it shall actually receive.  Neither the assignment
of Leases and Rents nor enforcement of Mortgagee's rights regarding Leases and
Rents (including collection of Rents) nor possession of the Property by
Mortgagee nor Mortgagee's consent to or approval of any Lease (nor all of the
same), shall render Mortgagee liable on any obligation under or with respect to
any Lease or constitute affirmation of, or any subordination to, any Lease,
occupancy, use or option.

    

    If
Mortgagee seeks or obtains any judicial relief regarding Rents or Leases, the
same shall in no way prevent the concurrent or subsequent employment of any
other appropriate rights or remedies nor shall same constitute an election of
judicial relief for any foreclosure or any other purpose.  Mortgagee
neither has nor assumes any obligations as lessor or landlord with respect to
any Lease.  The rights of Mortgagee under this Article 3 shall be
cumulative of all other rights of Mortgagee under the NL Loan
Documents.

    

    ARTICLE 4

    

    Default

    

    Section
4.1.  Events
of Default.  The occurrence of any one of the following shall
be a default under this Mortgage ("default" or "Default"):

    

    (a)       Failure to Pay
Indebtedness.  Any of the Secured Indebtedness is not paid
within ten (10) days after the date as and when due, regardless of how such
amount may have become due.

    

    (b)       Nonperformance of
Covenants.  Any covenant, agreement or condition herein (other
than covenants otherwise addressed in another paragraph of this Section, such as
covenants to pay the Secured Indebtedness) is not fully and timely performed,
observed or kept, and such failure remains uncured for more than thirty (30)
days after written notice thereof shall have been sent by Mortgagee to
Mortgagor, unless the nature of the failure is such that (i) it cannot be cured
within the thirty (30) day period, (ii) Mortgagor institutes corrective action
within the thirty (30) day period, and (iii) Mortgagor diligently pursues such
action until the failure is remedied and completes the cure thereof within a
period of an additional thirty (30) days.

    

    (c)       Representations.  Any
statement, representation or warranty in any of the NL Loan Documents is false
or misleading in any material respect on the date hereof or on the date as of
which such statement, representation or warranty is made, and such statement,
representation or warranty is not made true and correct (as of the time such
corrective action is taken) within the applicable grace period (if any) provided
for in such NL Loan Document.

    

    (d)       Bankruptcy or
Insolvency.  Mortgagor, Guarantor, Prudential or any other
person liable, directly or indirectly, for any of the Secured Indebtedness (or
any general partner, joint venturer or member of Mortgagor or such other person
or entity):

    

                 (i)       (A)
Executes an assignment for the benefit of creditors, or takes any action in
furtherance thereof; or (B) admits in writing its inability to pay, or fails to
pay, its debts generally as they become due; or (C) as a debtor, files a
petition, case, proceeding or other action pursuant to, or voluntarily seeks the
benefit or benefits of, Title 11 of the United States Code as now or hereafter
in effect or any other law, domestic or foreign, as now or hereafter in effect
relating to bankruptcy, insolvency, liquidation, receivership, reorganization,
arrangement, composition, extension or adjustment of debts, or similar laws
affecting the rights of creditors (Title 11 of the United States Code and such
other laws being herein called "Debtor Relief Laws"),
or takes any action in furtherance thereof; or (D) seeks the appointment of a
receiver, trustee, custodian or liquidator of the Property or any part thereof
or of any significant portion of its other property; or

    

           (ii)                    Suffers
the filing of a petition, case, proceeding or other action against it as a
debtor under any Debtor Relief Law or seeking appointment of a receiver,
trustee, custodian or liquidator of the Property or any part thereof or of any
significant portion of its other property, and (A) admits, acquiesces in or
fails to contest diligently the material allegations thereof, or (B) the
petition, case, proceeding or other action results in entry of any order for
relief or order granting relief sought against it, or (C) in a proceeding under
Debtor Relief Laws, the case is converted from one chapter to another, or (D)
fails to have the petition, case, proceeding or other action permanently
dismissed or discharged on or before the earlier of trial thereon or sixty (60)
days next following the date of its filing; or

    

                  (iii)                          Conceals,
removes, or permits to be concealed or removed, any part of its property, with
intent to hinder, delay or defraud its creditors or any of them, or makes or
suffers a transfer of any of its property which may be fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or makes any transfer of its
property to or for the benefit of a creditor at a time when other creditors
similarly situated have not been paid; or suffers or permits, while insolvent,
any creditor to obtain a lien (other than as described in subparagraph (iv)
below) upon any of its property through legal proceedings which are not vacated
and such lien discharged prior to enforcement thereof and in any event within
sixty (60) days from the date thereof; or

    

                  (iv)                          Fails  to
have discharged within a period of thirty (30) days, but in any event prior to
sale, seizure or transfer of title, any attachment, sequestration, or similar
writ levied upon any portion of  its property; provided, however, that
the occurrence of the foregoing shall not constitute a Default so long as any
such levy is being contested in good faith by proper proceedings which stays the
enforcement of the same; or

    

                 (v)             Fails
to pay immediately or to have bonded off to the complete satisfaction of
Mortgagee any final money judgment against it within a period of thirty (30)
days from the date of entry, but in any event, prior to any action being taken
to enforce the same.

    

    (e)       Transfer of the
Property.  Except for the Bank Mortgage and that certain
Assignment of Rents and Leases as described in the Bank Loan Documents, any
sale, lease, conveyance, assignment, pledge, encumbrance, or transfer of all or
any part of the Property or any interest therein, voluntarily or involuntarily,
whether by operation of law or otherwise, except: (i) sales or transfers of
items of the Accessories which have become obsolete or worn beyond practical use
and which have been replaced by adequate substitutes, owned by Mortgagor, having
a value equal to or greater than the replaced items when new; and (ii) the
grant, in the ordinary course of business, of a leasehold interest in a part of
the Improvements to a tenant for occupancy, not containing a right or option to
purchase and not in contravention of any provision of this Mortgage or of any
other NL Loan Document.  Mortgagee may, in its sole discretion, waive
a default under this paragraph, but it shall have no obligation to do so, and
any waiver may be conditioned upon such one or more of the following (if any)
which Mortgagee may require:  the grantee's integrity, reputation,
character, creditworthiness and management ability being satisfactory to
Mortgagee in its sole judgment and grantee executing, prior to such sale or
transfer, a written assumption agreement containing such terms as Mortgagee may
require, a principal paydown on the NL Note, an increase in the rate of interest
payable under the NL Note, a transfer fee, a modification of the term of the NL
Note, and any other modification of the NL Loan Documents which Mortgagee may
require.  NOTICE - THE DEBT SECURED HEREBY IS SUBJECT TO CALL IN FULL
IN THE EVENT OF SALE OR CONVEYANCE OF THE PROPERTY CONVEYED.

    

    (f)       Abandonment.  The
owner of the Property abandons any of the Property without the intent to
return.

    

    (g)       Default Under Bank
Loan.  A default or event of default occurs under the Bank Loan
Documents and which default or event of default remains uncured beyond any
applicable grace and/or cure period provided therefore or foreclosure
proceedings are instituted under the Bank Mortgage.

    

    (h)       Destruction.  The
Improvements are so demolished, destroyed or damaged that, in the reasonable
opinion of Mortgagee, they cannot be restored or rebuilt with available funds in
accordance with the terms hereof prior to the final maturity date of the
Notes.

    

    (i)       Condemnation.  (i)
Any governmental authority shall require, or commence any proceeding for, the
demolition of any building or structure comprising a part of the Premises, or
(ii) there is commenced any proceeding to condemn or otherwise take pursuant to
the power of eminent domain, or a contract for sale or a conveyance in lieu of
such a taking is executed which provides for the transfer of, a material portion
of the Premises.  For the purposes hereof, a taking or transfer of a
material portion of the Premises shall mean any taking (or transfer in lieu
thereof) to an extent that any current or proposed use of the Premises cannot be
continued or any taking (or transfer in lieu thereof) of any portion which would
result in the blockage or substantial impairment of access or utility service to
the Improvements or which would cause the Premises to fail to comply with any
Legal Requirement.

    

    (j)       Liquidation,
Etc.  The liquidation, termination, dissolution, insolvency,
merger, consolidation or failure to maintain good standing of Mortgagor, or any
general partner of Mortgagor in the State of New Jersey and/or the state of
incorporation or organization, if different, or the death, legal incapacity or
insolvency of J. Brian O'Neill.

    

    (k)       Enforceability;
Priority.  Any of the NL Loan Documents shall for any reason
without Mortgagee's specific written consent cease to be in full force and
effect, or shall be declared null and void or unenforceable in whole or in part,
or the validity or enforceability thereof, in whole or in part, shall be
challenged or denied by any party thereto other than Mortgagee; or the liens,
mortgages or security interests of Mortgagee in any of the Property become
unenforceable in whole or in part, or cease to be of the priority herein
required, or the validity or enforceability thereof, in whole or in part, shall
be challenged or denied by Mortgagor or any person obligated to pay any part of
the Secured Indebtedness.

    

    (l)       Material Adverse
Change.  In Mortgagee's reasonable
opinion:  (a) the prospect of payment of all or any part of the
Secured Indebtedness has been impaired because of a material, adverse change in
the Property or the financial condition, results of operations, business or
properties of Mortgagor, Guarantor, or any person liable, directly or
indirectly, for any of the Secured Indebtedness, (b) a breach in any of the
financial covenants regarding PRISA II as set forth in Section 19.1, 19.2 or
19.3 of the Multi-Party Agreement (b) a material impairment of any party to
perform its obligation under the Amended and Restated Agreement of Limited
Partnership or (c) a material adverse change upon the legality, validity,
binding effect or enforceability of any of the NL Loan Documents, the Amended
and Restated Agreement of Limited Partnership, the Ground Lease or the
Redevelopment Agreement (as defined in the Settlement Agreement and
Release).

    

    (m)             Other Property Related
Agreements.  A default or event of default occurs, by any party
thereto, under any of the Amended and Restated Agreement of Limited Partnership,
the Ground Lease or the Redevelopment Agreement, which default remains uncured
beyond applicable grace and/or cure periods provided thereby, or any of the
foregoing is modified in any matter whatsoever, without the prior written
consent of Mortgagee, or is terminated for any reason whatsoever.

    

    

    Section
4.2  Notice
and Cure.  If any provision of this Mortgage or any other Loan
Document provides for Mortgagee to give to Mortgagor any notice regarding a
default or incipient default, then if Mortgagee shall fail to give such notice
to Mortgagor as provided, the sole and exclusive remedy of Mortgagor for such
failure shall be to seek appropriate equitable relief to enforce the agreement
to give such notice and to have any acceleration of the maturity of the NL Note
and the Secured Indebtedness postponed or revoked and foreclosure proceedings in
connection therewith delayed or terminated pending or upon the curing of such
default in the manner and during the period of time permitted by such agreement,
if any, and Mortgagor shall have no right to damages or any other type of relief
not herein specifically set out against Mortgagee, all of which damages or other
relief are hereby waived by Mortgagor. Nothing herein or in any other NL Loan
Document shall operate or be construed to add on or make cumulative any cure or
grace periods specified in any of the NL Loan Documents.

    

    ARTICLE 5

    

    Remedies

    

    Section
5.1.  Certain
Remedies.  If a Default shall occur, which remains uncured,
Mortgagee may (but shall have no obligation to) exercise any one or more of the
following remedies, without notice (unless notice is required by applicable
statute):

    

    (a)       Acceleration.  Mortgagee
may at any time and from time to time declare any or all of the Secured
Indebtedness immediately due and payable and such Secured Indebtedness shall
thereupon be immediately due and payable.  Upon and such declaration,
such Secured Indebtedness shall thereupon be immediately due and payable without
presentment, demand, protest, notice of protest, notice of acceleration or of
intention to accelerate or any other notice or declaration of any kind, all of
which are hereby expressly waived by Mortgagor.  Without limitation of
the foregoing, upon the occurrence of a Default described in clauses (A), (C) or
(D) of subparagraph (i) of paragraph (d) of Section 4.1, hereof, all of the
Secured Indebtedness shall thereupon be immediately due and payable, without
presentment, demand, protest, notice of protest, declaration or notice of
acceleration or intention to accelerate, or any other notice, declaration or act
of any kind, all of which are hereby expressly waived by Mortgagor.

    

    (b)       Enforcement of Assignment of
Rents.  In addition to the rights of Mortgagee under Article 3
hereof, prior or subsequent to taking possession of any portion of the Property
or taking any action with respect to such possession, Mortgagee may: (1) collect
and/or sue for the Rents in Mortgagee's own name, give receipts and releases
therefor, and after deducting all expenses of collection, including reasonable
attorneys' fees and expenses, apply the net proceeds thereof to the Secured
Indebtedness in such manner and order as Mortgagee may elect and/or to the
operation and management of the Property, including the payment of management,
brokerage and reasonable attorney's fees and expenses; and (2) require Mortgagor
to transfer all security deposits and records thereof to Mortgagee together with
original counterparts of the Leases.

