Document:

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                                                                Exhibit 10.2(a)

                    CONSOLIDATED AND RENEWED PROMISSORY NOTE

U.S. $31,000,000.00                                               May 30, 2000

            FOR VALUE RECEIVED, and at the times hereinafter specified, SONESTA
BEACH RESORT LIMITED PARTNERSHIP, a Delaware limited partnership ("Maker"),
whose address is c/o Sonesta International Hotels Corp., 200 Clarendon Street,
41st Floor, Boston, Massachusetts 02116, hereby promises to pay to the order of
SUNAMERICA LIFE INSURANCE COMPANY, an Arizona corporation (hereinafter referred
to, together with each subsequent holder hereof, as "Holder"), at 1 SunAmerica
Center, Century City, Los Angeles, California 90067-6022, or at such other
address as may be designated from time to time hereafter by any Holder, the
principal sum of THIRTY-ONE MILLION AND NO/100THS DOLLARS ($31,000,000.00),
together with interest on the principal balance outstanding from time to time,
as hereinafter provided, in lawful money of the United States of America.

            By its execution and delivery of this Consolidated and Renewed
Promissory Note (this "Note"), Maker covenants and agrees as follows:

            1. Interest Rate and Payments.

                  (a) The balance of principal outstanding from time to time
under this Note shall bear interest at the rate of 8.60% per annum (the
"Original Interest Rate"), computed on the basis of a 360-day year for the
actual number of days elapsed.

                  (b) Interest only shall be payable on the date the loan
evidenced by this Note (the "Loan") is funded by Holder, in advance, for the
period from and including the date of funding through and including June 30,
2000.

                  (c) Commencing on August 1, 2000, and continuing on the first
day of each month thereafter through and including June 1, 2010, combined
payments of principal and interest shall be payable, in arrears, in the amount
of $251,712.92 each (such amount representing an amount that would be sufficient
to fully amortize the amount of this Note over a twenty-five (25) year period
(the "Amortization Period"), if such amortization were based on a three hundred
sixty (360) day year composed of twelve (12) months of thirty (30) days each).

                  (d) The entire outstanding principal balance, together with
all accrued and unpaid interest and all other sums due hereunder, shall be due
and payable in full on July 1, 2010 (the "Original Maturity Date").

            2. Holder's Extension Option; Net Operating Income.

                  (a) If Maker shall fail to pay the outstanding principal
balance of this Note and all accrued interest and other charges due hereon at
the Original Maturity Date, Holder shall have the right, at Holder's sole option
and discretion, to extend the term of the Loan for an additional period of five
(5) years (the "Extension Term"). If Holder elects to extend the term of
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the Loan, Maker shall pay all fees of Holder incurred in connection with such
extension, including, but not limited to, reasonable attorneys' fees and title
insurance premiums. Maker shall execute all documents reasonably requested by
Holder to evidence and secure the Loan, as extended, and shall obtain and
provide to Holder any title insurance policy or endorsement requested by Holder.

                  (b) Should Holder elect to extend the term of the Loan as
provided above, Holder shall (i) reset the interest rate borne by the
then-existing principal balance of the Loan to a rate per annum (the "Extension
Term Rate") equal to the greater of (A) the Original Interest Rate, or (B)
Holder's (or comparable lenders', if Holder is no longer making such loans)
then-prevailing interest rate for five (5) year loans secured by properties
similar to the Property (hereinafter defined), as determined by Holder in its
sole discretion; (ii) re-amortize the then-existing principal balance of the
Loan over the remaining portion of the Amortization Period (the "New
Amortization Period"); (iii) have the right to require Maker to enter into
modifications of the non-economic terms of the Loan Documents as Holder may
request (the "Non-Economic Modifications"); and (iv) notwithstanding any
provision set forth in the Loan Documents to the contrary, have the right to
require Maker to make monthly payments into escrow for insurance premiums and
real property taxes, assessments and similar governmental charges. Hence,
monthly principal and interest payments during the Extension Term shall be based
upon the Extension Term Rate, in an amount that would be sufficient to fully
amortize the outstanding principal balance of the Loan over the New Amortization
Period, if such amortization were based on a three hundred sixty (360) day year
composed of twelve (12) months of thirty (30) days each.

                  (c) If Holder elects to extend the term of the Loan, Holder
shall advise Maker of the Extension Term Rate on or prior to the Original
Maturity Date.

                  (d) In addition to the required monthly payments of principal
and interest set forth above, commencing on the first day of the second month
following the Original Maturity Date and continuing on the first day of each
month thereafter during the Extension Term (each an "Additional Payment Date"),
Maker shall make monthly payments to Holder in an amount equal to all Net
Operating Income (hereinafter defined) attributable to the Property for the
calendar month ending on the last day of the month that is two months preceding
each such Additional Payment Date. For example, assuming the Original Maturity
Date is January 1, then Net Operating Income for the period from January 1
through January 31 shall be payable to Holder on March 1; Net Operating Income
for the period from February 1 through February 28 shall be payable to Holder on
April 1, and so on.

                  (e) Holder shall deposit all such Net Operating Income
received from Maker into an account or accounts maintained at a financial
institution chosen by Holder or its servicer in its sole discretion (the
"Deposit Account") and all such funds shall be invested in interest-bearing
investments in a manner acceptable to Holder in its sole and reasonable
discretion. All interest, dividends and earnings credited to the Deposit Account
shall be held and applied in accordance with the terms hereof.
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                  (f) On the third Additional Payment Date and on each third
Additional Payment Date thereafter, Holder shall apply all Excess Funds
(hereinafter defined), if any, to prepayment of amounts due under this Note,
without premium or penalty.

                  (g) As security for the repayment of the Loan and the
performance of all other obligations of Maker under the Loan Documents, Maker
hereby assigns, pledges, conveys, delivers, transfers and grants to Holder a
first priority security interest in and to: all Maker's right, title and
interest in and to the Deposit Account; all rights to payment from the Deposit
Account and the money deposited therein or credited thereto (whether then due or
in the future due and whether then or in the future on deposit); all interest
thereon; any certificates, instruments and securities, if any, representing the
Deposit Account; all claims, demands, general intangibles, choses in action and
other rights or interests of Maker in respect of the Deposit Account; any monies
then or at any time thereafter deposited therein; any increases, renewals,
extensions, substitutions and replacements thereof; and all proceeds of the
foregoing.

                  (h) From time to time, but not more frequently than monthly,
Maker may request a disbursement (a "Disbursement") from the Deposit Account for
shortfalls in Operating Expenses (as defined in Section 2(k) below), capital
expenses, tenant improvement expenses, leasing commissions and special
contingency expenses. Holder may consent to or deny any such Disbursement in its
sole discretion, provided, however, that Holder shall consent to Disbursements
to cover Operating Expenses in months when Gross Revenue (as defined in Section
2(k) below) is insufficient to pay such Operating Expenses, if (i) the budget
approved by Holder as provided in Section 3 below for the applicable period
contemplates such deficit between Gross Revenue and Operating Expenses for such
months, (ii) no Default or Event of Default shall exist, and (iii) funds in the
Deposit Account are sufficient to pay the requested Disbursement.

                  (i) Upon the occurrence of any Event of Default (i) Maker
shall not be entitled to any further Disbursement from the Deposit Account; and
(ii) Holder shall be entitled to take immediate possession and control of the
Deposit Account (and all funds contained therein) and to pursue all of its
rights and remedies available to Holder under the Loan Documents, at law and in
equity.

                  (j) All of the terms and conditions of the Loan shall apply
during the Extension Term, except as expressly set forth above, and except that
no further extensions of the Loan shall be permitted.

                  (k) For the purposes of the foregoing:

                        (i) "Excess Funds" shall mean, on any Additional Payment
      Date, the amount of funds then existing in the Deposit Account (including
      any Net Operating Income due on the applicable Additional Payment Date),
      less an amount equal to the sum of three regularly scheduled payments of
      principal and interest due on this Note;
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                        (ii) "Net Operating Income" shall mean, for any
      particular period of time, Gross Revenue for the relevant period, less
      Operating Expenses for the relevant period; provided, however, that if
      such amount is equal to or less than zero (0), Net Operating Income shall
      equal zero (0);

                        (iii) "Gross Revenue" shall mean all payments and other
      revenues (exclusive, however, of any payments attributable to sales taxes)
      received by or on behalf of Maker from all sources related to the
      ownership or operation of the Property, including, but not limited to,
      rents, room charges, parking fees, interest, business interruption
      insurance proceeds, operating expense pass-through revenues and common
      area maintenance charges, for the relevant period for which the
      calculation of Gross Revenue is being made; and

                        (iv) "Operating Expenses" shall mean the sum of all
      ordinary and necessary operating expenses actually paid or incurred by
      Maker in connection with the operation of the Property during the relevant
      period for which the calculation of Operating Expenses is being made,
      including, but not limited to, (a) payments made by Maker for taxes and
      insurance required under the Loan Documents, (b) monthly debt service
      payments as required under this Note, (c) federal and state income taxes,
      and (d) amounts contributed by Maker to the Replacement Reserve Account
      (as defined in the Replacement Reserve and Security Agreement executed by
      Maker for the benefit of Holder).

            3. Budgets During Extension Term.

                  (a) Within fifteen (15) days following the Original Maturity
Date and on or before December 1 of each subsequent calendar year, Maker shall
deliver to Holder a proposed revenue and expense budget for the Property for the
remainder of the calendar year in which the Original Maturity Date occurs or the
immediately succeeding calendar year (as applicable). Such budget shall set
forth Maker's projection of Gross Revenue and Operating Expenses for the
applicable calendar year, which shall be subject to Holder's reasonable
approval. Once a proposed budget has been reviewed and approved by Holder, and
Maker has made all revisions reasonably requested by Holder, if any, the revised
budget shall be delivered to Holder and shall thereafter become the budget for
the Property hereunder (the "Budget") for the applicable calendar year. If Maker
and Holder are unable to agree upon a Budget for any calendar year, the budgeted
Operating Expenses (excluding extraordinary items) provided in the Budget for
the Property for the preceding calendar year shall be considered the Budget for
the Property for the subject calendar year until Maker and Holder agree upon a
new Budget for such calendar year.

                  (b) During the Extension Term, Maker shall operate the
Property in accordance with the Budget for the applicable calendar year, and the
total of expenditures relating to the Property exceeding one hundred and five
percent (105%) of the aggregate of such expenses set forth in the Budget for the
applicable time period shall not be treated as Operating Expenses for the
purposes of calculating "Net Operating Income," without the prior written
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consent of Holder except for emergency expenditures which, in the Maker's good
faith judgment, are reasonably necessary to protect, or avoid immediate danger
to, life or property.

            4. Reports During Extension Term.

                  (a) During the Extension Term, Maker shall deliver to Holder
all financial statements reasonably required by Holder to calculate Net
Operating Income, including, without limitation, a monthly statement to be
delivered to Holder concurrently with Maker's payment of Net Operating Income
that sets forth the amount of Net Operating Income accompanying such statement
and Maker's calculation of Net Operating Income for the relevant calendar month.
Such statements shall be certified by an executive officer of Maker or Maker's
manager, managing member or general partner (as applicable) as having been
prepared in accordance with the terms hereof and to be true, accurate and
complete in all material respects.

                  (b) In addition, on or before February 15 of each calendar
year during the Extension Term, Maker shall submit to Holder an annual income
and expense statement for the Property which shall include the calculation of
Gross Revenue, Operating Expenses and Net Operating Income for the preceding
calendar year and shall be accompanied by Maker's reconciliation of any
difference between the actual aggregate amount of the Net Operating Income for
such calendar year and the aggregate amount of Net Operating Income for such
calendar year actually remitted to Holder. All such statements shall be
certified by an executive officer of Maker or Maker's manager, managing member
or general partner (as applicable) as having been prepared in accordance with
the terms hereof and to be true, accurate and complete in all material respects.
If any such annual financial statement discloses any inconsistency between the
calculation of Net Operating Income and the amount of Net Operating Income
actually remitted to Holder, Maker shall immediately remit to Holder the amount
of any underpayment of Net Operating Income for such calendar year or, in the
event of an overpayment by Maker, such amount may be withheld from any
subsequent payment of Net Operating Income required hereunder.

                  (c) Holder may notify Maker within ninety (90) days after
receipt of any statement or report required hereunder that Holder disputes any
computation or item contained in any portion of such statement or report. If
Holder so notifies Maker, Holder and Maker shall meet in good faith within
twenty (20) days after Holder's notice to Maker to resolve such disputed items.
If, despite such good faith efforts, the parties are unable to resolve the
dispute at such meeting or within ten (10) days thereafter, the items shall be
resolved by an independent certified public accountant with at least fifteen
(15) years of hotel accounting experience designated by Holder within fifteen
(15) days after such ten (10) day period. The determination of such accountant
shall be final. All fees of such accountant shall be paid by Maker. Maker shall
remit to Holder any additional amount of Net Operating Income found to be due
for such periods within ten (10) days after the resolution of such dispute by
the parties or the accountant's determination, as applicable. The amount of any
overpayment found to have been made for such periods may be withheld from any
required future remittance of Net Operating Income.
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                  (d) Maker shall at all times keep and maintain full and
accurate books of account and records adequate to reflect correctly all items
required in order to calculate Net Operating Income.

            5. Loan Prepayment and Defeasance.

                  (a) Except for (i) the application of the Additional Principal
Payment (as defined in that certain Amended and Restated Promissory Note (the
"Cambridge Note") of even date herewith in the principal amount of
$41,000,000.00 executed by Sonesta of Massachusetts, Inc., a Massachusetts
corporation , and Roger P. Sonnabend, Peter J. Sonnabend, and Boy A.J. van Riel,
trustees of the Charterhouse of Cambridge Trust, and not individually, under a
Declaration of Trust dated December 27, 1963 and recorded at Middlesex South,
Commonwealth of Massachusetts, Deeds Book 11160, Page 340, as amended by
Amendment of Declaration of Trust dated July 8, 1966 and recorded at Middlesex
South, Commonwealth of Massachusetts, Deeds Book 11160, Page 359 (collectively,
the "Cambridge Borrower") for the benefit of Holder) to the principal balance of
this Note in connection with the Defeasance of the Cambridge Note, and (ii) the
application of insurance proceeds or condemnation awards to the principal
balance of this Note, as provided in the Mortgage, Maker shall have no right to
prepay all or any portion of the Loan evidenced by this Note during the period
commencing on the date hereof through, but not including, the date of the
regularly scheduled payment due under this Note that is six (6) months prior to
the Original Maturity Date (the "Optional Prepayment Date"). From and after the
Optional Prepayment Date, and at any time during the Extension Term, Maker may
prepay the Loan in whole, but not in part, together with accrued interest to the
date of such prepayment, without prepayment premium thereon, and without any
obligation to satisfy the Defeasance Requirements (hereinafter defined). Any
such prepayment shall be subject to the requirement that Maker gives not less
than thirty (30) days' prior written notice to Holder of Maker's election to
prepay this Note, and subject to the caveat that Maker may not prepay the Loan
on a Friday or on any day preceding a public holiday, or the equivalent for
banks generally under the laws of the State of Florida. Except for the
application of the Additional Principal Payment (as defined in the Cambridge
Note) to the principal balance of this Note and the application of insurance
proceeds or condemnation awards to the principal balance of this Note, as
provided above, and except for making payments of Net Operating Income as
required above, in no event shall Maker be permitted to make any partial
prepayments of this Note.

                  (b) No prepayment premium shall be due in connection with the
application of insurance proceeds or condemnation awards to the principal
balance of this Note as provided in the Mortgage. If Holder applies any
insurance proceeds to the principal balance of this Note as provided in the
Mortgage, then Maker shall have the right to prepay the remaining principal
amount of this Note and all accrued but unpaid interest thereon as of the date
of prepayment, without prepayment premium thereon.

                  (c) At any time during the term of the Loan, Maker shall have
the right to satisfy the "Defeasance Requirements" set forth below (a
"Defeasance"), provided that (i) Maker gives not less than thirty (30) days'
prior written notice to Holder of Maker's election

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to complete a Defeasance (a "Defeasance Notice"), and (ii) Maker thereafter
timely fulfills the Defeasance Requirements. The Defeasance Requirements shall
be as follows:

                        (i) The date for fulfillment of the Defeasance
      Requirements ("Defeasance Date") shall be identified in the Defeasance
      Notice.

                        (ii) All interest, fees and charges then due under all
      of the Loan Documents shall be paid in full as of the Defeasance Date and
      there shall exist no Default or Event of Default under this Note or under
      any of the other Loan Documents.

                        (iii) Maker shall remit to Holder, or Holder's designee,
      an amount of funds designated by Holder (the "Defeasance Deposit") as
      sufficient for Holder to purchase United States government obligations on
      behalf of Maker which are not callable or subject to prepayment, of such
      maturities and interest payment dates and bearing such interest as will,
      without further investment or reinvestment of either the principal amount
      thereof or the investment income thereon, be sufficient to pay as and when
      due the principal of and interest on this Note on each regularly scheduled
      payment date hereunder and on the Original Maturity Date (the "Defeasance
      Collateral").

                        (iv) On or prior to the Defeasance Date, Maker shall
      deliver, or cause to be delivered, to Holder:

                        A. written confirmation from an independent certified
                  public accountant acceptable to Holder that the Defeasance
                  Collateral is sufficient to timely make the required payments
                  of principal and interest due under this Note as and when they
                  become due, as described above;

                        B. a security agreement executed by Maker, in form and
                  substance satisfactory to Holder, creating in Holder a first
                  priority lien on the Defeasance Deposit and the Defeasance
                  Collateral (the "Defeasance Security Agreement"), together
                  with such other documents, notices and/or UCC Financing
                  Statements requested by Holder and necessary or desirable in
                  Holder's determination to create and perfect Holder's security
                  interest in the Defeasance Deposit and Defeasance Collateral;

                        C. an opinion of counsel to Maker, in form and substance
                  and delivered by counsel satisfactory to Holder in its sole
                  discretion, stating, among other things, that (1) Holder has a
                  perfected first priority security interest in the Defeasance
                  Deposit and the Defeasance Collateral, (2) the Defeasance
                  Security Agreement is enforceable against Maker in accordance
                  with its terms, (3) the Defeasance will not cause any REMIC
                  Trust formed pursuant to Section 860D of the Internal Revenue
                  Code of 1986, as amended from time to time, or any successor
                  statute (the "Code"), that holds this Note (if any) to
                  maintain its status as a "real estate mortgage investment
                  conduit" within the meaning of Section 860D of the Code as a
                  result of the Defeasance, and (4) if applicable, after the
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                  Defeasance, the Loan will continue to be a "qualified
                  mortgage" within the meaning of Section 860G of the Code;

                        D. a certificate, executed by an authorized officer of
                  Maker, certifying that all Defeasance Requirements set forth
                  in this Note have been satisfied; and

                        E. such other certificates, documents or instruments as
                  Holder may reasonably request.

                        (v) Maker shall pay, or cause the Cambridge Borrower to
      pay, to Holder for application to the amounts due under the Cambridge
      Note, an amount equal to fifteen percent (15%) of the outstanding
      principal balance of this Note existing immediately prior to the
      Defeasance (referred to herein as the "Additional Principal Payment").

                        (vi) Maker shall pay all costs and expenses of Holder
      incurred in connection with the Defeasance, including, without limitation,
      any costs and expenses associated with a release of the lien of the
      Mortgage as provided below, the assumption of this Note by any Successor
      Maker, if applicable, as well as attorneys' and accountants' fees, service
      fees and expenses.

