Document:

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                                                                    Exhibit 10.3

                             Location of Property:

                              Town of Marlborough

                              County of Middlesex

                         Commonwealth of Massachusetts

                          Dated as of January 30, 2001

                   LEASEHOLD MORTGAGE AND SECURITY AGREEMENT

                                  ("Mortgage")

                                      From

                       WATERFORD PARK, LLC, as Mortgagor

                                       to

                          SEPRACOR, INC., as Mortgagee

                   This instrument was prepared by and, after
                          recording, please return to:

                           Thomas Howard Brown, P.C.
                               Nixon Peabody LLP
                               101 Federal Street
                                Boston, MA 02110

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                               TABLE OF CONTENTS
                                                                            Page
                                                                            ----

ARTICLE I SECURED OBLIGATIONS..................................................2

   1.1   Security..............................................................2

   1.2   Secured Obligations...................................................2

ARTICLE II GRANT OF MORTGAGED PROPERTIES.......................................2

   2.1   Mortgaged Property....................................................2

   2.2   Release of Mortgage...................................................5

ARTICLE III SECURITY AGREEMENT.................................................5

   3.1   Grant of Security Interest............................................5

   3.2   Covenants of Debtor...................................................6

ARTICLE IV CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS OF MORTGAGOR......7

   4.1   Payment of Indebtedness...............................................7

   4.2   Title.................................................................7

   4.3   Maintenance of Existence; Due Authorization; Compliance with Laws;
           Etc.................. ..............................................8

   4.4   Compliance With Law and Insurance Requirements; Maintaining Permits;
           Etc................ ................................................9

   4.5   Taxes and other Charges; Deposits with Mortgagee.....................10

   4.6   Discharge of Liens...................................................11

   4.7   Contest of Impositions...............................................11

   4.8   Mortgagee's Taxes....................................................12

   4.9   Use of Mortgaged Property............................................12

   4.10    Maintenance of Mortgaged Property..................................12

   4.11    Maintenance of Personal Property...................................13

   4.12    Alterations........................................................13

   4.13    Waste..............................................................14

   4.14    Insurance..........................................................14

   4.15    Damage or Destruction..............................................17

   4.16    Condemnation; Knowledge of Proceedings.............................19

   4.17    General Right of Entry.............................................21

   4.18    Separate Tax Lots..................................................21

   4.19    Books of Account; Financial Statements.............................21

   4.20    Limitations on Transfer............................................23

   4.21    Recording, Filing and Perfection of Security Interests; Fees.......23

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   4.22    Further Acts and Assurances........................................24

ARTICLE V EVENTS OF DEFAULT...................................................24

   5.1   Events of Default....................................................24

ARTICLE VI REMEDIES AND RELATED MATTERS.......................................24

   6.1   Remedies.............................................................24

   6.2   Foreclosure and Sale; Application of Proceeds; Waiver of Right of
           Redemption; Etc....................................................26

   6.3   No Conditions Precedent to Exercise of Remedies......................30

   6.4   No Merger............................................................30

   6.5   Remedies Cumulative..................................................30

   6.6   Mortgagee's Performance of Mortgagor's Obligations...................31

ARTICLE VII MISCELLANEOUS.....................................................31

   7.1   Enforceability.......................................................31

   7.2   Maximum Rate of Interest.............................................31

   7.3   Notices..............................................................33

   7.4   No Release...........................................................34

   7.5   Attorneys' Fees and Costs of Mortgagee...............................34

   7.6   Brokerage............................................................34

   7.7   Indemnification......................................................34

   7.8   Environmental Matters................................................36

   7.9   Limitations on Recourse..............................................36

   7.10    Estoppel Certificates..............................................36

   7.11    Effect of Extensions and Amendments................................37

   7.12    No Joint Venture...................................................37

   7.13    Funds Held in Accounts.............................................37

   7.14    Expenses of Mortgagee..............................................37

   7.15    Governing Law......................................................37

   7.16    Captions and Pronouns..............................................37

   7.17    Amendments, Waivers, Etc...........................................38

   7.19    Entire Agreement; Controlling Provisions...........................38

   7.20    Covenants Running With the Land; Successors and Assigns............38

   7.21    Statutory Condition................................................38

   7.21    Forbearance; Subordination.........................................38

   EXHIBIT A: LAND DESCRIPTION.................................................1

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      This LEASEHOLD MORTGAGE AND SECURITY AGREEMENT (hereinafter called the
"Mortgage") is made as of the 30th day of January, 2001, by WATERFORD PARK, LLC,
a Massachusetts limited liability company ("Mortgagor"), having a principal
place of business c/o Waterford Development Corp., 175 Highland Avenue, Needham,
Massachusetts 02494, as Mortgagor, to SEPRACOR, INC., a Delaware corporation
having an address at 111 Locke Drive, Marlborough, Massachusetts 01752, and any
subsequent holder of the Secured Obligations hereinafter set forth (all of whom
shall be included within the term "Mortgagee" as used herein), as Mortgagee,
Assignee, and Secured Party, as more fully hereinafter set forth.

                              W I T N E S S E T H:

      WHEREAS, Mortgagee has loaned (the "Loan") to Mortgagor the aggregate
principal amount of TWENTY MILLION EIGHT HUNDRED SIXTY THOUSAND and 00/100
Dollars ($20,860,000.00), evidenced by a note, dated January 30, 2001, in such
amount (the "Note"); and

      WHEREAS, Mortgagor alone, or Mortgagor and/or certain other parties, as
the case may be, have executed and delivered to Mortgagee simultaneously with
the execution and delivery of the Note, a Loan Agreement (First Lien) dated as
of January 30, 2001 (the "Loan Agreement"), an Environmental Indemnification
Agreement dated as of January 30, 2001 (the "Indemnity Agreement"), a Joint and
Several Limited Guaranty Agreement dated as of January 30, 2001 (the
"Guaranty"), an Assignment of Leases and Rents dated as of January 30, 2001 (the
"Assignment of Leases") and Collateral Assignment of Contracts, Licenses,
Permits, Agreements, Warranties and Approvals dated as of January 30, 2001 (the
"Assignment of Contracts");

      WHEREAS, simultaneously with the execution and delivery of the Note, the
Loan Agreement, the Indemnity Agreement, the Guaranty, the Assignment of Leases
and the Assignment of Contracts, Mortgagor has entered into this Mortgage with
Mortgagee to secure, among other things, the payment of the Note, the
obligations and payments of Mortgagor under the Loan Agreement, the Indemnity
Agreement, Assignment of Leases and the Assignment of Contracts, and all of the
advances made and which may be made under the Mortgage covering all of the
interests of Mortgagor in and to the Mortgaged Property (as hereinafter
defined);

      NOW, THEREFORE, the parties hereto agree as follows:

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                                   ARTICLE I

                              SECURED OBLIGATIONS

      1.1 Security. This Mortgage is executed and delivered by Mortgagor to
secure the payment and performance of certain indebtedness, liabilities and
obligations owing and to become owing to or in favor of Mortgagee, as follows:

            1.1.1 The outstanding principal balance of the Note, payable to the
order of Mortgagee in the aggregate original principal amount of TWENTY MILLION
EIGHT HUNDRED SIXTY THOUSAND and 00/100 Dollars ($20,860,000.00), together with
all interest accruing thereon, being payable in the amounts, at the interest
rates and on the dates stipulated therein and in the Loan Agreement, said Note
being dated January 30, 2001;

            1.1.2 Any and all other amounts, liabilities, and obligations for
which or for the performance of which Mortgagor may become indebted or obligated
under the terms of this Mortgage, the Note, the Loan Agreement, the Indemnity
Agreement, the Assignment of Leases, the Assignment of Contracts and any other
documents, instruments, recordings or filings that may hereafter be entered into
by and between Mortgagor and Mortgagee or may be executed and delivered by
Mortgagor on behalf of Mortgagee in connection with the Loan (this Mortgage, the
Note, the Loan Agreement, the Indemnity Agreement, the Assignment of Leases, the
Assignment of Contracts and all such documents, instruments, recordings and
filings are herein collectively referred to as the "Loan Documents", but the
"Subordinate Loan Documents" (as defined in the Loan Agreement) shall not be
included in Loan Documents);

            1.1.3 Any and all renewals, increases, rearrangements,
modifications, supplements, restatements and extensions of the foregoing items
of indebtedness and obligations.

      1.2 Secured Obligations. Each and every item of indebtedness described and
included in this Mortgage is intended to be fully secured by the liens,
assignments, and security interests created under and by virtue of this
Mortgage; and all such items so secured (now or hereafter existing) are
hereinafter collectively called the "Secured Obligations." Secured Obligations
do not, however, include any obligation of Borrower to Lender set forth in the
"Subordinate Loan Documents" or the Tenant Lease (hereinafter defined).

                                   ARTICLE II

                         GRANT OF MORTGAGED PROPERTIES

      2.1 Mortgaged Property. For the purposes and trusts hereinafter set forth,
and for TEN AND 0O/000 DOLLARS ($10.00) and other good and valuable
consideration paid to Mortgagor, the receipt and sufficiency of which are hereby
acknowledged, Mortgagor has GRANTED and by these presents does GRANT unto
Mortgagee, WITH MORTGAGE

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COVENANTS, all the following described property (collectively, the "Mortgaged
Property"), to wit:

            2.1.1 All of Mortgagor's right, title and interest in and to those
certain tracts, pieces and parcels of land described in Exhibit A attached
hereto and hereby made a part hereof (the "Land") (the State in which the Land
is located is sometimes hereinafter referred to as the "Jurisdiction"), as
lessee under the Ground Lease dated as of January 30, 2001, from HILLSIDE
SCHOOL, INC., a Massachusetts non-profit corporation ("Fee Owner"), as landlord,
and Mortgagor as tenant (the "Ground Lease"), a notice of the Ground Lease being
recorded with the Middlesex South District Registry of Deeds herewith;

            2.1.2 All of Mortgagor's right, title and interest in and to all
structures, improvements, buildings and any additions and alterations thereto or
replacements thereof, now or hereafter erected upon the Land (all of the
foregoing being collectively referred to as the "Improvements"), and in
addition, all of Mortgagor's right, title and interest in and to all equipment,
apparatus, furnishings, furniture, machinery, fixtures of every kind and nature
whatsoever (the "Personal Property") now or hereafter located in and about said
Improvements, including without limitation all fixtures, fittings, appliances,
apparatus, equipment, machinery, furnishings and articles of personal property
now or hereafter attached or affixed to, placed upon or used in any way in
connection with the use, enjoyment, operation or occupancy of the Improvements,
including without limitation all landscaping and gardening equipment, all
heating and incinerating apparatus and equipment whatsoever, all boilers,
engines, motors, dynamos, generating equipment, piping and plumbing fixtures,
ranges, cooking utensils and apparatus and mechanical kitchen equipment,
refrigerators, cooling, ventilating, sprinkling and vacuum cleaning systems,
fire extinguishing and prevention apparatus, gas and electrical fixtures,
elevators, escalators, partitions, lockers, cabinets, window covering and all
hardware therefor, carpeting and other floor coverings, lighting fixtures, lamps
and office furniture, window shades, blinds, screens, storm sashes, awnings,
furnishings of public spaces, halls and lobbies and shrubbery and plants, all of
which property mentioned in this paragraph shall be deemed part of the realty
mortgaged hereby (the Land, the Improvements and the Personal Property being
collectively referred to herein as the "Premises"). Notwithstanding the
agreement hereinabove expressed that certain articles of property form a part of
the realty covered by this Mortgage and be appropriated to its use and deemed to
be realty, to the extent that such agreement and declaration may not be
effective and that any of said articles may constitute goods (as said term is
used in the Uniform Commercial Code as enacted in the Jurisdiction), this
instrument shall constitute a security agreement, creating a security interest
in such goods, as collateral, in Mortgagee as a secured party and Mortgagor as
debtor, all in accordance with said Uniform Commercial Code, as more
particularly set forth in Article III hereof;

            2.1.3 All of Mortgagor's estate, of whatever nature, in and to all
of the easements, rights, privileges, appurtenances, air rights and development
rights now or hereafter belonging or in any wise appertaining to the Premises
(the "Appurtenant Rights"), and all of the estate, right, title, interest, claim
or demand whatsoever, either in law or in equity, in possession or expectancy of
Mortgagor therein and in the streets and

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ways, open or proposed, adjacent thereto, and in and to all strips and gores,
vaults, alleyways, sidewalks and passages used in connection with the Land;

            2.1.4 All of Mortgagor's right, title and interest in all reserves
and/or escrow accounts or the like maintained with respect to the Mortgaged
Property and whether held by or in the name of either Mortgagor or Mortgagee,
all inventory accounts, accounts receivable, contract rights, general
intangibles, chattel paper, instruments, documents, Note, drafts, letters of
credit and insurance policies (including without limitation environmental and/or
flood insurance policies) arising from or related to the Premises (collectively,
the "Accounts") and including all replacements and substitutions for, or
additions to, all products and proceeds of any of the foregoing;

            2.1.5 All of Mortgagor's interest in all agreements, contracts,
certificates, instruments and other documents, now or hereafter entered into,
pertaining to the construction, operation or management of the Premises and all
right, title and interest of Mortgagor, therein;

            2.1.6 All unearned premiums accrued or to accrue under all insurance
policies for the Premises obtained by Mortgagor, all proceeds of the conversion,
voluntary or involuntary, of any of the foregoing into cash or liquidated
claims, proceeds of insurance and condemnation awards, and all rights of
Mortgagor to refunds of real estate taxes and assessments with respect to the
Premises (the "Proceeds");

            2.1.7 A non-exclusive right to Mortgagor's right, title and interest
in and to all trade names, trademarks and service marks now or hereafter used in
connection with the Premises or any part thereof or any other part of the
Premises, together with good will appurtenant thereto;

            2.1.8 All of Mortgagor's right, title and interest in and to all
leases, subleases, lettings, licenses and other occupancy agreements, and
guarantees thereof, for the Premises or any part thereof including without
limitation the Lease dated as of January 30, 2001 between Mortgagor, as landlord
and Sepracor, Inc., as tenant (the "Tenant Lease") (collectively, "Leases" and,
individually, a "Lease"), including any cash or other security deposited
thereunder, and the rents, issues, profits, revenue, royalties (collectively the
"Rents") payable under the Leases; the Tenant Lease being a Permitted Exception
(as hereinafter defined);

            2.1.9 All of Mortgagor's right, title and interest in and to all of
the books, computer software, records and files of or relating to the Premises
now or hereafter maintained by Mortgagor or for its account;

            2.1.10 All of Mortgagor's right, title and interest in and to all
awards and claims for damages made and to be made for the taking by eminent
domain of the whole or any part of the Premises, including without limitation
any awards for change of grade of streets, all of which awards Mortgagor hereby
assigns to Mortgagee;

            2.1.11 All of Mortgagor's right, title and interest in and to all
licenses, permits, and warranties attributable, allocable or relating to all or
any portion of the

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Premises, both real and personal, but only to the extent such licenses, permits
and warranties may be assigned, transferred or pledged without violation of the
terms thereof; and

            2.1.12 All of Mortgagor's right, title and interest in and to all
mineral, water, oil and gas rights and privileges and royalties pertaining to
the Premises;

            2.1.13 This Mortgage and the lien hereof (i) is subject and
subordinate to all rights of Sepracor, Inc. in and to the "Specialized Leasehold
Improvements", and (ii) do not encumber or create any security interest in any
personal property owned by Sepracor, Inc. and located in the Improvements.

      TO HAVE AND TO HOLD the Mortgaged Property unto Mortgagee and its
substitutes or successors forever, and Mortgagor does hereby bind itself, its
successors, assigns, executors and administrators to warrant and forever defend
all and singular the Mortgaged Property unto Mortgagee, its successors and
assigns, against every person whomsoever lawfully claiming or to claim an
interest in the same, or any part thereof. Subject only to the specific matters
set forth in Schedule B, Section 2 of the Commitment for Title Insurance issued
by Chicago Title Insurance Company, No. 2051-25071, as approved by Mortgagee,
and any future matters expressly permitted by this Mortgage, the Loan Agreement
or the Assignment of Leases or approved in writing by Mortgagee as permitted
exceptions (collectively, "Permitted Exceptions"). Permitted Exceptions include
taxes which are a lien on the Premises but are not delinquent, and any Leases
permitted under the Assignment of Leases.