    

    (c)         Foreclosure.  Mortgagee
may, with or without entry, institute one or more actions for the complete or
partial foreclosure of this Mortgage or to institute other proceedings according
to law for foreclosure, and prosecute the same to judgment, execution and sale,
for the collection of the Secured Indebtedness and all costs and expenses of
such proceedings, including reasonable attorneys’ fees and actual attorneys’
expenses.

    

    To the
extent permitted by law, Mortgagee has the option of proceeding as to
Mortgagor's interest in both the Premises and the Accessories in accordance with
its rights and remedies in respect of the Property, in which event the default
provisions of the Uniform Commercial Code will not apply.  Mortgagee
also has the option of exercising, in respect of Mortgagor's interest in the
Property consisting of Accessories, all of the rights and remedies available to
a secured party upon default under the applicable provisions of the New Jersey
Uniform Commercial Code.  In the event Mortgagee elects to proceed
with respect to the Accessories separately from the Land, whenever applicable
provisions of the New Jersey Uniform Commercial Code require that notice be
reasonable, ten (10) days notice will be deemed reasonable.

    

    (d)             Mortgages of Conveyance and
Transfer Upon the completion of every foreclosure, the public officer
acting under executive order of the court (a "Selling Official") will execute
and deliver to each purchaser a bill of sale or deed of conveyance, as
appropriate, for the items of the Property that are sold.  Mortgagor
hereby grants every such Selling Official the power as the attorney-in-fact of
Mortgagor to execute and deliver in Mortgagor's name all deeds, bills of sale
and conveyances necessary to convey and transfer to the purchaser all of
Mortgagor's rights, title and interest in the items of Property which are
sold.  Mortgagor hereby ratifies and confirms all that such
attorney-in-fact lawfully do pursuant to such power.  Nevertheless,
Mortgagor, if so requested by the Selling Official or by any purchaser, will
ratify any such sale by executing and delivering to such Selling Official or to
such purchaser, as applicable, such deeds, bills of sale or other Mortgages of
conveyance and transfer as may be specified in any such request.

    

    (f)       Recitals.  The recitals contained in any Mortgage of
conveyance or transfer made by a Selling Official to any purchaser at any
Judicial Sale will, to the extent permitted by law, conclusively establish the
truth and accuracy of the matters stated therein, including the amount of the
Obligations, the occurrence of a Default, and the advertisement and conduct of
such Judicial Sale in the manner provided herein or under applicable law, and
the qualification of the Selling Official.  All prerequisites to such
Judicial Sale will be presumed from such recitals to have been satisfied and
performed.

    

    (g)             Divestiture of Title;
Bar.  To the extent permitted by applicable law,
every sale made as contemplated by this Mortgage will operate to divest all
rights, title, and interest of Mortgagor in and to the items of the Property
that are sold, and will be a perpetual bar, both at law and in equity, against
Mortgagor and Mortgagor’s heirs, executors, administrators, personal
representatives, successors and assigns, and against everyone else, claiming the
item sold either from, through or under Mortgagor or Mortgagor’s heirs,
executors, administrators, personal representatives, successors or
assigns.

    

    (h)         Sale of Portion of Mortgaged
Property. The Lien
created by this Mortgage, as it pertains to any Property that remains unsold,
will not be affected by foreclosure sale of less than all of the
Property.

    

    (i)         Receiver.  Mortgagee
may apply to any court of competent jurisdiction to have a receiver appointed to
enter upon and take possession of the Property, collect the Rents therefrom and
apply the same as the court may direct, such receiver to have all of the rights
and powers permitted under the laws of the State of New Jersey.  To
the extent permitted by law, the right of the appointment of such receiver shall
be a matter of strict right without regard to the value or the occupancy of the
Property or the solvency or insolvency of Mortgagor.  The expenses,
including receiver's fees, reasonable attorneys' fees, costs and agent's
commission incurred pursuant to the powers herein contained, together with
interest thereon at the default rate under the Notes, shall be secured hereby
and shall be due and payable by Mortgagor immediately without notice or demand.
Notwithstanding the appointment of any receiver or other custodian, Mortgagee
shall be entitled as pledgee to the possession and control of any cash or
deposits at the time held by, payable, or deliverable under the terms of this
Mortgage to the Mortgagee, and the Mortgagee shall have the right to offset the
unpaid Secured Indebtedness against any such cash or deposits in such order as
Mortgagee may elect.

    

    (j)  Uniform Commercial
Code.  Mortgagee
may exercise any or all of its rights and remedies under the New Jersey Uniform
Commercial Code as in effect from time to time, (or under the Uniform Commercial
Code in force from time to time in any other state to the extent the same is
applicable law) or other applicable law as well as all other rights and remedies
possessed by Mortgagee, all of which shall be cumulative.  Mortgagee
is hereby authorized and empowered to enter the Property or other place where
the Accessories may be located without legal process, and to take possession of
the Accessories without notice or demand, which hereby are waived to the maximum
extent permitted by the laws of the State of New Jersey.  Upon demand
by Mortgagee, Mortgagor shall make the Accessories available to Mortgagee at a
place reasonably convenient to Mortgagee.  Mortgagee may proceed under
the Uniform Commercial Code as to all or any part of the Accessories, and in
conjunction therewith may exercise all of the rights, remedies and powers of a
secured creditor under the Uniform Commercial Code.  Any notification
required by the Uniform Commercial Code shall be deemed reasonably and properly
given if sent in accordance with the Notice provisions of this Mortgage at least
ten (10) days before any sale or other disposition of the
Accessories.  Mortgagee may choose to dispose of some or all of the
property, in any combination consisting of both Accessories and Property, in one
or more public or private sales to be held in accordance with the Law and
procedures applicable to real property, as permitted by Article 9 of the Uniform
Commercial Code.  Mortgagor agrees that such a sale of Accessories
together with Property constitutes a commercially reasonable sale of the
Accessories.

    

    (k)       Lawsuits.  Mortgagee
may proceed by a suit or suits in equity or at law, whether for collection of
the indebtedness secured hereby, the specific performance of any covenant or
agreement herein contained or in aid of the execution of any power herein
granted, or for any foreclosure hereunder or for the sale of the Property under
the judgment or decree of any court or courts of competent
jurisdiction.  Mortgagor hereby assents to the passage of a decree for
the sale of the Property by any equity court having jurisdiction.

    

    (l)       Entry on
Property.  Mortgagee is authorized, prior or subsequent to the
institution of any foreclosure proceedings, to the fullest extent permitted by
applicable law, to enter upon the Property, or any part thereof, and to take
possession of the Property and all books and records relating thereto, and to
exercise without interference from Mortgagor any and all rights which Mortgagor
has with respect to the management, possession, operation, protection or
preservation of the Property.  Mortgagee shall not be deemed to have
taken possession of the Property or any part thereof except upon the exercise of
its right to do so, and then only to the extent evidenced by its demand and
overt act specifically for such purpose.  All costs, expenses and
liabilities of every character reasonably incurred by Mortgagee in managing,
operating, maintaining, protecting or preserving the Property shall constitute a
demand obligation of Mortgagor (which obligation Mortgagor hereby promises to
pay) to Mortgagee pursuant to this Mortgage.  If necessary to obtain
the possession provided for above, Mortgagee may invoke any and all legal
remedies to dispossess Mortgagor. In connection with any action taken by
Mortgagee pursuant to this Section, Mortgagee shall not be liable for any loss
sustained by Mortgagor resulting from any failure to let the Property or any
part thereof, or from any act or omission of Mortgagee in managing the Property
unless such loss is caused by the willful misconduct and bad faith of Mortgagee,
nor shall Mortgagee be obligated to perform or discharge any obligation, duty or
liability of Mortgagor arising under any lease or other agreement relating to
the Property or arising under any Permitted Encumbrance or otherwise arising,
except as otherwise expressly provided in any subordination, non-disturbance and
attornment agreement executed by Mortgagee with respect to the
Property.  Mortgagor hereby assents to, ratifies and confirms any and
all actions of Mortgagee with respect to the Property taken under this
Section.

    

    (m)             Other Rights and
Remedies.  Mortgagee may exercise any and all other rights and
remedies which Mortgagee may have under the NL Loan Documents, or at law or in
equity or otherwise.

    

    Section
5.3.  Proceeds of
Foreclosure.  The proceeds of any sale held by Mortgagee or any
receiver or public officer in foreclosure of the liens and security interests
evidenced hereby shall be applied in accordance with the requirements of
applicable laws and to the extent consistent therewith:  FIRST, to the payment
of all necessary out of pocket costs and expenses incident to such foreclosure
sale, including but not limited to all reasonable attorneys' fees and legal
expenses, advertising costs, auctioneers' fees, costs of title rundowns and lien
searches, inspection fees, appraisal costs, fees for professional services,
environmental assessment and remediation fees, all court costs and charges of
every character, and to the payment of the other Secured Indebtedness, including
specifically without limitation the principal, accrued interest and reasonable
attorneys' fees due and unpaid on the NL Note and the amounts due and unpaid and
owed to Mortgagee under this Mortgage, the order and manner of application to
the items in this clause FIRST to be in
Mortgagee's sole discretion; and SECOND, the
remainder, if any there shall be, shall be paid to Mortgagor, or to Mortgagor's
representatives, successors or assigns, or such other persons or entities
(including the Mortgagee or beneficiary of any inferior lien) as may be entitled
thereto by law; provided, however, that if Mortgagee is uncertain which person
or persons are so entitled, Mortgagee may interplead such remainder in any court
of competent jurisdiction, and the amount of any reasonable attorneys' fees,
court costs and out of pocket expenses incurred in such action shall be a part
of the Secured Indebtedness and shall be reimbursable (without limitation) from
such remainder.

    

    Section
5.4.  Mortgagee as
Purchaser.  Mortgagee shall have the right to become the
purchaser at any sale held by Mortgagee or by any receiver or public officer or
at any public sale, and Mortgagee shall have the right to credit upon the amount
of Mortgagee's successful bid, to the extent necessary to satisfy such bid, all
or any part of the Secured Indebtedness in such manner and order as Mortgagee
may elect.

    

    Section 5.6.  Foreclosure as to Matured
Debt.  Upon the occurrence of a Default, Mortgagee shall have
the right to proceed with foreclosure (judicial or nonjudicial) of the liens and
security interests hereunder without declaring the entire Secured Indebtedness
due, and in such event any such foreclosure sale may be made subject to the
unmatured part of the Secured Indebtedness; and any such sale shall not in any
manner affect the unmatured part of the Secured Indebtedness, but as to such
unmatured part this Mortgage shall remain in full force and effect just as
though no sale had been made.  The proceeds of such sale shall be
applied as provided in Section 5.3 hereof
except that the amount paid under clause FIRST thereof shall be only the matured
portion of the Secured Indebtedness and any proceeds of such sale in excess of
those provided for in clause FIRST (modified as provided above) shall be applied
to the prepayment (without penalty) of any other Secured Indebtedness in such
manner and order and to such extent as Mortgagee deems advisable, and the
remainder, if any, shall be applied as provided in clause SECOND of Section 5.3
hereof.  Several sales may be made hereunder without exhausting the
right of sale for any unmatured part of the Secured Indebtedness.

    

    Section
5.6.  Remedies
Cumulative.  All rights and remedies provided for herein and in
any other NL Loan Document are cumulative of each other and of any and all other
rights and remedies existing at law or in equity, and Mortgagee shall, in
addition to the rights and remedies provided herein or in any other NL Loan
Document, be entitled to avail itself of all such other rights and remedies as
may now or hereafter exist at law or in equity for the collection of the Secured
Indebtedness and the enforcement of the covenants herein and the foreclosure of
the liens and security interests evidenced hereby, and the resort to any right
or remedy provided for hereunder or under any such other NL Loan Document or
provided for by law or in equity shall not prevent the concurrent or subsequent
employment of any other appropriate right or rights or remedy or
remedies.

    

    Section
5.7.  Mortgagee's Discretion as to
Security.  Mortgagee may resort to any security given by this
Mortgage or to any other security now existing or hereafter given to secure the
payment of the Secured Indebtedness, in whole or in part, and in such portions
and in such order as may seem best to Mortgagee in its sole discretion, and any
such action shall not in anywise be considered as a waiver of any of the rights,
benefits, liens or security interests evidenced by this Mortgage.