                        (vii) In connection with the Defeasance, Maker hereby
      appoints Holder as its agent and attorney-in-fact for the purpose of using
      the Defeasance Deposit to purchase the Defeasance Collateral.

                        (viii) Maker, pursuant to the Defeasance Security
      Agreement or other appropriate document, shall authorize and direct that
      the payments received from the Defeasance Collateral may be made directly
      to Holder or to an account maintained by, or for the benefit of, Holder
      (unless otherwise directed by Holder) and applied to satisfy the
      obligations of Maker or Successor Maker, if applicable, under this Note.

                        (ix) Maker shall submit to Holder, concurrently with
      Maker's delivery of the Defeasance Notice, a release of lien or
      reconveyance of the Mortgage and related Loan Documents (including any
      guaranty) for execution by Holder. Such release or reconveyance shall be
      in form appropriate in the jurisdiction in which the Property is located
      and satisfactory to Holder, in its reasonable discretion. Maker shall pay
      all recording costs, fees and expenses associated with recording such
      release or reconveyance and shall provide all other documentation Holder
      reasonably requests in connection with such release or reconveyance,
      together with a certificate certifying that such documentation (A) is in
      compliance with all applicable laws, and (B) will effect such release or
      reconveyance in accordance with the terms of this Note.

                        (x) Upon satisfaction of all of the Defeasance
      Requirements, the Property shall be released from the lien of the
      Mortgage, and the Defeasance Collateral shall be the sole source of
      collateral securing this Note. Holder shall remit to

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      Maker any portion of the Defeasance Deposit in excess of the amount
      necessary to purchase the Defeasance Collateral and to satisfy Maker's
      obligations under this Section.

                        (xi) In connection with the release of the lien of the
      Mortgage, Holder, at Maker's expense, may form or, at Holder's request,
      Maker shall form, a special-purpose, bankruptcy-remote entity whose only
      assets shall be the Defeasance Collateral (the "Successor Maker"), to be
      the successor obligor under this Note and the Defeasance Security
      Agreement. At Holder's request, Maker shall assign, and Successor Maker
      shall assume, all of Maker's rights and obligations under this Note and
      the Defeasance Security Agreement. In connection therewith, Successor
      Maker shall execute an assumption agreement in form and substance
      satisfactory to Holder, in Holder's sole discretion, pursuant to which
      Successor Maker shall assume Maker's obligations under this Note and the
      Defeasance Security Agreement, and Maker and any guarantors shall be
      released from their obligations with respect to such assumed documents.
      Maker shall pay $1,000.00 to Successor Maker as consideration for assuming
      the obligations under this Note and the Defeasance Security Agreement. In
      connection with such assignment and assumption, Maker shall:

                        A. Deliver to Holder an opinion of counsel, in form and
                  substance and delivered by counsel satisfactory to Holder in
                  its sole discretion stating, among other things, that (x) such
                  assumption agreement is enforceable against Maker and
                  Successor Maker in accordance with its terms, (y) this Note,
                  the Defeasance Security Agreement and any other documents
                  executed in connection with the Defeasance are enforceable
                  against Successor Maker in accordance with their respective
                  terms, and (z) the transfer of the Defeasance Collateral to
                  Successor Maker does not constitute a fraudulent conveyance or
                  a preference under applicable bankruptcy and state law; and

                        B. Pay all reasonable costs and expenses incurred by
                  Holder or its agents in connection with such assignment and
                  assumption, including, without limitation, all reasonable fees
                  and disbursements of legal counsel.

                  (d) If, prior to the Optional Prepayment Date, Holder
accelerates this Note due to an Event of Default, then in addition to Maker's
obligation to pay the then outstanding principal balance of this Note and all
accrued but unpaid interest thereon, Maker shall pay to Holder an additional
amount (a "Prepayment Premium") equal to the greater of (i) one percent (1%) of
the outstanding principal amount of this Note, or (ii) the Present Value of this
Note (hereinafter defined), less the amount of principal being prepaid,
calculated as of the prepayment date. In addition, Maker shall be obligated to
pay to Holder a prepayment premium on the Additional Principal Payment (as
defined in the Cambridge Note) being applied to the principal balance of this
Note in connection with the Defeasance of the Cambridge Note, in an amount equal
to the percentage of the principal balance being prepaid in connection
therewith, multiplied by the Prepayment Premium that would be due if this Note
were accelerated on such date.
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                  (e) For the purposes of the foregoing:

                        (i) The "Present Value of this Note" with respect to any
      prepayment of this Note, as of any date, shall be determined by
      discounting all scheduled payments of principal and interest remaining to
      maturity of this Note, attributed to the amount being prepaid, at the
      Discount Rate. If prepayment occurs on a date other than a regularly
      scheduled payment date, the actual number of days remaining from the
      prepayment date to the next regularly scheduled payment date will be used
      to discount within such period;

                        (ii) The "Discount Rate" is the rate which, when
      compounded monthly, is equivalent to the Treasury Rate, when compounded
      semi-annually;

                        (iii) The "Treasury Rate" is the semi-annual yield on
      the Treasury Constant Maturity Series with maturity equal to the remaining
      weighted average life of this Note (excluding the Extension Term), for the
      week prior to the prepayment date, as reported in Federal Reserve
      Statistical Release H.15 - Selected Interest Rates, conclusively
      determined by Holder on the prepayment date. The rate will be determined
      by linear interpolation between the yields reported in Release H.15, if
      necessary. In the event Release H.15 is no longer published, Holder shall
      select a comparable publication to determine the Treasury Rate.

                  6. Payments. Whenever any payment to be made under this Note
shall be stated to be due on a Saturday, Sunday or public holiday or the
equivalent for banks generally under the laws of the State of Florida (any other
day being a "Business Day"), such payment may be made on the next succeeding
Business Day.

            7. Default Rate.

                  (a) The entire balance of principal, interest, and other sums
due upon the maturity hereof, by acceleration or otherwise, shall bear interest
from the date due until paid at the greater of (i) eighteen percent (18%) per
annum and (ii) a per annum rate equal to five percent (5%) over the prime rate
(for corporate loans at large United States money center commercial banks)
published in The Wall Street Journal on the first business day of each month
(the "Default Rate"); provided, however, that such rate shall not exceed the
maximum permitted by applicable state or federal law. In the event The Wall
Street Journal is no longer published or no longer publishes such prime rate,
Holder shall select a comparable reference.

                  (b) If any payment under this Note is not made within five (5)
days following its due date, then interest shall accrue at the Default Rate from
the date such payment was due until payment is actually made.

            8. Late Charges. In addition to interest as set forth herein, Maker
shall pay to Holder a late charge equal to four percent (4%) of any amounts due
under this Note in the event any such amount is not paid within five (5) days
following its due date.
<PAGE>

            9. Application of Payments. All payments hereunder shall be applied
first to the payment of late charges, if any, then to the payment of prepayment
premiums, if any, then to the repayment of any sums advanced by Holder for the
payment of any insurance premiums, taxes, assessments, or other charges against
the property securing this Note (together with interest thereon at the Default
Rate from the date of advance until repaid), then to the payment of accrued and
unpaid interest, and then to the reduction of principal.

            10. Immediately Available Funds. Payments under this Note shall be
payable in immediately available funds without setoff, counterclaim or deduction
of any kind.

            11. Security. This Note is secured by, among other things, (a) a
Consolidated, Amended and Restated Mortgage, Security Agreement, Fixture Filing,
Financing Statement and Assignment of Leases and Rents of even date herewith
executed by Maker for the benefit of the named Holder hereof (the "Mortgage")
encumbering certain real property and improvements thereon commonly known as the
Sonesta Beach Resort, Key Biscayne, Florida, as more particularly described in
such Mortgage (the "Property") and the other Loan Documents (as defined in the
Mortgage), and (b) a Mortgage, Security Agreement, Fixture Filing, Financing
Statement and Assignment of Leases and Rents dated as of December 18, 1996,
executed by Cambridge Borrower for the benefit of the named Holder hereof, as
amended by a Mortgage and Loan Modification Agreement of even date herewith
executed by Cambridge Borrower and Holder, encumbering Cambridge Borrower's fee
interest and leasehold interest in and to certain real property and improvements
thereon commonly known as the Royal Sonesta Hotel, City of Cambridge, Middlesex
County, Massachusetts, as more particularly described therein. In the event that
payment of this Note is secured by a first lien on real estate, or by pledge of
any of the other forms of collateral described in Section 655.56, Florida
Statutes, then the interest due hereunder is being charged pursuant to the
provisions of Chapter 655, Florida Statutes.

            12. Certain Definitions. Capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Mortgage.

            13. Event of Default. Each of the following events will constitute
an event of default (an "Event of Default") under this Note, the Loan Documents,
the Cambridge Loan Documents (as defined in the Mortgage) and the Second
Mortgage (as defined in the Mortgage), and any Event of Default under any Loan
Document, Cambridge Loan Document or the Second Mortgage shall constitute an
Event of Default hereunder and under each of the other Loan Documents, the
Cambridge Loan Documents and the Second Mortgage:

                  (a) any failure to pay any sum due hereunder within five (5)
days after its due date or failure to perform any covenant or agreement herein
contained within thirty (30) days following written notice of default thereof;
or

                  (b) if, at any time during the Extension Term, Gross Revenue
for any twelve (12) month period shall be less than ninety-three percent (93%)
of the amount of projected Gross Revenue for such month set forth in the
applicable Budget.
<PAGE>

            14. Acceleration. Upon the occurrence of any Event of Default, the
entire balance of principal, accrued interest, and other sums owing hereunder
shall, at the option of Holder, become at once due and payable without notice or
demand. Upon the occurrence of an Event of Default described in Section 13(b)
hereof, Holder shall have the option, in its sole discretion, to either (a)
exercise any remedies available to it under the Loan Documents, the Cambridge
Loan Documents, the Second Mortgage, at law or in equity, or (b) require Maker
to submit a new proposed budget for Holder's approval. If Holder agrees to
accept such new proposed budget, then such budget shall become the Budget for
all purposes hereunder.

            15. Conditions Precedent. Maker hereby certifies and declares that
all acts, conditions and things required to be done and performed and to have
happened precedent to the creation and issuance of this Note by Maker, and to
constitute this Note the legal, valid and binding obligation of Maker,
enforceable in accordance with the terms hereof, have been done and performed
and happened in due and strict compliance with all applicable laws.

            16. Certain Waivers and Consents. Maker and all parties now or
hereafter liable for the payment hereof, primarily or secondarily, directly or
indirectly, and whether as endorser, guarantor, surety, or otherwise, hereby
severally (a) waive presentment, demand, protest, notice of protest and/or
dishonor, and all other demands or notices of any sort whatever with respect to
this Note, (b) consent to impairment or release of collateral, extensions of
time for payment, and acceptance of partial payments before, at, or after
maturity, (c) waive any right to require Holder to proceed against any security
for this Note before proceeding hereunder, (d) waive diligence in the collection
of this Note or in filing suit on this Note, and (e) agree to pay all reasonable
costs and expenses, including reasonable attorneys' fees, which may be incurred
in the collection of this Note or any part thereof or in preserving, securing
possession of, and realizing upon any security for this Note.

            17. Usury Savings Clause. The provisions of this Note and of all
agreements between Maker and Holder are, whether now existing or hereinafter
made, hereby expressly limited so that in no contingency or event whatever,
whether by reason of acceleration of the maturity hereof, prepayment, demand for
payment or otherwise, shall the amount paid, or agreed to be paid, to Holder for
the use, forbearance, or detention of the principal hereof or interest hereon,
which remains unpaid from time to time, exceed the maximum amount permissible
under applicable law, it particularly being the intention of the parties hereto
to conform strictly to Florida and Federal law, whichever is applicable. If from
any circumstance whatever, the performance or fulfillment of any provision
hereof or of any other agreement between Maker and Holder shall, at the time
performance or fulfillment of such provision is due, involve or purport to
require any payment in excess of the limits prescribed by law, then the
obligation to be performed or fulfilled is hereby reduced to the limit of such
validity, and if from any circumstance whatever Holder should ever receive as
interest an amount which would exceed the highest lawful rate, the amount which
would be excessive interest shall be applied to the reduction of the principal
balance owing hereunder (or, at Holder's option, be paid over to Maker) and
shall not be counted as interest. To the extent permitted by applicable law,
determination of the legal maximum amount of interest shall at all times be made
by amortizing, prorating, allocating and spreading in equal parts during the
period of the full stated term of this
<PAGE>

Note, all interest at any time contracted for, charged, or received from Maker
in connection with this Note and all other agreements between Maker and Holder,
so that the actual rate of interest on account of the indebtedness represented
by this Note is uniform throughout the term hereof.

            18. Non-Recourse; Exceptions to Non-Recourse. Except as expressly
hereinafter set forth, the recourse of Holder with respect to the obligations
evidenced by this Note shall be solely to the Property, Chattels, and Intangible
Personalty (as such terms are defined in the Mortgage and the Cambridge Loan
Documents), and all other collateral pledged by Maker to secure this Note.
Notwithstanding anything to the contrary contained in this Note or in any Loan
Document, Cambridge Loan Document or the Second Mortgage, nothing shall be
deemed in any way to impair, limit or prejudice the rights of Holder (a) in
foreclosure proceedings or in any ancillary proceedings brought to facilitate
Holder's foreclosure on the Property or any portion thereof; (b) to recover from
Maker damages or costs (including without limitation reasonable attorneys' fees)
incurred by Holder as a result of waste by Maker; (c) to recover from Maker any
condemnation or insurance proceeds attributable to the Property which were not
paid to Holder or used to restore the Property in accordance with the terms of
the Mortgage; (d) to recover from Maker any rents, profits, security deposits,
advances, rebates, prepaid rents or other similar sums attributable to the
Property collected by or for Maker following an Event of Default under any Loan
Document and not properly applied to the reasonable fixed and operating expenses
of the Property, including payments of this Note, or held pursuant to Leases or
other applicable agreements; (e) to pursue the personal liability of Maker under
the provisions of Section 5.10 of the Mortgage, including any indemnification
provisions under such Section; (f) to exercise any specific rights or remedies
afforded Holder under any other provisions of the Loan Documents or by law or in
equity (or to recover under any guarantee agreement given in connection with
this Note); (g) to recover from Maker and to properly apply and disburse the
amount of any accrued taxes, assessments, and/or utility charges affecting the
Property (whether or not the same have been billed to Maker) that are either
unpaid by Maker or paid by Holder under the Mortgage and to collect from Maker
any sums expended by Holder in fulfilling the obligations of Maker under any
leases, permits, licenses (including liquor licenses), management, franchise or
license agreements or any other agreements affecting or relating to the Property
or the operation of the Property as a full-service hotel; (h) to pursue any
personal liability of Maker and/or Guarantor under the Environmental Indemnity
Agreement; and (i) to recover from Maker the amount of any loss suffered by
Holder (that would otherwise be covered by insurance) as a result of Maker's
failure to maintain any insurance required under the terms of any Loan Document.
The agreement contained in this paragraph to limit the personal liability of
Maker shall become null and void and be of no further force and effect in the
event (i) that the Property or any part thereof or any interest therein, or any
interest in Maker, shall be further encumbered by a voluntary lien securing any
obligation upon which Maker or any general partner, principal or affiliate of
Maker shall be personally liable for repayment, whether as obligor or guarantor
which has not been approved in advance by Holder; (ii) of any breach or
violation of Section 5.4, 5.5 or 5.7 of the Mortgage; (iii) of any fraud or
material misrepresentation by Maker in connection with the Property, the Loan
Documents or the application made by Maker for the Loan; or (iv) of any
execution, amendment, modification or termination without the prior written
consent of Holder if such consent is required under the terms of Section 5.3 of
the Mortgage of any Lease. For purposes of the foregoing, "affiliate"
<PAGE>

shall mean any individual, corporation, trust, partnership or any other person
or entity controlled by, controlling or under common control with Maker. A
person or entity of any nature shall be presumed to have control when it
possesses the power, directly or indirectly, to direct, or cause the direction
of, the management or policies of another person or entity, whether through
ownership of voting securities, by contract, or otherwise.

            19. Severability. If any provision hereof or of any other document
securing or related to the indebtedness evidenced hereby is, for any reason and
to any extent, invalid or unenforceable, then neither the remainder of the
document in which such provision is contained, nor the application of the
provision to other persons, entities, or circumstances, nor any other document
referred to herein, shall be affected thereby, but instead shall be enforceable
to the maximum extent permitted by law.

            20. Transfer of Note. Each provision of this Note shall be and
remain in full force and effect notwithstanding any negotiation or transfer
hereof and any interest herein to any other Holder or participant.

            21. Governing Law. Regardless of the place of its execution, this
Note shall be construed and enforced in accordance with the laws of the State of
Florida.

            22. Time of Essence. Time is of the essence of this Note.

            23. Remedies Cumulative. The remedies provided to Holder in this
Note, the Mortgage, the Loan Documents, the Cambridge Loan Documents and the
Second Mortgage are cumulative and concurrent and may be exercised singly,
successively or together against Maker, the Property, and other security, or any
guarantor of this Note, at the sole and absolute discretion of the Holder.

            24. No Waiver. Holder shall not by any act or omission be deemed to
waive any of its rights or remedies hereunder unless such waiver is in writing
and signed by the Holder and then only to the extent specifically set forth
therein. A waiver of one event shall not be construed as continuing or as a bar
to or waiver of any right or remedy granted to Holder hereunder in connection
with a subsequent event.

            25. Joint and Several Obligation. If Maker is more than one person
or entity, then (a) all persons or entities comprising Maker are jointly and
severally liable for all of the Maker's obligations hereunder; (b) all
representations, warranties, and covenants made by Maker shall be deemed
representations, warranties, and covenants of each of the persons or entities
comprising Maker; (c) any breach, Default or Event of Default by any of the
persons or entities comprising Maker hereunder shall be deemed to be a breach,
Default, or Event of Default of Maker; and (d) any reference herein contained to
the knowledge or awareness of Maker shall mean the knowledge or awareness of any
of the persons or entities comprising Maker.

            26. WAIVER OF JURY TRIAL. MAKER AND HOLDER KNOWINGLY, IRREVOCABLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EITHER MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY ACTION, PROCEEDING OR
<PAGE>

COUNTERCLAIM BASED ON THIS NOTE, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS NOTE, THE MORTGAGE, OR ANY OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY
HERETO OR TO ANY LOAN DOCUMENT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
MAKER AND HOLDER TO ENTER INTO THE LOAN TRANSACTION EVIDENCED BY THIS NOTE.