      2.2 Release of Mortgage. This conveyance, however, is intended as a
mortgage and security agreement and is made upon the following trust, terms, and
conditions, to wit: In the event Mortgagor shall perform and pay the Secured
Obligations (including payment of all principal and interest, and all charges,
disbursements and fees of Mortgagee's attorneys, if any, owing or to become
owing thereon) to Mortgagee in accordance with the applicable Loan Documents,
then this Mortgage shall be null and void and shall be released at Mortgagor's
sole cost and expense; otherwise this Mortgage shall continue in full force and
effect.

                                  ARTICLE III

                               SECURITY AGREEMENT

      3.1 Grant of Security Interest. Without limiting any of the other
provisions of this Mortgage, Mortgagor, as Debtor (referred to in this Article
III as "Debtor," whether one or more), expressly GRANTS unto Mortgagee, as
Secured Party (referred to in this Article III as "Secured Party," whether one
or more), a security interest in all the Mortgaged Property (including both
those now and those hereafter existing) to the full extent that any portion of
the Mortgaged Property may be subject to the Uniform Commercial Code as enacted
in the Jurisdiction (hereinafter referred to as the "Uniform Commercial Code").

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      3.2 Covenants of Debtor. Debtor covenants and agrees with Secured Party
that:

            3.2.1 In addition to any other remedies granted in this Mortgage to
Secured Party (including specifically, but not limited to, the right to proceed
against the Mortgaged Property in accordance with the rights and remedies in
respect of the Mortgaged Property which are real property pursuant to the
Uniform Commercial Code), Secured Party may, should an Event of Default (as
defined in Article V hereof) occur and be continuing, proceed under the Uniform
Commercial Code as to all or any part of the personal property (tangible or
intangible) and fixtures included in the Mortgaged Property (such portion of the
Mortgaged Property being referred to in this Article III as the "Collateral"),
and shall have and may exercise with respect to the Collateral all the rights,
remedies, and powers of a secured party under the Uniform Commercial Code,
including without limitation the right and power to sell, at one or more public
or private sales, or otherwise dispose of, lease, or utilize the Collateral and
any part or parts thereof in any manner authorized or permitted under the
Uniform Commercial Code after default by a debtor. Without limiting the
foregoing, Secured Party shall have the right upon any such public sale or
sales, and, to the extent permitted by law, upon any such private sale and
sales, to purchase the whole or any part of the Collateral so sold, free of any
right or equity of redemption in Debtor, whether on Land or elsewhere. Debtor
further agrees to allow Secured Party to use or occupy the Mortgaged Property,
without charge, for the purpose of perfecting any of Secured Party's remedies in
respect of the Collateral. The net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all actual expenses
of every kind incurred therein or incidental to the care, safekeeping or
otherwise of any or all of the Collateral or in any way relating to the rights
of Secured Party hereunder, including all attorneys' charges, disbursements and
reasonable fees, shall be received by Secured Party and credited against the
payment in whole or in part of the indebtedness secured hereby. To the extent
permitted by applicable law, Debtor waives all claims, damages, and demands
against Secured Party arising out of the repossession, retention or sale of the
Collateral, except for claims, damages and demands due to the gross negligence
or willful misconduct of Secured Party (including its agents, employees and
contractors) in dealing with such Collateral. Mortgagor agrees that Secured
Party need not give more than ten (10) days' notice of the time and place or any
public sale or of the time at which a private sale will take place and that such
notice is reasonable notification of such matters.

            3.2.2 Debtor hereby authorizes Secured Party to file financing and
continuation statements with respect to the Collateral without the signature of
Debtor whenever lawful, and Debtor irrevocably constitutes and appoints each of
Secured Party, and each of the officers of Secured Party, as Debtor's
attorney-in-fact coupled with an interest for such purpose; and Debtor agrees to
execute such financing and continuation statements as Secured Party may
reasonably request.

            3.2.3 Debtor hereby represents and warrants that no financing
statement (other than financing statements which will be terminated promptly
following the date hereof and financing statements showing Secured Party as the
sole secured party, or with respect to liens or encumbrances, if any, expressly
permitted by this Mortgage covering any of the Collateral or any proceeds
thereof) is on file in any public office except pursuant hereto; and Debtor will
at its own cost and expense, upon demand, furnish to Secured

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Party such further information and will execute and deliver to Secured Party
such financing statements and other documents in form reasonably satisfactory to
Secured Party and will do all such acts as Secured Party may at any time or from
time to time reasonably request or as may be necessary or reasonably appropriate
to establish and maintain a perfected security interest in the Collateral as
security for the Secured Obligations, subject to no other liens or encumbrances,
other than liens or encumbrances benefiting Secured Party and no other party and
to liens and encumbrances (if any) expressly permitted by this Mortgage or the
Loan Agreement; and Debtor will pay the actual expense of filing or recording
such financing statements or other documents, and this instrument, in all public
offices wherever filing or recording is reasonably deemed by Secured Party to be
desirable.

            3.2.4 To the extent permitted by applicable law, the security
interest created hereby is specifically intended to cover all rents, royalties,
issues and profits, and all inventory accounts, accounts receivable and other
revenues of the Mortgaged Property.

            3.2.5 Certain of the Collateral is or will become "fixtures" (as
that term is defined in the Uniform Commercial Code) on the Land and
Improvements, and this Mortgage upon being filed for record in the Middlesex
South District Registry of Deeds shall operate also as a financing statement and
fixture filing upon such of the Collateral which is or may become fixtures.

            3.2.6 Any copy of this Mortgage which is signed by Debtor or any
carbon, photographic or other reproduction of this Mortgage may also serve as a
financing statement under the Uniform Commercial Code by Debtor, whose address
is set forth hereinabove, in favor of Secured Party, whose address is set out
hereinabove.

                                   ARTICLE IV

                      CERTAIN REPRESENTATIONS, WARRANTIES
                           AND COVENANTS OF MORTGAGOR

      Mortgagor hereby represents and warrants to and covenants with Mortgagee
as follows:

      4.1 Payment of Indebtedness. Mortgagor shall (a) punctually pay the
Secured Obligations at the time and place and in the manner specified in the
Loan Documents, according to the true intent and meaning thereof, all in such
coin or currency of the United States of America which at the time of such
payment shall be legal tender for the payment of public and private debts, and
(b) timely, fully and faithfully perform, discharge, observe and comply with
each and all of Mortgagor's obligations to be performed under the Loan
Documents. Mortgagor hereby represents and warrants that, as of the date hereof,
there exist no offsets, counterclaims or defenses against the Secured
Obligations.

      4.2 Title. Mortgagor has and will at all times have (subject to the
further provisions of this Mortgage) a valid and subsisting leasehold estate in
and to the Mortgaged Property as lessee under the Ground Lease, subject to no
lien, pledge,

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mortgage, mechanic's or materialman's lien, deed of trust, security interest,
claim, lease, charge, option, right of first refusal, easement, restrictive
covenant, encumbrance or other restriction, limitation, charge or right of
others of any kind whatsoever (collectively, "Liens"), other than the Permitted
Exceptions. Mortgagor will pay and perform, in timely manner, all obligations of
the tenant under the Ground Lease. This Mortgage is and will at all times remain
a valid and enforceable first lien on such leasehold estate in the Mortgaged
Property, subject only to the Permitted Exceptions. Subject to the Permitted
Exceptions, Mortgagor hereby covenants and agrees that it will preserve such
title, and will forever warrant and defend the same to Mortgagee, its successors
and assigns, and will forever warrant and defend the validity and priority of
the lien of this Mortgage against the claims of all persons and parties
whomsoever.

      4.3 Maintenance of Existence; Due Authorization; Compliance with Laws;
      Etc.

            4.3.1 Mortgagor is and shall remain a limited liability company
validly organized and existing under the laws of The Commonwealth of
Massachusetts, and Mortgagor covenants that it will do or cause to be done all
things necessary to preserve and keep in full force and effect the existence,
rights and privileges of Mortgagor as a limited liability company under the laws
of such commonwealth. Mortgagor now has and shall continue to have the full
right, power and authority to operate and lease the Premises, to encumber the
Mortgaged Property as provided herein and to perform all of the other
obligations to be performed by Mortgagor under the Loan Documents. Mortgagor is
solvent, and no bankruptcy, reorganization, insolvency or similar proceeding
under any state or federal law with respect to Mortgagor has been initiated.

            4.3.2 The execution and delivery of the Loan Documents by the
Mortgagor, and performance by Mortgagor of its obligations thereunder have been
duly authorized by all necessary action on the part of Mortgagor and its
constituent entities, and do not and will not violate any law or any regulation,
order, writ, injunction or decree of any court or governmental or
quasi-governmental body, agency or other instrumentality (collectively,
"Governmental Authorities") applicable to Mortgagor or the Mortgaged Property
(collectively, "Laws"), or result in a breach of any of the terms, conditions or
provisions of, or constitute a default under, or (except as created by this
Mortgage and/or the other Loan Documents) result in the creation or imposition
of any lien of any nature whatsoever upon any of the assets of Mortgagor
pursuant to the terms of, any mortgage, deed of trust, indenture, agreement or
instrument to which Mortgagor is a party or by which it or any of its properties
is bound.

            4.3.3 All authorizations, consents and approvals of, notices to,
registrations or filings with, or other actions in respect of or by any
Governmental Authority, required in connection with (i) the execution and
delivery of the Loan Documents by the Mortgagor have been, or concurrently
herewith will be, duly obtained, given or taken and are in full force and
effect, and (ii) the performance by Mortgagor of its obligations thereunder have
been, or will be in timely manner, duly obtained, given or taken and are, or
will be in timely manner, in full force and effect.

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            4.3.4 No material default has occurred and is continuing under any
indenture or other material agreement or instrument to which Mortgagor is a
party or by which its property is bound, including without limitation the Ground
Lease.

            4.3.5 Mortgagor is and shall remain a single asset entity and agrees
that it will not engage in any activities or acquire any interest in any
property other than the Mortgaged Property (including future Improvements and
Fixtures thereto, if any) without the prior written consent of Mortgagee which
consent may be withheld in Mortgagee's sole discretion.

      4.4 Compliance With Law and Insurance Requirements; Maintaining Permits;
Etc.

            4.4.1 Mortgagor, at no cost or expense to Mortgagee and subject to
the tenant's rights under the Tenant Lease, shall promptly comply with (or cause
to be complied with) in all material regards all Laws, and all orders, rules and
regulations (collectively, "Orders") of the National and Local Boards of Fire
Underwriters or any other body or bodies exercising similar functions, foreseen
or unforeseen, ordinary as well as extraordinary, applicable to the Mortgaged
Property or any part thereof, or to the use or manner of use of the Mortgaged
Property or the owners, tenants or occupants thereof, whether or not any such
Laws or Orders shall necessitate structural changes or improvements or interfere
with the use or enjoyment of the Mortgaged Property. Mortgagor shall also
procure, pay for and maintain (or cause to be procured, paid for and maintained)
all permits, licenses, approvals and other authorizations, necessary for the
operation of its business at the Premises and the lawful use and occupancy of
the Premises, or any part thereof, in connection therewith.

            4.4.2 Mortgagor shall, at no cost or expense to Mortgagee, observe
and comply (or cause to be observed and complied with) in all material respects
with the requirements of the policies of public liability, fire and all other
insurance at any time in force with respect to the Mortgaged Property, and
Mortgagor shall, in the event of any violation or attempted violation of the
provisions of this subsection or subsection 4.4.1 by any occupant of any portion
of the Premises, take steps, immediately upon actual knowledge of such violation
or attempted violation, to remedy or prevent the same, as the case may be.

            4.4.3 Mortgagor shall have the right, with Notice to Mortgagee, to
contest by appropriate legal proceedings, diligently conducted in good faith, in
the name of Mortgagor, the validity or application of any Laws, Orders or other
matters of the nature referred to in subsection 4.4.1, subject to the following:

                  (i) If by the terms of any such Law, Order or other matter,
compliance therewith pending the prosecution of any such proceeding may legally
be delayed without subjecting Mortgagor or Mortgagee to any liability (other
than for the payment or accrual of interest and civil penalties), civil or
criminal, for failure so to comply therewith, or if any lien, charge or civil
liability would be incurred by reason of any such delay, the same would not
subject the Mortgaged Property or any part thereof to forfeiture, loss or
suspension of operations, and Mortgagor (a) furnishes Mortgagee security

                                       9
<PAGE>

reasonably satisfactory to Mortgagee against any loss or injury by reason of
such contest or delay, and (b) prosecutes the contest with due diligence, then
Mortgagor may delay compliance therewith until the final determination of any
such proceeding.

      Mortgagor covenants that Mortgagee shall not suffer or sustain any
liabilities or expenses by reason of any act or thing done or omitted to be done
by Mortgagor pursuant to this subsection and that Mortgagor shall indemnify and
hold harmless Mortgagee from any such liability or expense.

      4.5 Taxes and other Charges; Deposits with Mortgagee.

            4.5.1 Subject to the provisions of Section 4.7 hereof, and subject
to the tenant's rights under the Tenant Lease, Mortgagor, from time to time when
the same shall become due and payable and before any fine, penalty or additional
interest may be added or imposed for late payments, will pay and discharge, or
cause to be paid and discharged, all of the following to the extent that they
are or may become a lien on the Mortgaged Property: taxes of every kind and
nature (including real and personal property taxes and income, franchise,
withholding, profits and gross receipts taxes), all general and special
assessments, levies, permits, inspection and license fees, all water and sewer
rents and charges, and all other public charges, whether of a like or different
nature, and any easement fees or charges, imposed upon or assessed against the
Mortgaged Property or any part thereof or upon the revenues, rents, issues,
income and profits of the Mortgaged Property or arising in respect of the
occupancy, use, possession or sale thereof (collectively, "Impositions"). If any
special assessment is payable in installments without payment of any penalty or
premium, other than interest at a non-default rate prior to the due date of such
installment, then Mortgagor may pay the same in installments. Mortgagor will
deliver to Mortgagee receipts or other evidence reasonably satisfactory to
Mortgagee of the payment of all Impositions promptly after receipt of a specific
request from Mortgagee. Mortgagor shall not claim or demand or be entitled to
any credit or credits on account of the Secured Obligations for any part of the
Impositions, and no deduction shall otherwise be made or claimed from the
taxable value of this Mortgage or the Secured Obligations.

            4.5.2 Except to the extent such matters are obligations of tenant
under the Tenant Lease and the Tenant Lease is not in default, Mortgagee may, at
its option to be exercised at any time, require the monthly deposit by Mortgagor
of an additional amount sufficient to discharge the obligations of Mortgagor
under subsection 4.5.1 above with respect to real and personal property taxes
and assessments when they become due and to pay all of the premiums on any
insurance policies required by this Mortgage. The determination of the amount so
payable and of the fractional part thereof to be deposited with Mortgagee, so
that the aggregate of such deposits shall be sufficient for this purpose, shall
be made by Mortgagee in its reasonable discretion. Such amounts shall be held by
Mortgagee in an interest bearing account and applied to the payment of the
obligations in respect of which such amounts were deposited on or before the
respective dates on which the same or any of them would become delinquent or, at
Mortgagee's option, after an Event of Default, to the payment of any Secured
Obligation in such order and priority as Mortgagee shall determine. Subject to
the tenant's rights under the Tenant Lease, if Mortgagee shall reasonably
determine that the amounts then on deposit therefor shall be insufficient for
the payment of such obligations in full, Mortgagor shall, within ten

                                       10
<PAGE>

business days after demand, deposit the amount of the deficiency with Mortgagee.
Nothing herein contained shall be deemed to affect any right or remedy of
Mortgagee under any provisions of this Mortgage or of any Law to pay any such
amount and to add the amount so paid, together with interest at the Default Rate
(as defined in the Note), to the Secured Obligations.