    

    Section
5.8.  Mortgagor's Waiver of
Certain Rights.  To the full extent Mortgagor may do so,
Mortgagor agrees that Mortgagor will not at any time insist upon, plead, claim
or take the benefit or advantage of any law now or hereafter in force providing
for any appraisement, valuation, stay, extension or redemption, homestead,
moratorium, reinstatement, marshaling or forbearance, and Mortgagor, for
Mortgagor, Mortgagor's heirs, devisees, representatives, successors and assigns,
and for any and all persons ever claiming any interest in the Property, to the
extent permitted by applicable law, hereby waives and releases all rights of
redemption, valuation, appraisement, stay of execution, notice of intention to
mature or declare due the whole of the Secured Indebtedness, notice of election
to mature or declare due the whole of the Secured Indebtedness and all rights to
a marshaling of assets of Mortgagor, including the Property, or to a sale in
inverse order of alienation in the event of foreclosure of the liens and/or
security interests hereby created.  Mortgagor shall not have or assert
any right under any statute or rule of law pertaining to the marshaling of
assets, sale in inverse order of alienation, the exemption of homestead, the
administration of estates of decedents, or other matters whatsoever to defeat,
reduce or affect the right of Mortgagee under the terms of this Mortgage to a
sale of the Property for the collection of the Secured Indebtedness without any
prior or different resort for collection, or the right of Mortgagee under the
terms of this Mortgage to the payment of the Secured Indebtedness out of the
proceeds of sale of the Property in preference to every other claimant
whatsoever.  To the extent permitted by law, Mortgagor waives any
right or remedy which Mortgagor may have or be able to assert pursuant to any
provision of New Jersey law pertaining to the rights and remedies of
sureties.  If any law referred to in this Section and now in force, of
which Mortgagor or Mortgagor's heirs, devisees, representatives, successors or
assigns or any other persons claiming any interest in the Property might take
advantage despite this Section, shall hereafter be repealed or cease to be in
force, such law shall not thereafter be deemed to preclude the application of
this Section to the extent permitted by law.

    

    Section
5.9.  Delivery of Possession After
Foreclosure.  In the event there is a foreclosure sale
hereunder and at the time of such sale, Mortgagor or Mortgagor's
representatives, or successors as owners of the Property are occupying or using
the Property, or any part thereof, each and all shall immediately become the
tenant of the purchaser at such sale, which tenancy shall be a tenancy from day
to day, terminable at the will of purchaser, at a reasonable rental per day
based upon the value of the property occupied, such rental to be due daily to
the purchaser; and to the extent permitted by applicable law, the purchaser at
such sale shall, notwithstanding any language herein apparently to the contrary,
have the sole option to demand immediate possession following the sale or to
permit the occupants to remain as tenants at will.  Except as
otherwise expressly agreed to by Mortgagee in any subordination, non-disturbance
and attornment agreement executed by Mortgagee with respect to the Property,
after such foreclosure, any Leases to tenants or subtenants that are subject to
this Mortgage (either by their date, their express terms, or by agreement of the
tenant or subtenant) shall, at the sole option of Mortgagee or any purchaser at
such sale, either (i) continue in full force and effect, and the tenant(s)
or subtenant(s) thereunder will, upon request, attorn to and acknowledge in
writing to the purchaser or purchasers at such sale or sales as landlord
thereunder, or (ii) upon notice to such effect from Mortgagee or any purchaser
or purchasers, terminate within sixty (60) days from the date of
sale.  In the event the tenant fails to surrender possession of the
Property upon demand, the purchaser shall be entitled to institute and maintain
a summary action for possession of the Property (such as an action for forcible
detainer) in any court having jurisdiction.

    

    ARTICLE 6

    

    Miscellaneous

    

    Section
6.1.  Scope
of Mortgage.  This Mortgage is a mortgage of both real and
personal property, a security agreement, an assignment of rents and leases, a
financing statement and a collateral assignment, and also covers proceeds and
fixtures.

    

    Section
6.2.  Effective as a Financing
Statement.  This Mortgage shall be effective as a financing
statement filed as a fixture filing with respect to all fixtures included within
the Property and is to be filed for record in the real estate records of each
county where any part of the Property (including said fixtures) is
situated.  This Mortgage shall also be effective as a financing
statement covering as-extracted collateral (including oil and gas), accounts and
general intangibles under the New Jersey Uniform Commercial Code, in effect from
time to time, and similar provisions (if any) of the Uniform Commercial Code, as
in effect from time to time, as enacted in any other state where the Property is
situated which will be financed at the wellhead or minehead of the wells or
mines located on the Property and is to be filed for record in the real estate
records of each county where any part of the Property is
situated.  This Mortgage shall also be effective as a financing
statement covering any other Property and may be filed in any other appropriate
filing or recording office.  The mailing address of Mortgagor and the
Mortgagee are set forth at the preamble of this Mortgage.  A carbon,
photographic or other reproduction of this Mortgage or of any financing
statement relating to this Mortgage shall be sufficient as a financing statement
for any of the purposes referred to in this Section.

    

    Section
6.3.  Notice
to Account Debtors.  In addition to the rights granted
elsewhere in this Mortgage, following a Default, Mortgagee may at any time
notify the account debtors or obligors of any accounts, chattel paper, general
intangibles, negotiable instruments or other evidences of indebtedness included
in the Collateral to pay Mortgagee directly.

    

    Section
6.4.  Waiver
by Mortgagee.  Mortgagee may at any time and from time to time
by a specific writing intended for the purpose: (a) waive compliance by
Mortgagor with any covenant herein made by Mortgagor to the extent and in the
manner specified in such writing; (b) consent to Mortgagor's doing any act which
hereunder Mortgagor is prohibited from doing, or to Mortgagor's failing to do
any act which hereunder Mortgagor is required to do, to the extent and in the
manner specified in such writing; (c) release any part of the Property or any
interest therein from the lien and security interest of this Mortgage; or (d)
release any party liable, either directly or indirectly, for the Secured
Indebtedness or for any covenant herein or in any other NL Loan Document,
without impairing or releasing the liability of any other party.  No
such act shall in any way affect the rights or powers of Mortgagee hereunder
except to the extent specifically agreed to by Mortgagee in such
writing.

    

    Section
6.5.  No
Impairment of Security.  The lien, security interest and other
security rights of Mortgagee hereunder or under any other NL Loan Document shall
not be impaired by any indulgence, moratorium or release granted by Mortgagee
including, but not limited to, any renewal, extension or modification which
Mortgagee may grant with respect to any Secured Indebtedness, or any surrender,
compromise, release, renewal, extension, exchange or substitution which
Mortgagee may grant in respect of the Property, or any part thereof or any
interest therein, or any release or indulgence granted to any endorser,
guarantor or surety of any Secured Indebtedness.  The taking of
additional security by Mortgagee shall not release or impair the lien, security
interest or other security rights of Mortgagee hereunder or affect the liability
of Mortgagor or of any endorser, guarantor or surety, or improve the right of
any junior lien mortgagee in the Property (without implying hereby Mortgagee's
consent to any junior lien).

    

    Section
6.6.  Acts
Not Constituting Waiver by Mortgagee.  Mortgagee may waive any
default without waiving any other prior or subsequent
default.  Mortgagee may remedy any default without waiving the default
remedied.  Neither failure by Mortgagee to exercise, nor delay by
Mortgagee in exercising, nor discontinuance of the exercise of any right, power
or remedy (including but not limited to the right to accelerate the maturity of
the Secured Indebtedness or any part thereof) upon or after any default shall be
construed as a waiver of such default or as a waiver of the right to exercise
any such right, power or remedy at a later date.  No single or partial
exercise by Mortgagee of any right, power or remedy hereunder shall exhaust the
same or shall preclude any other or further exercise thereof, and every such
right, power or remedy hereunder may be exercised at any time and from time to
time.  No modification or waiver of any provision hereof nor consent
to any departure by Mortgagor therefrom shall in any event be effective unless
the same shall be in writing and signed by Mortgagee and then such waiver or
consent shall be effective only in the specific instance, for the purpose for
which given and to the extent therein specified.  No notice to nor
demand on Mortgagor in any case shall of itself entitle Mortgagor to any other
or further notice or demand in similar or other
circumstances.  Remittances in payment of any part of the Secured
Indebtedness other than in the required amount in immediately available U.S.
funds shall not, regardless of any receipt or credit issued therefor, constitute
payment until the required amount is actually received by Mortgagee in
immediately available U.S. funds and shall be made and accepted subject to the
condition that any check or draft may be handled for collection in accordance
with the practice of the collecting bank or banks.  Acceptance by
Mortgagee of any payment in an amount less than the amount then due on any
Secured Indebtedness shall be deemed an acceptance on account only and shall not
in any way excuse the existence of a default hereunder, notwithstanding any
notation on or accompanying such partial payment to the contrary.

    

    Section
6.7.  Mortgagor's
Successors.  If the ownership of the Property or any part
thereof becomes vested in a person other than Mortgagor, Mortgagee may, without
notice to Mortgagor, deal with such successor or successors in interest with
reference to this Mortgage and to the Secured Indebtedness in the same manner as
with Mortgagor, without in any way vitiating or discharging Mortgagor's
liability hereunder or for the payment of the indebtedness or performance of the
obligations secured hereby.  No transfer of the Property, no
forbearance on the part of Mortgagee, and no extension of the time for the
payment of the Secured Indebtedness given by Mortgagee shall operate to release,
discharge, modify, change or affect, in whole or in part, the liability of
Mortgagor hereunder for the payment of the indebtedness or performance of the
obligations secured hereby or the liability of any other person hereunder for
the payment of the indebtedness secured hereby.  Mortgagor agrees that
it shall be bound by any modification of this Mortgage or any of the other NL
Loan Documents made by Mortgagee and any subsequent owner of the Property, with
or without notice to Mortgagor, and no such modifications shall impair the
obligations of Mortgagor under this Mortgage or any other NL Loan
Document.  Nothing in this Section or elsewhere in this Mortgage shall
be construed to imply Mortgagee's consent to any transfer of the
Property.

    

    Section
6.8.  Place
of Payment; Forum; Waiver of Jury Trial.  All Secured
Indebtedness which may be owing hereunder at any time by Mortgagor shall be
payable at the place designated in the NL Note (or if no such designation is
made, at the address of Mortgagee indicated at the end of this
Mortgage).  Mortgagor hereby irrevocably submits generally and
unconditionally for itself and in respect of its property to the non-exclusive
jurisdiction of any state or federal court sitting in the State of New Jersey or
of any state or federal court sitting in the jurisdiction in which the Secured
Indebtedness is payable over any suit, action or proceeding arising out of or
relating to this Mortgage or the Secured Indebtedness.  Mortgagor
hereby irrevocably waives, to the fullest extent permitted by law, any objection
that Mortgagor may now or hereafter have to the laying of venue in any such
court and any claim that any such court is an inconvenient
forum.  Mortgagor hereby agrees and consents that, in addition to any
methods of service of process provided for under applicable law, all service of
process in any such suit, action or proceeding in any New Jersey state court or
any United States federal court sitting in the jurisdiction in which the Secured
Indebtedness is payable may be made by certified or registered mail, return
receipt requested, directed to Mortgagor at its address stated at the end of
this Mortgage, or at a subsequent ad­dress of Mortgagor of which Mortgagee
received actual notice from Mortgagor in accordance with this Mortgage, and
service so made shall be complete five (5) days after the same shall have been
so mailed.  Nothing herein shall affect the right of Mortgagee to
serve process in any manner permitted by law or limit the right of Mortgagee to
bring proceedings against Mortgagor in any other court or
jurisdiction.  TO THE FULLEST EXTENT PERMITTED BY LAW, MORTGAGOR AND
MORTGAGEE (BY ACCEPTANCE OF THIS MORTGAGE) WAIVES THE RIGHT TO TRIAL BY JURY IN
CONNECTION WITH ANY ACTION, SUIT OR OTHER PROCEEDING ARISING OUT OF OR RELATING
TO THIS MORTGAGE OR ANY OTHER NL LOAN DOCUMENT.

    

    Section
6.9.  Subrogation to Existing
Liens; Vendor's Lien.  To the extent that proceeds of the NL
Note are used to pay indebtedness secured by any outstanding lien, security
interest, charge or prior encumbrance against the Property, such proceeds have
been advanced by Mortgagee at Mortgagor's request, and Mortgagee shall be
subrogated to any and all rights, security interests and liens owned by any
owner or Mortgagee of such outstanding liens, security interests, charges or
encumbrances, however remote, irrespective of whether said liens, security
interests, charges or encumbrances are released, and all of the same are
recognized as valid and subsisting and are renewed and continued and merged
herein to secure the Secured Indebtedness, but the terms and provisions of this
Mortgage shall govern and control the manner and terms of enforcement of the
liens, security interests, charges and encumbrances to which Mortgagee is
subrogated hereunder.  It is expressly understood that, in
consideration of the payment of such indebtedness by Mortgagee, Mortgagor hereby
waives and releases all demands and causes of action for offsets and payments in
connection with the said indebtedness.  To the extent permitted by
law, if all or any portion of the proceeds of the loans evidenced by the Notes
or of any other Secured Indebtedness has been advanced for the purpose of paying
the purchase price for all or a part of the Property, no vendor's lien is
waived; and Mortgagee shall have, and is hereby granted, a vendor's lien on the
Property as cumulative additional security for the Secured
Indebtedness.  To the extent permitted by law, Mortgagee may foreclose
under this Mortgage or under the vendor's lien without waiving the other or may
foreclose under both.