            27. WAIVER OF PREPAYMENT RIGHT WITHOUT PREMIUM. MAKER HEREBY
EXPRESSLY WAIVES ANY RIGHT IT MAY HAVE UNDER APPLICABLE LAW TO PREPAY THIS NOTE,
IN WHOLE OR IN PART, WITHOUT PREPAYMENT PREMIUM (EXCEPT AS OTHERWISE PROVIDED
HEREIN), UPON ACCELERATION OF THE MATURITY DATE OF THIS NOTE, AND AGREES THAT,
IF FOR ANY REASON A PREPAYMENT OF ALL OR ANY PART OF THIS NOTE IS MADE, WHETHER
VOLUNTARILY OR FOLLOWING ANY ACCELERATION OF THE MATURITY DATE OF THIS NOTE BY
HOLDER ON ACCOUNT OF THE OCCURRENCE OF ANY EVENT OF DEFAULT ARISING FOR ANY
REASON, INCLUDING, WITHOUT LIMITATION, AS A RESULT OF ANY PROHIBITED OR
RESTRICTED TRANSFER, FURTHER ENCUMBRANCE OR DISPOSITION OF THE PROPERTY OR ANY
PART THEREOF SECURING THIS NOTE, THEN MAKER SHALL BE OBLIGATED TO PAY,
CONCURRENTLY WITH SUCH PREPAYMENT, THE PREPAYMENT PREMIUM PROVIDED FOR IN THIS
NOTE OR, IN THE EVENT OF PREPAYMENT FOLLOWING ACCELERATION OF THE MATURITY DATE
HEREOF WHEN THIS NOTE IS CLOSED TO PREPAYMENT, AS PROVIDED IN THE MORTGAGE.
MAKER HEREBY DECLARES THAT HOLDER'S AGREEMENT TO MAKE THE LOAN AT THE INTEREST
RATE AND FOR THE TERM SET FORTH IN THIS NOTE CONSTITUTES ADEQUATE CONSIDERATION,
GIVEN INDIVIDUAL WEIGHT BY MAKER, FOR THIS WAIVER AND AGREEMENT.

            28. Consolidation of Notes.

                  (a) This Note amends, supplements, modifies, restates and
consolidates in their entirety: (a) that certain Second Renewal Promissory Note
(the "Aetna Note") dated December 1, 1993 from Key Biscayne Limited Partnership
("KBLP"), as maker, and payable to the order of Aetna Life Insurance Company
("Aetna") in the original principal amount of $24,142,088.26, which Aetna Note
was endorsed by Aetna to the order of State Street Bank and Trust Company,
Trustee for the registered holders of Aetna Commercial Mortgage Trust Multiclass
Pass-Through Certificates, Series 1997-ALIC ("State Street") and subsequently
assumed by Maker, and which Aetna Note has an outstanding principal balance as
of the date hereof of $22,431,486.12, (b) that certain Purchase Money Mortgage
Note dated December 27, 1984 from Biscayne Beach Hotel Associates, Ltd.
("BBHA"), now known as KBLP, as maker, and payable to the order of Florida
Sonesta Corporation, a Florida corporation ("FSC"), in the original principal
amount of $5,000,000.00, as amended by Amendment of Note and Second Mortgage
dated September 12, 1991 (as amended, the "FSC $5MM Note"), which FSC $5MM Note
has an outstanding principal balance as of the date hereof of $5,000,000.00, and
(c) that
<PAGE>

certain Purchase Money Mortgage Note dated December 27, 1984 from BBHA, as
maker, and payable to the order of FSC in the original principal amount of
$6,500,000.00, as amended by Amendment of Note and Third Mortgage dated
September 12, 1991 (as amended, the "FSC $6.5MM Note"), which FSC $6.5MM Note
has an outstanding principal balance as of the date hereof of $3,568,513.88.

                  (b) Maker is not the current obligor under the FSC $5MM Note
or the FSC $6.5MM Note. Maker hereby assumes the obligations of the makers under
the FSC $5MM Note and the FSC $6.5MM Note. Accordingly, the execution by Maker
of this Note evidences Maker's assumption of such promissory notes, and Florida
documentary stamp taxes are being paid in connection herewith, as described on
page 1 of this Note.

                  (c) The Aetna Note was endorsed to the order of the named
Holder hereof by way of a separate Allonge executed by State Street and attached
to the Aetna Note. The FSC $5MM Note and the FSC $6.5MM Note were each endorsed
to the order of the named Holder hereof by way of separate Allonges executed by
FSC and attached to such promissory notes.

                   [Balance of page intentionally left blank]
<PAGE>

            IN WITNESS WHEREOF and intending to be legally bound, Maker has duly
executed this Note as of the date first above written.

                                    SONESTA BEACH RESORT LIMITED
                                    PARTNERSHIP, a Delaware limited partnership

                                    By: Florida Sonesta Corporation, a Florida
                                        corporation, its General Partner

                                        By: /s/
                                            -----------------------------------
                                            Peter J. Sonnabend, Vice President<PAGE>

                                                              Exhibit 10.2(b)

STATE OF FLORIDA
COUNTY OF MIAMI-DADE

Prepared by:
And when recorded mail to:

Otten, Johnson, Robinson, Neff &
  Ragonetti, P.C.
950 Seventeenth Street
Suite 1600
Denver, Colorado 80202

Attention: Mark F. Copertino, Esq.

              CONSOLIDATED, AMENDED AND RESTATED MORTGAGE, SECURITY
          AGREEMENT, FIXTURE FILING, FINANCING STATEMENT AND ASSIGNMENT
                               OF LEASES AND RENTS

            THIS CONSOLIDATED, AMENDED AND RESTATED MORTGAGE, SECURITY
AGREEMENT, FIXTURE FILING, FINANCING STATEMENT AND ASSIGNMENT OF LEASES AND
RENTS (this "Mortgage") is executed as of May 30, 2000, by SONESTA BEACH RESORT
LIMITED PARTNERSHIP, a Delaware limited partnership ("Mortgagor"), in favor of,
and for the use and benefit of, SUNAMERICA LIFE INSURANCE COMPANY, an Arizona
corporation ("Mortgagee").

                                    RECITALS

            A. State Street Bank and Trust Company, as Trustee (referred to
herein as "State Street"), is the owner and holder of certain indebtedness (the
"Aetna Loan") evidenced, inter alia, by that Second Renewal Promissory Note (the
"Aetna Note") dated December 1, 1993 from Key Biscayne Limited Partnership
("KBLP"), as maker, which Aetna Note is payable to the order of Aetna Life
Insurance Company ("Aetna") in the original principal amount of $24,142,088.26
and which Aetna Note was endorsed to the order of State Street by way of a
separate Allonge executed by Aetna and attached to the Aetna Note, as well as
the following documents and instruments evidencing and securing the Aetna Loan
(collectively with the Aetna Note, the "Aetna Loan Documents"):

                  (i) That certain Promissory Note dated December 28, 1984,
      evidencing a loan from Southeast Bank, N.A. to Biscayne Beach Hotel
      Associates, Ltd. ("BBHA"), now known as KBLP, in the original principal
      amount of $22,000,000.00 (the "Original Aetna Note") and a Mortgage and
      Security Agreement dated December 28, 1984, from BBHA to Southeast Bank,
      N.A., which secures the Original Aetna Note and which is recorded in the
      Public Records of Dade County, Florida, now known as Miami-Dade County,
      Florida (the "Records") in Official Records Book 12369, Page 6689 (the
      "Original Aetna Mortgage"), which (i) Original Aetna Note, (ii) Original
      Aetna Mortgage, and (iii) Assignment of Lessor's Interest in Leases
      appurtenant thereto and
<PAGE>

      recorded in the Records in Official Records Book 12369, Page 6716 (the
      "Original Aetna Assignment"), were assigned to Aetna pursuant to that
      certain Assignment recorded in the Records in Official Records Book 12514,
      Page 2826, and which Original Aetna Note was endorsed to the order of
      Aetna pursuant to that certain endorsement affixed to the Original Aetna
      Note and executed by Southeast Bank, N.A. The Original Aetna Note was
      amended and restated by that certain Note Modification Agreement by and
      between Aetna and KBLP dated May 17, 1985, and the Original Aetna Mortgage
      was amended and restated by that certain Mortgage Modification and
      Extension Agreement dated May 17, 1985 and recorded in the Records in
      Official Records Book 12514, Page 2827. As additional security for the
      Original Aetna Note, as amended and restated as aforesaid, KBLP executed
      in favor of Aetna that certain Assignment of Rents and Leases dated May
      17, 1985 and recorded in the Records in Official Records Book 12514, Page
      2847 (the "Second Aetna Assignment"). KBLP and Aetna also entered into (i)
      that certain Note and Mortgage Modification Agreement dated July 29, 1988
      and recorded in the Records in Official Records Book 13804, Page 1027,
      (ii) that certain Second Note and Mortgage Modification Agreement dated
      October 9, 1989 and recorded in the Records in Official Records Book
      14290, Page 861, and (iii) that certain Third Note and Mortgage
      Modification Agreement dated February 22, 1990 and recorded in the Records
      in Official Records Book 14461, Page 697. In addition, KBLP executed and
      delivered to Aetna its Accrual Promissory Note dated as of October 1,
      1991, in the original principal amount of $953,333.33, which was
      consolidated with KBLP's indebtedness evidenced by the aforesaid Third
      Note and Mortgage Modification Agreement pursuant to a Consolidating Note
      Agreement dated as of October 1, 1991 between KBLP and Aetna, and renewed
      pursuant to KBLP's Renewal Promissory Note dated as of October 1, 1991,
      and further modified by Mortgage Modification Agreement dated as of
      October 1, 1991 and recorded in the Records in Official Records Book
      16242, Page 1563, and which Accrual Promissory Note and Renewal Promissory
      Note were each endorsed to the order of State Street for the registered
      holders of Aetna Commercial Mortgage Trust Multiclass Pass-Through
      Certificates, Series 1997-ALIC by way of separate Allonges executed by
      Aetna and attached to each of the aforesaid Accrual Promissory Note and
      Renewal Promissory Note. The Original Aetna Mortgage, as restated and
      subsequently assigned, amended, modified and renewed, as aforesaid, is
      hereinafter referred to as the "Aetna Mortgage."

                  (ii) State Street is also the holder of (i) that certain
      Accrual Promissory Note dated as of December 1, 1993 (the "Aetna Accrual
      Note") from KBLP, in the principal amount of $2,192,906.23, and (ii) that
      certain Promissory Note dated December 1, 1993 (the "Aetna Capitalized
      Interest Note") from KBLP, in the principal amount of $2,142,088.26. The
      Aetna Note, the Aetna Accrual Note and the Aetna Capitalized Interest Note
      have been consolidated pursuant to the terms of a Consolidating Note
      Agreement dated effective as of December 1, 1993, between KBLP and Aetna,
      and said notes, as consolidated, have been renewed pursuant to the
      provisions of the Aetna Note effective as of December 1, 1993, in favor of
      Aetna. The Aetna Note, the Aetna Accrual Promissory Note and the Aetna
      Capitalized Interest Note were each endorsed to the order of State Street
      by way of separate Allonges executed by Aetna and attached to each of the
      aforesaid Aetna Note, Aetna Accrual Promissory Note and Aetna Capitalized
<PAGE>

      Interest Note. The Aetna Accrual Promissory Note and the Aetna Capitalized
      Interest Note are secured by a Mortgage Deed (the "Aetna Mortgage Deed")
      dated as of December 1, 1993, from KBLP to Aetna and recorded in the
      Records in Official Records Book 16242, Page 1581. The Aetna Mortgage and
      the Aetna Mortgage Deed have been further consolidated and modified, and
      the Original Aetna Assignment and the Second Aetna Assignment have been
      ratified and confirmed, pursuant to that certain Mortgage Modification
      Agreement dated as of December 1, 1993, and recorded in the Records in
      Official Records Book 16242, Page 1589. The aforesaid Aetna Mortgage, the
      Aetna Mortgage Deed, the Original Aetna Assignment and the Second Aetna
      Assignment, each as restated, assigned, amended, modified and renewed, as
      aforesaid, together with the note or notes described in said documents,
      and all other documents or instruments which may have been executed in
      favor of Aetna in connection with the aforesaid documents were assigned by
      Aetna to State Street pursuant to that certain Assignment of Mortgage Loan
      dated as of December 22, 1997 and recorded in the Records in Official
      Records Book 17976, Page 980.

            B. The Aetna Loan, and the obligations of KBLP under the Aetna Loan
Documents, were assumed by Mortgagor pursuant to an Assumption Agreement
executed by Mortgagor and State Street dated as of July 1, 1998, and recorded in
the Records in Official Records Book 18174, Page 384.

            C. Mortgagor has requested that Mortgagee purchase, and modify the
terms of, the Aetna Loan Documents, and Mortgagee has taken an assignment of the
Aetna Loan Documents pursuant to an instrument dated on or about the date of
this Mortgage made by State Street to Mortgagee.

            D. Mortgagor and Mortgagee acknowledge that the outstanding
principal balance of the Aetna Loan is $22,431,486.12 as of the date of this
Mortgage, and that there is no accrued but unpaid interest thereon.

            E. Florida Sonesta Corporation, a Florida corporation ("FSC"), is
the owner and holder of certain indebtedness (the "FSC $5MM Loan") evidenced,
inter alia, by that certain Purchase Money Mortgage Note dated December 27, 1984
from BBHA, now known as KBLP, as maker, and payable to the order of FSC, in the
original principal amount of $5,000,000.00, as well as the following documents
(all such documents, each as restated, amended, modified and/or renewed,
together with the note or notes described in said documents, and all other
documents or instruments which may have been executed in favor of FSC in
connection therewith, being referred to herein as the "FSC First Loan
Documents"): Mortgage and Security Agreement from BBHA to FSC filed December 31,
1994, in Official Records Book 12369, Page 6723, in the amount of $5,000,000.00;
as amended by Amendment of Note and Second Mortgage filed October 17, 1991, in
Official Records Book 15232, Page 3219; Mortgage and Note Subordination
Agreement filed February 8, 1994, in Official Records Book 16242, Page 1608;
Second Amendment of Mortgage and Security Agreement filed February 8, 1994, in
Official Records Book 16242, Page 1624; and Third Amendment of Mortgage and
Security Agreement
<PAGE>

filed February 8, 1994, in Official Records Book 16242, Page 1644 (as amended,
the "FSC First Mortgage").

            F. FSC is also the owner and holder of certain indebtedness (the
"FSC $6.5MM Loan," and, together with the FSC $5MM Loan, collectively, the "FSC
Loans") evidenced, inter alia, by that certain Purchase Money Mortgage Note
dated December 27, 1984 from BBHA, as maker, and payable to the order of FSC in
the original principal amount of $6,500,000.00, as well as the following
documents (all such documents, each as restated, amended, modified and/or
renewed, together with the note or notes described in said documents, and all
other documents or instruments which may have been executed in favor of FSC in
connection therewith, being referred to herein as the "FSC Second Loan
Documents," and together with the FSC First Loan Documents, the "FSC Loan
Documents"): Mortgage and Security Agreement from BBHA to FSC filed December 31,
1984 in Official Records Book 12369, Page 6832, in the amount of $6,500,000.00;
as amended by Amendment of Note and Third Mortgage filed October 17, 1991, in
Official Records Book 15232, Page 3225; Mortgage and Note Subordination
Agreement filed February 8, 1994, in Official Records Book 16242, Page 1616; and
Second Amendment of Mortgage and Security Agreement filed February 8, 1994, in
Official Records Book 16242, Page 1634 (as amended, the "FSC Second Mortgage").

            G. Mortgagor is not the mortgagor under the FSC First Mortgage or
the FSC Second Mortgage, and pursuant to the terms of this Mortgage, Mortgagor
shall assume the obligations of the mortgagors thereunder prior to the
consolidation of the mortgages as contemplated hereby. The FSC Loans are being
assumed by Mortgagor in connection with Mortgagor's execution of the Note
(hereinafter defined).

            H. Mortgagor has requested that Mortgagee purchase, and modify the
terms of, the FSC Loan Documents, and Mortgagee has taken an assignment of the
FSC Loan Documents pursuant to an instrument dated on or about the date of this
Mortgage made by FSC to Mortgagee.

            I. Mortgagor and Mortgagee acknowledge that the outstanding
principal balance of the FSC $5MM Loan is $5,000,000.00 as of the date of this
Mortgage, that the outstanding principal balance of the FSC $6.5MM Loan is
$3,568,513.88 as of the date of this Mortgage, and that there is no accrued but
unpaid interest on either of such FSC Loans.

            J. Mortgagor and Mortgagee have agreed to consolidate, amend and
restate in their entireties the Aetna Loan Documents, the FSC First Loan
Documents and the FSC Second Loan Documents as set forth in the Loan Documents
(as hereinafter defined).

            NOW, THEREFORE, in consideration of the premises, Ten Dollars and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Mortgagor hereby assumes the obligations of the mortgagor
under each of the FSC First Mortgage and the FSC Second Mortgage, and Mortgagor
and Mortgagee agree that the outstanding principal balance of the Aetna Loan and
the FSC Loans shall be consolidated to reflect a single, consolidated and
extended indebtedness of $31,000,000.00 in connection with Mortgagor's execution
and delivery of the Note (as hereinafter defined), this Mortgage and the
<PAGE>

other Loan Documents, and that the Aetna Mortgage, the Aetna Mortgage Deed, the
Original Aetna Assignment, the Second Aetna Assignment, the FSC First Mortgage
and the FSC Second Mortgage (referred to herein, collectively, as the "Original
Mortgages," and, together with the other Aetna Loan Documents, FSC First Loan
Documents and the FSC Second Loan Documents, collectively, the "Original Loan
Documents") are hereby consolidated, amended and restated in their entireties as
follows:

                                   Article 1

                       PARTIES, PROPERTY, AND DEFINITIONS

            The following terms and references shall have the meanings
indicated:

            1.1 Cambridge Borrower: Collectively, Sonesta of Massachusetts,
Inc., a Massachusetts corporation , and Roger P. Sonnabend, Peter J. Sonnabend,
and Boy A.J. van Riel, trustees of the Charterhouse of Cambridge Trust, and not
individually, under a Declaration of Trust dated December 27, 1963 and recorded
at Middlesex South, Commonwealth of Massachusetts, Deeds Book 11160, Page 340,
as amended by Amendment of Declaration of Trust dated July 8, 1966 and recorded
at Middlesex South, Commonwealth of Massachusetts, Deeds Book 11160, Page 359.

            1.2 Cambridge Loan Documents: The Cambridge Note, all of the
mortgages, deeds of trust, and other instruments and documents executed by the
Cambridge Borrower and/or Guarantor securing the Cambridge Note, including any
guaranty agreements, environmental indemnity agreements, replacement reserve
agreements, collateral assignment of liquor licenses, lease certificates, and
all other documents executed or delivered by the Cambridge Borrower and/or
Guarantor in connection with the transaction pursuant to which the Cambridge
Note has been executed and delivered. The term Cambridge Loan Documents also
includes all modifications, extensions, renewals, and replacements of each
document referred to above.

            1.3 Cambridge Note: The Amended and Restated Promissory Note of even
date herewith executed by the Cambridge Borrower and payable to the order to
Mortgagee in the principal face amount of $41,000,000.00, together with all
renewals, extensions and modifications of such amended and restated promissory
note.

            1.4 Chattels: All goods, fixtures, inventory, equipment, building
and other materials, supplies, and other tangible personal property of every
nature now owned or hereafter acquired by Mortgagor and used, intended for use,
or reasonably required in the construction, development, or operation of the
Property, together with all accessions thereto, replacements and substitutions
therefor, and proceeds thereof.

            1.5 Default: Any matter which, with the giving of notice, passage of
time, or both, would constitute an Event of Default.
<PAGE>

            1.6 Environmental Indemnity Agreement: The Environmental Indemnity
Agreement of even date herewith executed by Mortgagor and Guarantor for the
benefit of Mortgagee.

            1.7 ERISA: The Employee Retirement Income Security Act of 1974, as
amended, together with all rules and regulations issued thereunder.