      4.6 Discharge of Liens. Subject to the tenant's rights under the Tenant
Lease, Mortgagor shall pay, from time to time when the same shall become due,
all claims and demands of mechanics, materialmen, laborers and others which, if
unpaid, would result in or permit the creation of a lien on the Mortgaged
Property or any part thereof, or on the revenues, rents, royalties, issues,
income and profits arising therefrom, and in general will do or cause to be done
everything necessary so that the first lien of the Mortgage shall be fully
preserved at the sole cost and expense of Mortgagor and without expense to
Mortgagee. Subject to the tenant's rights under the Tenant Lease, if any such
liens are filed, Mortgagor will cause the same to be permanently discharged of
record by payment or otherwise, unless Mortgagor shall in good faith and at its
own expense, be contesting such lien or liens or the validity thereof by
appropriate legal proceedings which shall operate to prevent the collection
thereof or other realization thereon or the sale or forfeiture of the Mortgaged
Property or any part thereof to satisfy the same; provided that during such
contest Mortgagor shall provide either (a) an indemnity bond, title insurance or
other security reasonably satisfactory to Mortgagee to cover the amount of the
contested item or items and the amount of the interest and penalties covering
the period through which such proceedings may be expected to last, and in any
event assuring the discharge of Mortgagor's obligation under this Section 4.6
and of any additional charge, penalty or expense arising from or incurred as a
result of such contest; and if Mortgagor shall have posted a bond as security
against payment of any such lien, interest, penalties and other charges related
thereto, Mortgagee shall be named as an additional obligee under the bond; or
(b) title insurance specifically insuring the priority of the lien of this
Mortgage over such lien (but such title insurance shall be sufficient only
during the period of such contest). Except as provided above, Mortgagor will not
directly or indirectly create, incur or suffer to exist any lien on the
Mortgaged Property or any part thereof (including without limitation any lien
securing the repayment of a loan made to Mortgagor by any partner(s),
shareholder(s), officer(s), director(s) or trustee(s) of Mortgagor), whether or
not junior to the lien of this Mortgage, other than the Permitted Exceptions,
such other documents as may be executed as further security for the Note or in
favor of Mortgagee, and such other matters (if any) as may be expressly
permitted by the provisions of any Loan Document or as may be approved by
Mortgagee.

      4.7 Contest of Impositions. Nothing in Section 4.5 shall require the
payment or discharge of any Imposition so long as Mortgagor or the tenant under
the Tenant Lease shall in good faith and at its own expense, contest the same or
the validity thereof by appropriate legal proceedings which shall operate to
prevent the collection thereof or other realization thereon or the sale or
forfeiture of the Mortgaged Property or any part thereof to satisfy the same;
provided that during such contest Mortgagor shall provide security reasonably
satisfactory to Mortgagee to cover the amount of the contested item or items and
the amount of the interest and penalties covering the period through which such
proceedings may be expected to last, and in any event assuring the discharge of
Mortgagor's obligation under this Section 4.7 and of any additional charge,
penalty or

                                       11
<PAGE>

expense arising from or incurred as a result of such contest. If Mortgagor shall
have posted a bond as security against payment of any Imposition, interest,
penalties and other charges related thereto, Mortgagee shall be named as an
additional obligee under the bond.

      4.8 Mortgagee's Taxes. Mortgagor will pay all Massachusetts taxes incurred
by Mortgagee by reason of Mortgagee's ownership of the Note, this Mortgage or
any other Loan Document, including without limitation all real estate transfer
and like taxes imposed in connection with a transfer of ownership of all or a
portion of the Mortgaged Property pursuant to a foreclosure, a deed in lieu of
foreclosure or otherwise. Notwithstanding the foregoing, Mortgagor shall not be
required to pay any net income or franchise taxes imposed on Mortgagee or any
taxes incurred due to an assignment of the Loan Documents or any interest
therein by Mortgagee or its successors and/or assigns.

      4.9 Use of Mortgaged Property. Mortgagor will maintain, preserve and renew
from time to time such rights of way, easements, grants, privileges, licenses
and franchises as are necessary for the use and operation of the Mortgaged
Property for Permitted Purposes (as hereafter defined), and will not use or
operate, or permit the use or operation of, the Mortgaged Property for any other
purpose without the consent of the Mortgagee, subject to the provisions of
Section 7.18, or initiate, join in or consent to any new private restrictive
covenant (apart from any Permitted Exception) easement or other public or
private restrictions to the use of the Mortgaged Property, without the consent
in each instance of Mortgagee, subject to the provisions of Section 7.18, and
except for the contemplated development activities as set forth in the Loan
Agreement. Mortgagor shall, moreover, comply in all material respects with all
lawful and restrictive covenants which may at any time affect the Mortgaged
Property and with zoning ordinances and other private or public restrictions as
to the use thereof. Mortgagor will not cause or maintain any nuisance in, at or
on the Mortgaged Property. Mortgagor will pay or cause to be paid all charges
for all public and private utility services, all public or private rail and
highway services (if any), all public or private communications services and all
sprinkler systems and protective services at any time rendered to or in
connection with the Mortgaged Property or any part thereof, will comply in all
material respects or use reasonable efforts to cause compliance with all
contracts relating to any such services, and will do all other things required
for the maintenance and continuance of all such services. However, Mortgagor
will not be required to pay or cause to be paid such charges if incurred by
third parties (such as tenants) unless the failure to pay such charges would
result in a lien on the Mortgaged Property. "Permitted Purposes" means general
office use, research and development and laboratory use, uses permitted by the
Tenant Lease and any other Lease specifically approved by Lender, parking and
storage relating to the foregoing, and other incidental uses related to the
foregoing uses; provided, however, that the foregoing shall be limited to uses
which are in compliance with all applicable laws, regulations, governmental
permits and/or approvals and the provisions of any insurance policies maintained
with respect to the Mortgaged Property; and provided further that "Permitted
Purposes" shall mean any lawful use subsequent to a termination of the Tenant
Lease.

      4.10 Maintenance of Mortgaged Property. Except as provided in or permitted
by the Loan Agreement, Mortgagor shall maintain or cause to be maintained the
Mortgaged Property, including all streets, sidewalks and curbs comprising same,
in good repair and condition, and will continuously (other than during periods
of repair after casualty or

                                       12
<PAGE>

condemnation, with respect to the portions of the Mortgaged Property damaged or
condemned) operate the Mortgaged Property only for Permitted Purposes, and, at
no cost or expense to Mortgagee, will make or cause to be made, as and when the
same shall become necessary, all structural and non-structural, exterior and
interior, ordinary or extraordinary, foreseen and unforeseen repairs, renewals
and replacements necessary to that end, and upon being apprised of any material
defect in the repair or condition of the Mortgaged Property, will repair or
cure, or cause to be repaired or cured, such defect, in each case with due
diligence and no cost or expense to Mortgagee. All such repairs, renewals and
replacements shall be at least substantially equal in quality to the original
Improvements. To the extent that the Tenant Lease requires that all or any of
the foregoing obligations be performed by the tenant thereunder, Mortgagor shall
be relieved of such obligations hereunder for so long as the Tenant Lease shall
be in effect.

      4.11 Maintenance of Personal Property. Mortgagor shall cause the
Improvements to be equipped with the Personal Property as, to the extent and in
the manner, as shall be necessary, appropriate or required for the operation of
the Premises. Except where appropriate replacements, free of superior liens, are
promptly made of a value at least equal to the value of the Personal Property
being removed, no Personal Property covered hereunder with a value of more than
$10,000 shall be permanently removed from the Premises without the consent of
Mortgagee, subject to the provisions of Section 7.18. The Personal Property so
disposed of shall be promptly replaced by Personal Property of the same
character and of at least equal usefulness and quality. Mortgagor shall not be
required to replace any item of Personal Property which has become unnecessary
or inappropriate for the operation or maintenance of the Premises. To the extent
that the Tenant Lease requires that all or any of the foregoing obligations be
performed by the tenant thereunder, Mortgagor shall be relieved of such
obligations hereunder for so long as the Tenant Lease shall be in effect.

      4.12 Alterations. Except as provided in or permitted by the Loan
Agreement, or the Tenant Lease, Mortgagor shall not, without the consent of
Mortgagee, construct any new Improvements on the Premises other than those which
are permitted by the following provisions of this Section 4.12. Mortgagor shall
give Mortgagee Notice of, and a copy of any plans prepared for any alteration
(excluding, however, tenant improvements unless they involve structural work)
which is reasonably estimated to cost $1,000,000 (the "Alteration Threshold")
(inclusive of architectural and engineering fees) or is structural. So long as
no Event of Default shall have occurred and be continuing hereunder, Mortgagor
shall have the right at any time and from time to time to make or cause to be
made reasonable alterations of and additions to the Mortgaged Property or any
part thereof, provided that any alteration or addition (i) shall not change the
general character of the Mortgaged Property, or reduce the fair market value
thereof below its fair market value immediately before such alteration or
addition, or otherwise materially and adversely alter the overall quality of the
Mortgaged Property, (ii) shall be effected with due diligence, in a good and
workmanlike manner and with first-class materials and in compliance in all
material respects with all requirements of applicable Laws, (iii) shall (subject
to Mortgagor's right to contest the same in accordance with the provisions of
Section 4.6 hereof) be promptly and fully paid for, or caused to be paid for, by
Mortgagor at no cost or expense to Mortgagee, if failure to make such payment
would result in a lien on the Mortgaged Property, and (iv) shall be made, in
case the estimated cost of such alteration or addition (excluding,

                                       13
<PAGE>

however, tenant improvements unless they involve structural work) exceeds the
Alteration Threshold, (1) only after Mortgagee shall have consented thereto
prior to the commencement of such work and in all material respects in
accordance with plans and specifications reasonably satisfactory to Mortgagee,
(2) only after Mortgagor shall have furnished to Mortgagee a completion or
performance bond, a letter of credit or cash deposit or other security
reasonably satisfactory to Mortgagee as security for the completion of such
work, and (3) if structural, only after submission of appropriate plans to
Mortgagee and approval thereof by Mortgagee (such approval not to be
unreasonably withheld or delayed). For purposes of clause (iv) of this
subsection, the Alteration Threshold limitation shall apply to any alteration or
addition taken separately or, if such alteration or addition is made together
with other alterations or additions that constitute a single construction plan
or project (whether accomplished in successive stages or procedures), then taken
in the aggregate as well. The cost of all such alterations and additions to the
Mortgaged Property shall be paid in cash or its equivalent, so that the
Mortgaged Property shall at all times be free of liens for labor and materials
supplied or claimed to have been supplied to the Mortgaged Property (subject to
Mortgagor's rights of contest provided for in Section 4.6 hereof). All
alterations of and additions to the Mortgaged Property shall immediately become
and shall remain a part of the Mortgaged Property, and shall be subject to the
lien of this Mortgage; but tenant improvements shall also be subject to the
rights therein of the relevant tenants. To the extent that the Tenant Lease
requires that all or any of the foregoing obligations be performed by the tenant
thereunder, Mortgagor shall be relieved of such obligations hereunder for so
long as the Tenant Lease shall be in effect.

      4.13 Waste; No Impairment. Mortgagor shall not commit or suffer any waste
of the Mortgaged Property, or do or permit to be done thereon anything that may
in any way materially impair the security of this Mortgage.

      4.14.Insurance.

            4.14.1 Mortgagor shall effect and maintain, or cause to be
maintained, insurance for Mortgagor and the Mortgaged Property providing at
least the following coverages:

            (i) comprehensive all risk insurance on the Improvements and the
Personal Property, including coverage against loss or damage by fire, collapse,
lightning, windstorm, tornado, hail, vandalism and malicious mischief,
electrical short circuit, sprinkler leakage, water damage, back-up of sewers and
drains, bursting water mains, debris removal, and against loss or damage by such
other, further and additional risks as now are or hereafter may be embraced by
the standard extended coverage forms of endorsements, in each case (A) in an
amount equal to 100% of their "Full Replacement Cost," which for purposes of
this Mortgage shall mean actual replacement value (exclusive of costs of
excavations, foundations, underground utilities and footings); (B) containing an
agreed amount endorsement with respect to the Improvements and Personal Property
waiving all co-insurance provisions; (C) containing an endorsement that all
covered losses will be paid on a replacement cost basis, which shall mean the
actual cost to repair or without deduction for depreciation; and (D) providing
for no deductible in excess of $25,000.

                                       14
<PAGE>

            (ii) Commercial General Liability insurance against claims for
personal injury or bodily injury including death or property damage occurring
upon, in or about the Premises, occurring as a result of construction and use
and occupancy of facilities located in or on the Premises or as a result of the
construction thereof, such insurance to (A) be on the so-called "occurrence"
form with a combined single limit and appropriate annual aggregate limitations;
(B) afford immediate protection at the date hereof to the limit of not less than
$2,000,000 in respect of each personal injury, bodily injury or death to any
person, to the limit of not less than $5,000,000 in respect of any one
occurrence, and to the limit of not less than $1,000,000 in respect of any one
occurrence for property damage (the foregoing limits may be achieved through
so-called "umbrella" coverage); and (C) continue at not less than the said
limits until required to be changed by Mortgagee, by Notice to Mortgagor, by
reason of changed economic conditions making such protection inadequate;

            (iii) as and if available at commercially reasonable rates, business
interruption insurance or, as the case may be, rental loss insurance, (A) with
loss payable to Mortgagee; (B) covering all risks required to be covered by the
insurance provided for in subdivision (i) above; (C) containing an agreed amount
endorsement waiving all co-insurance provisions; (D) agreeing to pay for losses
whether the Premises are open to the public or not; and (E) in an amount equal
to 100% of the projected gross income from the Premises for a period of twelve
(12) months. The amount of such business interruption insurance shall be
determined prior to the date hereof and at least once each year thereafter based
on Mortgagor's reasonable estimate of the gross income from the Premises for the
succeeding twelve-month period. In the event that all or any portion of the
Premises shall be damaged or destroyed, Mortgagor shall and hereby does assign
to Mortgagee all claims under the policies of such insurance, and all amounts
payable thereunder, and all net amounts, when collected by Mortgagee under such
policies, shall be held in trust by Mortgagee and shall be applied to taxes,
insurance premiums, other operating expenses of the Premises which are
obligations of Mortgagor and to any other Secured Obligations from time to time
due and payable hereunder and under the Note; provided, however, that nothing
herein contained shall be deemed to relieve Mortgagor of its obligations to pay
the Secured Obligations on the respective dates of payment provided for in the
Note except to the extent such amounts are actually paid out of the proceeds of
such business interruption insurance;

            (iv) at all times when required due to construction, structural
repairs or alterations with respect to the Improvements (A) owner's contingent
or protective liability insurance covering claims not covered by or under the
terms or provisions of the above mentioned Commercial General Public Liability
insurance policy; and (B) the insurance provided for in subdivision (i) of this
subsection written in a so-called builder's risk completed value form (1) on a
non-reporting basis, (2) against all risks insured against pursuant to
subdivision (i) of this subsection, and (3)including permission to occupy the
Premises and with an agreed amount endorsement waiving co-insurance;

            (v) workers' compensation, subject to the statutory limits of the
Jurisdiction, and employer's liability insurance with a limit of at least
$1,000,000.00 per accident, disease per employee, and disease aggregate, in
respect of any work or operations on, about, or in connection with, the
Mortgaged Property (if applicable);

                                       15
<PAGE>

            (vi) comprehensive boiler and machinery insurance, in such amounts
as shall be reasonably required by Mortgagee; and

            (vii) such other insurance and in such amounts as Mortgagee from
time to time may reasonably request against such other insurable hazards which
at the time are commonly insured against in respect of property similar to the
Premises located in or around the greater Boston area.

            4.14.2 All insurance provided for in subsection 4.14.1 hereof shall
be effected under valid and enforceable policies, in such forms and, from time
to time after the date hereof, in such amounts as may from time to time be
reasonably satisfactory to Mortgagee, issued by financially sound and
responsible insurance companies authorized to do business in the Jurisdiction as
approved admitted or unadmitted carriers which have been approved by Mortgagee
said carriers to be rated A- or better for claims paying ability by A. M. Best &
Co. unless Mortgagee has consented to a different rating, subject to the
provisions of Sections 7.18 hereof. Prior to the date hereof, and thereafter not
less than thirty (30) days prior to the expiration dates of the policies
theretofore furnished to Mortgagee pursuant to subsection 4.14.1, certified
copies of the policies accompanied by evidence satisfactory to Mortgagee of
payment of the first installment of the premiums, shall be delivered by
Mortgagor to Mortgagee; provided, however, that in the case of renewal policies,
Mortgagor may furnish Mortgagee with binders therefor to be followed by
certified copies of the policies when issued.

