Document:

EXHIBIT 10.11

                                 PROMISSORY NOTE

$ 44,000,000                                                 December 15, 2000

         FOR VALUE RECEIVED,  the  undersigned  FRANKLIN PLAZA PROPERTY TRUST, a
Maryland real estate investment trust ("Borrower"), promises to pay to the order
of MERRILL LYNCH MORTGAGE LENDING,  INC., a Delaware corporation  (together with
its successors and assigns,  "Lender"),  at 100 Church Street,  18th Floor,  New
York,  New York 10080,  or such other place as Lender may  designate in writing,
the principal sum of Forty-Four Million and 00/100 Dollars  ($44,000,000),  with
interest on the unpaid principal balance from the date of this Note, until paid,
at the  Interest  Rate (as  hereinafter  defined)  in  effect  from time to time
hereunder. This Promissory Note may be referred to herein as the "Note," and the
loan evidenced hereby may be referred to herein as the "Loan."

         PAYMENTS OF PRINCIPAL  AND INTEREST.  Borrower  shall make a payment on
the date hereof to Lender of interest only on the outstanding  principal balance
of this Note at the Interest Rate  (hereinafter  defined),  from the date hereof
through and including  the last day of the calendar  month in which this Note is
executed.  Commencing on February 1, 2001 (the "First  Payment Date") and on the
first day of each  calendar  month (each,  a "Payment  Date")  thereafter to and
including  January 1, 2004,  Borrower  shall make payments to Lender of interest
only at the Interest Rate. Thereafter, commencing on the third (3rd) anniversary
of the First  Payment  Date and on each  Payment  Date  thereafter  through  and
including the Optional  Prepayment Date  (hereinafter  defined),  Borrower shall
make  payments  to Lender of  principal  and  interest  in  consecutive  monthly
installments,  each in the amount of Three  Hundred  Five  Thousand  Two Hundred
Twenty-Four and 69/100 Dollars  ($305,224.69) (the "Monthly Debt Service Payment
Amount"). Each payment shall be applied first to accrued and unpaid interest and
the balance to principal.  Thereafter,  on each Payment Date occurring after the
Optional  Prepayment  Date,  Borrower  shall  (i) make a  payment  to  Lender of
principal and interest in the amount of the Monthly Debt Service Payment Amount,
such payment to be applied first to interest in an amount equal to interest that
would  have  accrued  on the  outstanding  principal  balance of the Loan at the
Initial  Interest  Rate  (hereinafter  defined) and the balance to principal and
(ii) pay to Lender  additional  amounts to be applied to  principal  and Accrued
Interest  (hereinafter defined) as set forth in Section 3.3(b) (vi) and (vii) of
the Cash Management  Agreement.  Interest accrued at the Adjusted  Interest Rate
after  the  Optional  Prepayment  Date and not paid  pursuant  to the  preceding
sentence  shall be paid on the Maturity  Date (such accrued  interest,  "Accrued
Interest") The entire outstanding principal balance of the Loan, all accrued and
unpaid interest thereon (including,  without  limitation,  Accrued Interest) and
all other amounts due hereunder and under the other Loan Documents (collectively
the "Debt") if not sooner paid, shall be due and payable on January 1, 2029 (the
"Maturity Date").

         Interest on the  principal  sum of this Note shall be calculated on the
basis of a 360 day year,  and shall be  charged  for the  actual  number of days
elapsed during any month or other accrual period. Interest on this Note shall be
payable in arrears.
<PAGE>

         DEFINITIONS.  The term "Interest  Rate" as used in this Note shall mean
from (a) the date of this Note through but not including the Optional Prepayment
Date  (hereinafter  defined)  a  rate  of  six  and  seven  hundred  ninety-four
one-thousandths percent (6.794%) per annum (the "Initial Interest Rate") and (b)
during  the  period  from and  including  the  Optional  Prepayment  Date to and
including the Maturity  Date, a rate per annum (the  "Adjusted  Interest  Rate")
equal to the sum of (i) the Initial  Interest  Rate plus (ii) two percent  (2%).
The term "Optional  Prepayment Date" as used in this Note shall mean January 31,
2011.