            1.8 Event of Default: As defined in Article 6.

            1.9 Financial Certificate: The certificate of even date herewith
executed by Mortgagor to Mortgagee concerning financial statements previously
delivered by Mortgagor to Mortgagee.

            1.10 General Partner: Florida Sonesta Corporation, a Florida
corporation, and any other or successor general partner of Mortgagor.

            1.11 Guarantor: Sonesta International Hotels Corporation, a New York
corporation.

            1.12 Intangible Personalty: All accounts, accounts receivable
arising from guest occupancy of the Property, monies in the possession of
Mortgagee (including without limitation proceeds from insurance, retainages and
deposits for taxes and insurance), permits, liquor licenses, contract rights
(including, without limitation, rights to receive insurance proceeds) and
general intangibles (whether now owned or hereafter acquired, and including
proceeds thereof) relating to or arising from Mortgagor's ownership, use,
operation, leasing, or sale of all or any part of the Property, specifically
including but in no way limited to any right which Mortgagor may have or acquire
to transfer any development rights from the Property to other real property, and
any development rights which may be so transferred, and any and all fees,
charges, accounts, or other payments for the use or occupancy of rooms and other
public facilities located at the Property.

            1.13 Lease Certificate: The certificate of even date herewith
executed by Mortgagor to Mortgagee concerning Leases.

            1.14 Leases: Any and all leases, subleases and other agreements
under the terms of which any person other than Mortgagor has or acquires any
right to occupy or use the Property, or any part thereof.

            1.15 Limited Guaranty Agreement: The Limited Guaranty Agreement of
even date herewith made by Guarantor for the benefit of Mortgagee.

            1.16 Liquor License Assignment: The Security Agreement and
Collateral Assignment of Liquor Licenses of even date herewith executed by
Mortgagor for the benefit of Mortgagee.
<PAGE>

            1.17 Loan Documents: The Note, all of the deeds of trusts, mortgages
and other instruments and documents securing the Note, including this Mortgage,
the Environmental Indemnity Agreement, the Limited Guaranty Agreement, the Lease
Certificate, the Financial Certificate, the Liquor License Assignment, the
Replacement Reserve and Security Agreement, and each other document executed or
delivered by Mortgagor or Guarantor in connection with the transaction pursuant
to which the Note has been executed and delivered, but excluding the
Non-Recourse Guaranty Agreement and the Second Mortgage. The term "Loan
Documents" also includes all modifications, extensions, renewals, and
replacements of each document referred to above.

            1.18 Mortgagee: The Mortgagee named in the introductory paragraph of
this Mortgage (Taxpayer Identification No. 52-502540), whose legal address is 1
SunAmerica Center, Century City, Los Angeles, California 90067-6022, together
with any future holder of the Note.

            1.19 Mortgagor: The Mortgagor named in the introductory paragraph of
this Mortgage (Taxpayer Identification No. 06-1518976), whose legal address is
c/o Sonesta International Hotels Corp., 200 Clarendon Street, 41st Floor,
Boston, Massachusetts 02116, Attention: Office of the Treasurer, together with
any future owner of the Property or any part thereof or interest therein.

            1.20 Non-Recourse Guaranty Agreement: The Non-Recourse Guaranty
Agreement of even date herewith made by Mortgagor for the benefit of Mortgagee,
and secured by the Second Mortgage, pursuant to which Mortgagor has guaranteed
to Mortgagee payment and performance of the Cambridge Note and the other
Cambridge Loan Documents.

            1.21 Note: Mortgagor's Consolidated and Renewed Promissory Note of
even date herewith, payable to the order of Mortgagee in the principal face
amount of $31,000,000.00, the last payment under which is due on July 1, 2010,
or, if extended by Mortgagee pursuant to its terms, July 1, 2015, unless such
due date is accelerated, together with all renewals, extensions and
modifications of such promissory note. All terms and provisions of the Note are
incorporated by this reference in this Mortgage.

            1.22 Permits: All permits, licenses, certificates and authorizations
necessary for the beneficial development, ownership, use, occupancy, operation
and maintenance of the Property, including, without limitation, all liquor,
innholder's and similar such licenses.

            1.23 Permitted Exceptions: The matters set forth in Exhibit B
attached hereto.

            1.24 Property: The tract or tracts of land described in Exhibit A
attached, together with the following:

                  (a) All buildings, structures, and improvements now or
hereafter located on such tract or tracts, as well as all rights-of-way,
easements, and other appurtenances thereto;
<PAGE>

                  (b) All of Mortgagor's right, title and interest in any land
lying between the boundaries of such tract or tracts and the center line of any
adjacent street, road, avenue, or alley, whether opened or proposed;

                  (c) All of the rents, income, receipts, revenues, issues and
profits of and from such tract or tracts and improvements;

                  (d) All (i) water and water rights (whether decreed or
undecreed, tributary, nontributary or not nontributary, surface or underground,
or appropriated or unappropriated); (ii) ditches and ditch rights; (iii) spring
and spring rights; (iv) reservoir and reservoir rights; and (v) shares of stock
in water, ditch and canal companies and all other evidence of such rights, which
are now owned or hereafter acquired by Mortgagor and which are appurtenant to or
which have been used in connection with such tract or tracts or improvements;

                  (e) All minerals, crops, timber, trees, shrubs, flowers, and
landscaping features now or hereafter located on, under or above such tract or
tracts;

                  (f) All machinery, apparatus, equipment, fittings, fixtures
owned by Mortgagor (whether actually or constructively attached, and including
all trade, domestic, and ornamental fixtures) now or hereafter located in, upon,
or under such tract or tracts or improvements and used or usable in connection
with any present or future operation thereof, including but not limited to all
heating, air-conditioning, freezing, lighting, laundry, incinerating and power
equipment; engines; pipes; pumps; tanks; motors; conduits; switchboards;
plumbing, lifting, cleaning, fire prevention, fire extinguishing, refrigerating,
ventilating, cooking, and communications apparatus; boilers, water heaters,
ranges, furnaces, and burners; appliances; vacuum cleaning systems; elevators;
escalators; shades; awnings; screens; storm doors and windows; stoves;
refrigerators; attached cabinets; partitions; ducts and compressors; rugs and
carpets; draperies; and all additions thereto and replacements therefor;

                  (g) All development rights associated with such tract or
tracts, whether previously or subsequently transferred to such tract or tracts
from other real property or now or hereafter susceptible of transfer from such
tract or tracts to other real property;

                  (h) All awards and payments, including interest thereon,
resulting from the exercise of any right of eminent domain or any other public
or private taking of, injury to, or decrease in the value of, any of such
property; and

                  (i) All other and greater rights and interests of every nature
in such tract or tracts and in the possession or use thereof and income
therefrom, whether now owned or subsequently acquired by Mortgagor.

            1.25 Replacement Reserve and Security Agreement: The Replacement
Reserve and Security Agreement of even date herewith executed by Mortgagor for
the benefit of Mortgagee.
<PAGE>

            1.26 Second Mortgage: The Mortgage, Security Agreement, Fixture
Filing, Financing Statement and Assignment of Leases and Rents of even date
herewith executed by Mortgagor for the benefit of Mortgagee and securing
Mortgagor's obligations under the Non-Recourse Guaranty Agreement.

            1.27 Secured Obligations: All present and future obligations of
Mortgagor to Mortgagee evidenced by or contained in the Note and the other Loan
Documents (excluding, however, the Limited Guaranty Agreement and all documents
executed by the Guarantor), whether stated in the form of promises, covenants,
representations, warranties, conditions, or prohibitions or in any other form.
If the maturity of the Note secured by this Mortgage is accelerated, the Secured
Obligations shall also include an amount equal to the prepayment premium payable
under the terms of the Note in connection with any such acceleration.

                                   Article 2

                                 GRANTING CLAUSE

            2.1 Grant to Mortgagee. As security for the Secured Obligations,
Mortgagor hereby grants, bargains, sells, conveys, mortgages, and warrants unto
Mortgagee the entire right, title, interest and estate of Mortgagor in and to
the Property, whether now owned or hereafter acquired; TO HAVE AND TO HOLD the
same, together with all and singular the rights, hereditaments, and
appurtenances in anywise appertaining or belonging thereto, unto Mortgagee and
Mortgagee's successors, substitutes and assigns forever.

            2.2 Security Interest to Mortgagee. As additional security for the
Secured Obligations, Mortgagor hereby grants to Mortgagee a security interest in
the Chattels and in the Intangible Personalty. To the extent any of the Chattels
or the Intangible Personalty may be or have been acquired with funds advanced by
Mortgagee under the Loan Documents, this security interest is a purchase money
security interest. This Mortgage constitutes a Security Agreement under the
Uniform Commercial Code of the state in which the Property is located (the
"Code") with respect to any part of the Property, Chattels and Intangible
Personalty that may or might now or hereafter be or be deemed to be personal
property, fixtures or property other than real estate (all collectively
hereinafter called "Collateral"); all of the terms, provisions, conditions and
agreements contained in this Mortgage pertain and apply to the Collateral as
fully and to the same extent as to any other property comprising the Property,
and the following provisions of this Section shall not limit the generality or
applicability of any other provisions of this Mortgage but shall be in addition
thereto:

                  (a) The Collateral shall be used by Mortgagor solely for
business purposes, and all Collateral (other than the Intangible Personalty)
shall be installed upon the real estate comprising part of the Property for
Mortgagor's own use or as the equipment and furnishings furnished by Mortgagor,
as landlord, to tenants of the Property;

                  (b) Subject to the provisions of Section 5.7, the Collateral
(other than the Intangible Personalty) shall be kept at the real estate
comprising a part of the Property, and shall not be removed therefrom without
the consent of Mortgagee (being the Secured Party as
<PAGE>

that term is used in the Code); and the Collateral (other than the Intangible
Personalty) may be affixed to such real estate but shall not be affixed to any
other real estate;

                  (c) No financing statement covering any of the Collateral or
any proceeds thereof is on file in any public office; and Mortgagor will, at its
cost and expense, upon demand, furnish to Mortgagee such further information and
will execute and deliver to Mortgagee such financing statements and other
documents in form satisfactory to Mortgagee and will do all such acts and things
as Mortgagee may at any time or from time to time reasonably request or as may
be necessary or appropriate to establish and maintain a perfected first-priority
security interest in the Collateral as security for the Secured Obligations,
subject to no adverse liens or encumbrances; and Mortgagor will pay the cost of
filing the same or filing or recording such financing statements or other
documents and this instrument in all public offices wherever filing or recording
is deemed by Mortgagee to be necessary or desirable;

                  (d) The terms and provisions contained in this Section and in
Section 7.6 of this Mortgage shall, unless the context otherwise requires, have
the meanings and be construed as provided in the Code; and

                  (e) This Mortgage constitutes a financing statement under the
Code with respect to the Collateral. As such, this Mortgage covers all items of
the Collateral that are or are to become fixtures. The filing of this Mortgage
in the real estate records of the county where the Property is located shall
constitute a fixture filing in accordance with the Code. Information concerning
the security interests created hereby may be obtained at the addresses set forth
in Article 1 of this Mortgage. Mortgagor is the "Debtor" and Mortgagee is the
"Secured Party" (as those terms are defined and used in the Code) insofar as
this Mortgage constitutes a financing statement.

                                   Article 3

                   MORTGAGOR'S REPRESENTATIONS AND WARRANTIES

            3.1 Warranty of Title. Mortgagor represents and warrants to
Mortgagee that:

                  (a) Mortgagor has good, indefeasible and marketable fee simple
title to the Property, and such fee simple title is free and clear of all liens,
encumbrances, security interests and other claims whatsoever, subject only to
the Permitted Exceptions;

                  (b) Mortgagor is the sole and absolute owner of the Chattels
and the Intangible Personalty, free and clear of all liens, encumbrances,
security interests and other claims whatsoever, subject only to the Permitted
Exceptions;

                  (c) This Mortgage is a valid and enforceable first lien and
security interest on the Property, Chattels and Intangible Personalty, subject
only to the Permitted Exceptions; and
<PAGE>

                  (d) Mortgagor, for itself and its successors and assigns,
hereby agrees to warrant and forever defend, all and singular of the property
and property interests granted and conveyed pursuant to this Mortgage, against
every person whomsoever lawfully claiming, or to claim, the same or any part
thereof.

            The warranties contained in this Section shall survive foreclosure
of this Mortgage, and shall inure to the benefit of and be enforceable by any
person who may acquire title to the Property, the Chattels, or the Intangible
Personalty pursuant to any such foreclosure.

            3.2 Due Authorization. If Mortgagor is other than a natural person,
then each individual who executes this document on behalf of Mortgagor
represents and warrants to Mortgagee that such execution has been duly
authorized by all necessary corporate, partnership, or other action on the part
of Mortgagor. Mortgagor represents that Mortgagor has obtained all consents and
approvals required in connection with the execution, delivery and performance of
this Mortgage.

            3.3 Other Representations and Warranties. Mortgagor represents and
warrants to Mortgagee as follows:

                  (a) Mortgagor is a limited partnership, duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Mortgagor is duly authorized to transact business in and is in good standing
under the laws of the State of Florida. The sole General Partner of Mortgagor is
Florida Sonesta Corporation, a corporation duly organized authorized, validly
existing and in good standing under the laws of the State of Florida;

                  (b) This Mortgage is, and each other Loan Document to which
Mortgagor is a party will, when delivered hereunder, be valid and binding
obligations of Mortgagor enforceable against Mortgagor in accordance with their
respective terms, except as limited by equitable principles and bankruptcy,
insolvency and similar laws affecting creditors' rights;

                  (c) The execution, delivery and performance by Mortgagor of
the Loan Documents will not contravene any contractual or other restriction
binding on or affecting Mortgagor, any General Partner or any Guarantor, and
will not result in or require the creation of any lien, security interest, other
charge or encumbrance (other than pursuant hereto) upon or with respect to any
of its properties;

                  (d) The execution, delivery and performance by Mortgagor of
the Loan Documents does not contravene any applicable law;

                  (e) No authorization, approval, consent or other action by,
and no notice to or filing with, any court, governmental authority or regulatory
body is required for the due execution, delivery and performance by Mortgagor of
any of the Loan Documents or the effectiveness of any assignment of any of
Mortgagor's rights and interests of any kind to Mortgagee;
<PAGE>

                  (f) No part of the Property, Chattels, or Intangible
Personalty is in the hands of a receiver, no application for a receiver is
pending with respect to any portion of the Property, Chattels, or Intangible
Personalty, and no part of the Property, Chattels, or Intangible Personalty is
subject to any foreclosure or similar proceeding;

                  (g) Neither Mortgagor, Guarantor nor any General Partner has
made an assignment for the benefit of creditors, nor has Mortgagor, Guarantor or
any General Partner filed, or had filed against it, any petition in bankruptcy;

                  (h) (h) There is no pending or, to the best of Mortgagor's
knowledge, threatened condemnation proceeding against the Property, and there is
no pending or, to the best of Mortgagor's knowledge, threatened, litigation,
action, proceeding or investigation against Mortgagor, Guarantor, any General
Partner or the Property before any court, governmental or quasi-governmental,
arbitrator or other authority which may have a material adverse effect upon the
Property or any such party;

                  (i) Mortgagor is a "non-foreign person" within the meaning of
Sections 1445 and 7701 of the United States Internal Revenue Code of 1986, as
amended, and the regulations issued thereunder;

                  (j) Access to and egress from the Property are available and
provided by public streets, and Mortgagor has no knowledge of any federal,
state, county, municipal or other governmental plans to change the highway or
road system in the vicinity of the Property or to restrict or change access from
any such highway or road to the Property;

                  (k) All public utility services necessary for the operation of
all improvements constituting part of the Property for their intended purposes
are available at the boundaries of the land constituting part of the Property,
including water supply, storm and sanitary sewer facilities, and natural gas,
electric, telephone and cable television facilities;

                  (l) The Property is located in a zoning district designated
HR-Hotel Resort by the Village of Key Biscayne, Florida with a permitted use of
the Property as a hotel. Such zoning and the land use designation permit the use
and operation of the Property as a permitted use, and are consistent; however,
the Property is legally non-conforming with respect to the density requirements
of the Master Plan of the Village of Key Biscayne, Florida. The Master Plan
would not preclude the repair or reconstruction of the Property or any portion
thereof following a natural disaster or other casualty to its present form
within the existing building envelope and with the same or fewer number of units
than existed prior to any such natural disaster or other casualty. To the best
of Mortgagor's knowledge, and except as provided above, the Property complies in
all respects with all requirements, conditions, restrictions, zoning ordinances
and regulations applicable to the Property;

                  (m) There are no special or other assessments for public
improvements or otherwise now affecting the Property, nor does Mortgagor know of
any pending or threatened special assessments affecting the Property or any
contemplated improvements affecting the
<PAGE>

Property that may result in special assessments. There are no tax abatements or
exceptions affecting the Property;

                  (n) Mortgagor, Guarantor and each General Partner have filed
all tax returns which are required to be filed by them, and have paid all taxes
as shown on such returns or on any assessment received pertaining to the
Property;

                  (o) Mortgagor has not received any notice from any
governmental body having jurisdiction over the Property as to any violation of
any applicable law, or any notice from any insurance company or inspection or
rating bureau setting forth any requirements as a condition to the continuation
of any insurance coverage on or with respect to the Property or the continuation
thereof at premium rates existing at present which have not been remedied or
satisfied;

                  (p) To the best of Mortgagor's knowledge, neither Mortgagor,
Guarantor nor any General Partner is in default, in any manner which would
adversely affect its properties, assets, operations or condition (financial or
otherwise), in the performance, observance or fulfillment of any of the
obligations, covenants or conditions set forth in any agreement or instrument to
which it is a party or by which it or any of its properties, assets or revenues
are bound;

                  (q) Except as set forth in the Lease Certificate, there are no
occupancy rights (written or oral), Leases or tenancies presently affecting any
part of the Property. The Lease Certificate contains a true and correct
description of all Leases presently affecting the Property. No written or oral
agreements or understandings exist between Mortgagor and the tenants under the
Leases described in the Lease Certificate that grant such tenants any rights
greater than those described in the Lease Certificate or that are in any way
inconsistent with the rights described in the Lease Certificate;

                  (r) There are no options, purchase contracts or other similar
agreements of any type (written or oral) presently affecting any part of the
Property;

                  (s) There exists no brokerage agreement with respect to any
part of the Property;

                  (t) Except as otherwise disclosed to Mortgagee in writing
prior to the date hereof, (i) there are no contracts presently affecting the
Property ("Contracts") having a term in excess of one hundred eighty (180) days
or not terminable by Mortgagor (without penalty) on thirty (30) days' notice;
(ii) Mortgagor has heretofore delivered to Mortgagee true and correct copies of
each of the Contracts together with all amendments thereto; (iii) to the best of
Mortgagor's knowledge, Mortgagor is not in default of any obligations under any
of the Contracts; and (iv) the Contracts represent the complete agreement
between Mortgagor and such other parties as to the services to be performed or
materials to be provided thereunder and the compensation to be paid for such
services or materials, as applicable, and except as otherwise disclosed herein,
such other parties possess no unsatisfied claims against Mortgagor. To the best
of Mortgagor's knowledge, Mortgagor is not in default under any of the Contracts
and no event
<PAGE>

has occurred which, with the passing of time or the giving of notice, or both,
would constitute a default under any of the Contracts;

                  (u) Mortgagor has obtained all Permits necessary or desirable
for the operation, use, ownership, development, occupancy and maintenance of the
Property as a hotel. None of the Permits has been suspended or revoked, and all
of the Permits are in full force and effect, are fully paid for, and Mortgagor
has made or will make application for renewals of any of the Permits prior to
the expiration thereof;

                  (v) All insurance policies held by Mortgagor relating to or
affecting the Property are in full force and effect and shall remain in full
force and effect until all Secured Obligations are paid in full. Mortgagor has
not received any notice of default or notice terminating or threatening to
terminate any such insurance policies. Mortgagor has made or will make
application for renewals of such insurance policies prior to the expiration
thereof;

                  (w) Mortgagor currently complies with ERISA. To the best of
Mortgagor's knowledge, neither the making of the loan evidenced by the Note and
secured by this Mortgage nor the exercise by Mortgagee of any of its rights
under the Loan Documents constitutes or will constitute a non-exempt, prohibited
transaction under ERISA; and

                  (x) To the best of Mortgagor's knowledge, and except as
provided in Section 3.3(l), the Property is in compliance with the requirements
of all applicable comprehensive plans, including without limitation, all
concurrency requirements.