            4.14.3 Mortgagor shall not take out (1) separate insurance
concurrent in form or contributing in the event of loss with that required in
subsection 4.14.1 to be furnished by, or which may be reasonably required to be
furnished by, Mortgagor, or (2) any casualty policy intended to provide any
coverage from time to time required hereunder with respect to the Mortgaged
Property unless, in each case, Mortgagee is included therein as an insured, with
loss payable as in this Mortgage provided. Mortgagor shall immediately notify
Mortgagee of the taking out of any such separate insurance or umbrella or
blanket policy by it and shall cause certified copies of the policies therefor
to be delivered as required in subsection 4.14.1. Any blanket insurance policy
shall specifically allocate to the Mortgaged Property the amount of coverage
from time to time required hereunder and shall otherwise provide the same
protection as would a separate policy insuring only the Mortgaged Property in
compliance with the provisions of subsection 4.14.1.

            4.14.4 All policies of insurance provided for or contemplated by
subsection 4.14.1 shall name Mortgagee and Mortgagor, as the insured or
additional insured, as their respective interests may appear, and in the case of
property damage insurance, shall contain a so-called New York standard mortgagee
clause in favor of Mortgagee providing that the loss thereunder shall be payable
to Mortgagee.

            4.14.5 All policies of insurance provided for in subsection 4.14.1
hereof shall contain clauses or endorsements to the effect that:

            (i) no act or negligence of Mortgagor, or anyone acting for
Mortgagor, or of any tenant under any Lease or other occupant or failure to
comply with the provisions of any policy which might otherwise result in a
forfeiture of such insurance or any part

                                       16
<PAGE>

thereof shall in any way affect the validity or enforceability of such insurance
insofar as Mortgagee is concerned;

            (ii) such policies shall not be materially changed (other than to
increase the coverage provided thereby) canceled or non-renewed without at least
30 days' written notice to Mortgagee; and

            (iii) Mortgagee shall not be liable for any premiums thereon or
subject to any assessments thereunder.

            4.14.6 Claims under each policy of insurance provided for or
contemplated by subsection 4.14.1 (excluding third party liability, Workers
Compensation and Employers liability insurance) in excess of $500,000 shall be
adjusted with the insurers and/or underwriters by Mortgagee and Mortgagor,
respectively (provided that, so long as no Event of Default shall then have
occurred and be continuing, Mortgagee agrees that it shall not settle any such
claims without Mortgagor's consent (not to be unreasonably withheld, conditioned
or delayed), and Mortgagor shall (subject to Mortgagee's reasonable discretion)
be entitled to lead all negotiations with insurers and underwriters in
connection with such claims). Any such claims which do not exceed $500,000
shall, so long as no Event of Default exists hereunder, be adjusted by
Mortgagor. All costs and expenses of collecting or recovering any insurance
proceeds under such policies (including without limitation the actual and
reasonable out-of-pocket expenses incurred by Mortgagee, if any), including
without limitation any and all reasonable fees of attorneys, appraisers and
adjusters, shall be paid by Mortgagor.

            4.14.7 To the extent that the Tenant Lease requires that all or any
of the foregoing obligations be performed by the tenant thereunder, Mortgagor
shall be relieved of such obligations hereunder for so long as the Tenant Lease
shall be in effect.

      4.15 Damage or Destruction.

            4.15.1 In the event of any damage to or destruction of the Premises
for which the cost of repair might reasonably be expected to exceed $500,000,
Mortgagor shall, promptly after obtaining knowledge of the occurrence thereof,
give notice thereof to Mortgagee and shall, regardless of the dollar amount of
such damage, proceed with reasonable diligence, at Mortgagor's sole cost and
expense, to repair and restore or cause to be repaired or restored the Premises
or the portion thereof so damaged as nearly as practically possible to the
condition the same were in immediately prior to such damage. If any Personal
Property is damaged or lost as a result of such fire or other casualty,
Mortgagor shall likewise, at its sole cost and expense, whether or not any
insurance proceeds are available or adequate for such purpose, replace or cause
to be replaced the Personal Property so damaged or lost. In the event that
Mortgagor fails to advance any funds required for the completion of any such
repairs or restoration, Mortgagee may, but shall not be obligated to, advance
the required funds or any portion thereof, and Mortgagor shall, on demand,
reimburse Mortgagee for all sums advanced and actual expenses incurred by
Mortgagee in connection therewith, together with interest thereon at the Default
Rate (as defined in the Note) from the date each such advance is made to the
date of receipt by Mortgagee of reimbursement from Mortgagor, which amounts and
interest

                                       17
<PAGE>

shall become part of the Secured Obligations and be secured hereby. All repairs
and restoration required to be made by Mortgagor hereunder shall be performed in
material compliance with all Laws and Orders and shall be without any liability
or actual expense of any kind to Mortgagee. Notwithstanding the foregoing,
Mortgagor should not be obligated to repair, restore or replace the Premises
and/or Personal Property in the event that (i) Mortgagee requires (pursuant to
clause (A) of Section 4.15.2(ii)) the application of insurance proceeds to the
payment of Secured Obligations at a time when no Event of Default has occurred
and is continuing or (ii) Mortgagor elects not to restore pursuant to Section
4.15.2(iii).

            4.15.2 If by reason of any damage or destruction, any insurance
proceeds are paid under any insurance policy maintained pursuant to subsection
4.14.1 hereof or otherwise (other than business interruption insurance proceeds
or, as the case may be, rental loss insurance proceeds, which shall be paid as
provided in clause (iii) of subsection 4.14.1), such proceeds shall be paid as
follows:

            (i) If the aggregate insurance proceeds received by reason of any
single instance of damage or destruction shall not exceed $500,000, such
insurance proceeds shall be paid over to Mortgagor, and Mortgagor shall hold the
same as a trust fund, to be used first for the payment of the entire cost of
repairing and restoring the Premises and/or Personal Property and the balance
thereof shall be paid to the Mortgagor; provided, however, that, if any Event of
Default shall exist hereunder at the time all such insurance proceeds are so to
be paid over to Mortgagor, or if Mortgagee shall have accelerated the Secured
Obligations, all such insurance proceeds (in whatever amount) shall be paid over
to Mortgagee and not to Mortgagor for application pursuant to clause (B) below.

            (ii) If the aggregate insurance proceeds received by reason of any
single instance of damage or destruction shall exceed $500,000, such insurance
proceeds shall be paid over to Mortgagee and held in an interest-bearing
account. The Mortgagee shall apply such insurance proceeds to the repair and
restoration of the Mortgaged Property by disbursing the same to Mortgagor on a
periodic basis and with such retainage (not to exceed 10%) as Mortgagee
reasonably shall deem appropriate, but no more frequently than monthly, as the
repair and restoration work progresses, upon receipt by Mortgagee of such
guaranties of completion (from Mortgagor and/or other third parties acceptable
to Mortgagee), surety bonds, requisitions, architect's certificates and title
updates as Mortgagee shall in its good faith discretion require (including
without limitation requiring Mortgagor, inter alia, to provide to Mortgagee for
its approval appropriate plans and specifications and budgets, and to show that
there are at all times sufficient funds (in addition to the available insurance
proceeds, as the case may be) available for the completion of the repair and
restoration in question and to pay all amounts due under this Mortgage and the
Note during such repair and restoration). All amounts held by Mortgagee as
retainage shall be paid to Mortgagor upon substantial completion of the repair
and restoration work. If any excess proceeds shall remain after the repair and
restoration work has been completed and paid for in full out of such insurance
proceeds, such excess proceeds shall be paid to Mortgagor if the Premises have
been restored to their condition prior to such change or destruction, but
otherwise such excess proceeds shall be retained by Mortgagee and applied to the
partial prepayment of the Note, at par. Interest earned on insurance proceeds
while held by Mortgagee shall be added to the amount of

                                       18
<PAGE>

such insurance proceeds. If while any such insurance proceeds are held by
Mortgagee an Event of Default shall have occurred and be continuing or Mortgagee
shall have accelerated the Secured Obligations, Mortgagee shall have no duty to
make advances to Mortgagor as provided for in this clause (ii).

            4.15.3 No destruction of or damage to the Mortgaged Property, or any
part thereof, by fire or other casualty whatsoever, whether such damage or
destruction be partial or total or otherwise, shall relieve Mortgagor from its
liability to pay in full as and when due the Secured Obligations, or from
timely, fully and faithfully performing all its other obligations hereunder and
under the Loan Documents. No application of insurance proceeds to the reduction
of the Secured Obligations shall have the effect of releasing the lien of this
Mortgage from all or any portion of the Mortgaged Property until and unless all
of the Secured Obligations have been paid in full.

            4.15.4 For so long as the Tenant Lease shall be in effect and not in
default, if and to the extent that the provisions of the Tenant Lease are
inconsistent with the provisions of this Section 4.15, such provisions of the
Tenant Lease shall govern, including without limitation, that if the tenant
under the Tenant Lease is required to restore the Premises under the Tenant
Lease, the Mortgagee shall make insurance proceeds available for such purpose.

      4.16 Condemnation; Knowledge of Proceedings.

            4.16.1 Mortgagor, promptly upon obtaining knowledge of the
institution or pending institution of any proceedings for the condemnation of
the Mortgaged Property or any material portion thereof, shall notify Mortgagee
thereof, and Mortgagee may participate in any such proceedings and be
represented by counsel of its selection. Mortgagor shall not make any agreement
in lieu of condemnation of the Mortgaged Property or any portion thereof without
the prior written consent of Mortgagee in each instance, which consent shall not
be (i) unreasonably withheld or delayed in the case of the taking of any
insubstantial portion of the Mortgaged Property or (ii) withheld or delayed if
the Secured Obligations will be paid in full from the net condemnation proceeds.
In the event of the condemnation of the Mortgaged Property, or any portion
thereof, any awards for condemnation or payments in lieu thereof are hereby
assigned and shall be paid to Mortgagee.

            4.16.2 In the event that Mortgagee shall determine in its good faith
judgment after an event of condemnation that the taking of the Mortgaged
Property was so extensive as to make continued operation thereof after
restoration not commercially viable, all of the Secured Obligations shall become
immediately due and payable, and any awards for condemnation or payments in lieu
thereof shall be paid over to Mortgagee and applied in reduction of the Secured
Obligations in such order as Mortgagee may determine in its discretion, but
without any prepayment premium, and any excess shall be paid to Mortgagor. Any
remaining Secured Obligations shall be prepaid by Mortgagor without any
prepayment premium. Otherwise, whether or not any condemnation proceeds are
available therefor, Mortgagor shall proceed with reasonable diligence, at
Mortgagor's sole cost and expense, to repair and restore or cause to be repaired
or restored the Mortgaged Property into an architectural and commercially viable
premises comparable to or better

                                       19
<PAGE>

than (to the greatest extent possible) the previously existing structure, with
such additional improvements as Mortgagor may elect to add. In the case of a
condemnation which is not so extensive as to make continued operation of the
Mortgaged Property after restoration not commercially viable, the Mortgagee
shall hold the condemnation proceeds in an interest bearing account and apply
such proceeds to the repair and restoration of the Mortgaged Property by
disbursing the same to Mortgagor on a periodic basis and with such retainage
(not to exceed 10%) as Mortgagee reasonably shall deem appropriate, but no more
frequently than monthly, as the repair and restoration work progresses, and upon
receipt by Mortgagee of such guaranties of completion, surety bonds,
requisitions, architect's certificates and title updates as Mortgagee shall in
its good faith discretion require (including without limitation requiring
Mortgagor to show that there are at all times sufficient funds (in addition to
the available condemnation proceeds, as the case may be) available for the
repair and restoration in question). Provided that Mortgagee shall not have
elected to cause the acceleration of the Secured Obligations pursuant to the
first sentence of this subsection, in the event that Mortgagor fails to make any
payment in respect of any such repairs and restorations, Mortgagee may, but
shall not be obligated to, advance funds required for the completion of such
repairs or restoration, and Mortgagor shall, on demand, reimburse Mortgagee for
all sums advanced and expenses actually incurred by Mortgagee in connection
therewith (including without limitation the charges, disbursements and
reasonable fees of Mortgagee's counsel), together with interest thereon at the
Default Rate (as defined in the Note) from the date each such advance is made or
expense paid by Mortgagee until the date on which repayment thereof is received
by Mortgagee, which amounts and the interest thereon shall become part of the
Secured Obligations and be secured hereby. All amounts held by Mortgagee as
retainage shall be paid to Mortgagor upon substantial completion of the repair
and restoration work. In the event that there are surplus proceeds of any award
for condemnation or payments in lieu thereof, all such surplus proceeds shall be
paid over to and/or retained by Mortgagee and shall be applied in accordance
with the Loan Agreement.

            4.16.3 Notwithstanding any taking by public or quasi-public
authority through eminent domain or otherwise, Mortgagor agrees to continue to
pay all amounts due in respect of the Secured Obligations, which shall not be
reduced until any award or payment therefor shall have been actually received by
Mortgagee for application to the discharge of the Secured Obligations in
accordance with the Loan Agreement. No application of the proceeds of any award
for condemnation or payments in lieu thereof to the reduction of the Secured
Obligations shall have the effect of releasing the lien of this Mortgage from
the portion, if any, of the Mortgaged Property not taken until and unless the
principal sum secured hereby, the interest thereon and the remainder of the
Secured Obligations have been paid in full.

            4.16.4 In the event of any temporary taking of the Mortgaged
Property or any portion thereof in condemnation or by eminent domain, Mortgagor
shall continue to pay all principal, interest and other sums and charges secured
hereby when due and payable under the Note and the other Loan Documents and, so
long as there has occurred no Event of Default, receive the proceeds of any
award for a temporary taking; provided, however, that if any award payable to
Mortgagor on account of such taking is made in a lump sum or is payable other
than in equal monthly installments, then the award shall be paid over to
Mortgagee (who shall hold the same in an interest bearing account) and

                                       20
<PAGE>

applied by Mortgagee to the payment of each monthly installment of interest and
principal due under the Note and all of the other Secured Obligations as and
when the same become due and payable; and provided, further, that the excess (if
any) of such award received by Mortgagee over such monthly installment of
interest and other Secured Obligations falling due for the entire period with
respect to which such award was paid shall, monthly, be paid to or on behalf of
Mortgagor for use solely in paying, with respect to the Premises, real estate
and personal property taxes, insurance premiums, labor charges, repairs,
utilities, accounting and legal expenses and other operating expenses; and
provided further, that any unapplied portion of such award held by Mortgagee
when such taking ceases or expires, or after all of the Secured Obligations
shall have been paid in full (whichever first occurs), plus any interest accrued
thereon, shall be repaid to Mortgagor. If while the proceeds of any such award
are held by Mortgagee an Event of Default shall have occurred and be continuing,
or Mortgagee shall have accelerated the Secured Obligations, Mortgagee may apply
such proceeds in reduction of the Secured Obligations in such order and priority
as Mortgagee shall in its discretion determine.

            4.16.5 For so long as the Tenant Lease shall be in effect, if and to
the extent that the provisions of the Tenant Lease are inconsistent with the
provisions of this Section 4.16, such provisions of the Tenant Lease shall
govern.

      4.17 General Right of Entry. Mortgagor agrees that it will permit
Mortgagee from time to time upon reasonable advance notice (not exceeding one
business day) and during regular business hours (or upon occurrence of any
emergency situation, without advance notice and at any time), but subject to the
rights of tenants under their leases, to enter upon and inspect the Mortgaged
Property to determine its compliance with the requirements of this Mortgage and
the other Loan Documents and to ascertain its condition.

      4.18 Separate Tax Lots. Mortgagor agrees that if and to the extent the
Mortgaged Property is not assessed for real estate tax purposes as a wholly
independent tax lot (or lots), separate from any adjoining land or improvements
not constituting a part of such lot or lots, it will enter into, or cause to be
entered into, a tax sharing agreement (or agreements), reasonably satisfactory
in form and substance to Mortgagee, with the respect to the party or parties
responsible for paying real estate taxes as to any such adjacent land or
improvements.