    

    Section
6.10.  Application of Payments to
Certain Indebtedness.  If any part of the Secured Indebtedness
cannot be lawfully secured by this Mortgage or if any part of the Property
cannot be lawfully subject to the lien and security interest hereof to the full
extent of such indebtedness, then all payments made shall be applied on said
indebtedness first in discharge of that portion thereof which is not secured by
this Mortgage.

    

    Section
6.11.  Nature of Loans; Compliance
with Usury Laws.  The loan evidenced by the NL Notes is being
made solely for the purpose of carrying on or acquiring a business or commercial
enterprise.  It is the intent of Mortgagor and Mortgagee and all other
parties to the NL Loan Documents to conform to and contract in strict compliance
with applicable usury law from time to time in effect.  All agreements
between Mortgagee and Mortgagor (or any other party liable with respect to any
indebtedness under the NL Loan Documents) are hereby limited by the provisions
of this Section which shall override and control all such agreements, whether
now existing or hereafter arising.  In no way, nor in any event or
contingency (including but not limited to prepayment, default, demand for
payment, or acceleration of the maturity of any obligation), shall the interest
taken, reserved, contracted for, charged, chargeable, or received under this
Mortgage, the NL Note or any other NL Loan Document or otherwise, exceed the
maximum nonusurious amount permitted by applicable law (the "Maximum
Amount").  If, from any possible construction of any document,
interest would otherwise be payable in excess of the Maximum Amount, any such
construction shall be subject to the provisions of this Section and such
document shall ipso facto be automatically reformed and the interest payable
shall be automatically reduced to the Maximum Amount, without the necessity of
execution of any amendment or new document.  If Mortgagee shall ever
receive anything of value which is characterized as interest under applicable
law and which would apart from this provision be in excess of the Maximum
Amount, an amount equal to the amount which would have been excessive interest
shall, without penalty, be applied to the reduction of the principal amount
owing on the Secured Indebtedness in the inverse order of its maturity and not
to the payment of interest, or refunded to Mortgagor or the other payor thereof
if and to the extent such amount which would have been excessive exceeds such
unpaid principal.  The right to accelerate maturity of the NL Note or
any other Secured Indebtedness does not include the right to accelerate any
interest which has not otherwise accrued on the date of such acceleration, and
Mortgagee does not intend to charge or receive any unearned interest in the
event of accelera­tion.  All interest paid or agreed to be paid to
Mortgagee shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread throughout the full stated term (including any
renewal or extension) of such indebtedness so that the amount of interest on
account of such indebtedness does not exceed the Maximum Amount. As used in this
Section, the term "applicable law" shall
mean the laws of the State of New Jersey or the federal laws of the United
States applicable to this transaction, whichever laws allow the greater
interest, as such laws now exist or may be changed or amended or come into
effect in the future.

    

    Section
6.12.  Notices.  All
notices, requests, consents, demands and other communications required or which
any party desires to give hereunder or under any other NL Loan Document shall be
in writing and, unless otherwise specifically provided in such other NL Loan
Document, shall be deemed sufficiently given or furnished if delivered by
personal delivery, by nationally recognized overnight courier service, or by
registered or certified United States mail, return receipt requested, postage
prepaid, addressed to the party as set forth in Multi-Party Agreement (unless
changed by similar notice in writing given by the particular party whose address
is to be changed) or by facsimile.  Any such notice or communication
shall be deemed to have been given either at the time of personal delivery or,
in the case of courier or mail, as of the date of first attempted delivery at
the address and in the manner provided herein, or, in the case of facsimile,
upon receipt.  Notwithstanding the foregoing, no notice of change of
address shall be effective except upon receipt.  This Section shall
not be construed in any way to affect or impair any waiver of notice or demand
provided in any NL Loan Document or to require giving of notice or demand to or
upon any person in any situation or for any reason.

    

    Section
6.13.  Invalidity of Certain
Provisions.  A determination that any provision of this
Mortgage is unenforceable or invalid shall not affect the enforceability or
validity of any other provision and the deter­mination that the application
of any provision of this Mortgage to any person or circumstance is illegal or
unenforceable shall not affect the enforceability or validity of such provision
as it may apply to other persons or circumstances.

    

    Section
6.14.  Gender; Titles;
Construction.  Within this Mortgage, words of any gender shall
be held and construed to include any other gender, and words in the singular
number shall be held and construed to include the plural, unless the context
otherwise requires.  Titles appearing at the beginning of any
subdivisions hereof are for convenience only, do not consti­tute any part of
such subdivisions, and shall be disregarded in construing the language contained
in such subdivisions.  The use of the words "herein," "hereof," "hereunder" and other
similar compounds of the word "here" shall refer to
this entire Mortgage and not to any particular Article, Section, paragraph or
provision.  The term "person" and words
importing persons as used in this Mortgage shall include firms, associations,
partnerships (including limited partnerships), joint ventures, trusts,
corporations, limited liability companies and other legal entities, including
public or governmental bodies, agencies or instrumentalities, as well as natural
persons.

    

    Section
6.15.  Reporting
Compliance.  Mortgagor agrees to comply with any and all
reporting requirements applicable to the transaction evidenced by the NL Note
and secured by this Mortgage which are set forth in any law, statute, ordinance,
rule, regulation, order or determination of any governmental authority,
including but not limited to The International Investment Survey Act of 1976,
The Agricultural Foreign Investment Disclosure Act of 1978, The Foreign
Investment in Real Property Tax Act of 1980 and the Tax Reform Act of 1984 and
further agrees upon request of Mortgagee to furnish Mortgagee with evidence of
such compliance.

    

    Section
6.16.  Mortgagee's
Consent.  Except where otherwise expressly provided herein, in
any instance hereunder where the approval, consent or the exercise of judgment
of Mortgagee is required or requested, (a) the granting or denial of such
approval or consent and the exercise of such judgment shall be within the sole
discretion of Mortgagee, and Mortgagee shall not, for any reason or to any
extent, be required to grant such approval or consent or exercise such judgment
in any particular manner, regardless of the reasonableness of either the request
or Mortgagee's judgment, and (b) no approval or consent of Mortgagee shall be
deemed to have been given except by a specific writing intended for the purpose
and executed by an authorized representative of Mortgagee.

    

    Section
6.17.  Mortgagor.  Unless
the context clearly indicates otherwise, as used in this Mortgage, "Mortgagor" means the
Mortgagors named in the Preamble of this Mortgage.  The obligations of
Mortgagor hereunder shall be joint and several.  If any Mortgagor, or
any signatory who signs on behalf of any Mortgagor, is a corporation,
partnership or other legal entity, Mortgagor and any such signatory, and the
person or persons signing for it, represent and warrant to Mortgagee that this
instrument is executed, acknowledged and delivered by Mortgagor's duly
authorized representatives.  If Mortgagor is an individual, no power
of attorney granted by Mortgagor herein shall terminate on Mortgagor's
disability.

    

    Section
6.18.  Execution;
Recording.  This Mortgage has been executed in several
counterparts, all of which are identical, and all of which counterparts together
shall constitute one and the same instrument.  The date or dates
reflected in the acknowledgments hereto indicate the date or dates of actual
execution of this Mortgage, but such execution is as of the date shown on the
first page hereof, and for purposes of identification and reference the date of
this Mortgage shall be deemed to be the date reflected on the first page
hereof.  Mortgagor will cause this Mortgage and all amendments and
supplements thereto and substitutions therefor and all financing statements and
continuation statements relating thereto to be recorded, filed, re-recorded and
refiled in such manner and in such places as Mortgagee shall reasonably request
and will pay all such recording, filing, re-recording and refiling taxes, fees
and other charges.

    

    Section
6.19.  Successors and
Assigns.  The terms, provisions, covenants and conditions
hereof shall be binding upon Mortgagor, and the successors and assigns of
Mortgagor, and shall inure to the bene­fit of Mortgagee and shall constitute
covenants running with the Land.  All references in this Mortgage to
Mortgagor shall be deemed to include all such successors and assigns of
Mortgagor.

    

    Section
6.20.  Modification or
Termination.  The NL Loan Documents may only be modified or
terminated by a written instrument or instruments intended for that purpose and
executed by the party against which enforcement of the modification or
termination is asserted.  Any alleged modification or termination
which is not so documented shall not be effective as to any party.

    

    Section
6.21.  No
Partnership, Etc..  The relationship between Mortgagee and
Mortgagor is solely that of lender and borrower.  No Mortgagee has any
fiduciary or other special relationship with Mortgagor.  Nothing
contained in the NL Loan Documents is intended to create any partnership, joint
venture, association or special relationship between Mortgagor and Mortgagee or
in any way make Mortgagee a co-principal with Mortgagor with reference to the
Property. All agreed contractual duties between or among Mortgagee and Mortgagor
are set forth herein and in the other NL Loan Documents and any additional
implied covenants or duties are hereby disclaimed.  Any inferences to
the contrary of any of the foregoing are hereby expressly negated.

    

    Section
6.22.  Applicable
Law.    THIS MORTGAGE, AND ITS VALIDITY, ENFORCEMENT
AND INTERPRETATION, SHALL BE GOVERNED BY NEW JERSEY LAW AND CONSTRUED,
INTERPRETED AND ENFORCED IN ACCORDANCE WITH AND PURSUANT TO THE LAWS OF THE
STATE OF NEW JERSEY (WITHOUT REGARD TO ANY CONFLICT OF LAWS PRINCIPLES) AND
APPLICABLE UNITED STATES FEDERAL LAW, EXCEPT AS OTHERWISE REQUIRED BY MANDATORY
PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT REMEDIES PROVIDED BY THE LAWS OF
ANY JURISDICTION OTHER THAN THE STATE OF NEW JERSEY ARE GOVERNED BY THE LAWS OF
SUCH OTHER JURISDICTION.

    

    Section 6.23.  Entire
Agreement.  The
NL Loan Documents constitute the entire understanding and agreement between
Mortgagor and Mortgagee with respect to the transactions arising in connection
with the indebtedness secured hereby and supersede all prior written or oral
understandings and agreements between Mortgagor and Mortgagee with respect to
the matters addressed in the NL Loan Documents.  Mortgagor hereby
acknowledges that, except as incorporated in writing in the NL Loan Documents,
there are not, and were not, and no persons are or were authorized by Mortgagee
to make, any representations, understandings, stipulations, agreements or
promises, oral or written, with respect to the matters addressed in the NL Loan
Documents.

    

    Section
6.24.  Intercreditor Agreement;
Conflicts.  Notwithstanding anything to the contrary contained
herein, this Mortgage (including, without limitation the enforcement of the
rights, remedies and obligations as set forth hereunder) is and shall remain
subject and the terms, covenants, conditions set forth in the Intercreditor
Agreement.  In the event of any conflict or ambiguity with between the
terms, covenants and conditions of the Intercreditor Agreement and this
Mortgage, the provisions of the Intercreditor Agreement shall
control.

    

    SIGNATURES
BEGIN ON FOLLOWING PAGE

    

    
      
        
           

        

         

      

      
         

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, Mortgagor has executed this instrument under seal as of the
date first written on page 1 hereof.

    

    MORTGAGOR:

    

    SAYREVILLE SEAPORT ASSOCIATES, L.P.,
a Delaware

    limited partnership

    

    By:    Sayreville
Seaport Associates Acquisition

              Company,
LLC, a Delaware limited liability company

              General
Partner

    

    

    By_____________________________(SEAL)

              Name:

              Title:

    

    
      
        
           

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    COMMONWEALTH
OF PENNSYLVANIA, COUNTY OF _______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of _______________, 2008, before me, the
undersigned Notary Public of said State, personally appeared ____________, who
acknowledged himself to be the _____________ of Sayreville Seaport Associates
Acquisition Company, LLC, a Delaware limited  liability company and
the General Partner of  Sayreville Seaport Associates, L.P., a
Delaware limited partnership, known to me, (or satisfactorily proven) to be the
person whose name is subscribed to the within instrument, and acknowledged that
he executed the same for the purposes therein contained as the duly authorized
____________ of said limited liability company by signing the name of the
limited liability company by himself as ______________.

    

    WITNESS
my hand and Notarial Seal.

    

    

    

    _____________________________

    Notary
Public

    

    My
Commission Expires:exhibit105.htm

    
      
         

      

       

      
         

        
          EXHIBIT
10.5

        

      

    

    
      	 
      	
              Prepared by and Return to:

              Buchanan Ingersoll & Rooney
      PC

              1835 Market Street, 14th Floor

              Philadelphia,
      PA 19103

              Attn:  Frederick
      H. Masters, Esq.