            3.4 Continuing Effect. Mortgagor shall be liable to Mortgagee for
any damage suffered by Mortgagee if any of the foregoing representations are
materially inaccurate as of the date hereof, regardless of when such inaccuracy
may be discovered by, or result in harm to, Mortgagee. Mortgagor further
represents and warrants that the foregoing representations and warranties, as
well as all other representations and warranties of Mortgagor to Mortgagee
relative to the Loan Documents, shall remain materially true and correct during
the term of the Note and shall survive termination of this Mortgage.

                                   Article 4

                        MORTGAGOR'S AFFIRMATIVE COVENANTS

            4.1 Payment of Note. Mortgagor will pay all principal, interest, and
other sums payable under the Note, on the date when such payments are due,
without notice or demand.

            4.2 Performance of Other Obligations. Mortgagor will promptly and
strictly perform and comply with all other covenants, conditions, and
prohibitions required of Mortgagor by the terms of the Loan Documents.

            4.3 Other Encumbrances. Mortgagor will promptly and strictly perform
and comply with all covenants, conditions, and prohibitions required of
Mortgagor in connection
<PAGE>

with any other encumbrance affecting the Property, the Chattels, or the
Intangible Personalty, or any part thereof, or any interest therein, regardless
of whether such other encumbrance is superior or subordinate to the lien hereof.

            4.4 Payment of Taxes.

                  (a) Property Taxes. Except to the extent that Mortgagor has
made escrow payments to Mortgagee pursuant to Section 4.4(b) below, (i)
Mortgagor will pay, before delinquency, all taxes and assessments, general or
special, which may be levied or imposed at any time against Mortgagor's interest
and estate in the Property, the Chattels, or the Intangible Personalty, (ii)
within ten (10) days after each payment of any such tax or assessment, Mortgagor
will deliver to Mortgagee, without notice or demand, an official receipt for
such payment, and (iii) at Mortgagee's option, Mortgagee may retain the services
of a firm to monitor the payment of all taxes and assessments relating to the
Property, the cost of which shall be borne by Mortgagor.

                  (b) Deposit for Taxes. On or before the date hereof, Mortgagor
shall deposit with Mortgagee an amount equal to 1/12th of the amount which
Mortgagee estimates will be required to make the next annual payment of taxes,
assessments, and similar governmental charges referred to in this Section,
multiplied by the number of whole or partial months that have elapsed since the
date one month prior to the most recent due date for such taxes, assessments and
similar governmental charges. Thereafter, with each monthly payment under the
Note, Mortgagor shall deposit with Mortgagee an amount equal to 1/12th of the
amount which Mortgagee estimates will be required to pay the next annual payment
of taxes, assessments, and similar governmental charges referred to in this
Section. The purpose of these provisions is to provide Mortgagee with sufficient
funds on hand to pay all such taxes, assessments, and other governmental charges
thirty (30) days before the date on which they become past due. If the
Mortgagee, in its sole discretion, determines that the funds escrowed hereunder
are, or will be, insufficient, Mortgagor shall upon demand pay such additional
sums as Mortgagee shall determine necessary and shall pay any increased monthly
charges requested by Mortgagee. Provided no Default or Event of Default exists
hereunder, Mortgagee will apply the amounts so deposited to the payment of such
taxes, assessments, and other charges when due. Any amount deposited pursuant to
this Section 4.4(b) may be held and commingled with Mortgagee's own funds. All
amounts held in escrow pursuant to this Section 4.4(b) shall accrue interest for
the benefit of Mortgagor; provided, however, Mortgagor shall pay to Mortgagee
(or its loan servicer) the administrative costs associated with investing,
administering or otherwise providing for interest on the amounts so deposited.

                  (c) Intangible Taxes. If by any reason, including, but not
limited to, by reason of any statutory or constitutional amendment or judicial
decision adopted or rendered after the date hereof, any tax, assessment, or
similar charge, including, without limitation, mortgage, documentary or other
intangible tax, is imposed against the Note, this Mortgage or any other Loan
Document, Mortgagee, or any interest of Mortgagee in any real or personal
property encumbered hereby, Mortgagor will pay such tax, assessment, or other
charge before delinquency and will indemnify Mortgagee against all loss,
expense, or diminution of income in
<PAGE>

connection therewith. In the event Mortgagor fails to do so, or is unable to do
so, either for economic reasons or because the legal provisions or decisions
creating such tax, assessment or charge forbid Mortgagor from doing so, then the
Note will, at Mortgagee's option, become due and payable in full upon ninety
(90) days' notice to Mortgagor. Mortgagor's obligation to pay any tax,
assessment or similar charge referred to in this Section 4.4(c) shall not be
subject to limitation on personal liability described in the Note.

                  (d) Right to Contest. Notwithstanding any other provision of
this Section, Mortgagor will not be deemed to be in default solely by reason of
Mortgagor's failure to pay any tax, assessment or similar governmental charge so
long as, in Mortgagee's judgment, each of the following conditions is satisfied:

                        (i) Mortgagor is engaged in and diligently pursuing in
good faith administrative or judicial proceedings appropriate to contest the
validity or amount of such tax, assessment, or charge; and

                        (ii) Mortgagor's payment of such tax, assessment, or
charge would necessarily and materially prejudice Mortgagor's prospects for
success in such proceedings; and

                        (iii) Nonpayment of such tax, assessment, or charge will
not result in the loss or forfeiture of any property encumbered hereby or any
interest of Mortgagee therein; and

                        (iv) Mortgagor deposits with Mortgagee, as security for
such payment which may ultimately be required, a sum equal to the amount of the
disputed tax, assessment or charge plus the interest, penalties, advertising
charges, and other costs which Mortgagee estimates are likely to become payable
if Mortgagor's contest is unsuccessful.

            If Mortgagee determines that any one or more of such conditions is
not satisfied or is no longer satisfied, Mortgagor will pay the tax, assessment,
or charge in question, together with any interest and penalties thereon, within
ten (10) days after Mortgagee gives notice of such determination.

            4.5 Maintenance of Insurance.

                  (a) Coverages Required. Mortgagor shall maintain or cause to
be maintained, with financially sound and reputable insurance companies or
associations satisfactory to Mortgagee, all insurance required under the terms
of that certain Agreement Concerning Insurance Requirements of even date
herewith executed by Mortgagor for the benefit of Mortgagee (the "Insurance
Agreement"), and shall comply with each and every covenant and agreement
contained in such Insurance Agreement.

                  (b) Renewal Policies. Not less than thirty (30) days prior to
the expiration date of each insurance policy required pursuant to the Insurance
Agreement,
<PAGE>

Mortgagor will deliver to Mortgagee an appropriate renewal policy (or a
certified copy thereof), together with evidence satisfactory to Mortgagee that
the applicable premium has been prepaid.

                  (c) Deposit for Premiums. Upon demand made by Mortgagee
following the occurrence of any Default or Event of Default, Mortgagor shall
deposit with Mortgagee an amount equal to 1/12th of the amount which Mortgagee
estimates will be required to make the next annual payments of the premiums for
the policies of insurance referred to in this Section, multiplied by the number
of whole and partial months which have elapsed since the date one month prior to
the most recent policy anniversary date for each such policy. Thereafter, with
each monthly payment under the Note, Mortgagor will deposit an amount equal to
1/12th of the amount which Mortgagee estimates will be required to pay the next
required annual premium for each insurance policy referred to in this Section.
The purpose of these provisions is to provide Mortgagee with sufficient funds on
hand to pay all such premiums thirty (30) days before the date on which they
become past due. If the Mortgagee, in its sole discretion, determines that the
funds escrowed hereunder are, or will be, insufficient, Mortgagor shall upon
demand pay such additional sums as Mortgagee shall determine necessary and shall
pay any increased monthly charges requested by Mortgagee. Provided no Default or
Event of Default exists hereunder, Mortgagee will apply the amounts so deposited
to the payment of such insurance premiums when due. Any amount deposited
pursuant to this Section 4.5(c) may be held and commingled with Mortgagee's own
funds. All amounts held in escrow pursuant to this Section 4.5(c) shall accrue
interest for the benefit of Mortgagor; provided, however, Mortgagor shall pay to
Mortgagee (or its loan servicer) the administrative costs associated with
investing, administering or otherwise providing for interest on the amounts so
deposited.

                  (d) Application of Hazard Insurance Proceeds. Mortgagor shall
promptly notify Mortgagee of any damage or casualty to all or any portion of the
Property or Chattels. Mortgagee may participate in all negotiations and appear
and participate in all judicial arbitration proceedings concerning any insurance
proceeds which may be payable as a result of such casualty or damage. Any such
insurance proceeds shall be paid to Mortgagee and shall be applied first to
reimburse Mortgagee for all costs and expenses, including attorneys' fees,
reasonably incurred by Mortgagee in connection with the collection of such
insurance proceeds. The balance of any insurance proceeds received by Mortgagee
with respect to an insured casualty may, in Mortgagee's sole discretion, either
(i) be retained and applied by Mortgagee toward payment of the Secured
Obligations, or (ii) be paid over, in whole or in part and subject to such
conditions as Mortgagee may reasonably impose and as are consistent with
customary construction loan disbursements, to Mortgagor to pay for repairs or
replacements necessitated by the casualty; provided, however, that if all of the
Secured Obligations have been performed or are discharged by the application of
less than all of such insurance proceeds, then any remaining proceeds will be
paid over to Mortgagor. Notwithstanding the preceding sentence, if (A) no
Default or Event of Default shall exist hereunder, and (B) the proceeds received
by Mortgagee (together with any other funds delivered by Mortgagor to Mortgagee
for such purpose) shall be sufficient, in Mortgagee's reasonable judgment, to
pay for any restoration necessitated by the casualty, and (C) the cost of such
restoration shall not exceed $2,300,000.00, and (D) such restoration can be
completed, in Mortgagee's judgment, at least ninety (90) days prior to the
maturity date of the Note, then Mortgagee shall apply such proceeds as provided
in clause (ii) of
<PAGE>

the preceding sentence. Mortgagee will have no obligation to see to the proper
application of any insurance proceeds paid over to Mortgagor, nor will any such
proceeds received by Mortgagee bear interest or be subject to any other charge
for the benefit of Mortgagor. Mortgagee may, prior to the application of
insurance proceeds, commingle them with Mortgagee's own funds and otherwise act
with regard to such proceeds as Mortgagee may determine in Mortgagee's sole
discretion.

                  (e) Successor's Rights. Any person who acquires title to the
Property or the Chattels upon foreclosure hereunder will succeed to all of
Mortgagor's rights under all policies of insurance maintained pursuant to this
Section.

            4.6 Maintenance and Repair of Property and Chattels. Mortgagor will
at all times maintain the Property and the Chattels in good condition and
repair, will diligently prosecute the completion of any building or other
improvement which is at any time in the process of construction on the Property,
and will promptly repair, restore, replace, or rebuild any part of the Property
or the Chattels which may be affected by any casualty or any public or private
taking or injury to the Property or the Chattels, provided that applicable
insurance proceeds or condemnation awards are made available for such purpose
pursuant to Section 4.5 or 4.8 hereof. All costs and expenses arising out of the
foregoing shall be paid by Mortgagor whether or not the proceeds of any
insurance or eminent domain shall be sufficient therefor. Mortgagor will comply
with all statutes, ordinances, and other governmental or quasi-governmental
requirements and private covenants relating to the ownership, construction, use,
or operation of the Property, including but not limited to any environmental or
ecological requirements; provided, that so long as Mortgagor is not otherwise in
default hereunder, Mortgagor may, upon providing Mortgagee with security
reasonably satisfactory to Mortgagee, proceed diligently and in good faith to
contest the validity or applicability of any such statute, ordinance, or
requirement. Mortgagee and any person authorized by Mortgagee may enter and
inspect the Property at all reasonable times, and may inspect the Chattels,
wherever located, at all reasonable times.

            4.7 Leases. Mortgagor shall timely pay and perform each of its
obligations under or in connection with the Leases, and shall otherwise pay such
sums and take such action as shall be necessary or required in order to maintain
each of the Leases in full force and effect in accordance with its terms.
Mortgagor shall comply with applicable state statutes governing the handling of
security deposits and the payment of sales taxes on rents. Mortgagor shall
immediately furnish to Mortgagee copies of any notices given to Mortgagor by the
lessee under any Lease, alleging the default by Mortgagor in the timely payment
or performance of its obligations under such Lease and any subsequent
communication related thereto. Mortgagor shall also promptly furnish to
Mortgagee copies of any notices given to Mortgagor by the lessee under any
Lease, extending the term of any Lease, requiring or demanding the expenditure
of any sum by Mortgagor (or demanding the taking of any action by Mortgagor), or
relating to any other material obligation of Mortgagor under such Lease and any
subsequent communication related thereto. Mortgagor agrees that Mortgagee, in
its sole discretion, may advance any reasonable sum or take any action which
Mortgagee believes is necessary or required to maintain the Leases in full force
and effect, and all such sums advanced by Mortgagee, together with all
reasonable
<PAGE>

costs and expenses incurred by Mortgagee in connection with action taken by
Mortgagee pursuant to this Section, shall be due and payable by Mortgagor to
Mortgagee upon demand, shall bear interest until paid at the Default Rate, and
shall be secured by this Mortgage.

            4.8 Eminent Domain; Private Damage. If all or any part of the
Property is taken or damaged by eminent domain or any other public or private
action, Mortgagor will notify Mortgagee promptly of the time and place of all
meetings, hearings, trials, and other proceedings relating to such action.
Mortgagee may participate in all negotiations and appear and participate in all
judicial or arbitration proceedings concerning any award or payment which may be
due as a result of such taking or damage. Any such award or payment is to be
paid to Mortgagee and will be applied first to reimburse Mortgagee for all costs
and expenses, including attorneys' fees, reasonably incurred by Mortgagee in
connection with the ascertainment and collection of such award or payment. The
balance, if any, of such award or payment may, in Mortgagee's sole discretion,
either (a) be retained by Mortgagee and applied toward the Secured Obligations,
or (b) be paid over, in whole or in part and subject to such conditions as
Mortgagee may reasonably impose and as are consistent with customary
construction loan disbursements, to Mortgagor for the purpose of restoring,
repairing, or rebuilding any part of the Property affected by the taking or
damage. Notwithstanding the preceding sentence, if (i) no Default or Event of
Default shall have occurred and be continuing hereunder, and (ii) the proceeds
received by Mortgagee (together with any other funds delivered by Mortgagor to
Mortgagee for such purpose) shall be sufficient, in Mortgagee's reasonable
judgment, to pay for any restoration necessitated by the taking or damage, and
(iii) the cost of such restoration shall not exceed $2,300,000.00, and (iv) such
restoration can be completed, in Mortgagee's judgment, at least ninety (90) days
prior to the maturity date of the Note, and (v) the remaining Property shall
constitute, in Mortgagee's sole judgment, adequate security for the Secured
Obligations, then Mortgagee shall apply such proceeds as provided in clause (b)
of the preceding sentence. Mortgagee will have no duty to see to the application
of any part of any award or payment released to Mortgagor. Mortgagor's duty to
pay the Note in accordance with its terms and to perform the other Secured
Obligations will not be suspended by the pendency or discharged by the
conclusion of any proceedings for the collection of any such award or payment,
and any reduction in the Secured Obligations resulting from Mortgagee's
application of any such award or payment will take effect only when Mortgagee
receives such award or payment. If this Mortgage has been foreclosed prior to
Mortgagee's receipt of such award or payment, Mortgagee may nonetheless retain
such award or payment to the extent required to reimburse Mortgagee for all
costs and expenses, including attorneys' fees, incurred in connection therewith,
and to discharge any deficiency remaining with respect to the Secured
Obligations.

            4.9 Mechanics' Liens. Mortgagor will keep the Property free and
clear of all liens and claims of liens by contractors, subcontractors,
mechanics, laborers, materialmen, and other such persons, and will cause any
recorded statement of any such lien to be released of record or transferred to
bond within thirty (30) days after the recording thereof. Notwithstanding the
preceding sentence, however, Mortgagor will not be deemed to be in default under
this Section if and so long as Mortgagor (a) contests in good faith the validity
or amount of any asserted lien and diligently prosecutes or defends an action
appropriate to obtain a binding determination of the disputed matter, and (b)
provides Mortgagee with such security as
<PAGE>

Mortgagee may require to protect Mortgagee against all loss, damage, and
expense, including attorneys' fees, which Mortgagee might incur if the asserted
lien is determined to be valid.

            4.10 Defense of Actions. Mortgagor will defend, at Mortgagor's
expense, any action, proceeding or claim which affects any property encumbered
hereby or any interest of Mortgagee in such property or in the Secured
Obligations, and will indemnify and hold Mortgagee harmless from all loss,
damage, cost, or expense, including attorneys' fees, which Mortgagee may incur
in connection therewith. Mortgagor's obligations under this Section are subject
to the following: (a) the right to settle or resolve such claim, subject to
Mortgagee's approval, which approval shall not be unreasonably withheld, (b) the
right to select legal counsel of Mortgagor's choice, subject to Mortgagee's
approval, which approval shall not be unreasonably withheld, and (c) Mortgagor
shall not indemnify Mortgagee for Mortgagee's gross negligence or willful
misconduct.

            4.11 Expenses of Enforcement. Mortgagor will pay all costs and
expenses, including attorneys' fees, which Mortgagee may incur in connection
with any effort or action (whether or not litigation or foreclosure is involved)
to enforce or defend Mortgagee's rights and remedies under any of the Loan
Documents, including but not limited to all attorneys' fees, appraisal fees,
consultants' fees, and other expenses incurred by Mortgagee in securing title to
or possession of, and realizing upon, any security for the Secured Obligations.
All such costs and expenses (together with interest thereon at the Default Rate
from the date ten (10) days following demand therefor until paid) shall
constitute part of the Secured Obligations, and may be included in the
computation of the amount owed to Mortgagee for purposes of foreclosing or
otherwise enforcing this Mortgage.