      4.19 Books of Account; Financial Statements.

            4.19.1 Mortgagor will keep adequate records and books of account of
Mortgagor and the Premises at the principal office of Mortgagor or the
management agent for the Premises in accordance with generally accepted
accounting principles, tax accounting principles or other sound accounting
principles consistently applied reflecting all financial transactions of the
Mortgagor in respect of the Mortgaged Property and will permit Mortgagee (at the
cost and expense of Mortgagee unless an error in excess of 5% of net operating
income is discovered in which event the cost of such examination shall be borne
by Mortgagor), by its agents, accountants and attorneys, to visit the Mortgaged
Property and the office of Mortgagor and examine and make copies and extracts of
Mortgagor's records and books of account and to discuss Mortgagor's affairs,
finances and

                                       21
<PAGE>

accounts with the officers of Mortgagor and its accountants, at such reasonable
times during business hours with reasonable advance notice (which may be by
telephone) of not less than one business day. Promptly upon demand by Mortgagee,
but not more than once in any twelve (12) month period, the Mortgagor, shall use
reasonable efforts to cause to be delivered to Mortgagee reports established
and/or maintained by any rating agency and/or credit verification organization
designated by Mortgagee (collectively, the "Credit Agencies") with respect to
the credit status and/or financial condition of, and/or history of default with
respect to credit transactions by, Mortgagor and/or the Guarantors (as defined
in Section 7.9) (collectively the "Credit Reports") and Mortgagor hereby
expressly grants to Mortgagee the right, license and privilege to obtain the
Credit Reports directly from the Credit Agencies at Mortgagee's cost.

            4.19.2 Mortgagor covenants that it will, at its own expense, deliver
to the Mortgagee, within (10) ten days after any request by Mortgagee (which
request shall reference this subsection and such ten (10) day requirement) a
written certificate, in recordable form, setting forth to its knowledge the
amount then due under this Mortgage and whether to its knowledge any offsets or
defenses exist against the indebtedness secured hereby; and, if any such offsets
or defenses are alleged to exist, then the nature of such offsets or defenses.
Such certificate shall also contain a statement that the Mortgagor has no
knowledge of the occurrence of any Event of Default nor of any other event,
which, with the giving of notice or passage of time, or both, would constitute
an Event of Default which has occurred and remains uncured as of the date of
such certificate; or, if any such Event of Default or other default has occurred
and remains uncured as of the date of such certificate, then such certificate
shall contain a statement specifying the nature thereof, the time for which the
same has continued and the action which the Mortgagor has taken or proposes to
take with respect thereto and setting forth or describing such additional
matters with respect to the Mortgagor, Loan or the Mortgaged Property as the
Mortgagee shall reasonably request and such additional information as the
Mortgagee may reasonably request. Such certificate shall be certified to, and
may be relied upon by, such parties as the Mortgagee shall direct.

            4.19.3 Mortgagor will deliver to Mortgagee within ninety (90) days
after the close of its respective fiscal year its balance sheets and statements
of profit and loss setting forth in comparative form, figures for the preceding
year reviewed or audited by a reputable certified public accounting firm.
Mortgagor shall also deliver within ninety (90) days after the close of the
calendar year an annual operating statement for Mortgaged Property setting
forth, in comparative form, figures for the preceding year, and a schedule
showing all Leases (excluding subleases) and basic information with respect
thereto in form approved by Mortgagor and Mortgagee as part of the application
by Mortgagor for the loan secured hereby, in each case certified by a principal
financial or accounting officer of Mortgagor. Throughout the term of this
Mortgage, Mortgagor, with reasonable promptness, will deliver to Mortgagee such
other information with respect to Mortgagor as Mortgagee may reasonably request
from time to time. All financial statements of Mortgagor shall be prepared in a
manner reasonably satisfactory to Mortgagee shall be delivered in duplicate, and
in the case of Mortgagor, shall be accompanied by the certificate of a principal
financial or accounting officer of Mortgagor, dated within five (5) days of the
delivery of such statements to Mortgagee, stating that such financial statements
are, to the best of such officer's knowledge after diligent inquiry, true and
correct and that he/she

                                       22
<PAGE>

knows of no Event of Default, nor of any default which after notice or lapse of
time or both would constitute an Event of Default, which has occurred and is
continuing, or, if any such default or Event of Default has occurred and is
continuing, specifying the nature and period of existence thereof and what
action Mortgagor has taken or proposes to take with respect thereto, and, except
as otherwise specified, stating that, to the best of such officer's knowledge
after diligent inquiry, Mortgagor has fulfilled all its obligations under this
Mortgage which are required to be fulfilled on or prior to the date of such
certificate.

      4.20 Limitations on Transfer. Mortgagor hereby covenants and agrees that
Mortgagor will not, without the prior written consent in each instance of
Mortgagee, which may be withheld in Mortgagee's sole discretion except as
provided below, (i) convey, sell, assign, lease or otherwise transfer any
interest of Mortgagor in the Mortgaged Property or any portion thereof, (ii)
pledge, mortgage, hypothecate, place a deed of trust or other lien on or
otherwise encumber Mortgagor's interest in the Mortgaged Property or any portion
thereof, (iii) permit the conveyance, sale, assignment, pledge, mortgage,
hypothecation or other transfer or disposition, either directly or indirectly or
through one or more step transactions or tiered transactions, of interests in
Mortgagor or in the partners, shareholders, principals, trustee or beneficiary
of Mortgagor or in the partners, shareholders, principals, trustees or
beneficiaries of such partners, shareholders, principals, trustee or
beneficiary, or any portion thereof, or (iv) enter into or permit to be entered
into any agreement or arrangement to do any of the foregoing unless such
agreement or arrangement is expressly made subject to Mortgagee's approval (each
of the aforesaid acts referred to in clauses (i) through (iv) above being
referred to herein as a "Transfer"). Any conveyance, sale, assignment, lease,
pledge, mortgage, hypothecation, encumbrance or transfer deemed to be such by
operation of Law shall also be deemed to be a Transfer. Any attempted Transfer
in violation of this Section shall be void and of no force or effect. Transfers
of membership interests in the Borrower shall not be permitted without the prior
written consent of Mortgagee, which consent will not be unreasonably withheld or
delayed. Notwithstanding the same, transfers which (i) do not result in more
than a majority of the membership interests of Class B Members of Borrower being
transferred, or (ii) result from the death of a member or are a transfer to a
spouse, child or entity for which the member, a spouse and/or child are the sole
beneficiary(ies), shall be permitted without consent of Mortgagee.

      4.21 Recording, Filing and Perfection of Security Interests; Fees.

            4.21.1 Mortgagor, promptly upon the execution and delivery of the
Note, this Mortgage, the Assignment of Leases and the Indemnity Agreement and
thereafter from time to time, will cause this Mortgage, the Assignment of Leases
and any other Loan Document creating a lien or evidencing the lien of this
Mortgage upon the Mortgaged Property and each instrument of further assurance to
be filed, registered or recorded in such manner and in such places as may be
required by any present or future law in order to publish notice of and to
protect the lien hereof upon, and the interest of Mortgagee in, the Mortgaged
Property.

            4.21.2 Mortgagor will pay all filing, registration and recording
fees, and all expenses incident to the execution and acknowledgment of the
Mortgage and any other Loan Document (including any security instrument with
respect to the Personal Property

                                       23
<PAGE>

and Proceeds) and any instrument of further assurance, and all federal, state,
county and municipal mortgage recording taxes, stamp taxes and other taxes,
duties, imports, assessments and charges arising out of or in connection with
the execution and delivery of the Loan Documents, any deed of trust supplemental
hereto, any supplemental security instrument with respect to the Personal
Property and Proceeds or any instrument of further assurance.

      4.22 Further Acts and Assurances. Mortgagor will, at its sole cost and
expense, and without actual expense to Mortgagee, do, execute, acknowledge and
deliver all and every such further acts, deeds, conveyances, deeds of trust,
mortgages, assignments, notices of assignment, transfers and assurances as
Mortgagee shall from time to time reasonably require for the better assuring,
conveying, assigning, transferring and confirming unto Mortgagee the property
and rights hereby conveyed or assigned or intended now or hereafter so to be, or
which Mortgagor may be or may hereafter become bound to convey or assign to
Mortgagee, or for carrying out the intention or facilitating the performance of
the terms of this Mortgage, or filing, registering or recording this Mortgage,
and, on demand, will execute and deliver, and hereby authorizes Mortgagee to
execute and file in Mortgagor's name, to the extent it may lawfully do so, one
or more financing statements, chattel mortgages or comparable security
instruments, to evidence more effectively the lien of this Mortgage or the lien
intended hereby upon the Mortgaged Property.

                                   ARTICLE V

                               EVENTS OF DEFAULT

      5.1 Events of Default. It shall be an event of default ("Event of
Default") hereunder if any one or more Event of Default as defined in the Loan
Agreement shall occur.

                                   ARTICLE VI

                          REMEDIES AND RELATED MATTERS

      6.1 Remedies. Upon the occurrence and continuance of any Event of Default,
the Mortgagee, at the option of the Mortgagee, may:

            6.1.1 by Notice to the Mortgagor, declare the entire principal
amount under the Note then outstanding, and all accrued and unpaid interest
thereon, to be immediately due and payable, and upon such declaration such
principal amount and said accrued and unpaid interest and all other Secured
Obligations shall become and be immediately due and payable, anything in either
Note or in this Mortgage to the contrary notwithstanding;

                                       24
<PAGE>

            6.1.2 by itself, its agents or attorneys, or by a court-appointed
receiver, enter into and upon all or any part of the Mortgaged Property and each
and every part thereof and exclude the Mortgagor, its agents and servants wholly
therefrom; and having and holding the same, use, operate, manage and control the
Mortgaged Property and conduct the business thereof, either personally or by its
superintendents, managers, agents, servants, attorneys or receivers; and upon
every such entry, at the expense of the Mortgaged Property, from time to time,
either by purchase, repairs or construction, maintain and restore the Mortgaged
Property and, likewise make all necessary or proper repairs, renewals and
replacements and such alterations, betterments, additions and improvements
thereto and thereon as it may deem advisable and insure the same; and in every
such case the Mortgagee shall have the right to manage and operate the Mortgaged
Property and to carry on the business thereof and exercise all rights and powers
of the Mortgagor, as its attorney-in-fact, coupled with an interest, or
otherwise, as it shall deem best; and the Mortgagee shall be entitled to collect
and receive all Rents and other earnings, revenues, issues, profits and income
of the Mortgaged Property and after deducting the expenses of conducting the
business thereof and all maintenance, repairs, renewals, replacements,
alterations, additions, betterments and improvements and amounts necessary to
pay for taxes, assessments, insurance and prior or other proper charges upon the
Mortgaged Property or any part thereof, as well as just and reasonable
compensation for the services of all attorneys, counsel, agents, clerks,
servants and other employees engaged or employed by it, the Mortgagee may apply
the remainder of the monies so received by it, first to the payment of any other
sums required to be paid by the Mortgagor under this Mortgage; then to the
payment of all other Secured Obligations in such order as Mortgagee shall elect;
and the balance, if any, shall be turned over to the Mortgagor or such other
person as may be lawfully entitled thereto;

            6.1.3 with or without entry, personally or by its agents or
attorneys insofar as applicable:

                  (a) foreclose the lien and security interest of this Mortgage
against the Mortgaged Property, or any portion thereof, in accordance with the
laws of The Commonwealth of Massachusetts and the provisions hereof for all
Secured Obligations secured hereby or for any portion of such Secured
Obligations or any other sums secured hereby which are then due and payable,
subject to the continuing lien of this Mortgage for the balance of the Secured
Obligations not then due; it being agreed that several sales may be made
hereunder without exhausting the rights of sale for any other breach by the
Mortgagor of any of the Secured Obligations secured hereby, it being the purpose
to provide for foreclosure and sale of the Mortgaged Property, or any portion
thereof, for any matured portion of any of the Secured Obligations secured
hereby or otherwise provided for herein without exhausting the power to
foreclose and sell the Mortgaged Property, or any portion thereof, for any other
part of the Secured Obligations secured hereby, whether matured at the time or
subsequently maturing; or

                  (b) take such other steps to protect and enforce their
respective rights, whether by action, suit or proceeding in equity or at law for
the specific performance of any covenant, condition or agreement in the Note,
this Mortgage, the Loan Agreement or any other Loan Document, or in aid of the
execution of any power granted herein or in the Note, this Mortgage, the Loan
Agreement or any other Loan Document, or for any

                                       25
<PAGE>

foreclosure hereunder, or for the enforcement of any other appropriate legal or
equitable remedy or otherwise as the Mortgagee may elect.

      6.2 Foreclosure and Sale; Application of Proceeds; Waiver of Right of
Redemption; Etc.

            6.2.1 Foreclosure and Sale. During the continuance of any Event of
Default, the Mortgagee, personally or by its agents or attorneys, may sell the
Mortgaged Property, or any part or parts thereof, and all estate, right, title,
interest, claim and demand therein, at public auction at such time and place and
upon such terms and conditions as the Mortgagee may deem appropriate or as may
be required or permitted by applicable law or rule of court, having first given
notice prior to the sale of such time, place and terms by advertisement in at
least one newspaper published or having a general circulation in the county or
counties in which the Mortgaged Property is located or at such time or times as
may be required by applicable law or rule of court, and at such other times and
by such other methods, if any, as the Mortgagee may deem appropriate.

            6.2.2 Adjournment of Sale. The Mortgagee may adjourn from time to
time any sale to be made by it under or by virtue of this Mortgage by
announcement at the time and place appointed for such sale or for such adjourned
sale or sales; and, except as otherwise provided by an applicable provision of
law or rule of court, the Mortgagee, without further notice or publication, may
make such sale at the time and place to which the same shall be so adjourned.

            6.2.3 Effect of Sale Upon Mortgagor. Any sale or sales made under or
by virtue of this Article, whether made under the power of sale herein granted
or under or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, shall operate to divest all the estate, right, title,
interest, claim and demand whatsoever, whether at law or in equity, of the
Mortgagor in and to the properties and rights so sold, and shall be a perpetual
bar both at law and in equity against the Mortgagor and against any and all
persons claiming or who may claim the same, or any part thereof from, through or
under the Mortgagor.

            6.2.4 Acceleration Upon Sale. In the event of any sale or sales made
under or by virtue of this Subsection, whether made under the power of sale
herein granted or under or by virtue of judicial proceedings or of a judgment or
decree of foreclosure and sale, all Secured Obligations, if not previously due
and payable, and all other sums required to be paid by the Mortgagor pursuant to
the Note, this Mortgage and the other Loan Documents, shall, at the option of
the Mortgagee, immediately become due and payable, in full, anything in the
Note, this Mortgage, the Loan Agreement or the other Loan Documents to the
contrary notwithstanding. If an Event of Default should occur, and following the
acceleration of maturity as herein provided, a tender of payment by the
Mortgagor of the amount then necessary to satisfy all Secured Obligations made
at any time prior to any sale made under or by virtue of this Subsection,
whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale, shall
constitute an evasion of the provisions of the Note prohibiting prepayment, and,
to the extent permitted by applicable law, such payment

                                       26
<PAGE>

shall include the Prepayment Premiums (as defined in the Note), and other
payments required by the Note.

            6.2.5 Appointment of Receiver. During the continuance of an Event of
Default, the Mortgagee shall be entitled (and, to the extent permitted under the
laws of The Commonwealth of Massachusetts, with five (5) days' notice, without
regard to the adequacy of any security for the Secured Obligations and without
regard to the solvency of any person, partnership or entity liable for the
payment thereof) to the appointment of a receiver or receivers of the Mortgaged
Property and of all of the earnings, revenues, rents, issues, profits and income
there from, and the Mortgagor hereby consents to the appointment of such
receiver and agrees that it will not oppose any such appointment; provided,
however, that notwithstanding the appointment of any receiver as aforesaid, the
Mortgagee shall be entitled to retain possession and control of the Mortgaged
Property. Such receiver shall have all of the powers and authority permitted by
applicable law.