         SECURITY;  LOAN  DOCUMENTS.  This Note is being  executed and delivered
pursuant  to that  certain  Loan and  Security  Agreement,  dated as of the date
hereof (the "Loan  Agreement"),  between  Borrower and Lender and is secured by,
among other  things,  that  certain  Mortgage,  Assignment  of Leases and Rents,
Security  Agreement  and  Fixture  Filing,  dated  as of the  date  hereof  (the
"Instrument"),  executed  by  Borrower,  encumbering  Borrower's  ground  lessee
interest in and to certain real property  commonly known as One Franklin  Plaza,
Philadelphia,   Pennsylvania,   as  more  particularly  described  therein  (the
"Property").  This  Note,  the Loan  Agreement,  the  Instrument,  and all other
documents  or  instruments  given by Borrower or any  guarantor  and accepted by
Lender for purposes of evidencing,  securing,  perfecting,  or guaranteeing  the
indebtedness  evidenced by this Note may be referred to as the "Loan Documents."
Capitalized  terms used but not otherwise defined herein but defined in the Loan
Agreement  shall  have  the  respective  meanings  given  thereto  in  the  Loan
Agreement.

         DEFEASANCE.

         A. Notwithstanding anything to the contrary contained in this Note, the
Instrument or the Loan Documents, at any time after the second (2nd) anniversary
of the date that is the "startup day," within the meaning of Section 860G of the
Internal  Revenue Code of 1986,  as amended  from time to time or any  successor
statute (the "Code"), of a "real estate mortgage investment conduit," within the
meaning of Section 860D of the Code,  that holds this Note,  Borrower shall have
the right to obtain the release of the Property from the lien of the  Instrument
and  the  other  Loan  Documents  (such  release,  the  "Defeasance")  upon  the
satisfaction  of the following  conditions  precedent  (all of which  conditions
shall become covenants upon occurrence of the Defeasance):

               (i)  Borrower  shall  provide to Lender not less than thirty (30)
days' prior  written  notice  specifying a Payment Date on which the  Defeasance
Deposit  (hereinafter  defined)  is to be made  (the  date so  specified  may be
referred to as the "Defeasance Election Date").

               (ii) Borrower shall pay to Lender on the Defeasance Election Date
all interest accrued and unpaid on the outstanding principal amount of this Note
due  through  the   Defeasance   Election  Date  and  the  scheduled   principal
amortization  payment due on such  Defeasance  Election Date,  together with all
other amounts,  if any, then due and payable under this Note, the Instrument and
the other Loan Documents.

               (iii) Borrower shall irrevocably deposit with Lender an amount of
U.S.  Government  Securities  (hereinafter  defined) which through the scheduled
payment of principal and interest in respect  thereof in  accordance  with their
terms  will  provide,  not  later  than  the due  dates  of the  payments  owing
hereunder, cash in an amount sufficient, without reinvestment, in

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<PAGE>

the opinion of a firm of independent  certified  public  accountants  reasonably
acceptable to Lender expressed in a written  certification  thereof delivered to
Lender (the "CPA  Certificate"),  to pay and discharge the Scheduled  Defeasance
Payments  (hereinafter  defined) (the U.S.  Government  Securities so deposited,
together with any interest or other  increase from the issuer of the  securities
earned thereon and any replacements thereof,  shall be referred to herein as the
"Defeasance Deposit").  All such Government  Securities,  if in registered form,
shall be  registered in the name of Lender or its nominee (and, if registered in
nominee name endorsed to Lender or in blank) and, if issued in book-entry  form,
the name of Lender or its nominee  shall appear as the owner of such  securities
on the  books of the  Federal  Reserve  Bank or  other  party  maintaining  such
book-entry system.

               (iv) Borrower shall cause the following to be delivered to Lender
on or  prior  to the  Defeasance  Election  Date,  all  in  form  and  substance
satisfactory to Lender in its reasonable discretion:

                  (a) a security  agreement,  in form and  substance  reasonably
satisfactory to Lender, creating a first priority lien on the Defeasance Deposit
(the "Defeasance Security Agreement");

                  (b) the CPA Certificate;

                  (c) a certificate of Borrower certifying that all requirements
for the Defeasance set forth herein have been satisfied;

                  (d) an opinion of counsel for  Borrower in form and  substance
reasonably  satisfactory to Lender to the effect that (i) Lender has a perfected
first priority security interest in the Defeasance  Deposit,  (ii) the holder of
this Note will not  recognize  income,  gain or loss for United  States  federal
income tax purposes as a result of the  Defeasance and will be subject to United
States  federal  income tax on the same  amounts,  in the same manner and at the
same times as would have been the case if the Defeasance had not occurred, (iii)
any holder,  trustee or custodian of this Note which is a "real estate  mortgage
investment conduit" within the meaning of Section 860D of the Code will not fail
to  maintain  its  status  as such as a result  of the  Defeasance  and (iv) the
Defeasance Security Agreement is enforceable against Borrower in accordance with
its terms;