            4.12 Financial Reports. Within ninety (90) days after the end of
each fiscal year of Mortgagor, Mortgagor will furnish to Mortgagee (a)
Mortgagor's operating statements for the Property as of the end of and for the
preceding fiscal year, prepared against the budget for such year; and (b) an
annual balance sheet and profit and loss statement of Mortgagor and of each
Guarantor. The financial statements and reports described in (a) and (b) above
shall be in such detail as Mortgagee may require, shall be prepared in
accordance with generally accepted accounting principles consistently applied
and shall be prepared in accordance with the Uniform System of Accounts for the
Lodging Industry, Ninth Revised Edition, First Printing 1996, as adopted by the
American Hotel and Motel Association, as amended or supplemented from time to
time, and shall be certified as true and correct by Mortgagor or the applicable
Guarantor (or, if required by Mortgagee, such operating statements, balance
sheets and profit and loss statements shall be certified by an independent
certified public accountant acceptable to Mortgagee). Mortgagor will also
furnish or cause to be furnished to Mortgagee within thirty (30) days of
Mortgagee's request, any other financial reports or statements of Mortgagor,
including, without limitation, balance sheets, profit and loss statements, other
financial statements and certified rent rolls, required under any of the Loan
Documents, requested by any regulatory or governmental authority exercising
jurisdiction over Mortgagee, or reasonably requested by Mortgagee from time to
time.
<PAGE>

            4.13 Priority of Leases. To the extent Mortgagor has the right,
under the terms of any Lease, to make such lease subordinate to the lien hereof,
Mortgagor will, at Mortgagee's request and Mortgagor's expense, take such action
as may be required to effect such subordination. Conversely, Mortgagor will, at
Mortgagee's request and Mortgagor's expense, take such action as may be
necessary to subordinate the lien hereof to any future Lease designated by
Mortgagee.

            4.14 Inventories; Assembly of Chattels. Mortgagor will, from time to
time at the request of Mortgagee, supply Mortgagee with a current inventory of
the Chattels and the Intangible Personalty, in such detail as Mortgagee may
require. Upon the occurrence of any Event of Default hereunder, Mortgagor will
at Mortgagee's request assemble the Chattels and make them available to
Mortgagee at any place designated by Mortgagee which is reasonably convenient to
both parties.

            4.15 Compliance with Laws, Etc. Mortgagor shall comply in all
material respects with all applicable laws, rules, regulations and orders, such
compliance to include, without limitation, maintaining all Permits and paying
before the same become delinquent all taxes, assessments and governmental
charges imposed upon Mortgagor or the Property.

            4.16 Records and Books of Account. Mortgagor shall keep accurate and
complete records and books of account, in which complete entries will be made in
accordance with generally accepted accounting principles consistently applied,
reflecting all financial transactions relating to the Property.

            4.17 Inspection Rights. At any reasonable time, and from time to
time, Mortgagor shall permit Mortgagee, or any agents or representatives
thereof, to examine and make copies of and abstracts from the records and books
of account of, and visit the Property and to discuss with Mortgagor the affairs,
finances and accounts of Mortgagor.

            4.18 Change of Executive Offices. Mortgagor shall promptly notify
Mortgagee if changes are made in the location of Mortgagor's primary executive
offices.

            4.19 Further Assurances; Estoppel Certificates. Mortgagor will
execute and deliver to Mortgagee upon demand, and pay the costs of preparation
and recording thereof, any further documents which Mortgagee may request to
confirm or perfect the liens and security interests created or intended to be
created hereby, or to confirm or perfect any evidence of the Secured
Obligations. Mortgagor will also, within ten (10) days after any request by
Mortgagee, deliver to Mortgagee a signed and acknowledged statement certifying
to Mortgagee, or to any proposed transferee of the Secured Obligations, (a) the
balance of principal, interest, and other sums then outstanding under the Note,
and (b) whether Mortgagor claims to have any offsets or defenses with respect to
the Secured Obligations and, if so, the nature of such offsets or defenses.

            4.20 Costs of Closing. Mortgagor shall on demand pay directly or
reimburse Mortgagee for any costs or expenses pertaining to the closing of the
loan evidenced by the Note and secured by this Mortgage, including, but not
limited to, fees of counsel for Mortgagee, costs and expenses for which invoices
were not available at the closing of such loan, or costs and
<PAGE>

expenses which are incurred by Mortgagee after such closing. All such costs and
expenses (together with interest thereon at the Default Rate from the date ten
(10) days following demand therefor until paid) shall constitute a part of the
Secured Obligations, and may be included in the computation of the amount owed
to Mortgagee for purposes of foreclosing or otherwise enforcing this Mortgage.

            4.21 Fund for Electronic Transfer. All monthly payments of principal
and interest on the Note, and escrow deposits under this Mortgage, shall be made
by Mortgagor by electronic funds transfer from a bank account or accounts
established and maintained by Mortgagor.

            4.22 Use. Mortgagor shall use the Property solely for the operation
of a hotel and ancillary purposes and for no other use or purpose.

                                   Article 5

                         MORTGAGOR'S NEGATIVE COVENANTS

            5.1 Waste and Alterations. Mortgagor will not commit or permit any
waste with respect to the Property or the Chattels. Mortgagor shall not cause or
permit any part of the Property, including but not limited to any building,
structure, parking lot, driveway, landscape scheme, timber, or other ground
improvement, to be removed, demolished, or materially altered without the prior
written consent of Mortgagee.

            5.2 Zoning and Private Covenants. Mortgagor will not initiate, join
in, or consent to any change in any zoning ordinance or classification, any
change in the "zone lot" or "zone lots" (or similar zoning unit or units)
presently comprising the Property, any transfer of development rights, any
private restrictive covenant, or any other public or private restriction
limiting or defining the uses which may be made of the Property or any part
thereof, without the express written consent of Mortgagee. If under applicable
zoning provisions the use of all or any part of the Property is or becomes a
nonconforming use, Mortgagor will not cause such use to be discontinued or
abandoned without the express written consent of Mortgagee, and Mortgagor will
use its best efforts to prevent the tenant under any Lease from discontinuing or
abandoning such use.

            5.3 Interference with Leases. Mortgagor shall not collect rent from
all or any part of the Property for more than one month in advance, or assign
the rents from the Property or any part thereof. Without the prior written
consent of Mortgagee, which consent shall not be unreasonably withheld,
Mortgagor shall not terminate (other than at the stated expiration thereof) or
make or permit any modification to the Lease relating to that portion of the
Property currently operated as the so called "Two Dragons" restaurant (the "Two
Dragons Lease"), or enter into, modify or terminate (other than at the stated
expiration thereof) any Lease approved by Mortgagee as a replacement to, or
substitution of, the Two Dragons Lease.

            5.4 Transfer or Further Encumbrance of Property. Subject to the
provisions of Section 5.7 relating to Chattels, without Mortgagee's prior
written consent, which
<PAGE>

consent may be granted or withheld in Mortgagee's sole and absolute discretion,
Mortgagor shall not (a) sell, assign, convey, transfer or otherwise dispose of
any legal, beneficial or equitable interest in all or any part of the Property,
(b) permit or suffer any owner, directly or indirectly, of any beneficial
interest in the Property or Mortgagor to transfer such interest, whether by
transfer of partnership, membership, stock or other beneficial interest in any
entity or otherwise, or (c) mortgage, hypothecate or otherwise encumber or
permit to be encumbered or grant or permit to be granted a security interest in
all or any part of the Property or Mortgagor or any beneficial or equitable
interest in either the Property or Mortgagor. The provisions of this Section
shall not prohibit transfers of title or interest under any will or testament or
applicable law of descent, and shall not prohibit the transfer of the limited
partnership interests in Mortgagor owned by Key Biscayne Limited Partnership, a
Florida limited partnership. Notwithstanding the foregoing to the contrary, (1)
Mortgagee shall permit transfers of the shares of Guarantor (a "Guarantor
Transfer") in connection with the sale of all of the shares of Guarantor to an
individual or entity previously approved in writing by Mortgagee in its sole
discretion, or, in all other cases, provided that the Sonnabend family, or any
of them, shall at all times during which any Secured Obligation shall remain
outstanding, (x) collectively own not less than 51% of Guarantor, and (y)
control Guarantor, and (2) if any Guarantor Transfer is not permitted under the
terms of this Section 5.4, then Mortgagor shall have the right to complete a
Defeasance of the Note by satisfying the Defeasance Requirements set forth in
the Note. For purposes of the foregoing, the Sonnabend family shall be presumed
to control Guarantor if the Sonnabend family, or any of them, possesses the
power, directly or indirectly, to direct, or cause the direction of, the
management or policies of Guarantor, whether through ownership of voting
securities, by contract, or otherwise.

            5.5 Further Encumbrance of Chattels. Mortgagor will neither create
nor permit any lien, security interest or encumbrance against the Chattels or
Intangible Personalty or any part thereof or interest therein, other than the
liens and security interests created by the Loan Documents, without the prior
written consent of Mortgagee, which may be withheld for any reason.

            5.6 Assessments Against Property. Mortgagor will not, without the
prior written approval of Mortgagee, which may be withheld for any reason,
consent to or allow the creation of any so-called special districts, special
improvement districts, benefit assessment districts or similar districts, or any
other body or entity of any type, or allow to occur any other event, that would
or might result in the imposition of any additional taxes, assessments or other
monetary obligations or burdens on the Property, and this provision shall serve
as RECORD NOTICE to any such district or districts or any governmental entity
under whose authority such district or districts exist or are being formed that,
should Mortgagor or any other person or entity include all or any portion of the
Property in such district or districts, whether formed or in the process of
formation, without first obtaining Mortgagee's express written consent, the
rights of Mortgagee in the Property pursuant to this Mortgage or following any
foreclosure of this Mortgage, and the rights of any person or entity to whom
Mortgagee might transfer the Property following a foreclosure of this Mortgage,
shall be senior and superior to any taxes, charges, fees, assessments or other
impositions of any kind or nature whatsoever, or liens (whether statutory,
<PAGE>

contractual or otherwise) levied or imposed, or to be levied or imposed, upon
the Property or any portion thereof as a result of inclusion of the Property in
such district or districts.

            5.7 Transfer or Removal of Chattels. Mortgagor will not sell,
transfer or remove from the Property all or any part of the Chattels, unless the
items sold, transferred, or removed are simultaneously replaced with similar
items of equal or greater value. Mortgagor shall not replace any Chattel owned
by any Mortgagor as of the date hereof by leasing such Chattel or Chattels
unless Mortgagee consents to such lease, which consent shall not be unreasonably
withheld provided (a) Mortgagee may, under the terms of any such lease, succeed
to Mortgagor's rights as lessee, and (b) Mortgagee is given notice and an
opportunity to cure any default by Mortgagor under any such lease.

            5.8 Change of Name. Mortgagor will not change the name under which
Mortgagor does business, or adopt or begin doing business under any other name
or assumed or trade name, without first notifying Mortgagee of Mortgagor's
intention to do so and delivering to Mortgagee such executed modifications or
supplements to this Mortgage (and to any financing statement which may be filed
in connection herewith) as Mortgagee may require.

            5.9 Improper Use of Property or Chattels. Mortgagor will not use the
Property or the Chattels for any purpose or in any manner which violates any
applicable law, ordinance, or other governmental requirement, the requirements
or conditions of any insurance policy, or any private covenant.

            5.10 ERISA. Mortgagor shall not engage in any transaction which
would cause the Note (or the exercise by Mortgagee of any of its rights under
the Loan Documents) to be a non-exempt (under a class exemption), prohibited
transaction under ERISA (including for this purpose the parallel provisions of
Section 4975 of the Internal Revenue Code of 1986, as amended), or otherwise
result in Mortgagee being deemed in violation of any applicable provisions of
ERISA. Mortgagor shall indemnify, protect, defend, and hold Mortgagee harmless
from and against any and all losses, liabilities, damages, claims, judgments,
costs, and expenses (including, without limitation attorneys' fees and costs
reasonably incurred in the investigation, defense, and settlement of claims and
in obtaining any individual ERISA exemption or state administrative exception
that may be required, in Mortgagee's sole and absolute discretion) that
Mortgagee may incur, directly or indirectly, as the result of the breach by
Mortgagor of any warranty or representation set forth in Section 3.3(w) hereof
or the breach by Mortgagor of any covenant contained in this Section. This
indemnity shall survive any termination, satisfaction or foreclosure of this
Mortgage and shall not be subject to the limitation on personal liability
described in the Note.

                                   Article 6

                                EVENTS OF DEFAULT

            Each of the following events will constitute an event of default (an
"Event of Default") under this Mortgage and under each of the other Loan
Documents:
<PAGE>

            6.1 Failure to Pay Note. Mortgagor's failure to make any payment due
under the Note or any other Loan Document within five (5) days following its due
date.

            6.2 Due on Sale or Encumbrance. The occurrence of any violation of
any covenant contained in Section 5.4, 5.5 or 5.7 hereof.

            6.3 Other Obligations. The failure of Mortgagor to properly perform
any obligation contained herein or in any of the other Loan Documents (other
than the obligation to make payments under the Note or the other Loan Documents)
and the continuance of such failure for a period of thirty (30) days following
written notice thereof from Mortgagee to Mortgagor; provided, however, that if
such failure is not curable within such thirty (30) day period, then, so long as
Mortgagor commences to cure such failure within such thirty (30) day period and
is continually and diligently attempting to cure to completion, such failure
shall not be an Event of Default unless such failure remains uncured for ninety
(90) days after such written notice to Mortgagor.

            6.4 Levy Against Property. The levy against any of the Property,
Chattels or Intangible Personalty, of any execution, attachment, sequestration
or other writ, unless discharged within thirty (30) days.

            6.5 Liquidation. The liquidation, termination or dissolution of
Mortgagor, any General Partner, any Guarantor, or any other party directly or
indirectly liable for the payment of the Note, whether as maker, endorser,
guarantor, surety, general partner or otherwise.

            6.6 Appointment of Receiver. The appointment of a trustee,
liquidator or receiver for Mortgagor, any General Partner or any Guarantor, or
the assets, or any part thereof, of Mortgagor, any General Partner, any
Guarantor or any other party directly or indirectly liable for the payment of
the Note, whether as maker, endorser, guarantor, surety, general partner or
otherwise, or the appointment of a trustee or receiver for any real or personal
property, or the like, or any part thereof, representing the security for the
Note, unless discharged within thirty (30) days.

            6.7 Assignments. The making by Mortgagor, any General Partner, any
Guarantor or by any other person or entity directly or indirectly liable for the
payment of the Note, whether as maker, endorser, guarantor, surety, general
partner or otherwise, of a transfer in fraud of creditors or an assignment for
the benefit of creditors.

            6.8 Order for Relief. The entry in bankruptcy of an order for relief
for or against Mortgagor, any General Partner, any Guarantor or any other party
directly or indirectly liable for the payment of the Note, whether as maker,
endorser, guarantor, surety, general partner or otherwise.

            6.9 Bankruptcy. The filing of any petition (or answer admitting the
material allegations of any petition), or other pleading, seeking entry of an
order for relief for or against Mortgagor, any General Partner, any Guarantor or
any other party directly or indirectly liable for the payment of the Note,
whether as maker, endorser, guarantor, surety, general partner or
<PAGE>

otherwise as a debtor or bankrupt or seeking an adjustment of any of such
parties' debts, or any other relief under any state or federal bankruptcy,
reorganization, debtor's relief or insolvency laws now or hereafter existing,
including, without limitation, a petition or answer seeking reorganization or
admitting the material allegations of a petition filed against any such parties
in any bankruptcy or reorganization proceeding, or the act of any of such
parties in instituting or voluntarily being or becoming a party to any other
judicial proceedings intended to effect a discharge of the debts of any such
parties, in whole or in part, or a postponement of the maturity or the
collection thereof, or a suspension of any of the rights or powers of a trustee
or of any of the rights or powers granted to Mortgagee herein, or in any other
document executed in connection herewith; provided, however, that no Event of
Default shall occur under this Section if an involuntary bankruptcy or
insolvency petition is filed against Mortgagor, any General Partner, any
Guarantor or any other party directly or indirectly liable for the payment of
the Note unless such petition is not dismissed within sixty (60) days following
its filing.

            6.10 Misrepresentation. If any representation or warranty made by
Mortgagor, any General Partner, any Guarantor or any other party directly or
indirectly liable for the payment of the Note, whether as maker, endorser,
guarantor, surety, general partner or otherwise, herein, or in any of the other
Loan Documents or any other instrument or document modifying, renewing,
extending, evidencing, securing or pertaining to the Note is false, misleading
or erroneous in any material respect.

            6.11 Judgments. The failure of Mortgagor, any General Partner, any
Guarantor or any party directly or indirectly liable for the payment of the
Note, whether as maker, endorser, guarantor, surety, general partner or
otherwise, to pay any money judgment in excess of $50,000.00 against any such
party before the expiration of thirty (30) days after such judgment becomes
final and no longer appealable.

            6.12 Admissions Regarding Debts. The admission of Mortgagor, any
General Partner, any Guarantor or any other party directly or indirectly liable
for the payment of the Note, whether as maker, endorser, guarantor, surety,
general partner or otherwise, in writing of any such party's inability to pay
such party's debts as they become due.

            6.13 Assertion of Priority. The assertion of any claim of priority
over this Mortgage, by title, lien, or otherwise, unless Mortgagor within thirty
(30) days after such assertion either causes the assertion to be withdrawn or
provides Mortgagee with such security as Mortgagee may require to protect
Mortgagee against all loss, damage, or expense, including attorneys' fees, which
Mortgagee may incur in the event such assertion is upheld.

            6.14 Other Loan Documents. The occurrence of any default by
Mortgagor, after the lapse of any applicable grace or cure period, or the
occurrence of any event or circumstance defined as an Event of Default, under
any of the Loan Documents other than this Mortgage.

            6.15 Other Liens. The occurrence of any default by Mortgagor, after
the lapse of any applicable grace or cure period, or the occurrence of any event
or circumstance defined as an Event of Default, under any other consensual lien
encumbering the Property, or any part
<PAGE>

thereof or interest therein, or any document or instrument evidencing
obligations secured thereby.

            6.16 Default Under Cambridge Loan Documents. The occurrence of any
default by Cambridge Borrower or Guarantor, after the lapse of any applicable
grace or cure period, or the occurrence of any event or circumstance defined as
an Event of Default, under any of the Cambridge Loan Documents.

            6.17 Default Under Non-Recourse Guaranty Agreement or Second
Mortgage. The failure by Mortgagor to make any payment due under the
Non-Recourse Guaranty Agreement or the occurrence of any default, after the
lapse of any applicable grace or cure period, or the occurrence of any event or
circumstance defined as an Event of Default, under the Non-Recourse Guaranty
Agreement or the Second Mortgage.

                                   Article 7

                              MORTGAGEE'S REMEDIES

            Immediately upon or any time after the occurrence of any Event of
Default hereunder, Mortgagee may exercise any remedy available at law or in
equity, including but not limited to those listed below and those listed in the
other Loan Documents, in such sequence or combination as Mortgagee may determine
in Mortgagee's sole discretion:

            7.1 Performance of Defaulted Obligations. Mortgagee may make any
payment or perform any other obligation under the Loan Documents which Mortgagor
has failed to make or perform, and Mortgagor hereby irrevocably appoints
Mortgagee as the true and lawful attorney-in-fact for Mortgagor to make any such
payment and perform any such obligation in the name of Mortgagor. All payments
made and expenses (including attorneys' fees) incurred by Mortgagee in this
connection, together with interest thereon at the Default Rate from the date
paid or incurred until repaid, will be part of the Secured Obligations and will
be immediately due and payable by Mortgagor to Mortgagee. In lieu of advancing
Mortgagee's own funds for such purposes, Mortgagee may use any funds of
Mortgagor which may be in Mortgagee's possession, including but not limited to
insurance or condemnation proceeds and amounts deposited for taxes, insurance
premiums, or other purposes.