              Telephone:
      215.665.8700

            

    

    

    

    

    

    
      

    

    INTERCREDITOR, SUBORDINATION
AND STANDSTILL AGREEMENT

    

    

    THIS
INTERCREDITOR, SUBORDINATION AND STANDSTILL AGREEMENT (this “Agreement”) is made and
entered into as of October 15, 2008, by NL INDUSTRIES, INC., a New Jersey
corporation (“NL”) and
NL ENVIRONMENTAL MANAGEMENT SERVICES, INC., a New Jersey Corporation (“NL EMS”, and together with NL,
jointly and severally, the “NL
Companies”); and BANK OF AMERICA, N.A., a national banking association
(“Administrative Agent”)
on behalf of itself and the other financial institutions, now or hereinafter,
party to the Loan Agreement (as defined below) (together with Administrative
Agent collectively, the “Banks”); and acknowledged and
consented to by SAYREVILLE SEAPORT ASSOCIATES, L.P., a Delaware limited
partnership (“Borrower”)
and J. BRIAN O'NEILL.

    

    R E C I T
A L S:

    

    A.         The
Banks have extended a loan (the “Bank Loan”) to Borrower in the
amount of Seventy Million Dollars ($70,000,000.00) evidenced by those certain
mortgage notes in the aggregate amount of Seventy Million Dollars
($70,000,000.00), each of even date herewith, made by Borrower and payable to
the order of each of the Banks (as such mortgage notes may be renewed, extended,
modified, amended or restated from time to time, collectively, the “Bank Notes”).

    

    B.         The
Bank Notes and the total indebtedness evidenced thereby are secured by that
certain Leasehold Mortgage, Assignment, Security Agreement and Fixture Filing
dated of even date herewith, executed by Borrower in favor of Administrative
Agent and the other Banks, which shall be recorded in the Official Records of
Middlesex County, New Jersey (the “Official Records”) (as amended, supplemented,
modified, restated, renewed or extended from time to time, the “Mortgage”), granting a first
priority lien on and/or security interest in the "Property" (as defined in the
Mortgage), including, without limitation, the land and any improvements situated
thereon, which land is more particularly described in Exhibit
A attached hereto and incorporated herein.  The Bank Notes, the
Mortgage and any loan agreement, security agreement, pledge agreement, UCC
financing statements, environmental indemnity agreement, guaranty agreements
(including, without limitation that certain Guaranty Agreement of even date
herewith from J. BRIAN O'NEILL in favor of Administrative Agent and the other
Banks (the "Bank Guaranty")), any Swap Contract (as defined in the Mortgage) or
any assignment of architect's agreement, construction contract or other
contracts or subcontracts or any other document or modification now or hereafter
executed in connection therewith are herein referred to collectively as the
“Bank Loan
Documents.”

    

    C.         NL
Companies have extended a loan (the “NL Loan”) to Borrower in the
amount of Fifteen Million Dollars ($15,000,000.00) evidenced by that certain
mortgage note in the amount of Fifteen Million Dollars ($15,000,000.00), dated
of even date herewith, made by Borrower and payable to the order of NL Companies
(as such mortgage note may be renewed, extended, modified, amended or restated
from time to time, with the prior written consent of Administrative Agent, the
“NL  Note”)
and secured by that certain Leasehold Mortgage, Assignment, Security Agreement
and Fixture Filing dated of even date herewith, executed by Borrower in favor of
the NL Companies, which shall be recorded in the Official Records (as amended,
supplemented, modified, restated, renewed or extended from time to time, the
“Subordinate Mortgage”),
granting a second priority lien on and security interest in the Property and a
Guaranty Agreement of even date herewith from J. BRIAN O'NEILL to NL Companies
(the "NL Guaranty").  The NL Note, Subordinate Mortgage and NL
Guaranty are herein referred to collectively as the "NL Loan
Documents".

    

    D.         The
Bank Loan Documents contain restrictions on Borrower's ability to incur
additional indebtedness, arrange for guarantees of such indebtedness and place
liens on the Property.  Banks are unwilling to make the Bank Loan
unless NL Companies agree to subordinate and make inferior:  (i) the
right, title, security interest, lien and interest created by the Subordinate
Mortgage and the other NL Loan Documents to the right, title, security interest,
lien and interest of the Bank Mortgage and the other Bank Loan Documents; and
(ii) except as hereinafter provided in Section 4(b) and 4(c) below, NL
Companies' rights to receive any payments under or on account of the NL Loan
Obligations to Banks' rights to receive payments under or on account of the Bank
Loan Obligations.

    

    E.         This
Agreement shall be recorded in the Official Records.

    

    NOW
THEREFORE, for and in consideration of the mutual covenants hereinafter set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Administrative Agent, on behalf of itself and the
other Banks, and NL Companies hereby agree as follows:

    

    1.         Recitals
Incorporated.  The recitals set forth hereinabove are
incorporated herein by reference to the same extent and with the same force and
effect as if fully set forth hereinbelow, provided, however, that such recitals
shall not be deemed to modify the express provisions hereinafter set
forth.

    

    2.         Definitions.  The
following terms shall have the meanings indicated below:

    

    “Bank
Loan” or “Bank Loan
Obligations”
means all present and future indebtedness, obligations and liabilities of
Borrower under the Bank Loan Documents, including (a) all principal (including
principal which is borrowed, repaid and reborrowed), interest (including
interest accruing subsequent to, and interest that would have accrued but for,
the filing of any petition under any bankruptcy, insolvency or similar law or
the commencement of any Proceeding), default interest, late charges, prepayment
fees, expenses, fees, other reimbursements, Swap Contracts, indemnities and
other amounts payable thereunder, in each case whether now or hereafter arising,
direct or indirect, primary or secondary, joint, several or joint and several,
liquidated or unliquidated, final or contingent, and whether incurred as maker,
endorser or otherwise; (b) all indebtedness arising from all present and future
optional or obligatory advances under the Bank Notes or any other Bank Loan
Document, (c) all indebtedness, obligations and liabilities arising under any
and all amendments, modifications, extensions, renewals, refinancing or
refundings of any of the Bank Loan Documents, and (d) all indebtedness,
obligations and liabilities under Protective Advances.  To the extent
any payment on any of the Bank Loan Obligations, whether by or on behalf of
Borrower, as proceeds of security or enforcement of any right of setoff or
otherwise, is recovered by or required to be paid over to Borrower or a
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person in a
Proceeding, such Bank Loan Obligation or any part thereof originally intended to
be satisfied by such payment shall be deemed to be reinstated and outstanding as
if such payment had not occurred.  All outstanding Bank Loan
Obligations shall be and remain Bank Loan Obligations for all purposes of this
Agreement, regardless of whether they are allowed, not allowed or subordinated
in any Proceeding.

    

    “Bank Loan
Documents” is
defined in Recital B.

    

    “Bank
Notes” is defined
in Recital A.

    

    "Loan
Agreement" means
that certain Loan Agreement, dated of event date herewith, by and among the
Banks and Borrower evidencing the Bank Loan, as the same may be amended,
supplemented, modified, restated, renewed or extended from time to
time.

    

    "Loan
Pay-off Capital Contribution" has the meaning set forth in
the Multi-Party Agreement.

    

    “Mortgage” is defined in Recital
B.

    

    "Multi-Party
Agreement" means
that certain Multi-Party Agreement of even date herewith by and among Borrower;
SAYREVILLE SEAPORT ASSOCIATES ACQUISITION COMPANY, LLC, a Delaware limited
liability company and general partner of the Borrower; OPG PARTICIPATION, LLC, a
Pennsylvania limited liability company and limited partner of the Borrower; J.
BRIAN O'NEILL; NL COMPANIES; SAYREVILLE PRISA II LLC, a Delaware limited
liability company; and THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, an insurance
company organized under the laws of the State of  New Jersey, acting
solely on behalf of, for the benefit of, and with its liability limited to the
assets of its insurance company separate account known as PRISA II.

    

    “NL
Loan” or “NL Loan
Obligations”
means all indebtedness, obligations and liabilities of Borrower under the NL
Loan Documents, including all principal, interest (including interest accruing
subsequent to, and interest that would have accrued but for, the filing of any
petition under any bankruptcy, insolvency or similar law or the commencement of
any Proceeding), default interest, late charges, prepayment fees, expenses,
fees, reimbursements, indemnities and other amounts payable thereunder, in each
case whether now or hereafter arising, direct or indirect, primary or secondary,
joint, several or joint and several, liquidated or unliquidated, final or
contingent and whether incurred as a maker, endorser, guarantor or
otherwise.

    

    “NL Loan
Documents” is
defined in Recital C.

    

    “NL
Note” is defined
in Recital C.

    

    “Person” means any person,
individual, sole proprietorship, partnership, joint venture, corporation,
limited liability company, unincorporated organization, association,
institution, entity, party, including any government and any political
subdivision, agency, or instrumentality thereof.

    

    "Power of
Attorney" is
defined in Section 15 hereof.

    

    "PRISA II
Account" has the
meaning set forth in the Multi-Party Agreement.

    

    “Proceeding” means (a) any voluntary or
involuntary case, action or proceeding before any court or other governmental
authority relating to bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up or relief of debtors, or (b) any general
assignment for the benefit of creditors, composition, marshaling of assets for
creditors, or other, similar arrangement in respect of its creditors generally
or any substantial portion of its creditors; undertaken under U.S. Federal,
state or foreign law, including the Bankruptcy Code.

    

    “Property” means, collectively, the
real property and all other property (whether real, personal or otherwise)
described in the Mortgage.

    

    “Protective
Advances” means
any and all sums advanced or expended by Administrative Agent (whether deemed
optional or obligatory advances, or otherwise) which Administrative Agent deems
necessary or appropriate (a) to repair, maintain, remediate or otherwise protect
the Property or to prevent waste or destruction or to pay or prevent liens or to
defend Borrower’s title or the lien priority of the Mortgage, (b) to pay taxes,
assessments or insurance premiums in respect of the Property or to otherwise
protect security interest of the Banks in the Property and any other collateral
for the Bank Loan Obligations, or (c) in connection with Administrative Agent's
review, protection or exercise of its rights or remedies under the Bank Loan
Documents.

    

    "Prudential"
means The Prudential Insurance Company of America, an insurance company
organized under the laws of the State of  New Jersey, acting solely on
behalf of, for the benefit of, and with its liability limited to the assets of
its insurance company separate account known as PRISA II.

    

    “Swap
Contracts” has
the meaning set forth in the Mortgage.

    

    3.         Subordination.  Each
of the NL Companies, for itself and its successors and assigns (including,
without limitation, all subsequent holders of the NL Note and the Subordinate
Mortgage) does hereby subordinate (a) the Subordinate Mortgage and all other NL
Loan Documents, (b) its right to any payment of any of the NL Loan Obligations,
including any and all payments under the NL Guaranty, except as hereinafter
provided in Section 4(b) and/or 4(c) below and (c) all of its right, title,
security interest, lien, and interest in and to the Property and any other
collateral for the Bank Loan and all sales proceeds, proceeds from insurance or
condemnation, other proceeds, rents, issues, and profits therefrom, to (i) the
Mortgage and all other Bank Loan Documents, (ii) the payment of all of the
Bank Loan Obligations, including all rights to payment under and pursuant to the
Bank Guaranty  and (iii) all of the right, title, security interest,
lien and interest held by Administrative Agent and/or any of the Banks and their
respective successors and assigns (including, without limitation, all subsequent
holders of a Bank Note and the Mortgage), in and to the Property and any other
collateral and all sales proceeds, proceeds from insurance or condemnation,
other proceeds, rents, issues, and profits therefrom, under and pursuant to (X)
the Bank Notes, (Y) the Mortgage, and (Z) all other Bank Loan Documents, and any
and all extensions, renewals, modifications, and replacements
thereof.  From and after the date hereof, all of the documents,
indebtedness, right to payment, title, security interest, lien, right and
interest described in clauses (a), (b) and (c) hereinabove shall be subject and
subordinate to all of the documents, indebtedness, right to payment, title,
security interest, lien, right and interest described in clauses (i), (ii) and
(iii) hereinabove.

    

    4.         Permitted Scheduled Interest
Payments; Permitted Multi-Party Payment.  Each of the NL
Companies, for itself and its successors and assigns (including, without
limitation, all subsequent holders of the NL  Note and the Subordinate
Mortgage) does hereby agree that, notwithstanding anything provided in the NL
Loan Documents to the contrary, so long as the Bank Loan Obligations remain
outstanding, unless Administrative Agent shall consent in writing:

    

    (a)         No
Payments.  Except as provided in (b) and/or (c) below, no
payment of principal, interest, fees or other amounts shall be made or accepted
on account of the NL Loan Obligations at any time when any amount of the Bank
Loan Obligations remains unpaid or unsatisfied.

    

    (b)         Permitted Scheduled
Payments.  NL Companies may collect and receive from Borrower
Permitted Scheduled Payments on account of the NL Loan Obligations on a monthly
basis as the same come due. As used herein “Permitted Scheduled Payments” means
the regularly scheduled monthly payment of interest due and payable under the NL
Note based on the outstanding principal sum of the NL Note, not to exceed a
maximum principal sum of $15,000,000, and the non-default interest rate provided
for in the NL Note, being no greater than the non-default interest rate
specified in the Bank Notes.  Without any obligation to NL Companies
with respect to the same, Administrative Agent acknowledges to NL Companies that
within the Bank Loan there is budgeted the sum of $1,991,714 as interest on the
NL Note. NL Companies acknowledges that such sum is not being held in trust,
"set-aside" funds, collateral or escrowed for or with respect to the interest
due under the NL Note and neither Administrative Agent nor any of the Banks have
any obligation or duty to NL Companies  with respect to or for the
same or the payment of interest under the NL Note and NL Companies releases any
and all claims against Administrative Agent and Banks with respect to the
same.