            6.2.6 Application of Proceeds. The proceeds of any sale made under
or by virtue of this Article, whether made under the power of sale herein
granted or under or by virtue of judicial proceedings or of a judgment or decree
of foreclosure and sale, together with any other sums which may then be held by
the Mortgagee pursuant to this Mortgage, whether under the provisions of this
Subsection or otherwise, shall be applied as follows:

                  First: To the payment of the actual costs and expenses of such
sale or sales, including compensation to Mortgagee and the fees, charges and
disbursements of its agents, and the charges, disbursements and reasonable fees
of its counsel, and of any judicial or other proceedings wherein the same may be
made, and of all expenses, liabilities and advances made or incurred by
Mortgagee under this Mortgage, together with interest at the Default Rate (as
defined in the Note) on all advances made by Mortgagee, and of taxes,
assessments or other charges, except any taxes, assessments or other charges
subject to which the Mortgaged Property shall have been sold.

                  Second: To the payment of any actual expenses, charges,
losses, indemnities, penalties, premiums (including, without limitation,
Prepayment Premiums (as defined in the Note) and late payment premiums) and all
other amounts due under the Loan Documents, excluding interest and principal.

                  Third: To the payment of interest on the unpaid principal due
under the Note including Additional Interest.

                  Fourth: To the payment of principal due under the Note.

                  Fifth: To the payment of all other Secured Obligations.

                  Sixth: To the payment of the surplus, if any, to whomsoever
may be lawfully entitled to receive the same (including, if applicable,
Mortgagor, or the beneficiary of Mortgagor).

            6.2.7 Application of Purchase Money. In the event of any sale made
under or by virtue of this Section 6.2, whether made under the power of sale
herein granted or

                                       27
<PAGE>

under or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, the receipt of the officer making the sale under judicial
proceedings or of the Mortgagee for the payment of the purchase money shall be
full and sufficient discharge of the purchaser of the Mortgaged Property for the
purchase money and no such purchaser, after paying such purchase money and
receiving such a receipt, shall be bound or liable to see to the application of
such purchase money.

            6.2.8 Conveyance of the Mortgaged Property. Upon the completion of
any sale or sales made under or by virtue of this Section, whether made under
the power of sale herein granted or under or by virtue of judicial proceedings
or of a judgment or decree of foreclosure and sale, the Mortgagee or an officer
of the court empowered so to do, shall execute and deliver to the purchaser or
purchasers a good and sufficient instrument or instruments, conveying, assigning
and transferring all estate, right, title and interest of the Mortgagor in and
to the Mortgaged Property and rights sold, including the estate of the Mortgagor
as lessor under the Leases (excluding subleases), but without any covenant or
warranty, express or implied. The recitals in such instrument(s) of any matters
of fact shall be conclusive proof of the truthfulness thereof. The Mortgagee is
hereby appointed, which appointment is coupled with an interest and is
irrevocable, and which appointment shall become effective upon the occurrence of
an Event of Default, the true and lawful attorney of the Mortgagor, in its name
and stead, to make all necessary conveyances, assignments, transfers and
deliveries of the Mortgaged Property and rights so sold and for that purpose the
Mortgagee may execute all necessary instruments of conveyance, assignment and
transfer, and may substitute one or more persons with like power, the Mortgagor
hereby ratifying and confirming all that its said attorney or such substitute or
substitutes shall lawfully do by virtue hereof. Nevertheless, the Mortgagor, if
so requested by the Mortgagee, shall ratify and confirm any such sale or sales
by executing and delivering to the Mortgagee or to such purchaser or purchasers,
all such instruments as may be advisable, in the judgment of the Mortgagee, for
that purpose, and as may be designated in any such request.

            6.2.9 Purchase of Mortgaged Property. The Mortgagee shall have the
right to be a purchaser at any sale made under or by virtue of this Mortgage,
whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale, and on
so purchasing shall have the right to be credited upon the amount of the bid
made therefor with the amount payable to the Mortgagee out of the net proceeds
of such sale. In the event of any such sale, the Secured Obligations, if not
previously due, shall be and become immediately due and payable without demand
or notice of any kind.

            6.2.10 Waiver of Right of Redemption - Exemptions Waived. The
Mortgagor will not at any time insist upon, or plead, or in any manner whatever
claim or take any benefit or advantage of a stay or extension or moratorium law,
any exemption from attachment, execution or sale of the Mortgaged Property, or
any part thereof, whether enacted now or at any time hereafter in force, which
may affect the covenants and terms of performance of this Mortgage, nor claim,
take or insist upon any benefit or advantage of any law now or hereafter in
force providing for the valuation or appraisal of the Mortgaged Property, or any
part thereof, prior to any sale or sales thereof which may be made pursuant to
any provision herein, or pursuant to the decree, judgment or order of any court

                                       28
<PAGE>

of competent jurisdiction; nor after any such sale or sales, claim or exercise
any right under any statute heretofore or hereafter enacted to redeem the
Mortgaged Property so sold, or any part thereof, and the Mortgagor hereby
expressly waives all benefit and advantage of any such law or laws, and
covenants not to hinder, delay or impede the execution of any right, power or
remedy herein granted or delegated to the Mortgagee, but to suffer and permit
the execution of every right, power or remedy as though no such law or laws had
been made or enacted. The Mortgagor, for itself and all who claim under it,
waives, to the extent that it lawfully may, the benefit of any homestead
exemption and any and all right to have the Mortgaged Property marshaled upon
any sale or foreclosure hereunder.

            6.2.11 Recovery of Judgment. A. During the continuation of any Event
of Default, the Mortgagee shall be entitled and empowered to institute such
actions or proceedings at law or in equity as it may consider advisable for the
collection of the Secured Obligations, and may prosecute any such action or
proceeding to judgment or final decree, and may enforce any such judgment or
final decree against the Mortgagor in any manner provided by law. The Mortgagee
shall be entitled to recover judgment as aforesaid either before, after or
during the pendency of any proceeding for the enforcement of any remedies
provided for in the Note, this Mortgage, the Loan Agreement or the other Loan
Documents and the right of the Mortgagee to recover judgment as aforesaid shall
not be affected by any sale hereunder, or by the passage or entry of a decree
for the sale of the Mortgaged Property, or any part thereof, or by the
enforcement of the provisions of the Note, this Mortgage, the Loan Agreement and
the other Loan Documents or the foreclosure of the lien hereof. In the event of
a sale of the Mortgaged Property, and of the application of the proceeds of
sale, as in this Mortgage provided, to the payment of the Secured Obligations,
the Mortgagee, except as otherwise provided in the Note, shall be entitled to
enforce payment of, and to receive all amounts then remaining due and unpaid
with respect to the Secured Obligations, and shall be entitled to recover
judgment for any portion of the Secured Obligations remaining unpaid, together
with interest as provided in the Note. In case of proceedings against the
Mortgagor in insolvency or bankruptcy or any proceedings for its reorganization
or involving the liquidation of its assets, then the Mortgagee shall be entitled
to prove the whole amount due on account of the Secured Obligations, without
deducting therefrom any proceeds obtained from the sale of the whole or any part
of the Mortgaged Property; provided, however, that in no case shall the
Mortgagee receive a greater amount than the total amount due on account of the
Secured Obligations from the aggregate amount of the proceeds of the sale of the
Mortgaged Property and the distribution from the estate of the Mortgagor.

                  B. No recovery of any judgment upon the Mortgaged Property or
upon any other property of the Mortgagor shall affect, in any manner or to any
extent, the lien of this Mortgage upon the Mortgaged Property, or any part
thereof, or any liens, rights, powers or remedies of the Mortgagee hereunder,
but such liens, rights, powers and remedies of the Mortgagee shall continue
unimpaired as before.

            6.2.12 Discontinuance of Proceedings. If the Mortgagee shall
commence any proceeding to enforce any right, power or remedy hereunder or under
the Note or the other Loan Documents and such proceeding shall be discontinued
or abandoned for any reason, then in every such case the parties shall be
restored to their former positions and the

                                       29
<PAGE>

rights, powers and remedies of the Mortgagee shall continue as if no such
proceeding had been commenced.

            6.2.13 Judicial Foreclosure. The provisions hereinabove set forth
relating to the remedy of foreclosure of the lien of this Mortgage by public
sale to be conducted by the Mortgagee, are not intended as an exclusive method
of foreclosure hereunder or to deprive the Mortgagee of any other legal or
equitable remedies available to it. Accordingly, it is specifically agreed that
such remedy shall be cumulative and shall not in any way be construed as an
exclusive remedy, and Mortgagee shall be fully entitled to a court foreclosure
and to avail itself of any and all other legal or equitable remedies at any time
available under the laws of The Commonwealth of Massachusetts.

      6.3 No Conditions Precedent to Exercise of Remedies. The Mortgagor shall
not be relieved of any obligation by reason of the failure of the Mortgagee to
comply with any request of the Mortgagor or of any other person to take action
to foreclose on this Mortgage or otherwise to enforce any provisions of the
Note, this Mortgage, the Loan Agreement or the other Loan Documents, or by
reason of the release, regardless of consideration, of all or any part of the
Mortgaged Property, or by reason of any agreement or stipulation between any
subsequent owner of the Mortgaged Property and the Mortgagee extending the time
of payment or modifying the terms of the Note, this Mortgage or the other Loan
Documents without first having obtained the consent of the Mortgagor, and, in
the latter event, the Mortgagor shall continue to be liable to make payment
according to the terms of any such extension or modification agreement, unless
expressly released and discharged in writing by the Mortgagee. The Mortgagee
shall not be required to proceed hereunder before proceeding against any other
security held by the Mortgagee for the payment of the Secured Obligations or for
the performance by the Mortgagor of all of its obligations under the Note , this
Mortgage or any of the Loan Documents, nor shall the Mortgagee be required to
proceed against such other security before proceeding hereunder. The Mortgagee
shall be entitled to proceed hereunder and against such other security in such
order and manner as it may elect and no such action by the Mortgagee shall
operate to preclude it from proceeding against any or all of any security at the
same time or in any order.

      6.4 No Merger. It is the intention of the parties hereto that if the
Mortgagee shall at any time hereafter acquire title to all or any portion of the
Mortgaged Property, then, and until the Secured Obligations have been satisfied
in full, the interest of the Mortgagee hereunder and the lien of this Mortgage
shall not merge or become merged in or with the estate and interest of the
Mortgagee as the holder and owner of title to all or any portion of the
Mortgaged Property and that, until such payment, the estate of the Mortgagee in
the Mortgaged Property and the lien of this Mortgage and the interest of the
Mortgagee hereunder shall continue in full force and effect to the same extent
as if the Mortgagee had not acquired title to all or any portion of the
Mortgaged Property.

      6.5 Remedies Cumulative. The remedies specified in this Section shall be
in addition to all other rights and remedies provided herein or in any other
Loan Document and which the Mortgagee may have at law or in equity and no single
or partial exercise by the Mortgagee of any right or remedy hereunder or under
any other Loan Document or which the Mortgagee may have at law or in equity
shall exhaust the same or shall preclude

                                       30
<PAGE>

any other or further exercise thereof or of any other right or remedy hereunder
or under any other Loan Document or which the Mortgagee may have at law or in
equity, and every such right or remedy hereunder or under any other Loan
Document or which the Mortgagee may have at law or in equity may be exercised at
any time and from time to time after the occurrence of an Event of Default.

      6.6 Mortgagee's Performance of Mortgagor's Obligations. If, after the
giving of any applicable notice and expiration of any applicable grace and/or
cure period, Mortgagor shall fail timely to perform any of the covenants
contained in this Mortgage, the Note, the Loan Agreement or any other Loan
Document, Mortgagee may make advances to perform the same on Mortgagor's behalf
(except that Mortgagee agrees that it shall not make advances under this Section
to pay any amount(s) secured by a Lien, or any Imposition, which Mortgagor is
then contesting fully in accordance with the provisions of Section 4.6 or
Section 4.7, as applicable). Inaction of Mortgagee shall never be considered as
a waiver of any right accruing to it on account of any Event of Default nor
shall the provisions of this Section 6.6 or any exercise by Mortgagee of its
rights hereunder prevent any default from constituting an Event of Default.
Mortgagee, in making any payment hereby authorized (a) relating to Impositions,
may do so according to any bill, statement or estimate, without inquiry into the
validity of any such Imposition; (b) for the purchase, discharge, compromise or
settlement of any lien, may do so without inquiry as to the validity or amount
of any claim for lien which may be asserted; or (c) in connection with the
completion of construction or alterations, furnishing or equipping of the
Improvements or the rental, operation or management of the Mortgaged Property or
the payment of operating costs thereof, may do so in such amounts and to such
persons as Mortgagee may deem appropriate. Nothing contained herein shall be
construed to require Mortgagee to advance monies for any purpose.

                                  ARTICLE VII

                                 MISCELLANEOUS

      7.1 Enforceability. In the event that any provision of this Mortgage, the
Note, the Loan Agreement or any other Loan Document or the application thereof
to Mortgagor or any circumstance in any jurisdiction governing this Mortgage,
the Note, the Loan Agreement or such Loan Document shall, to any extent, be
invalid or unenforceable under any Law, such provision shall be deemed
inoperative only to the extent that it may conflict therewith and shall be
deemed modified to conform to such Law, and the remainder of this Mortgage, the
Note, the Loan Agreement or such Loan Document and the application of such
invalid or unenforceable provision to parties, jurisdictions or circumstances
other than to whom or to which it is held invalid or unenforceable shall not be
affected thereby nor shall the same affect the validity or enforceability of any
other provision of this Mortgage, the Note, the Loan Agreement or such Loan
Document.

      7.2 Maximum Rate of Interest. Notwithstanding any contrary provision of
this Mortgage, in no event shall the aggregate of the interest payable hereunder
or under the Note, the Loan Agreement or any other Loan Document, or penalties
or premiums for late payments, Prepayment Premiums (as defined in the Note) loan
servicing fees, application

                                       31
<PAGE>

fees, commitment fees, "points" or any other amounts, fees or charges which
would under any applicable Law be deemed "interest" ever exceed the maximum
amount of interest which under any applicable Law could be lawfully charged on
the principal balance of the Note from time to time outstanding. In this
connection, it is expressly stipulated and agreed that it is the intention of
Mortgagee and Mortgagor in the execution and delivery of the Note, this
Mortgage, the Loan Agreement, the Assignment of Leases, the Indemnity Agreement
and any other Loan Document contractually to limit the maximum amounts charged
to, contracted for with, or received from Mortgagor in connection with the
Secured Obligations which would be deemed "interest" under any applicable Law to
the maximum non-usurious amount of interest which would be permitted under such
Law. In furtherance thereof, it is stipulated and agreed that none of the terms
of this Mortgage, the Note, the Loan Agreement, the Assignment of Leases, the
Indemnity Agreement or any other Loan Document shall ever be construed to create
a contract to pay for the use, forbearance or detention of money interest at a
rate in excess of the maximum non-usurious interest rate permitted to be charged
to, contracted for with, or received from Mortgagor by Mortgagee under any
applicable Law; neither Mortgagor nor any Guarantor (as defined in Section 7.9)
under the Guaranty (as defined in Section 7.9), endorser or other parties now or
hereafter becoming liable for the payment of the Secured Obligations shall ever
be liable for interest in excess of the maximum non-usurious interest that under
any applicable Law could be charged, contracted for or received from Mortgagor
by Mortgagee; and the provisions of this Section shall be deemed to govern the
maximum rate and amount of interest which may be paid under the Note, the Loan
Agreement, the Indemnity Agreement, the Assignment of Leases and any other Loan
Document, and shall control over all other provisions of this Mortgage, the
Note, the Loan Agreement, the Assignment of Leases or any other Loan Document
which might be in apparent conflict herewith. Specifically and without limiting
the generality of the foregoing, it is expressly provided:

            7.2.1 If and when any installment of the interest calculated under
the Note becomes due and the aggregate amount thereof, when added to the
aggregate amount of any other amounts which constitute interest on the
indebtedness evidenced thereby and which have been heretofore paid on said
indebtedness, would be in excess of the maximum non-usurious amount of interest
permitted by any applicable Law, in light of all discounts, payments or
prepayments theretofore made on said indebtedness and presuming the Secured
Obligations will be paid at their stated maturity date, then the aggregate
amount of such interest installment shall be automatically reduced to the
maximum sum, if any, which could lawfully be paid as interest on the principal
balance of the Note on such date under such circumstances.