            7.2 Specific Performance and Injunctive Relief. Notwithstanding the
availability of legal remedies, Mortgagee will be entitled to obtain specific
performance, mandatory or prohibitory injunctive relief, or other equitable
relief requiring Mortgagor to cure or refrain from repeating any Default.

            7.3 Acceleration of Secured Obligations. Mortgagee may, without
notice or demand, declare all of the Secured Obligations immediately due and
payable in full.

            7.4 Suit for Monetary Relief. Subject to the non-recourse provisions
of the Note, with or without accelerating the maturity of the Secured
Obligations, Mortgagee may sue
<PAGE>

from time to time for any payment due under any of the Loan Documents, or for
money damages resulting from Mortgagor's default under any of the Loan
Documents.

            7.5 Possession of Property. Mortgagee may enter and take possession
of the Property without seeking or obtaining the appointment of a receiver, may
employ a managing agent for the Property, and may lease or rent all or any part
of the Property, either in Mortgagee's name or in the name of Mortgagor, and may
collect the rents, issues, and profits of the Property and may exclude Mortgagor
and its agents and employees wholly therefrom. If Mortgagor for any reason fails
to surrender or deliver the Property or any part thereof after Mortgagee's
demand, Mortgagee may obtain a judgment or order conferring on Mortgagee the
right to immediate possession or requiring Mortgagor to deliver immediate
possession to Mortgagee, and Mortgagor hereby specifically consents to the entry
of any such judgment or decree. Any revenues collected by Mortgagee under this
Section will be applied first toward payment of all expenses (including
attorneys' fees) incurred by Mortgagee, together with interest thereon at the
Default Rate from the date incurred until repaid, and the balance, if any, will
be applied against the Secured Obligations.

            7.6 Enforcement of Security Interests. Mortgagee may exercise all
rights of a secured party under the Code with respect to the Chattels and the
Intangible Personalty, including but not limited to taking possession of,
holding, and selling the Chattels and enforcing or otherwise realizing upon any
accounts and general intangibles. Any requirement for reasonable notice of the
time and place of any public sale, or of the time after which any private sale
or other disposition is to be made, will be satisfied by Mortgagee's giving of
such notice to Mortgagor at least five (5) days prior to the time of any public
sale or the time after which any private sale or other intended disposition is
to be made.

            7.7 Foreclosure Against Property.

                  (a) Mortgagee may bring an action in any court of competent
jurisdiction to foreclose this Mortgage. Mortgagee may bid for and purchase all
or any portion of the Property at any foreclosure sale thereof.

                  (b) If any installment or part of the Secured Obligations
under the Note or Loan Documents shall fail to be paid when due, Mortgagee shall
be entitled to sue for and to recover judgment against Mortgagor for the amounts
so due and unpaid together with all costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses) incurred by Mortgagee in
connection with such proceedings, together with interest thereon at the Default
Rate from the date incurred by Mortgagee. All such costs and expenses shall be
secured by this Mortgage and shall be due and payable by Mortgagor immediately.

                  (c) If Mortgagor shall fail to pay upon Mortgagee's demand,
after acceleration as provided for in Section 7.3, all of the unpaid Secured
Obligations including all accrued interest represented thereby, Mortgagee shall
be entitled to sue for and to recover judgment against Mortgagor for the entire
amount so due and unpaid together with all costs and expenses (including without
limitation, reasonable attorneys' fees and expenses) incurred by Mortgagee in
connection with such proceeding, together with interest thereon at the Default
Rate
<PAGE>

from the date incurred by Mortgagee. All such costs and expenses shall be
secured by this Mortgage and shall be payable by Mortgagor immediately.
Mortgagee's rights under this subsection (c) may be exercised by Mortgagee
either before, after or during the pendency of any proceeding for the
enforcement of this Mortgage, including appellate proceedings.

                  (d) No recovery of any judgment as provided in subsections (b)
and (c) above and no attachment or levy or any execution on any of the Property
or any other property shall in any way affect the lien of this Mortgage upon the
Property or any part thereof, or any lien, rights, powers, or remedies of
Mortgagee hereunder, but such lien, rights, powers and remedies shall continue
unimpaired as before.

                  (e) Mortgagee may institute proceedings for the partial or
complete foreclosure of this Mortgage and Mortgagee may, pursuant to any final
judgment of foreclosure, sell the Property as an entirety or in separate lots,
units or parcels. Mortgagee is authorized to foreclose this Mortgage subject to
the rights of any tenant of the Property, or Mortgagee may elect which tenants
Mortgagee desires to name as parties defendant in such foreclosure and failure
to make any such tenants parties defendants to any such foreclosure proceedings
and to foreclose their rights will not be, nor be asserted by Mortgagor to be, a
defense to any proceeding instituted by Mortgagee to collect the Secured
Obligations.

                  (f) All fees, costs and expenses of any kind incurred by
Mortgagee in connection with foreclosure of this Mortgage, including, without
limitation, the costs of any appraisals of the Property obtained by Mortgagee,
the cost of any title reports or abstracts, all costs of any receivership for
the Property advanced by Mortgagee, and all attorneys' and consultants' fees and
expenses incurred by Mortgagee, shall constitute a part of the Secured
Obligations and may be included as part of the amount owing from Mortgagor to
Mortgagee at any foreclosure sale.

                  (g) The proceeds of any sale under this Section shall be
applied first to the fees and expenses of the officer conducting the sale, and
then to the reduction or discharge of the Secured Obligations in such order and
manner as Mortgagee may elect in its sole discretion; any surplus remaining
shall be paid over to Mortgagor or to such other person or persons as may be
lawfully entitled to such surplus.

                  (h) Nothing in this Section dealing with foreclosure
procedures or specifying particular actions to be taken by Mortgagee shall be
deemed to contradict or add to the requirements and procedures now or hereafter
specified by Florida law, and any such inconsistency shall be resolved in favor
of Florida law applicable at the time of foreclosure.

            7.8 Appointment of Receiver. To the extent permitted by law,
Mortgagee shall be entitled, as a matter of absolute right and without regard to
the value of any security for the Secured Obligations or the solvency of any
person liable therefor, to the appointment of a receiver for the Property upon
ex parte application to any court of competent jurisdiction. Mortgagor waives
any right to any hearing or notice of hearing prior to the appointment of a
receiver. Such receiver and its agents shall be empowered, but shall not be
obligated, to (a) take possession of the Property and any businesses conducted
by Mortgagor or any other person
<PAGE>

thereon and any business assets used in connection therewith, (b) exclude
Mortgagor and Mortgagor's agents, servants, and employees from the Property, (c)
collect the rents, issues, profits, and income therefrom, (d) complete any
construction which may be in progress, (e) do such maintenance and make such
repairs and alterations as the receiver deems necessary, (f) use all stores of
materials, supplies, and maintenance equipment on the Property and replace such
items at the expense of the receivership estate, (g) pay all taxes and
assessments against the Property and the Chattels, all premiums for insurance
thereon, all utility and other operating expenses, and all sums due under any
prior or subsequent encumbrance, and (h) generally do anything which Mortgagor
could legally do if Mortgagor were in possession of the Property. All expenses
incurred by the receiver or its agents shall constitute a part of the Secured
Obligations. Any revenues collected by the receiver shall be applied first to
the expenses of the receivership, including attorneys' fees incurred by the
receiver and by Mortgagee, together with interest thereon at the Default Rate
from the date ten (10) days following demand therefor until paid, and the
balance shall be applied toward the Secured Obligations in such order or manner
as Mortgagee may in its sole discretion elect or in such other manner as the
court may direct. Unless sooner terminated with the express consent of
Mortgagee, any such receivership will continue until the Secured Obligations
have been discharged in full, or until title to the Property has passed after
foreclosure sale and all applicable periods of redemption have expired.

            7.9 Right to Make Repairs, Improvements. Should any part of the
Property come into the possession of Mortgagee after an Event of Default,
Mortgagee may, but shall not be obligated to, use, operate, and/or make repairs,
alterations, additions and improvements to the Property for the purpose of
preserving it or its value. Mortgagor covenants to promptly reimburse and pay to
Mortgagee, at the place where the Note is payable, or at such other place as may
be designated by Mortgagee in writing, the amount of all reasonable expenses
(including the cost of any insurance, taxes, or other charges) incurred by
Mortgagee in connection with its custody, preservation, use or operation of the
Property, together with interest thereon from the date incurred by Mortgagee at
the Default Rate, and all such expenses, costs, taxes, interest, and other
charges shall be a part of the Secured Obligations. It is agreed, however, that
the risk of accidental loss or damage to the Property is undertaken by Mortgagor
and Mortgagee shall have no liability whatsoever for decline in value of the
Property, for failure to obtain or maintain insurance, or for failure to
determine whether any insurance ever in force is adequate as to amount or as to
the risks insured.

            7.10 Prima Facie Evidence. Mortgagor agrees that, in any
assignments, deeds, bills of sale, notices of sale, or postings, given by
Mortgagee, any and all statements of fact or other recitals therein made as to
the identity of Mortgagee, or as to the occurrence or existence of any Event of
Default, or as to the acceleration of the maturity of the Secured Obligations,
or as to the request to sell, posting of notice of sale, notice of sale, time,
place, terms and manner of sale and receipt, distribution and application of the
money realized therefrom, and without being limited by the foregoing, as to any
other act or thing having been duly done by Mortgagee, shall be taken by all
courts of law and equity as prima facie evidence that such statements or
recitals state facts and are without further question to be so accepted, and
Mortgagor does hereby ratify and confirm any and all acts that Mortgagee may
lawfully do by virtue hereof.
<PAGE>

            7.11 Other Proceedings. Mortgagee may institute and maintain any
suits and proceedings as Mortgagee may deem advisable (i) to prevent any
impairment of the Property by any acts which may be unlawful or in violation of
this Mortgage, (ii) to preserve or protect its interest in the Property, and
(iii) to restrain the enforcement or compliance with any governmental
requirement that may be unconstitutional or otherwise invalid, if the
enforcement of or compliance with such governmental requirement might impair the
security hereunder or be prejudicial to Mortgagee's interest.

            7.12 Credit of Mortgagee. To the maximum extent permitted by the
laws of the State of Florida, on a sale made under or by virtue of this Article,
Mortgagee may bid for and acquire the Property, or any part thereof, and in lieu
of paying cash thereof may apply to the purchase price, all or any portion of
the unpaid Secured Obligations in such order as Mortgagee may elect.

            7.13 Sale. Any sale or sales made under or by virtue of this Article
shall operate to divest all of the estate, right, title, interest, claim and
demand whatsoever at law or in equity, of Mortgagor and all persons, except
tenants pursuant to leases approved by Mortgagee claiming by, through or under
Mortgagor in and to the properties and rights so sold, whether sold to Mortgagee
or to others.

            7.14 Waiver of Redemption, Notice, Marshalling, Etc. Mortgagor
hereby waives and releases for itself and anyone claiming through, by, or under
it, to the maximum extent permitted by the laws of the State of Florida:

                  (a) All benefits that might accrue to Mortgagor by virtue of
any present or future law exempting the Property, or any part of the proceeds
arising from any sale thereof, from attachment, levy or sale on execution, or
providing for any appraisement, valuation, stay of execution, exemption from
civil process, redemption or extension of time for payment;

                  (b) Unless specifically required herein, all notices of
default, or Mortgagee's actual exercise of any option or remedy under the Loan
Documents; and

                  (c) Any right to have the Property marshaled.

            7.15 Discontinuance of Proceedings. If Mortgagee shall have
proceeded to enforce any rights under any Loan Document and such proceeding
shall have been discontinued or abandoned for any reason, then except as may be
provided in any written agreement between Mortgagor and Mortgagee providing for
the discontinuance or abandonment of such proceeding, Mortgagor and Mortgagee
shall be restored to their former positions and the rights, remedies and powers
of Mortgagee shall continue as if no such proceeding had been instituted.
<PAGE>

                                   Article 8

                         ASSIGNMENT OF LEASES AND RENTS

            8.1 Assignment of Leases and Rents. Assignment of Leases and Rents.
Pursuant to Section 697.07, Florida Statutes, as further security for the
Secured Obligations, Mortgagor hereby unconditionally and absolutely grants,
transfers and assigns unto Mortgagee all rents, royalties, issues, profits and
income ("Rents") now or hereafter due or payable for the occupancy or use of the
Property, and all Leases, whether written or oral, with all security therefor,
including all guaranties thereof, now or hereafter affecting the Property;
reserving unto Mortgagor, however, a license to collect and retain such Rents
prior to the occurrence of any Event of Default (and Mortgagee shall not revoke
such license prior to the occurrence of any Event of Default). Such license
shall be revocable by Mortgagee without notice to Mortgagor at any time after
the occurrence of an Event of Default. Mortgagor represents that the Rents and
the Leases have not been heretofore sold, assigned, transferred or set over by
any instrument now in force and will not at any time during the life of this
assignment be sold, assigned, transferred or set over by Mortgagor or by any
person or persons whomsoever; and Mortgagor has good right to sell, assign,
transfer and set over the same and to grant to and confer upon Mortgagee the
rights, interest, powers and authorities herein granted and conferred. Failure
of Mortgagee at any time or from time to time to enforce the assignment of Rents
and Leases under this Section shall not in any manner prevent its subsequent
enforcement, and Mortgagee is not obligated to collect anything hereunder, but
is accountable only for sums actually collected. The assignment contained in
this Section 8.1 is a collateral assignment but will become absolute upon the
occurrence of an Event of Default.

            8.2 Further Assignments. Mortgagor shall give Mortgagee at any time
upon demand any further or additional forms of assignment or transfer of such
Rents, Leases and security as may be reasonably requested by Mortgagee, and
shall deliver to Mortgagee executed copies of all such Leases and security.

            8.3 Application of Rents. Mortgagee shall be entitled to deduct and
retain a just and reasonable compensation from monies received hereunder for its
services or that of its agents in collecting such monies. Any monies received by
Mortgagee hereunder may be applied when received from time to time in payment of
any taxes, assessments or other liens affecting the Property regardless of the
delinquency, such application to be in such order as Mortgagee may determine.
The acceptance of this Mortgage by Mortgagee or the exercise of any rights by it
hereunder shall not be, or be construed to be, an affirmation by it of any Lease
nor an assumption of any liability under any Lease.

            8.4 Collection of Rents. Upon or at any time after an Event of
Default shall have occurred and be continuing, Mortgagee may declare all sums
secured hereby immediately due and payable, and may, at its option, without
notice, and whether or not the Secured Obligations shall have been declared due
and payable, either in person or by agent, with or without bringing any action
or proceeding, or by a receiver to be appointed by a court, (a) enter upon, take
possession of, manage and operate the Property, or any part thereof (including
without
<PAGE>

limitation making necessary repairs, alterations and improvements to the
Property); (b) make, cancel, enforce or modify Leases; (c) obtain and evict
tenants; (d) fix or modify Rents; (e) do any acts which Mortgagee deems
reasonably proper to protect the security thereof; (f) either with or without
taking possession of the Property, in its own name sue for or otherwise collect
and receive such Rents, including those past due and unpaid; and (g) upon
written demand, collect the Rents pursuant to Section 697.07, Florida Statutes.
In connection with the foregoing, Mortgagee shall be entitled and empowered to
employ attorneys, and management, rental and other agents in and about the
Property and to effect the matters which Mortgagee is empowered to do, and in
the event Mortgagee shall itself effect such matters, Mortgagee shall be
entitled to charge and receive reasonable management, rental and other fees
therefor as may be customary in the area in which the Property is located; and
the reasonable fees, charges, costs and expenses of Mortgagee or such persons
shall be additional Secured Obligations. Mortgagee may apply all funds collected
as aforesaid, less costs and expenses of operation and collection, including
reasonable attorneys' and agents' fees, charges, costs and expenses, as
aforesaid, upon any Secured Obligations, and in such order as Mortgagee may
determine. The entering upon and taking possession of the Property, the
collection of such Rents and the application thereof as aforesaid shall not cure
or waive any default or waive, modify or affect notice of default under the Note
or this Mortgage or invalidate any act done pursuant to such notice.

            8.5 Authority of Mortgagee. Any tenants or occupants of any part of
the Property are hereby authorized to recognize the claims of Mortgagee
hereunder without investigating the reason for any action taken by Mortgagee, or
the validity or the amount of secured obligations owing to Mortgagee, or the
existence of any default in the Note or this Mortgage, or under or by reason of
this assignment of Rents and Leases, or the application to be made by Mortgagee
of any amounts to be paid to Mortgagee. The sole signature of Mortgagee shall be
sufficient for the exercise of any rights under this assignment and the sole
receipt of Mortgagee for any sums received shall be a full discharge and release
therefor to any such tenant or occupant of the Property. Checks for all or any
part of the rentals collected under this assignment of Rents and Leases shall be
drawn to the exclusive order of Mortgagee.

            8.6 Indemnification of Mortgagee. Nothing herein contained shall be
deemed to obligate Mortgagee to perform or discharge any obligation, duty or
liability of any lessor under any Lease of the Property unless and until
Mortgagee forecloses this Mortgage or takes title to the Property, and Mortgagor
shall and does hereby indemnify and hold Mortgagee harmless from any and all
liability, loss or damage which Mortgagee may or might incur under any Lease or
by reason of the assignment; and any and all such liability, loss or damage
incurred by Mortgagee, together with the costs and expenses, including
reasonable attorneys' fees, incurred by Mortgagee in defense of any claims or
demands therefor (whether successful or not), shall be additional Secured
Obligations, and Mortgagor shall reimburse Mortgagee therefor on demand.
Mortgagor's obligations under this Section are subject to the following: (a) the
right to settle or resolve such claim, subject to Mortgagee's approval, which
approval shall not be unreasonably withheld, (b) the right to select legal
counsel of Mortgagor's choice, subject to Mortgagee's approval, which approval
shall not be unreasonably withheld, and (c) Mortgagor shall not indemnify
Mortgagee for Mortgagee's gross negligence or willful misconduct.
<PAGE>

                                   Article 9

                            MISCELLANEOUS PROVISIONS

            9.1 Time of the Essence. Time is of the essence with respect to all
provisions of the Loan Documents.

            9.2 Joint and Several Obligations. If Mortgagor is more than one
person or entity, then (a) all persons or entities comprising Mortgagor are
jointly and severally liable for all of the Secured Obligations; (b) all
representations, warranties, and covenants made by Mortgagor shall be deemed
representations, warranties, and covenants of each of the persons or entities
comprising Mortgagor; (c) any breach, Default or Event of Default by any of the
persons or entities comprising Mortgagor hereunder shall be deemed to be a
breach, Default, or Event of Default of Mortgagor; (d) any reference herein
contained to the knowledge or awareness of Mortgagor shall mean the knowledge or
awareness of any of the persons or entities comprising Mortgagor; and (e) any
event creating personal liability of any of the persons or entities comprising
Mortgagor shall create personal liability for all such persons or entities.

            9.3 Waiver of Homestead and Other Exemptions. To the extent
permitted by law, Mortgagor hereby waives all rights to any homestead or other
exemption to which Mortgagor would otherwise be entitled under any present or
future constitutional, statutory, or other provision of applicable state or
federal law. Mortgagor hereby waives any right it may have to require Mortgagee
to marshal all or any portion of the security for the Secured Obligations.