    

    (c)         Payment by Prudential under
the Multi-Party Agreement. NL Companies shall be permitted to receive
payment of the Loan Pay-off Capital Contribution from Prudential pursuant to and
in accordance with the Multi-Party Agreement.

    

    (d)         No Prepayment or Other
Payment.  Except as provided for in Section 4(b) and/or (c)
above, until the Bank Loan Obligations have been paid and performed in full, no
payment or prepayment of any kind may be made to NL Companies with respect to
the NL Loan Obligations.

    

    (e)         Payments Held In Trust For
Banks.  In the event at any time that any payment is made to NL
Companies on account of the principal, interest, fees, or other amounts on or
with respect to the NL Loan Obligations, including any payments received under
the NL  Guaranty, which is not permitted under this Agreement, such
payment shall be held by NL Companies in trust for the benefit of the Banks and
shall be paid forthwith over and delivered to Administrative Agent for
application to the payment of all of the  Bank Loan Obligations
remaining unpaid.

    

    5.         Limitation on NL Companies
Acts/Multi-Party Agreement/Appointment of Agency.

    

    (a)              Notwithstanding
anything to the contrary in any of the NL Loan Documents, so long as any of the
Bank Loan Obligations remain outstanding, NL Companies shall have no rights,
power or authority to exercise any rights, remedies or privileges under or
pursuant to any of the NL Loan Documents or against Borrower or J. Brian
O'Neill, or his heirs, successors or assigns, under or pursuant to the NL
Guaranty. Without limitation, the forgoing shall include the exercise of any
approval or consent rights or options; the granting of any consents or
approvals; the making of any determinations or elections; the exercise of any
right or remedy upon a Default occurring under any of the NL Loan Documents,
including, without limitation, acceleration, foreclosure, collection, set-off or
the bringing of any legal or equitable action under any of the Mortgage, the NL
Note, the NL Guaranty, the Uniform Commercial Code or any other applicable laws,
provided NL Companies shall be entitled to declare and give notice of such
Default; or the collection of any default interest or late
fees.  Nothing herein however, shall limit or prohibit NL Companies
from demanding and receiving payment from Prudential under and pursuant to the
Multi-Party Agreement and pursue its rights and remedies thereunder in
accordance with the terms of the Multi-Party Agreement.

    

    (b)              NL
Companies agrees that so long as any of the Bank Loan Obligations remain
outstanding, Administrative Agent is hereby irrevocably appointed agent for NL
Companies under and pursuant to the Mortgage and NL Note and Administrative
Agent is hereby authorized, permitted and empowered to take and/or perform any
and all actions for, on behalf and in the name of NL Companies with respect to
the Mortgage, NL Note, and the NL Loan Obligations with the same force and
effect as if NL Companies had taken the same and NL Companies shall be bound by
any and all such acts and actions and releases Administrative Agent and Banks
from any and all claims and liability with respect to the same, except no
release is hereby given for the willful misconduct by Administrative Agent or
the willful misconduct of any of the Banks.  Without limitation, the
forgoing power and authority of Administrative Agent to act for and on behalf of
NL Companies shall include the exercise of any approval or consent rights or
options; the granting of any consents or approvals; the making of any
determinations or elections; the extension of the Maturity Date (as defined in
the NL Note) in accordance with the terms of the NL Note.  NL
Companies agrees that if the event the Bank Notes are extended for one (1) year
as provided for therein, the Maturity Date of the NL Note shall be automatically
extended for one (1) year, on a one time basis only and Administrative Agent and
Banks have no power or authority to extend the Maturity Date of the NL Note
beyond the one (1) year extension.. NL Companies further acknowledges that it
has executed and delivered the Power of Attorney as provided for in section 15
and Administrative Agent is authorized to act for and on behalf of NL Companies
pursuant to the same.

    

    (c)              Nothing
in this Agreement shall alter or modify NL Companies' right to exercise its
rights under  section 2 of the Multi-Party Agreement.

    

    6.           Responsibility of
Administrative Agent and Banks.

    

    (a)         The
rights granted to Administrative Agent on behalf of itself and the other Banks
hereunder are solely for its protection and nothing herein contained shall
impose on Administrative Agent any duties with respect to Borrower, NL Companies
and/or the Property.  Neither the Administrative Agent nor any of the
Banks shall be liable to either the Borrower or NL Companies for (i) any failure
or defect of title to the Property, (ii) any failure to perfect the lien of the
Mortgage, (iii) any defect in any collateral realization or the exercise of any
right or remedy by Administrative Agent or (iv) any other act, action, omission,
matter or occurrence relating to the Property, the Mortgage, the NL Note, PRISA
II or the Multi-Party Agreement.

    

    (b)           Neither
the Administrative Agent nor any of the Banks is responsible for the
sufficiency, validity or enforceability of the Mortgage or any other documents
related thereto.  The Administrative Agent shall not be deemed to be
in a relation of trust or confidence with NL Companies  by reason of
this Agreement, and shall not owe any fiduciary, trust or other special duties
to NL Companies by reason of this Agreement.

    

    7.         Administrative Agent’s
Freedom of Action.  NL Companies agree that subject to the
terms of the Bank Loan Documents, Administrative Agent on behalf of itself and
the other Banks, may at any time and from time to time, without notice to or the
consent of NL Companies, and without affecting the agreements herein made by NL
Companies, do any one or more of the following in Administrative Agent's sole
and absolute discretion:

    

    (a)         Extend,
renew, modify, amend or waive any of the terms of any of the Bank Loan
Documents, including, without limitation, any payment provisions under any of
the Bank Loan Documents.

    

    (b)         Make
such Protective Advances as Administrative Agent may deem appropriate (it being
understood that neither Administrative Agent nor any of the Banks have in any
way committed to make any such advance).  The amount of any Protective
Advance made by Administrative Agent shall be added to and shall increase the
Bank Loan Obligations and shall be secured by the Bank Loan Documents, including
the Mortgage, and the NL Loan Documents and the Subordinate Mortgage shall be
subordinate to the same in all respects as provided for in this
Agreement.

    

    (c)         Apply
any sums received from Borrower, any guarantor, endorser, or cosigner, or from
the disposition of any of the Property or any other collateral or security, to
any indebtedness whatsoever owing from such Person or secured by the Property or
such collateral or security, in such manner and order as Administrative Agent
determines in its sole discretion, and regardless of whether such indebtedness
is part of the Bank Loan Obligations, is secured, or is due and payable. Add or
substitute, or take any action or omit to take any action which results in the
release of any endorser, guarantor or any collateral or security.

    

    (d)         Make
loans or advances to Borrower secured in whole or in part by the Mortgage or
refrain from making any such loans or advances.

    

    (e)         Accept
partial payments of, compromise or settle, refuse to enforce, or release all or
any parties to, any or all of the Bank Loan Obligations.

    

    (f)         Settle,
release (with or without receipt of consideration therefor, and whether by
operation of law or otherwise), compound, compromise, collect or liquidate any
of the Bank Loan Obligations in any manner permitted by applicable
law.

    

    (g)         Accept,
release (with or without receipt of consideration), waive, surrender, enforce,
exchange, modify, impair or extend the time for the performance, discharge or
payment of, any and all property of any kind securing any or all of the Bank
Loan Obligations or any guaranty of any or all of the Bank Loan Obligations, or
on which Banks at any time may have a lien, or refuse to enforce its rights or
make any compromise or settlement or agreement therefor in respect of any or all
of such property. Administrative Agent and none of the Lenders are under and
shall not hereafter be under any obligation to marshal any assets in favor of NL
Companies, or against or in payment of any or all of the NL Loan Obligations,
and may proceed against any of the Property or any other collateral in such
order and manner as it elects.

    

    All such
actions, rights and matters set forth in (a) through (g) above shall be senior
in all respects to the NL Loan Obligations and the NL Loan Documents which shall
automatically be subordinate to such actions, rights and matters set forth in
(a) through (g) above.  Third parties including title insurance
companies insuring the priority of the Bank Loan Documents are hereby authorized
to rely upon this provision as to the priority of such matters without
requirement to confirm such senior position from NL Companies.

    

    

    8.         No Transfer of NL Loan;
Refinancing.  NL Companies agree that they shall not sell,
assign, pledge, encumber or otherwise transfer any portion of its interest in
the NL Loan Documents without the prior written consent of Administrative Agent,
such consent to be in Administrative Agent sole discretion, provided however, NL
Companies shall be permitted to assign and transfer in whole the NL Loan
Documents and the Multi-Party Agreement to: (i)  any one or more of
the Banks or an Affiliate of a Bank (as the term "Affiliate" is defined in the
Loan Agreement) or (ii) a corporation or limited liability company which is
"controlled" (as hereinafter defined) by either NL or NL EMS (an "NL Company
Subsidiary"); or a corporation or limited liability company "controlling" (as
hereinafter defined) either of NL or NL EMS (an "NL Company Parent"); or a
corporation or limited liability company which is controlled by, controlling or
under common "control" (as hereinafter defined) with, an NL Company Subsidiary
or NL Company Parent, who shall be entitled to purchase the same, provided, in
all cases, such assignment, transfer and sale as to the NL Documents shall be
expressly under and subject to this Agreement and the assignee and transferee
shall expressly assume this Agreement and, in the case of an assignee or
transferee of the NL Loan Documents described in (ii) above, such assignee or
transferee shall execute and deliver to Administrative Agent a Power of Attorney
in the form attached hereto as Exhibit B. In addition, so long as any of the
Bank Loan Obligations remains outstanding, any refinance of the NL Loan
Obligations shall be subject to Administrative Agent's prior written approval of
the terms thereof and the refinance lender, which approval may be granted or
withheld by Administrative Agent in its sole and absolute discretion. For
purposes of this section 8, the terms "controlled", "controlling" and "control"
shall mean, as the context shall require, the ability to direct or cause the
direction of the management and policies of such corporation or limited
liability company by contract or otherwise.

    

    9.         Representations, Warranties
and Covenants of NL Companies.  NL Companies hereby covenant,
agree, warrant, represent, and certify to the Banks that:

    

    (a)              NL
Companies have delivered to Administrative Agent true, correct and complete
copies of the NL Loan Documents.  NL Companies covenant and agree that
the NL Note and the Subordinate Mortgage are the only NL Loan Documents and NL
Companies shall not accept any other security for the NL Obligations other than
the Mortgage and the Multi-Party Agreement.

    

    (b)         NL
Companies are the owners and holders of the NL Loan Documents.  None
of the NL Loan Documents has been transferred, assigned or pledged by NL
Companies.

    

    (c)         NL
Companies acknowledge having received and reviewed copies of all of the Bank
Loan Documents and NL Companies consent to and approve all of the provisions of
each of the Bank Loan Documents and all other agreements including, without
limitation, any escrow or disbursement agreements, between Borrower and
Administrative Agent for the disbursement of the proceeds of the Bank
Loan.

    

    (d)         This
Agreement has been duly authorized by NL Companies, the persons executing,
acknowledging, and delivering this Agreement on behalf of NL Companies are fully
authorized to do so, and all of the terms and provisions of this Agreement are
fully enforceable against NL Companies and their successors and
assigns.

    

    (e)         The
indebtedness evidenced by the NL Note is the only indebtedness secured by the
Subordinate Mortgage and the only indebtedness due NL Companies by Borrower.
There is no guarantee by any guarantor of the obligations under the NL Note or
any of the other NL Loan Documents, except for the Multi-Party
Agreement.

    

    (f)         To
the knowledge of NL Companies, there currently exists no default or event of
default of any nature under the terms and provisions of any of the NL Loan
Documents, or any combination thereof, and no condition which, with the giving
of notice and/or the passage of time, would result in such an event of
default.

    

    (g)         NL
Companies agrees and covenants that copies of all notices, communications, or
designations required or permitted under any of the NL Loan Documents shall be
sent to Administrative Agent at the address specified in Section 19 hereof, or
at such other address as Administrative Agent shall furnish to NL Companies in
the manner provided in Section 19 hereof.

    

    (h)         Except
as specifically provided for in the NL Note and this Agreement with respect to
the automatic extension of the NL Note occurring simultaneous with the
corresponding extension with respect to the Bank Notes, in no event shall the
terms and provisions of any NL Loan Documents be modified, amended, renewed, or
extended, unless Administrative Agent shall first consent in writing to such
modification, amendment, renewal, or extension, which consent may be withheld in
Administrative Agent's sole judgment.

    

    (i)         NL
Companies acknowledges and understands that Administrative Agent and the Banks
will rely upon the certification, warranties, representations, covenants, and
agreements contained in this Agreement as a material consideration and
inducement in making, extending or modifying the loan evidenced by the Bank
Notes.