            7.2.2 If under any circumstances the aggregate amounts paid on the
Note, this Mortgage, the Loan Agreement, the Indemnity Agreement, the Assignment
of Leases and any other Loan Document prior to and incident to final payment
thereof include any amounts which under any applicable Law would be deemed
interest and which would exceed the maximum non-usurious amount of interest
which, under any applicable Law, could lawfully have been collected on such
indebtedness, Mortgagor and Mortgagee stipulate that such payment and collection
will have been and will be deemed to have been the result of mathematical error
on the part of both Mortgagor and Mortgagee, and the person or entity receiving
such excess payment shall promptly refund the amount of such excess (to the
extent only of the excess of such interest payments above the maximum
non-

                                       32
<PAGE>

usurious amount which could lawfully have been collected and retained under any
applicable Law) upon discovery of such error by the person or entity receiving
such payment or Notice thereof from the person or entity making such payment;
and

            7.2.3 All amounts paid or agreed to be paid in connection with the
Secured Obligations which would under any applicable Law be deemed "interest"
shall, to the extent permitted by such Law, be amortized, prorated, allocated
and spread throughout the full term of the Note.

      7.3 Notices. All notices, requests for approval or consent, demands,
consents, approvals and other communications (collectively, "Notices") hereunder
shall be in writing and shall be sent by hand, or by telecopy (with a duplicate
copy sent the same day by reputable overnight courier service, postage prepaid),
or by postage prepaid, certified or registered mail, return receipt requested,
or by reputable overnight courier service, postage prepaid, addressed to the
party to be notified as set forth below:

                  (a)      if to Mortgagee,

                           SEPRACOR, INC.
                           111 Locke Drive
                           Marlborough, Massachusetts  01752
                           Attn: Vice President for Finance and Administration

                           with a copy to:

                           Nixon Peabody LLP
                           101 Federal Street
                           Boston, MA 02110
                           Attn:  William C. Stone, PC
                           Telecopy No.: 617-345-1300

                  (b)      if to Mortgagor,

                           WATERFORD PARK, LLC
                           c/o Waterford Development Corp.
                           175 Highland Avenue
                           Needham, MA 02494
                           Attn: Robert E. Shapiro

                           with a copy to:

                           Garrity Levin & Muir
                           99 Summer Street
                           Boston, Massachusetts  02110
                           Attn: Jonathan Levin, Esq.

                                       33
<PAGE>

      Notices shall be deemed given when so delivered by hand or when a legible
copy is received by telecopier (with receipt being verified by telephone
confirmation and provided that a copy is sent on the same day by reputable
overnight courier service), or if mailed, five (5) business days after mailing
(or one (1) business day for reputable overnight courier service), with failure
to accept delivery constituting delivery for this purpose. Any party hereto may
change the addresses for Notices set forth above by giving at least ten (10)
days' prior Notice of such change in writing to the other party as aforesaid and
otherwise in accordance with these provisions.

      7.4 No Release. Mortgagor agrees that no other security, now existing or
hereafter taken, for the Secured Obligations shall be impaired or affected in
any manner by the execution hereof; no security subsequently taken by any holder
of the Secured Obligations shall impair or affect in any manner the security
given by this Mortgage; all security for the payment of the Secured Obligations
shall be taken, considered, and held as cumulative; and the taking of additional
security shall at no time release or impair any security by endorsement or
otherwise previously given. Mortgagor further agrees that any part of the
security herein described may be released without in any way altering, varying,
or diminishing the force, effect, or lien of this Mortgage, or of any renewal or
extension of said lien, and that this Mortgage shall continue as a first lien,
assignment, and security interest on all the Mortgaged Property not expressly
released until all Secured Obligations are fully discharged and paid.

      7.5 Attorneys' Fees and Costs of Mortgagee. Mortgagor agrees to pay,
within ten (10) business days of demand of Mortgagee, all actual reasonable
out-of-pocket expenses incurred by Mortgagee, including without limitation
attorneys' charges, disbursements and reasonable fees, in connection with the
enforcement by Mortgagee of any of the Note, this Mortgage, the Assignment of
Contracts, the Loan Agreement, the Guaranty, the Indemnity Agreement, the
Assignment of Leases or any of the other Loan Documents.

      7.6 Brokerage. Mortgagor hereby indemnifies and holds harmless Mortgagee
against all liability, cost and expense, including without limitation attorneys'
charges, disbursements and reasonable fees, incurred in connection with any
claims which may be asserted by any broker or finder or similar agent alleging
to have dealt with Mortgagor in any of the transactions contemplated hereby;
excluding however such amounts, if any, which Mortgagee has agreed in writing to
pay.

      7.7 Indemnification. Mortgagor will protect, indemnify and save harmless
Mortgagee from and against any and all liabilities, obligations, claims,
damages, penalties, assessments, fines, causes of action and actual reasonable
out-of-pocket expenses (including without limitation attorneys' disbursements,
charges and reasonable fees) imposed upon or incurred by or asserted against
Mortgagee or the Mortgaged Property or any of Mortgagee's interest therein, by
reason of the execution of this Mortgage, the Note, the Loan Agreement or any
other Loan Document or the Guaranty, or the consummation of the transactions
contemplated hereby or thereby, or the occurrence or existence during or prior
to the term of this Mortgage of any of the following: (i) ownership by Mortgagor
of any interest in the Mortgaged Property or receipt of any rent or other sum
therefrom during any period when Mortgagor has not been excluded from
possession; (ii) any accident, injury to or death of persons or loss of or
damage to property occurring on or

                                       34
<PAGE>

about the Mortgaged Property or any part thereof or the adjoining sidewalks,
curbs, vaults and vault space, if any, and streets and ways during any period
when Mortgagor has not been excluded from possession; (iii) any design,
construction, operation, use, nonuse or condition of the Mortgaged Property or
any part thereof or the adjoining sidewalks, curbs, vaults and vault space, if
any, and streets and ways, including, without limitation, claims or penalties
arising from violation of any requirement of law or insurance requirements as
well as any claim based on any patent or latent defect, whether or not
discoverable by Mortgagor, any claim as to which the insurance is inadequate,
and any claim in respect of any adverse environmental impact or effect; (iv) any
negligence or tortious act or omission on the part of Mortgagor or any of its
agents, contractors, servants, employees, sublessees, licensees, guests or
invitees; (v) any failure by Mortgagor to perform its obligations under this
Mortgage, the Note, the Loan Agreement, the Indemnity Agreement, the Assignment
of Leases, the Assignment of Contracts, or any other Loan Document; or (vi) any
claims arising from the alleged or actual breach of Mortgagor's obligations
under Section 7.6 hereof, whether such claim proves true or false. Mortgagor
further agrees that its obligations under this Section 7.7 shall include, but
are not limited to, liability for damages resulting from the personal injury or
death of an employee of Mortgagor, regardless of whether Mortgagor has paid the
employee under the worker's compensation laws of the Jurisdiction, or other
similar federal or state legislation for the protection of employees. Mortgagor
agrees that its obligations under this Section 7.7 shall include indemnifying
Mortgagee for all reasonable attorney's charges, disbursements and fees, and all
other actual and reasonable out-of-pocket expenses incurred by Mortgagee to
enforce the terms of this Section. Mortgagor's obligations under this Section
are exclusive of, and in addition to, any and all insurance obligations which
Mortgagor has under this Mortgage and any of its obligations under the Indemnity
Agreement. If any action or proceeding shall be commenced (including without
limitation an action to foreclose this Mortgage or to collect the indebtedness
secured hereby or to enforce Mortgagee's rights under the Note, the Loan
Agreement, the Indemnity Agreement, the Assignment of Leases, the Assignment of
Contracts or any other Loan Document) by Mortgagee or Mortgagor or any third
party, to which action or proceeding Mortgagee is made a party by reason of the
execution of this Mortgage, the Note, the Loan Agreement, the Assignment of
Leases, the Assignment of Contracts, the Indemnity Agreement, or any other Loan
Document in which it becomes necessary to enforce, defend or uphold the lien of
this Mortgage or Mortgagee's rights under the Note, all actual and reasonable
out-of-pocket expenses incurred by Mortgagee in connection with any litigation
to enforce, prosecute or defend the rights and lien created hereby or otherwise
incurred in connection with any action or proceeding referred to in this Section
(including without limitation attorneys' charges, disbursements and reasonable
fees) shall be paid by Mortgagor to Mortgagee within ten (10) days after demand.
In case any action, suit or proceeding is brought against Mortgagee by reason of
any such occurrence, Mortgagor, upon request of Mortgagee, will, at Mortgagor's
sole cost and expense, resist and defend such action, suit or proceeding or
cause the same to be resisted or defended by counsel designated by Mortgagor and
approved by Mortgagee, which approval shall not be unreasonably withheld or
delayed. Notwithstanding the foregoing, Mortgagor shall have no obligations
under this Section 7.7 with respect to any claims arising solely out of the
grossly negligent or intentional acts of Mortgagee or its employees, agents or
other persons acting on its behalf.

                                       35
<PAGE>

      7.8 Environmental Matters. Without limiting the foregoing obligations and
indemnities of Mortgagor, Mortgagor hereby represents and warrants that, to the
best of its knowledge and belief after reasonable investigation, it is currently
in compliance in all material regards with, and covenants and agrees (subject to
the rights of the tenant under the Tenant Lease) that it will manage and operate
the Mortgaged Property and will, in accordance with prudent commercial business
practices, cause each tenant under any Lease to occupy its demised portion of
the Mortgaged Property in compliance in all material regards with, Environmental
Laws (as that term is defined in the Indemnity Agreement). Subject to the rights
of the tenant under the Tenant Lease, Mortgagor further covenants and agrees
that, in accordance with prudent commercial business practices, it shall not
install or permit to be installed in the Mortgaged Property any Hazardous
Materials (as that term is defined in the Indemnity Agreement) (other than those
lawful amounts of cleaning supplies and other materials incidental to the
Permitted Uses of the Mortgaged Property, and except as disclosed in the
Existing Reports, as that term is defined in the Indemnity Agreement). Mortgagor
hereby represents and warrants that, to the best of its knowledge after
reasonable investigation, it has heretofore delivered to Mortgagee true, correct
and complete copies of all reports, citations, notices and other writings,
including without limitation hazardous waste disposal manifests, which Mortgagor
has received from or delivered to any governmental authority empowered to
regulate or oversee any of the foregoing activities; and Mortgagor covenants and
agrees that it shall from and after the date hereof deliver to Mortgagee within
ten (10) days of receipt thereof, true, correct and complete copies of all such
writings prepared or received by Mortgagor. Mortgagor shall use reasonable
efforts to cause the tenant under the Tenant Lease to remove from the Mortgaged
Property and dispose of any Hazardous Materials in violation of Environmental
Laws in a manner consistent with and in compliance with applicable Environmental
Laws and shall take any and all other action to remedy, rectify, rehabilitate
and correct any violation of any applicable Environmental Law or any violation
of any agreement entered into between Mortgagor and Mortgagee and/or any third
party with respect to Hazardous Materials. Mortgagor agrees to indemnify, defend
with counsel reasonably acceptable to Mortgagee (at Mortgagor's sole cost and
expense), and hold Mortgagee harmless against any claim, response or other
actual expenses, damages, liability or demand (including without limitation all
reasonable attorneys' charges, disbursements and reasonable fees incurred by
Mortgagee) arising out of any claimed violation by Mortgagor of any
Environmental Laws or breach of any of the foregoing covenants or agreements
except to the extent caused solely by the actions of Mortgagee or its employees,
agents or other persons acting on its behalf. The foregoing provision shall not
be construed as imposing on Borrower any obligation or liability for any act or
omission of tenant under the Tenant Lease.

      7.9 Limitations on Recourse. The provisions of Section 10 of the Note,
Limitations on Recourse, are applicable to this Mortgage.

      7.10 Estoppel Certificates. Mortgagor and Mortgagee agree at any time and
from time to time, upon ten (10) business days prior written notice from either
party, to execute and deliver to such party, or to any person or entity
designated by such party, a statement in writing certifying (i) the outstanding
principal balance of the Secured Obligations, (ii) the last date to which
interest has been paid by Mortgagor, (iii) that the Loan is in full force and
effect, (iv) to the knowledge of Mortgagor, whether Mortgagor has any defenses

                                       36
<PAGE>

or offsets thereto, and (v) whether any default on the part of Mortgagor has
occurred (if made by Mortgagee, subject to its knowledge).

      7.11 Effect of Extensions and Amendments. If the payment of the Secured
Obligations, or any part thereof, shall be extended or varied, or if any part of
the security or guaranties therefor be released, all persons (including, without
limitation the Guarantors under the Guaranty now or at any time hereafter liable
therefor, or interested in the Mortgaged Property, shall be held to assent to
such extension, variation or release, and their liability, and the lien, and all
provisions hereof, shall continue in full force and effect; the right of
recourse against all such persons being expressly reserved by Mortgagee,
notwithstanding any such extension, variation or release (subject to the express
limitations set forth in Section 7.9). Any person, firm or corporation taking a
junior deed of trust or other Lien upon the Mortgaged Property or any part
thereof or any interest therein, shall, without waiving any other limitations in
this Mortgage on such Liens, take the said Lien subject to the rights of
Mortgagee to amend, modify, extend or release the Note, this Mortgage or any
other document or instrument evidencing, securing or guarantying the
indebtedness secured hereby, in each case without obtaining the consent of the
holder of such junior Lien and without the lien of this Mortgage losing its
priority over the rights of any such junior Lien.

      7.12 No Joint Venture. Mortgagor acknowledges that the relationship
between the parties is that of mortgagor and mortgagee and that in no event
shall Mortgagee be deemed to be a partner or joint venturer with Mortgagor.
Mortgagee shall not be deemed to be such a partner or joint venturer by reason
of its becoming a mortgagee in possession or exercising any rights pursuant to
this Mortgage or any other of the Loan Documents.

      7.13 Funds Held in Accounts. Mortgagor hereby agrees that Mortgagee shall
have no liability for any investment losses or reduction in value which accrue
or occur with respect to any amounts held by Mortgagee in any accounts hereunder
for the benefit or account of Mortgagor or the Premises (such as insurance
proceeds or partial condemnation awards) and any such losses shall be borne
solely by Mortgagor except where such losses are caused by Mortgagee's gross
negligence or willful misconduct. In addition, Mortgagor agrees that all
interest and/or other income on such funds shall for income tax purposes be
deemed to belong to Mortgagor.

      7.14 Expenses of Mortgagee. Any reference herein to "actual expenses
incurred by Mortgagee" shall be deemed to refer to actual costs and expenses
incurred by Mortgagee paid or payable to third parties (as opposed to
Mortgagee's general overhead expenses).

      7.15 Governing Law. This Mortgage shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts and any applicable
laws of the United States of America.

      7.16 Captions and Pronouns. The captions and headings of the various
sections of this Mortgage are for convenience only, and are not to be construed
as confining or limiting in any way the scope or intent of the provisions
hereof. Whenever the context requires or permits, the singular shall include the
plural, the plural shall include the singular, and the masculine, feminine and
neuter shall be freely interchangeable.

                                       37
<PAGE>

      7.17 Amendments, Waivers, Etc. No amendment, modification, termination, or
waiver of any provision of this Mortgage nor consent to any departure therefrom
shall in any event be effective unless the same shall be in writing and signed
by the party against which such action or waiver is sought to be charged, and
then such action or waiver shall be effective only in the specific instance and
for the specific purpose for which given or omitted. No notice to or demand on
Mortgagor in any case shall entitle Mortgagor to any other or further notice or
demand in similar or other circumstances except as provided in this Mortgage.

      7.18 Entire Agreement; Controlling Provisions. This Mortgage, the Note,
the Loan Agreement, the Indemnity Agreement, the Assignment of Leases and the
other Loan Documents embody the entire agreement between the parties hereto and
supersede all prior agreements and understandings between them relating to the
same subject matter. If and to the extent the provisions of this Mortgage
conflict with the provisions of the Loan Agreement, the provisions of the Loan
Agreement shall govern.