            9.4 Non Recourse; Exceptions to Non-Recourse. Except as expressly
set forth in the Note, the recourse of Mortgagee with respect to the obligations
evidenced by the Note and the other Loan Documents shall be solely to the
Property, Chattels and Intangible Personalty (as defined in this Mortgage and
the Cambridge Loan Documents), and any other collateral given as security for
the Note.

            9.5 Rights and Remedies Cumulative. Mortgagee's rights and remedies
under each of the Loan Documents are cumulative of the rights and remedies
available to Mortgagee under each of the other Loan Documents and those
otherwise available to Mortgagee at law or in equity. No act of Mortgagee shall
be construed as an election to proceed under any particular provision of any
Loan Document to the exclusion of any other provision in the same or any other
Loan Document, or as an election of remedies to the exclusion of any other
remedy which may then or thereafter be available to Mortgagee.

            9.6 No Implied Waivers. Mortgagee shall not be deemed to have waived
any provision of any Loan Document unless such waiver is in writing and is
signed by Mortgagee. Without limiting the generality of the preceding sentence,
neither Mortgagee's acceptance of any payment with knowledge of a Default by
Mortgagor, nor any failure by Mortgagee to exercise any remedy following a
Default by Mortgagor shall be deemed a waiver of such Default, and no waiver by
Mortgagee of any particular Default on the part of Mortgagor shall be deemed a
waiver of any other Default or of any similar Default in the future.
<PAGE>

            9.7 No Third Party Rights. No person shall be a third party
beneficiary of any provision of any of the Loan Documents. All provisions of the
Loan Documents favoring Mortgagee are intended solely for the benefit of
Mortgagee, and no third party shall be entitled to assume or expect that
Mortgagee will not waive or consent to modification of any such provision in
Mortgagee's sole discretion.

            9.8 Preservation of Liability and Priority. Without affecting the
liability of Mortgagor or of any other person (except a person expressly
released in writing) for payment and performance of all of the Secured
Obligations, and without affecting the rights of Mortgagee with respect to any
security not expressly released in writing, and without impairing in any way the
priority of this Mortgage over the interests of any person acquired or first
evidenced by recording subsequent to the recording hereof, Mortgagee may, either
before or after the maturity of the Note, and without notice or consent: (a)
release any person liable for payment or performance of all or any part of the
Secured Obligations; (b) make any agreement altering the terms of payment or
performance of all or any of the Secured Obligations; (c) exercise or refrain
from exercising, or waive, any right or remedy which Mortgagee may have under
any of the Loan Documents; (d) accept additional security of any kind for any of
the Secured Obligations; or (e) release or otherwise deal with any real or
personal property securing the Secured Obligations. Any person acquiring or
recording evidence of any interest of any nature in the Property, the Chattels,
or the Intangible Personalty shall be deemed, by acquiring such interest or
recording any evidence thereof, to have agreed and consented to any or all such
actions by Mortgagee.

            9.9 Subrogation of Mortgagee. Mortgagee shall be subrogated to the
lien of any previous encumbrance discharged with funds advanced by Mortgagee
under the Loan Documents, regardless of whether such previous encumbrance has
been released of record.

            9.10 Notices. Any notice required or permitted to be given by
Mortgagor or Mortgagee under this Mortgage shall be in writing and will be
deemed given (a) upon personal delivery, (b) on the first business day after
receipted delivery to a courier service which guarantees next-business-day
delivery, or (c) on the fifth business day after mailing, by registered or
certified United States mail, postage prepaid, in any case to the appropriate
party at its address set forth below:

                  If to Mortgagor:

                        c/o Sonesta International Hotels Corporation
                        200 Clarendon Street, 41st Floor
                        Boston, Massachusetts  02116
                        Attn:  Office of the Treasurer
<PAGE>

                  with a copy to:

                        Broad and Cassel
                        Corporate Centre at Boca Raton
                        7777 Glades Road, Suite 300
                        Boca Raton, Florida  33434
                        Attn: Arvin J. Jaffe, Esq.

                  If to Mortgagee:

                        SunAmerica Life Insurance Company
                        1 SunAmerica Center
                        Century City
                        Los Angeles, California  90067-6022
                        Attn:  Director-Mortgage Lending and Real Estate

Either party may change such party's address for notices or copies of notices by
giving notice to the other party in accordance with this Section.

            9.11 Defeasance. Upon payment and performance in full of all of the
Secured Obligations and satisfaction of the obligations set forth in the
Non-Recourse Guaranty Agreement (or upon the satisfaction of all Defeasance
Requirements specified in the Note in connection with the Defeasance of the
Note), Mortgagee will execute and deliver to Mortgagor such documents as may be
required to reconvey this Mortgage of record.

            9.12 Illegality. If any provision of this Mortgage is held to be
illegal, invalid, or unenforceable under present or future laws effective during
the term of this Mortgage, the legality, validity, and enforceability of the
remaining provisions of this Mortgage shall not be affected thereby, and in lieu
of each such illegal, invalid or unenforceable provision there shall be added
automatically as a part of this Mortgage a provision as similar in terms to such
illegal, invalid, or unenforceable provision as may be possible and be legal,
valid, and enforceable. If the rights and liens created by this Mortgage shall
be invalid or unenforceable as to any part of the Secured Obligations, then the
unsecured portion of the Secured Obligations shall be completely paid prior to
the payment of the remaining and secured portion of the Secured Obligations, and
all payments made on the Secured Obligations shall be considered to have been
paid on and applied first to the complete payment of the unsecured portion of
the Secured Obligations.

            9.13 Usury Savings Clause. It is expressly stipulated and agreed to
be the intent of Mortgagee and Mortgagor at all times to comply with the
applicable law governing the highest lawful interest rate. If the applicable law
is ever judicially interpreted so as to render usurious any amount called for
under the Note or under any of the other Loan Documents, or contracted for,
charged, taken, reserved or received with respect to the loan evidenced thereby,
or if acceleration of the maturity of the Note, any prepayment by Mortgagor, or
any other circumstance whatsoever, results in Mortgagor having paid any interest
in excess of that permitted by applicable law, then it is the express intent of
Mortgagor and Mortgagee that all
<PAGE>

excess amounts theretofore collected by Mortgagee be credited on the principal
balance of the Note (or, at Mortgagee's option, paid over to Mortgagor), and the
provisions of the Note and other Loan Documents immediately be deemed reformed
and the amounts thereafter collectible hereunder and thereunder reduced, without
the necessity of the execution of any new document, so as to comply with the
applicable law, but so as to permit the recovery of the fullest amount otherwise
called for hereunder and thereunder. The right to accelerate maturity of the
Note 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 collect any unearned interest in the event of acceleration. All sums
paid or agreed to be paid to Mortgagee for the use, forbearance or detention of
the Secured Obligations evidenced hereby or by the Note shall, to the extent
permitted by applicable law, be amortized, prorated, allocated and spread
throughout the full term of such Secured Obligations until payment in full so
that the rate or amount of interest on account of such Secured Obligations does
not exceed the maximum rate or amount of interest permitted under applicable
law. The term "applicable law" as used herein shall mean any federal or state
law applicable to the loan made by Mortgagee to Mortgagor evidenced by the Note.

            9.14 Obligations Binding Upon Mortgagor's Successors. This Mortgage
is binding upon Mortgagor and Mortgagor's successors and assigns, and shall
inure to the benefit of Mortgagee, and its successors and assigns, and the
provisions hereof shall likewise be covenants running with the land. The duties,
covenants, conditions, obligations, and warranties of Mortgagor in this Mortgage
shall be joint and several obligations of Mortgagor and Mortgagor's successors
and assigns

            9.15 Future Advances. This Mortgage shall secure not only existing
indebtedness, but also such future advances, whether such advances are
obligatory or to be made at the option of Mortgagee, or otherwise, as are made
within twenty (20) years from the date hereof, to the same extent as if such
future advances were made on the date of the execution of this Mortgage, but
such secured indebtedness shall not exceed at any time the maximum principal
amount of two times the amount of the Note, plus interest thereon, and any
disbursements made for the payment of taxes, levies, or insurance, on the
Property, with interest on such disbursements. Any such future advances, whether
obligatory or to be made at the option of the Mortgagee, or otherwise, may be
made either prior to or after the due date of the Note or any other notes
secured by this Mortgage. This Mortgage is given for the specific purpose of
securing any and all indebtedness by the Mortgagor to Mortgagee (but in no event
shall the secured indebtedness exceed at any time the maximum amount set forth
in this Section) in whatever manner this indebtedness may be evidenced or
represented, until this Mortgage is satisfied of record. All covenants and
agreements contained in this Mortgage shall be applicable to all further
advances made by Mortgagee to Mortgagor under this future advance clause.

            If, pursuant to Florida Statutes, Section 697.04, Mortgagor files a
notice specifying the dollar limit beyond which future advances made pursuant to
this Mortgage will not be secured by this Mortgage, then Mortgagor shall, within
one (1) day of filing such notice, notify Mortgagee and its counsel by certified
mail pursuant to Section 9.10 of this Mortgage. In addition, such a filing shall
constitute an Event of Default hereunder.
<PAGE>

            9.16 Construction. All pronouns and any variations of pronouns
herein shall be deemed to refer to the masculine, feminine, or neuter, singular
or plural, as the identity of the parties may require. Whenever the terms herein
are singular, the same shall be deemed to mean the plural, as the identity of
the parties or the context requires.

            9.17 Waiver of Removal to Federal Court. Mortgagor and each General
Partner hereby waive any right they may have to remove any action or proceeding
brought against them to any federal court of the United States, and hereby waive
any right they may have to transfer or change the venue of any litigation
brought against them, whether such action or proceeding arises directly,
indirectly or otherwise in connection with, out of, related to, or from the
Note, this Mortgage or any of the other Loan Documents.

            9.18 Attorneys' Fees. Any reference in this Mortgage to attorneys'
or counsel fees paid or incurred by Mortgagee shall be deemed to mean reasonable
fees and shall be further deemed to include reasonable paralegals' fees and
reasonable legal assistants' fees. Moreover, wherever provision is made herein
for payment of attorneys' or counsels fees or expenses incurred by Mortgagee,
such provision shall include but not be limited to, such fees or expenses
incurred in any and all judicial, bankruptcy, reorganization, administrative, or
other proceedings, including appellate proceedings, whether such fees or
expenses arise before proceedings are commenced, during such proceedings or
after entry of a final judgment.

            9.19 Waiver and Agreement. MORTGAGOR HEREBY EXPRESSLY WAIVES ANY
RIGHT IT MAY HAVE UNDER APPLICABLE LAW TO PREPAY THE NOTE, IN WHOLE OR IN PART,
WITHOUT PREPAYMENT CHARGE (EXCEPT AS OTHERWISE PROVIDED IN THE NOTE), UPON
ACCELERATION OF THE MATURITY DATE OF THE NOTE, AND AGREES THAT, IF FOR ANY
REASON A PREPAYMENT OF ALL OR ANY PART OF THE NOTE IS MADE, WHETHER VOLUNTARILY
OR FOLLOWING ANY ACCELERATION OF THE MATURITY DATE OF THE NOTE BY MORTGAGEE ON
ACCOUNT OF THE OCCURRENCE OF ANY EVENT OF DEFAULT ARISING FOR ANY REASON,
INCLUDING, WITHOUT LIMITATION, AS A RESULT OF ANY PROHIBITED OR RESTRICTED
TRANSFER, FURTHER ENCUMBRANCE OR DISPOSITION OF THE PROPERTY OR ANY PART THEREOF
SECURING THE NOTE, THEN MORTGAGOR SHALL BE OBLIGATED TO PAY, CONCURRENTLY WITH
SUCH PREPAYMENT, THE PREPAYMENT PREMIUM PROVIDED FOR IN THE NOTE. MORTGAGOR
HEREBY DECLARES THAT MORTGAGEE'S AGREEMENT TO MAKE THE LOAN EVIDENCED BY THE
NOTE AT THE INTEREST RATE AND FOR THE TERM SET FORTH IN THE NOTE CONSTITUTES
ADEQUATE CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY MORTGAGOR, FOR THIS WAIVER
AND AGREEMENT.

            9.20 Waiver of Jury Trial. MORTGAGEE AND MORTGAGOR KNOWINGLY,
IRREVOCABLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EITHER MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM BASED ON THIS
MORTGAGE, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS MORTGAGE OR ANY
LOAN
<PAGE>

DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL
OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO OR TO ANY LOAN DOCUMENT. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR MORTGAGEE AND MORTGAGOR TO ENTER INTO THE
LOAN TRANSACTION EVIDENCED BY THE NOTE.

            9.21 Governing Laws. The substantive laws of the State of Florida
shall govern the validity, construction, enforcement and interpretation of this
Mortgage.

            9.22 Inconsistency. In the event of any inconsistency between the
terms of the Loan Documents and the terms of that certain First Mortgage Loan
Application between Mortgagor and Mortgagee dated March 9, 2000, as amended by
Addendum to First Mortgage Loan Application, the terms of the Loan Documents
shall govern and control in all respects.

            9.23 Incorporation of Recitals. The Recitals to this Mortgage are
hereby incorporated into this Mortgage and made a part hereof.

            9.24 Novation. It is the intent of the parties to this Mortgage that
this Mortgage shall not constitute a novation and shall in no way adversely
affect the lien priority of the Original Mortgages and other Original Loan
Documents referred to herein. In the event that this Mortgage, or any part
hereof, shall be construed by a court of competent jurisdiction as operating to
affect the lien priority of said Original Mortgages or other Original Loan
Documents, or any of them, over the claims which would otherwise be subordinate
thereto, then to the extent so ruled by such court, and to the extent that third
persons acquiring an interest in such property as is encumbered by the
respective Original Mortgages and other Original Loan Documents between the time
of execution of the Original Mortgages and other Original Loan Documents, and
the execution hereof, are prejudiced thereby, this Mortgage, or such portion
hereof as shall be so construed, shall be void and of no force and effect and
this Mortgage shall constitute, as to that portion, a subordinate lien on the
collateral described therein, incorporating by reference the terms of the
Original Mortgages and other Original Loan Documents, and which Original
Mortgages and other Original Loan Documents then shall be enforced pursuant to
the terms therein contained, independent of this Mortgage; provided, however,
that notwithstanding the foregoing, the parties hereto, as between themselves,
shall be bound by all terms and conditions hereof until all indebtedness owing
from the Mortgagor to the Mortgagee shall have been paid in full.

                   [Balance of page intentionally left blank]
<PAGE>

            IN WITNESS WHEREOF, Mortgagor has executed and delivered this
Mortgage as of the date first mentioned above.

Witnesses:                            SONESTA BEACH RESORT LIMITED
                                      PARTNERSHIP, a Delaware limited
                                      partnership

_________________________________     By: Florida Sonesta Corporation, a Florida
                                          corporation, its General Partner
Print Name:______________________

                                          By: /S/
---------------------------------             ----------------------------------
                                              Peter J. Sonnabend, Vice President
Print Name:______________________

COMMONWEALTH OF MASSACHUSETTS          )
                                       ) ss.
COUNTY OF __________________________   )

            The foregoing instrument was acknowledged before me this _____ day
of May, 2000, by Peter J. Sonnabend, as Vice President of Florida Sonesta
Corporation, a Florida corporation, General Partner of Sonesta Beach Resort
Limited Partnership, a Delaware limited partnership, who is known to me, or
produced _________________________________ as identification.

                        Serial Numbers, if any:______________________
                        My commission expires:_______________________

                                          --------------------------------------
                                          Notary Public

                                          --------------------------------------
                                          Print Name

<PAGE>

            Mortgagee hereby consents and agrees to the terms of this Mortgage.

Witnesses:                            SUNAMERICA LIFE INSURANCE COMPANY,
                                      an Arizona corporation

                                      By: /s/
---------------------------------         --------------------------------------
Print Name:                           Name:
           ----------------------          -------------------------------------
                                      Title:
                                            ------------------------------------

---------------------------------
Print Name:
           ----------------------
<PAGE>

                   [ATTACH CALIFORNIA FORM OF ACKNOWLEDGMENT]
<PAGE>

                                    EXHIBIT A
                                       to
                                    MORTGAGE

                               (Legal Description)
<PAGE>

                                    EXHIBIT B
                                       to
                                    MORTGAGE

                             (Permitted Exceptions)

                    [INCLUDE SECOND MORTGAGE, AS SUBORDINATE]
<PAGE>

                                    EXHIBIT C
                                       to
                                    MORTGAGE

            This Consolidated, Amended and Restated Mortgage, Security
Agreement, Fixture Filing, Financing Statement and Assignment of Leases and
Rents (this "Mortgage") evidences the consolidation and renewal of the Aetna
Mortgage, the FSC First Mortgage and the FSC Second Mortgage (as such mortgages
are more particularly described in the recitals to this Mortgage). This Mortgage
secures the obligations evidenced by that certain Consolidated and Renewed
Promissory Note (the "Consolidated Note") dated of even date herewith in the
original principal amount of $31,000,000.00, which Consolidated Note evidences
the consolidation and renewal of (i) that certain Second Renewal Promissory Note
dated December 1, 1993 in the original principal amount of $24,142,088.26 and
having a current outstanding principal balance of $22,431,486.12, made by Key
Biscayne Limited Partnership ("KBLP") payable to the order of Aetna Life
Insurance Company, as assigned by Aetna to State Street Bank and Trust Company,
Trustee, and subsequently assumed by Mortgagor, as assigned of even date
herewith to Mortgagee ("Aetna Note"); (ii) that certain Purchase Money Mortgage
Note dated December 27, 1984 in the original principal amount of $5,000,000.00
and having a current outstanding principal balance of $5,000,000.00, made by
Biscayne Beach Hotel Associates, Ltd. ("BBHA"), now known as KBLP, payable to
the order of Florida Sonesta Corporation ("FSC"), as assigned of even date
herewith to Mortgagee (as amended, the "FSC $5MM Note"); and (iii) that certain
Purchase Money Mortgage Note dated December 27, 1984 in the original principal
amount of $6,500,000.00 and having a current outstanding principal balance of
$3,568,513.88, made by BBHA payable to the order of FSC, as assigned of even
date herewith to Mortgagee (as amended, the "FSC $6.5MM Note"). Mortgagor is the
obligor under the Aetna Note, but is not the obligor under the FSC $5MM Note or
the FSC $6.5MM Note. The execution of the Consolidated Note evidences the
assumption by Mortgagor of the obligations under the FSC $5MM Note and the FSC
$6.5MM Note. Pursuant to Chapter 201, Florida Statutes and Florida
Administrative Code Rule 12-4.053(19), the assumption of the obligations
evidenced by the FSC $5MM Note and the FSC $6.5MM Note by Mortgagor is subject
to Florida documentary stamp tax based upon the current outstanding principal
balance of such promissory notes. Accordingly, documentary stamp tax in the
amount of $29,990.10, based upon the aggregate current outstanding principal
balance of the FSC $5MM Note and the FSC $6.5MM Note of $8,568,513.88, is being
paid upon recording of this Mortgage in the Public Records of Miami-Dade County,
Florida. Intangible personal property tax in the amount of $54,576.66 was paid
upon the recording of the Aetna Mortgage, intangible personal property tax in
the amount of $10,000.00 was paid upon a recording of the FSC First Mortgage and
intangible personal property tax in the amount of $13,000.00 was paid upon
recording of the FSC Second Mortgage. Accordingly, no additional intangible
personal property tax is due and payable upon the recording of this Mortgage.

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