    

    10.         Dealings with
Borrower.

    

    (a)         In
making disbursements under any of the Bank Loan Documents, Administrative Agent
and none of the other Banks have any duty to, nor have any represented that it
or they will, see to the application of any proceeds by the Person or Persons to
whom Administrative Agent disburses such proceeds.  Any application or
use of such proceeds for purposes other than those provided for in the Bank Loan
Documents does not and shall not defeat the subordination herein made, in whole
or in part.

    

    (b)         In
making disbursements under any of the Bank Loan Documents, Administrative Agent
may waive any and all conditions to a disbursement contained in the Bank Loan
Documents. No such waiver shall defeat the subordination herein made, in whole
or in part.

    

    (c)         The
rights granted to Administrative Agent and the Banks hereunder are solely for
its and their protection and nothing herein contained shall impose on
Administrative Agent or any of the Banks any duties with respect to Borrower, NL
Companies or any of the Environmental Remediation Work (as defined in the Loan
Agreement).

    

    11.         Assignment of the Bank Loan
Obligations.  In accordance with the terms of the Bank Loan
Documents and/or that  certain Multi-Party Agreement by and among
Administrative Agent and other parties, including Prudential (the "Bank
Multi-Party Agreement"), the Banks may assign or transfer any or all of the Bank
Loan Obligations and/or any interest therein or herein and, notwithstanding any
such assignment or transfer or any subsequent assignment or transfer thereof and
every immediate and successive assignee or transferee of any of the Bank Loan
Obligations or of any interest therein or herein shall, to the extent of the
interest of such assignee or transferee in the Bank Loan Obligations, be
entitled to the benefits of this Agreement to the same extent as if such
assignee or transferee were the Banks; provided, however, that, unless
Administrative Agent shall otherwise consent in writing, Administrative Agent
shall have an unimpaired right, prior and superior to that of any such assignee
or transferee, to enforce this Agreement, for the benefit of Administrative
Agent on behalf of itself and the other Banks, as to those portions of the Bank
Loan Obligations which neither Administrative Agent nor any other Bank has
assigned or transferred.

    

    12.         Bankruptcy of
Borrower.  Upon any distribution of the assets or properties of
Borrower or upon any dissolution, winding up, liquidation, bankruptcy or
reorganization involving Borrower (whether in bankruptcy, insolvency or
receivership proceedings or any other Proceeding, or upon an assignment for the
benefit of creditors or otherwise):

    

    (a)         Administrative
Agent shall first be entitled to receive payment in full of the principal of and
interest on the Bank Loan Obligations and all fees and any other payments
(including post-petition interest and all costs and expenses) due pursuant to
the terms of the Bank Loan Documents, before NL Companies are entitled to
receive any payment on account of the NL Loan Obligations; and

    

    (b)         any
payment or distribution of the assets or properties of Borrower of any kind or
character, whether in cash, property, or securities, to which Banks would be
entitled except for the provisions of this Agreement, shall be paid by the
debtor in possession, liquidating trustee or agent or other person making such
payment or distribution directly to Administrative Agent; and

    

    (c)         in
the event that, notwithstanding the foregoing, any payment or distribution of
the assets or properties of Borrower of any kind or character, whether in cash,
property, or securities, shall be received by NL Companies on account of
principal, interest, fees, or other amounts on or with respect to the NL Loan
Obligations before all of the Bank Loan Obligations are paid in full, such
payments or distribution shall be received and held in trust for and shall be
paid over to Administrative Agent forthwith, for application to the payment of
the Bank Loan Obligations until all such Bank Loan Obligations shall have been
paid in full in accordance with the terms of the Bank Loan
Documents.

    

    To
effectuate the foregoing,  NL Companies do hereby irrevocably assign
to Administrative Agent all of NL Companies' rights as a secured or unsecured
creditor in any Proceeding and authorizes Administrative Agent to take, or
refrain from taking, any action to assert, enforce, modify, waive, release or
extend NL Companies' lien and/or claim in such Proceeding, including but not
limited to (a) filing a proof of claim arising out of the NL Loan Obligations,
(b) voting or refraining from voting claims arising from the NL Loan
Obligations, either in Administrative Agent's name or in the name of
Administrative Agent as attorney-in-fact of NL Companies, (c) accepting or
rejecting any payment or distribution made with respect to any claim arising
from the NL Loan Obligations and applying such payment and distribution to
payment of Banks' claim in accordance with the terms hereof, and (d) taking any
and all actions and executing any and all instruments necessary to effectuate
the foregoing and, among other things, to establish Administrative Agent's
entitlement to assert NL Companies' claim in such Proceeding.

    

    13.         Additional Waivers and
Agreements.

    

    (a)         NL
Companies waives the right to require Administrative Agent or the Banks to
proceed against Borrower or any other Person liable on any Bank Loan Obligation,
to proceed against or exhaust any security held from Borrower or other Person,
or to pursue any other remedy in Administrative Agent's or the Bank's power
whatsoever.  Administrative Agent on behalf of itself and the other
Banks may, at its election, exercise any right or remedy the Banks may have
against Borrower or any security held by Administrative Agent on behalf of the
Banks, including, without limitation, the right to foreclose upon any such
security by one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable, without affecting or
impairing in any way the obligations of NL Companies hereunder, except to the
extent the Bank Loan Obligations have been paid, and NL Companies waives any
defense arising out of the absence, impairment or loss of any right of
reimbursement, contribution or subrogation or any other right or remedy against
Borrower or any such security, whether resulting from such election by
Administrative Agent or otherwise.  NL Companies waives any defense
arising by reason of any disability or other defense of Borrower or by reason of
the cessation from any cause whatsoever (including, without limitation, any
intervention or omission by Administrative Agent on behalf of itself and the
other Banks) of the liability, either in whole or in part, of Borrower to the
Banks for the Bank Loan Obligations.

    

    (b)         NL
Companies assumes all responsibility for keeping itself informed as to the
condition (financial or otherwise), business, assets and operations of Borrower,
Prudential, the PRISA II Account, the condition of the Property and all other
circumstances that might in any way affect NL Companies' risk under this
Agreement and/or the Multi-Party Agreement (including, without limitation, the
risk of nonpayment of the NL Loan Obligations, the Bank Loan Obligations and/or
the Loan Pay-off Capital Contribution or any sum due the Banks from Prudential
under the Bank Multi-Party Agreement), and neither Administrative Agent nor any
of the Banks shall have any duty or obligation whatsoever to obtain or disclose
to NL Companies any information or documents relative to such condition,
business, assets, or operations of Borrower, Prudential, the PRISA II Account or
such risk, whether acquired by Administrative Agent or any of the other Banks in
the course of its relationship with Borrower, Prudential, the PRISA II Account
or otherwise.

    

    (c)         NL
Companies acknowledges that neither Administrative Agent nor any other Bank has
made any warranties or representations to it with respect to the due execution,
legality, validity, completeness or enforceability of the Bank Loan Documents
(including, without limitation, the Multi-Party Agreement), the NL Loan
Documents or the collectability of the Secured Obligations evidenced thereby or
secured by the Mortgage and/or the Loan Pay-off Capital
Contribution.

    

    (d)         NL
Companies unconditionally and irrevocably authorizes Administrative Agent, upon
the occurrence of and during the continuance of any default or event of default
under the Bank Loan Documents, at its sole option, without affecting any
obligations of NL Companies hereunder, the enforceability of this Agreement, or
the validity or enforceability of the lien of the Mortgage, to foreclose the
Mortgage or other instruments securing the Bank Loan Obligations by judicial or
nonjudicial sale.  NL Companies expressly, unconditionally and
irrevocably waives any defenses to the enforcement of this Agreement or any
liens created hereby, granted to or otherwise held by Administrative Agent on
behalf of itself and the other Banks, or to the recovery by Administrative Agent
on behalf of itself and the other Banks from Borrower or any other Person liable
therefor of any deficiency after a judicial or nonjudicial foreclosure or sale,
even though such a foreclosure or sale may impair the subrogation rights of NL
Companies and may preclude NL Companies from obtaining reimbursement or
contribution from Borrower or any other Person.

    

    (e)         NL
Companies hereby expressly, unconditionally and irrevocably waives all rights
(a) under Sections 361 through 365, 502(e) and 509 of the Bankruptcy Code
(or any similar sections hereafter in effect under any other Federal or state
laws or legal or equitable principles relating to bankruptcy, insolvency,
reorganizations, liquidations or otherwise for the relief of debtors or
protection of creditors), and (b) to seek or obtain conversion to a
different type of proceeding or to seek or obtain dismissal of a proceeding, in
each case in relation to a bankruptcy, reorganization, insolvency or other
proceeding under similar laws with respect to Borrower.  Without
limiting the generality of the foregoing, NL Companies hereby expressly,
unconditionally and irrevocably waives (i) the right to seek to provide
credit (secured or otherwise) to Borrower in any way under Section 364 of the
Bankruptcy Code unless the same is acceptable to Administrative Agent in its
sole and absolute discretion; (ii) the right to take a position
inconsistent with or contrary to that of Administrative Agent (including a
position by Administrative Agent to take no action) if Borrower seeks to use,
sell or lease the Property or any other collateral for the Secured Obligations
(or the proceeds or products thereof) under Section 363 of the Bankruptcy Code;
(iii) the right to receive any collateral security (including any "super
priority" or equal or "priming" or replacement lien) for any NL Loan Obligation
unless Administrative Agent has collateral security acceptable to Administrative
Agent in its sole and absolute discretion to secure all Bank Loan Obligations
(in the same collateral to the extent collateral is involved); and (iv) the
right to seek adequate protection in respect of Property (or the proceeds or
products thereof) under Section 363 or 361 of the Bankruptcy Code.

    

    (f)         If
any of the Bank Loan Obligations or any lien securing same, should be
invalidated, avoided or set aside, the subordination provided for herein
nevertheless shall continue in full force and effect and, as between
Administrative Agent and NL Companies, shall be and be deemed to remain in full
force and effect.

    

    14.         Continuing
Benefits.  No right of either Administrative Agent or the Banks
or any present or future holder of the Bank Loan Obligations to enforce the
provisions of this Agreement shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of Borrower or any other
party, whether borrower, guarantor or otherwise, or by any act or failure to act
in good faith, by the holder of the Bank Loan Obligations, or by any
noncompliance by Borrower or any borrower, guarantor or otherwise with the terms
of the Bank Notes or any other of the Bank Loan Documents regardless of any
knowledge thereof which such holder may have or be otherwise charged
with.

    

    15.         Power of
Attorney.  NL Companies, by its execution of this Agreement,
agrees to grant to Administrative Agent a power of attorney and in furtherance
of the foregoing to execute the form of Power of Attorney attached hereto as
Exhibit
B (the "Power of
Attorney").  NL Companies hereby authorizes and expressly
directs Administrative Agent to take such action as may be necessary or
appropriate, in Administrative Agent's sole discretion, from time to time to
effectuate the terms of this Agreement and hereby appoints Administrative Agent
its attorney-in-fact for such purpose, including, without limitation, in the
event of any dissolution, winding up, liquidation, or reorganization of Borrower
(whether in bankruptcy, insolvency, or receivership proceedings or upon an
assignment for the benefit of creditors or otherwise) tending toward liquidation
of the business or the assets of Borrower, the immediate filing of a claim for
the unpaid balance of any of the NL Loan Obligations in the form required in
such proceedings, the voting of such claims during the pendency of such
proceedings, and the taking of all steps necessary to cause such claim to be
approved.

    

    16.         No Waiver;
Modification.  Neither this Agreement nor the transactions
herein contemplated shall operate to waive the enforcement after the date hereof
of any due on sale provision, due on encumbrance provision, change-in-ownership
of Borrower provision, or any other accelerating transfer provision contained in
the Bank Loan Documents.  No delay on the part of Administrative Agent
on behalf of itself and the other Banks in the exercise of any right or remedy
shall operate as a waiver thereof, and no single or partial exercise by
Administrative Agent on behalf of itself and the other Banks of any right or
remedy shall preclude other or further exercise thereof or the exercise of any
right or remedy; nor shall any modification or waiver of any of the provisions
of this Agreement be binding upon Administrative Agent or the other Banks except
as expressly set forth in a writing duly signed and delivered by or on behalf of
Administrative Agent.  This Agreement may be executed in any number of
counterparts.

    

    17.         Borrower’s
Waiver.  Borrower hereby waives (a) notice of acceptance of
this Agreement by Administrative Agent and (b) all diligence in the collection
or protection of or realization upon the Bank Loan Obligations or the collateral
therefor.

    

    18.         Legend.  NL
Companies agrees to cause all instruments evidencing indebtedness or other
obligations of Borrower to NL Companies which are or may be subject to the
provisions of this Agreement to be subject to an appropriate legend to the
effect that such indebtedness or other obligation evidenced by such instrument
is subject to the provisions of this Agreement, and NL Companies will make
appropriate entries in the books and records of NL Companies to indicate that
the NL Loan Obligations are subject to this Agreement.