      7.19 Covenants Running With the Land; Successors and Assigns. All of the
grants, covenants, terms, provisions and conditions of this Mortgage shall run
with the land and shall apply to and bind the successors and assigns of
Mortgagor, and apply to and inure to the benefit of the successors and assigns
of Mortgagee.

      7.20 Statutory Condition. This Mortgage is upon the STATUTORY CONDITION,
subject to the applicable notice, grace and cure provisions provided herein, and
upon the further condition that all covenants and agreements of Mortgagor
contained herein shall be kept and performed and for any breach of which
Mortgagee shall have the STATUTORY POWER OF SALE.

      7.21 Forbearance; Subordination. Under the circumstances described in, and
subject to the terms and conditions of, Section 15 of the Loan Agreement,
Mortgagee is obligated to forebear from exercising remedies hereunder and to
subordinate the lien hereof to an alternative financing by Borrower.

              [The remainder of this page is intentionally blank.]

                                       38
<PAGE>

      IN WITNESS WHEREOF, Mortgagor has executed this Mortgage under seal as of
date first set forth above.

                                     WATERFORD PARK, LLC,

                                     By: /s/ Richard N. Houlding
                                         ---------------------------------------
                                         Richard N. Houlding

                          COMMONWEALTH OF MASSACHUSETTS

SUFFOLK, ss.                                                  January ____, 2001

      Then appeared the above-named Richard N. Houlding, Manager of WATERFORD
PARK, LLC, and acknowledged the foregoing to be his free act and deed as Manager
of WATERFORD PARK, LLC, before me

                                     ------------------------------------
                                     Notary Public
                                     My Commission Expires:
                                                           ---------------------

                                                                          (Seal)

                                       39
<PAGE>

                                   EXHIBIT A

                                LAND DESCRIPTION

Those certain parcels of land with the buildings thereon situated in
Marlborough, Middlesex County, Massachusetts, being bounded and described as
follows:

                                       1<PAGE>

                                                                    Exhibit 10.4

                                      NOTE

                            [Secured by a first lien]

$20,860,000.00                                             Boston, Massachusetts
                                                           January 30, 2001

Maturity Date: February 1, 2006

Interest Rate: as provided in the "Loan Agreement" referred to below, computed
on the basis of a 360 day year of twelve 30 day months, with interest payable in
arrears

      FOR VALUE RECEIVED, WATERFORD PARK, LLC, a Massachusetts limited liability
company (hereinafter, called "Maker") does hereby covenant and promise to pay to
the order of SEPRACOR, INC., its successors and assigns (collectively "Payee"),
at 111 Locke Drive, Marlborough, Massachusetts 01752, or at such other place or
bank account as Payee may designate in writing from time to time, in legal
tender of the United States, the sum of TWENTY MILLION EIGHT HUNDRED SIXTY
THOUSAND AND 00/100 DOLLARS ($20,860,000.00), or so much thereof as has been
advanced pursuant to the Loan Agreement, together with interest at the Interest
Rate on the outstanding balance from time to time as hereinafter set forth.
Without limiting the foregoing payment shall be made by electronic wire transfer
pursuant to instructions delivered to Maker by Payee from time to time.

      During the Construction Period (as defined in the Loan Agreement) this
Note shall be payable as to interest only, monthly in arrears. Thereafter, this
Note shall be payable in constant monthly payments of principal and interest in
the amount established pursuant to Section 4.3(b)(ii) of the Loan Agreement,
commencing on the date established in Section 4.3(b)(ii) of the Loan Agreement,
and thereafter on the first day of each succeeding month until the 1st day of
February, 2006, when the balance, unless sooner paid, shall become immediately
due and payable. Said payments shall be applied first to accrued interest with
the balance in reduction of principal.

      A late payment premium of five percent (5%) of any required monthly
payment (but not any payment of the loan at or after maturity or acceleration or
any prepayment of the loan as permitted hereby) due under this Note, the
Leasehold Mortgage and Security Agreement, dated as of January 30, 2001 from
Maker as mortgagor to Payee as mortgagee (the "Mortgage"), the Loan Agreement
(First Lien) dated as of January 30, 2001 between the Maker and Payee (the "Loan
Agreement") or any other Loan Document (as defined in the Mortgage) shall be due
in the event such required monthly payment shall not be made on or before the
5th day after its due date.

      All payments due hereunder shall be made without setoff or counterclaim.

      1. Certain Definitions. For purposes of this Note, the following terms
shall have the meanings ascribed to them below:

            (a)   "Event of Default" has the meaning specified in the Loan
                  Agreement.

            (b) "Lease" means the Lease, dated January 30, 2001, from Maker as
      landlord to Payee as tenant.

<PAGE>

            (c) "Mortgaged Property" has the meaning specified in the Loan
      Agreement.

            (d) "Loan Year" means the twelve calendar month period commencing
      with the first day of February, 2001 and annually thereafter.

            (e) All other capitalized terms used herein but not defined herein
      shall have the respective meanings set forth in the Mortgage or the Loan
      Agreement.

      2. Prepayment. The loan is closed to prepayment at the option of Maker,
except as provided in the Loan Agreement.

      All or a portion of the loan may be prepaid as a result of or after the
application of insurance proceeds or the application of condemnation awards
pursuant to the Mortgage. In the event of any such partial prepayment of the
loan as the result of such application of insurance proceeds or condemnation
awards pursuant to the Loan Agreement, the constant monthly payments of
principal and interest payable on this Note shall be adjusted so as to fully
amortize the remaining outstanding principal balance (after giving effect to
such partial prepayment) in equal monthly payments over the period ending on the
date 20 years after the Maturity Date at the interest rate then in effect on
this Note. The outstanding principal balance of this Note, plus all accrued and
unpaid interest thereon, shall continue to be due and payable on the Maturity
Date.

      3. [Intentionally omitted.]

      4. Security. This Note is secured by, among other things, the Mortgage and
an Assignment of Leases and Rents from Maker to Payee (the "Assignment of
Leases") with respect to property located in Solomon Pond Corporate Center,
Marlborough, Middlesex County, Massachusetts, which Mortgage specifies various
Events of Default (as defined in the Loan Agreement) upon the happening of which
all sums due hereunder may, at Payee's option, be declared immediately due and
payable.

      5. Default Rate. Commencing the day after the due date of any required
payment under this Note (whether a regular monthly payment or at stated
maturity, or after acceleration after an Event of Default), interest shall
accrue with respect to such unpaid required payment at a rate equal to the
greater of (i) one hundred fifty percent (150%) of the Interest Rate, or (ii)
five percent (5%) above the Wall Street Journal (Eastern Edition) "prime rate",
but in no event greater than the highest rate permitted by law (the "Default
Rate") until paid in full. Such Default Rate interest shall be payable upon
demand by Payee to Maker.

      6. Acceleration of Principal, Interest and Other Amounts. Upon the
occurrence and during the continuance of an Event of Default, Payee may, at its
sole option, declare the entire outstanding principal balance of, and all
accrued interest on, this Note to be, and whereupon the same (together with all
other sums that may be payable under this Note and the other Loan Documents)
shall be, immediately due and payable in full to the Payee.

      7. [Intentionally Omitted.]

      8. Costs of Collection. Should the indebtedness represented by this Note
or any part thereof be collected at law or in equity, or in bankruptcy,
receivership or any other court proceedings (whether at the trial or appellate
level or by settlement), or should this Note be placed in the hands of attorneys
for collection upon default, Maker agrees to pay, in addition to the interest,
principal and other amounts due under this Note or the other Loan Documents, all
costs of collection or attempting to collect all sums due under this Note and
the other Loan Documents, including reasonable attorneys' fees and expenses.

                                      -2-
<PAGE>

      9. Limitation on Interest. Anything herein to the contrary
notwithstanding, in no event shall the aggregate of the interest payable under
this Note and the other Loan Documents, or penalties or premiums for late
payments, prepayment premiums, loan servicing fees, application fees, commitment
fees, "points" or any other amounts, fees or charges payable under this Note or
any other Loan Document which would under applicable law be deemed interest ever
exceed the maximum amount of interest which under applicable law may lawfully be
charged on the principal balance of this Note from time to time outstanding and,
therefore, the provisions of the Mortgage shall, in all respects, be applicable
to all such "interest" and all provisions of the Note and other Loan Documents
governing, or relating to, the payment of such interest.

      10. Limitations on Recourse. Payee agrees that, for payment of this Note,
it will look solely to the Mortgaged Property and such other collateral, if any,
as may now or hereafter be given to secure the payment of this Note, and no
other property or assets of Maker or any other person, firm or entity, disclosed
or undisclosed (each an "Exculpated Party"), other than a person, firm or entity
who or which has expressly guaranteed some or all of the Maker's obligations
under this Note or any other Loan Document to the extent of such guaranty (each
a "Guarantor"), shall be subject to levy, execution or other enforcement
procedure for the satisfaction of the remedies of Payee, or for any payment
required to be made under this Note or any other Loan Document or for the
performance of any of the covenants or warranties contained herein or therein;
provided, however, that the foregoing provisions of this paragraph shall not (i)
constitute a waiver of any obligation evidenced by this Note or secured by any
other Loan Document, (ii) limit the right of Payee to name Maker, any Exculpated
Party or any Guarantor as a party defendant in any action or suit for judicial
or non-judicial foreclosure and sale or any other action or suit under the
Mortgage, Assignment of Leases or any other Loan Document, (iii) release or
impair this Note or the lien of the Mortgage or any other Loan Document or, (iv)
release, impair or affect in any way the validity or enforceability of any
guaranty (whether of payment, performance and/or otherwise) (a "Guaranty") or
indemnity agreement given to Payee in connection with the loan evidenced hereby;
and provided, further that if Maker, any one or more of the Exculpated Parties,
any one or more of the Guarantors or any other person or entity (all of the
foregoing are collectively referred to as "Persons and Entities") (i) commits
any act of fraud in connection with the transactions contemplated by this Note
or any other Loan Document, (ii) makes a material adverse misrepresentation of
any facts or circumstances related to the Mortgaged Property, Maker, any
Exculpated Party or any Guarantor, or any constituent or sub-constituent
(including, without limitation, a shareholder, partner, principal, trustee or
beneficiary) of any of the foregoing, (iii) is obligated to pay, but fails to
pay or cause to be paid any taxes assessed or payable with respect to the
Mortgaged Property (to the extent that escrowed funds held or controlled by
Payee are not available therefor), (iv) commits or (as to any Person or Entity
having title to or control of the Mortgaged Property) suffers to exist, any
waste with respect to the Mortgaged Property or (v) misapplies (a) any revenues
received from the Mortgaged Property by failing to apply the same solely to the
expenses of the Mortgaged Property and/or to amounts due under the Loan
Documents after the occurrence and during the continuance of any Event of
Default under this Note or any other Loan Document, (b) insurance proceeds or
condemnation awards received with respect to the Mortgaged Property, or (c) tax
deposits or security deposits by tenants relating to the Mortgaged Property or
any portion thereof, the Person or Entity committing such fraud,
misrepresentation or failure to pay taxes, or so misapplying the aforesaid
funds, shall be personally liable from his, her or its separate assets to Payee
for any loss or damage resulting therefrom up to the value of the misapplied
funds and any interest chargeable thereto (and in this regard, (I) any act by an
employee or agent authorized to handle funds for any Person or Entity shall be
deemed to be the act of such Person or Entity, and (II) any representation made
or deemed made by Maker with respect to facts or circumstances that are
particularly susceptible to the control or knowledge, directly or indirectly, of
any constituent shareholder, partner, principal, trustee or beneficiary of
Maker, or any affiliate of same, shall be deemed to be the representation of
such partner, shareholder, principal, trustee, beneficiary or affiliate).
Nothing in this paragraph shall be deemed to be a waiver of any right which the
Payee may have under any provision of the Bankruptcy Act of 1986, as amended, or
any successor legislation, to file a claim for the full amount of indebtedness
owed by Maker

                                      -3-
<PAGE>

to Payee or to require that the Mortgaged Property shall continue to secure all
of the indebtedness owed by Maker to Payee in accordance with the Mortgage and
the other Loan Documents.

      11. Modifications and Extensions. This Note may not be changed orally, but
only by an agreement in writing, signed by the party against whom enforcement of
any waiver, change, modification or discharge is sought.

      12. Certain Waivers. All parties to this Note, whether Maker, principal,
surety, guarantor or endorser, hereby waive presentment for payment, demand,
protest, notice of protest and notice of dishonor and further waive any right
they may have to adjudicate any matter or issue under, or related to, this Note,
the Mortgage or any other Loan Document by jury trial and further waive all
exemptions to which any of them may now or hereafter be entitled under the laws
of the state in which the Mortgaged Property is located or any other state or of
the United States, and further agrees that the Payee shall have the right,
without notice, to deal in any way, at any time, with the Maker, and to grant
the Maker any extension of time for payment of this Note or any other indulgence
or forbearance whatsoever, and may release any security for the payment of this
Note and/or modify the terms of any of the agreements, documents and/or
instruments referred to herein or otherwise securing or pertaining to this Note,
and may release the Guarantors or any other guarantor of this Note from
liability for payment of this Note, in every instance without the consent of the
Maker hereunder and without waiving any rights the Payee may have hereunder or
by virtue of the laws of the state in which the Mortgaged Property is located or
any other state or of the United States.

      13. Assignment. This Note and the other Loan Documents may be assigned by
Payee to any Tenant Affiliate after the Commencement Date (as each such term is
defined in the Lease), but not otherwise, except with the written consent of
Maker, which consent will not be unreasonably withheld or delayed.

      14. Notices. All notices, requests for approval or consent, demands,
consents, approvals and other communications (collectively, "Notices") hereunder
shall be in writing and shall be sent by hand, or by telecopy (with a duplicate
copy sent the same day by reputable overnight courier service, postage prepaid),
or by postage prepaid, certified or registered mail, return receipt requested,
or by reputable overnight courier service, postage prepaid, addressed to the
party to be notified as set forth below:

if to Payee,

SEPRACOR, INC.
111 Locke Drive
Marlborough, Massachusetts 01752
Attn: Vice President for Finance and Administration

with a copy to:

Nixon Peabody LLP
101 Federal Street
Boston, MA 02110
Attn:  William C. Stone, PC

                                      -4-
<PAGE>

if to Maker,

WATERFORD PARK, LLC
c/o Waterford Development Corp.
175 Highland Avenue
Needham, MA 02494
Attn:  Robert E. Shapiro

with a copy to,

Garrity Levin & Muir
99 Summer Street
Boston, Massachusetts 02110
Attn:  Jonathan Levin, Esq.

Notices shall be deemed given when delivered by hand or when a legible copy is
received by telecopier (with receipt being verified by telephone confirmation
and provided that a copy is sent on the same day by reputable overnight courier
service), or if mailed, five (5) business days after mailing (or one business
day for reputable overnight courier service), with failure to accept delivery
constituting delivery for this purpose. Any party hereto may change the
addresses for Notices set forth above by giving at least ten (10) days' prior
Notice of such change in writing to the other party as aforesaid and otherwise
in accordance with these provisions.

      15. Governing Law. This Note and the rights and obligations of the parties
hereunder shall in all respects be governed by, and construed and enforced in
accordance with, the laws of The Commonwealth of Massachusetts. Any suit, action
or proceeding arising out of or relating to this Note shall be conducted in a
State or Federal court sitting in Middlesex, Norfolk or Suffolk County in The
Commonwealth of Massachusetts; and Maker hereby irrevocably submits to the
jurisdiction of any such court.

      16. Severability of Provisions. Any provision of this Note that is
prohibited or unenforceable in any jurisdiction shall, as to that jurisdiction,
be ineffective to the extent of that prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of that provision in any other jurisdiction.

      17. The Tax Identification Number of Maker is ______________.

              [The remainder of this page is intentionally blank.]

                                      -5-
<PAGE>

      IN WITNESS WHEREOF, Maker has executed and delivered this Note under seal
on the day and year first above written.

                                          WATERFORD PARK, LLC

                                          By: /s/ Richard N. Houlding
                                             --------------------------------
                                             Richard N. Houlding,
                                             its Manager

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