    

    19.         Notices.  Any
notice which a party is required or may desire to give the other shall be in
writing and may be sent by facsimile, personal delivery or by mail (either (i)
by United States registered or certified mail, return receipt requested, postage
prepaid, or (ii) by Federal Express or similar generally recognized overnight
carrier regularly providing proof of delivery), addressed as follows (subject to
the right of a party to designate a different address for itself by notice
similarly given at least fifteen (15) days in advance):

    

    
      	
              If
      to NL Companies:

              NL
      Environmental Management Services, Inc.

              NL
      Industries, Inc.

              5430
      LBJ Freeway

              Suite
      1700

              Dallas,
      TX  75240

              Attention:  General
      Counsel

               

              with
      a copy to:

               

              Christopher
      R. Gibson, Esq.

              Archer
      & Greiner, P.C.

              One
      Centennial Square

              Haddonfield,
      NJ  08033

               

            
	
              If
      to Administrative Agent:

               

            
	
              Bank
      of America, N.A.

              4
      Penn Center, Suite 1100

              1600
      John F. Kennedy Blvd.

              Philadelphia,
      PA 19103

              Attn:
      David S. Ross, SVP

              Fax
      No.: 267-675-0148

               

              with
      copy to:

               

              Buchanan,
      Ingersoll & Rooney PC

              1835
      Market Street

              14th
      Floor

              Philadelphia,
      PA 19103

              Attn:
      Frederick H. Masters, Esq.

              Fax
      No.: 215-665-8760

               

               

            
	 
      
	
              If
      to Borrower:

               

              c/o
      O'Neill Properties Group, L.P.

              2701
      Renaissance Boulevard, 4th Floor

              King
      of Prussia, Pennsylvania  19406

              Attn:
      Richard Heany

              Fax
      No.:  (610) 337-5599

               

              with
      copy to:

               

              c/o
      Macartney, Mitchell & Campbell, LLC

              2701
      Renaissance Boulevard, 4th Floor

              King
      of Prussia, Pennsylvania 19406

              Attn:  Sean
      E. Mitchell, Esq.

              Fax
      No.  215-754-4217

               

              and
      with a copy of all notices to Prudential and its counsel:

               

              Prudential
      Real Estate Investors

              8
      Campus Drive

              Parsippany,
      New Jersey 07054

              Attn:
      Steven B. LaBold

              Fax
      No.  973-734-1411

               

              with
      a copy to:

               

              PAMG-RE
      Law Department

              8
      Campus Drive, 4th Floor

              Arbor
      Circle South

              Parsippany,
      New Jersey 07054

              Attn:
      Law Department

              Fax
      No. 973-683-1788

               

              with
      a copy to:

               

              Goodwin|Procter
      LLP

              Exchange
      Place

              Boston,
      Massachusetts  02109

              Attn:  Minta
      E. Kay, Esq.

              Fax
      No. 617-227-8591

               

               

               

            
	 
      

    

    

    20.         No Modification to Bank Loan
Documents.  This Agreement is not intended to modify and shall
not be construed to modify any term or provision of the Bank Notes, the
Mortgage, the Bank Multi-Party Agreement, the other Bank Loan Documents or any
other documents or instruments evidencing, securing, guaranteeing the payment
of, or otherwise relating to the indebtedness evidenced by the Bank Notes or
secured by the Mortgage, or both.

    

    21.         Further
Assurances.  So long as any of the Bank Loan Obligations remain
outstanding, NL Companies, its successors or assigns, or any other legal holder
of the NL Note, as the case may be, shall execute, acknowledge, and deliver upon
the demand of Administrative Agent, at any time or times, any and all further
documents or instruments in recordable form for the purpose of further
confirming the agreements herein set forth.

    

    22.         Estoppel
Certificate.  NL Companies hereby agrees that within ten (10)
days after written demand of Administrative Agent, it shall execute, acknowledge
and deliver a certification setting forth the total amount of indebtedness owed
to it which shall be then secured by any portion of the Property, and any and
all such certifications shall be conclusive as to the matters set forth therein,
and shall be fully binding upon NL Companies, its successors and
assigns.  Notwithstanding the foregoing, NL Companies shall not be
obligated to give such certification more frequently than once every other
calendar month.

    

    23.         Governing Law/Successors and
Assigns/Joint and Several Liability/Counterparts.  This
Agreement shall be governed by the laws of the State of New Jersey (without reference to
its conflict of laws principles).  This Agreement shall be binding on
and inure to the benefit of the parties hereto and their respective successors
and assigns. NL and NL EMS acknowledge and agree that they have executed this
Agreement jointly and severally and that the term "NL Companies" refers to each
individually and to them collectively and as such jointly and severally. This
Agreement may be executed in separate counterpart signature pages.

    

    24.         Forum.  Administrative
Agent, on behalf of itself and the other Banks, and NL Companies each hereby
irrevocably submits generally and unconditionally to the jurisdiction of any
state court or any United States federal court sitting in the State of New
Jersey, over any suit, action or proceeding arising out of or relating to this
Agreement or the Bank Loan Obligations or the NL Loan
Obligations.  Administrative Agent, on behalf of itself and the other
Banks, and NL Companies each hereby irrevocably waives, to the fullest extent
permitted by law, any objection that it may now or hereafter have to the laying
of venue in any such court and any claim that any such court is an inconvenient
forum.

    

    25.         WAIVER OF JURY
TRIAL.  ADMINISTRATIVE AGENT, ON BEHALF OF ITSELF AND THE OTHER
BANKS, AND NL COMPANIES WAIVE TRIAL BY JURY IN RESPECT OF ANY CLAIM,
COUNTERCLAIM, ACTION OR CAUSE OF ACTION RELATING TO OR ARISING OUT OF THIS
AGREEMENT.  THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE
BY ADMINISTRATIVE AGENT AND NL COMPANIES AND ADMINISTRATIVE AGENT AND NL
COMPANIES HEREBY REPRESENT THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN
MADE BY ANY PERSON OR ENTITY TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY
WAY MODIFY OR NULLIFY ITS EFFECT.  THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE PARTIES ENTERING INTO THIS
AGREEMENT.  ADMINISTRATIVE AGENT AND NL COMPANIES ARE EACH HEREBY
AUTHORIZED TO FILE A COPY OF THIS SECTION 25 IN
ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER OF JURY
TRIAL.  ADMINISTRATIVE AGENT AND NL COMPANIES EACH FURTHER REPRESENTS
AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND
IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE
OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL COUNSEL SELECTED OF ITS OWN
FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH
COUNSEL.

    

    26.         
Reinstated and Amended
Settlement Agreement.  Borrower, NL Companies, Sayreville
Economic and Redevelopment Agency and County of Middlesex are all parties to
that certain Reinstated and Amended Settlement Agreement and Release, dated as
of June 26, 2008, as amended by that certain Amendment to "Reinstated and
Amended Settlement Agreement and Release dated September 25, 2008 (the "Four
Party Agreement").  Nothing in this Agreement is intended to modify or
amend the Four Party Agreement.

    

    SIGNATURES
ON FOLLOWING PAGE

    
      
         

      

      
         

        
          

        

      

      
         

        
           

        

      

    

    

    IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the day and
year first above written.

    

    
      	
              NL
      INDUSTRIES, INC., a New Jersey corporation

               

               

               

            
	
              By:                

              Name:Title

            
	
              NL
      ENVIRONMENTAL MANAGEMENT SERVICES,  INC., a New Jersey
      corporation

               

               

            
	
              By:____________________________________Name:_________________________________Title:__________________________________

            

    

    

    
      	
              BANK
      OF AMERICA, N.A., a national banking association

            
	
              By:                                                                      

            
	
              Name:

            
	
              Title:

            

    

    
      
        
          [Signature Page - Intercreditor
Agreement]

        

         

      

      
         

        
          

        

      

      
         

        
           

        

      

    

    ACKNOWLEDGMENT AND
CONSENT

    

    The undersigned hereby executes and
delivers this Acknowledgment and Consent to and regarding the terms, conditions
and covenants set forth in the Intercreditor and Standstill Agreement attached
hereto (the “Intercreditor Agreement”).  The undersigned states that
it has received a copy of the foregoing Intercreditor Agreement and that it will
recognize all rights granted therein to the respective lenders that are party
thereto, that it will not undertake any act or perform any obligation which is
not in accordance with the provisions of the Intercreditor
Agreement.  Sayreville Seaport Associates, L.P. further executes and
delivers this Acknowledgment and Consent for purposes of Section
17.

    

    The undersigned further acknowledges
and agrees that it is not an intended beneficiary under the Intercreditor
Agreement.

    

    EXECUTED as of October ____________,
2008.

     

    

    
      	
               
      

            	
              BORROWER:

            	
              SAYREVILLE
      SEAPORT ASSOCIATES, L.P.,

            

    

    
      	
               
      

            	
              a
      Delaware limited partnership

            

    

    

    
      	
               
      

            	
              By:  Sayreville
      Seaport Associates Acquisition Company, LLC, a Delaware limited liability
      company, its general partner

            

    

    

    

    
      	
               
      

            	
              By:(SEAL)

            

    

    Name: Jon Robinson

    Title:  Vice
President

    

    

    
      	
               
      

            	
              GUARANTOR:

            	
              ________________________________(SEAL)

            

    

             J.
Brian O'Neill

     

    

     

    
      
        
           

        

         

      

      
         

        
          

        

      

      
         

        
           

        

      

    

    
      	
               
      

            	
              NOTARY
      ACKNOWLEDGEMENTS

            

    

     

    

    STATE OF
________________________, ____________ OF ______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of ____________, 2008, before me, the
undersigned Notary Public of said State, personally appeared, who acknowledged
himself to be a ________________ of NL INDUSTRIES, INC., a New Jersey
corporation, known to me (or satisfactorily proven) to be the person whose name
is subscribed to the within instrument, and acknowledged that he executed the
same for the purposes therein contained as the duly authorized _______________
of said state chartered bank by signing the name of the state chartered bank by
himself as ______________

    

    WITNESS
my hand and Notarial Seal.

    

    

    _____________________________

    Notary Public

    

    My
Commission Expires:

    

    

    

    

    

    STATE OF
_______________________, ____________ OF ______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of ____________, 2008, before me, the
undersigned Notary Public of said State, personally appeared
___________________, who acknowledged himself to be a ___________________ of NL
ENVIRONMENTAL MANAGEMENT SERVICES,  INC., a New Jersey corporation,
known to me (or satisfactorily proven) to be the person whose name is subscribed
to the within instrument, and acknowledged that he executed the same for the
purposes therein contained as the duly authorized officer of said
__________________ by signing the name of the _________________ by himself as
Vice President.

    

    WITNESS
my hand and Notarial Seal.

    

    

    _____________________________

    Notary Public

    My
Commission Expires:

    

    

    

    

    COMMONWEALTH
OF PENNSYLVANIA, ____________________ OF ______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of ____________, 2008, before me, the
undersigned Notary Public of said State, personally appeared _________________,
who acknowledged himself to be a _________________________ of Bank of America,
N.A., a national banking association, known to me (or satisfactorily proven) to
be the person whose name is subscribed to the within instrument, and
acknowledged that he executed the same for the purposes therein contained as the
duly authorized officer of said banking association by signing the name of the
banking association by himself as Senior Vice President.

    

    WITNESS
my hand and Notarial Seal.

    

    

    _____________________________

    Notary Public

    

    

    My
Commission Expires:

    

    

    

    

    COMMONWEALTH
OF PENNSYLVANIA, COUNTY OF _______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of _______________, 2008, before me, the
undersigned Notary Public of said State, personally appeared Jon Robinson, who
acknowledged himself to be the Vice President of Sayreville Seaport Associates
Acquisition Company, LLC, a Delaware limited  liability company and
the General Partner of  Sayreville Seaport Associates, L.P., a
Delaware limited partnership, known to me, (or satisfactorily proven) to be the
person whose name is subscribed to the within instrument, and acknowledged that
he executed the same for the purposes therein contained as the duly authorized
Vice President of said limited liability company by signing the name of the
limited liability company by himself as Vice President.

    

    WITNESS
my hand and Notarial Seal.

    

    

    

    _____________________________

    Notary
Public

    

    My
Commission Expires:

    

    

    

    

    

    COMMONWEALTH
OF PENNSYLVANIA, ____________________ OF ______________, TO WIT:

    

    I HEREBY
CERTIFY, that on this ______ day of ____________, 2008, before me, the
undersigned Notary Public of said State, personally appeared J. BRIAN O'NEILL,
known to me (or satisfactorily proven) to be the person whose name is subscribed
to the within instrument, and acknowledged that he executed the same for the
purposes therein contained by signing the same by himself .

    

    WITNESS
my hand and Notarial Seal.

    

    

    _____________________________

    Notary Public

    

    

    My
Commission Expires:

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