                  (e) evidence in writing from the  applicable  Rating  Agencies
for any  Securities  backed in whole or in part by this Note, to the effect that
the Defeasance will not result in a downgrading, withdrawal, or qualification of
the ratings in effect immediately prior to such Defeasance for any class of such
then outstanding Securities;

                  (f) evidence  reasonably  satisfactory to Lender that Borrower
remains validly  existing and in good standing under the laws of the state where
it is organized  and qualified to do business in the state where the Property is
located;  and Borrower shall maintain such existence  during the time thereafter
when this Note shall be outstanding  (unless a Successor  Borrower  (hereinafter
defined) assumes Borrower's obligations under this Note); and

                  (g) a  certificate  of  Borrower  certifying  that  all of the
representations,  and  warranties  contained in the Loan Agreement and the other
Loan  Documents  are  true  and

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<PAGE>

correct  in  all  material  respects  as of the  Defeasance  Election  Date  and
ratifying  all of the  covenants  and  obligations  of  Borrower  under the Loan
Documents as of such date and such other certificates,  documents or instruments
as Lender may  reasonably  request or as may be required by the Rating  Agencies
referred to above,  provided that such  certificates,  documents or  instruments
shall not increase  Borrower's  obligations or decrease  Borrower's rights under
the Loan Documents.

               (v) Either (i)  Borrower  shall  deliver to Lender a  certificate
stating  that at all times  following  the  Defeasance,  Borrower  shall have no
interest in any assets other than the Defeasance Deposit, or (ii) Borrower shall
satisfy all of the requirements of Section C below.

               (vi) Borrower  shall pay to Lender all  reasonable  out-of-pocket
costs and expenses (including,  without limitation,  reasonable  attorneys' fees
and disbursements) incurred by Lender in connection with the Defeasance.

         B. Upon  compliance with the  requirements  of Section A above,  Lender
shall cause the  Property to be released  from the lien of the  Instrument,  the
obligations  under the Loan  Documents  with  respect to the  Property  shall no
longer be  applicable,  and the  Defeasance  Deposit shall be the sole source of
collateral securing this Note. Lender shall apply the Defeasance Deposit and the
payments  received  therefrom  to the  payment of all  scheduled  principal  and
interest payments due on all successive  Payment Dates under this Note after the
Defeasance  Election Date to and including the Optional  Prepayment  Date and to
payment  of  the  entire   remaining  Debt  on  the  Optional   Prepayment  Date
(collectively,  the "Scheduled Defeasance Payments").  Borrower, pursuant to the
Defeasance Security Agreement or other appropriate  document,  shall direct that
the payments  received  from the  Defeasance  Deposit  shall be made directly to
Lender and applied to satisfy the obligations of Borrower under this Note.

         C. If, after the  Defeasance,  Borrower  will own any assets other than
the Defeasance Deposit,  Borrower shall establish or designate a single-purpose,
bankruptcy-remote   successor  entity   acceptable  to  Lender  (the  "Successor
Borrower"),   with  respect  to  which  a  nonconsolidation  opinion  reasonably
satisfactory in form and substance to Lender and any applicable  Rating Agencies
shall  be   delivered   to  Lender  and  such   Rating   Agencies   (if  such  a
nonconsolidation  opinion  was  required  of  Borrower  in  connection  with the
origination  of the  indebtedness  secured  hereby) in which case Borrower shall
transfer and assign to the Successor Borrower all obligations, rights and duties
under this Note and the Defeasance Security Agreement, together with the pledged
Defeasance  Deposit.  The Successor  Borrower  shall assume the  obligations  of
Borrower under this Note and the  Defeasance  Security  Agreement,  and Borrower
shall be relieved of its obligations  hereunder and  thereunder.  Borrower shall
pay not less than $1,000 to the Successor Borrower as consideration for assuming
such Borrower obligations.

         D. As used herein,  the term "U.S.  Government  Securities"  shall mean
securities  that are (i) direct  obligations of the United States of America for
the full and  timely  payment  of which its full  faith and credit is pledged or
(ii)  obligations  of an entity  controlled  or  supervised  by and acting as an
agency or  instrumentality  and guaranteed as a full faith and credit obligation
which shall be fully and timely paid by the United  States of America,  which in
either case are not callable or redeemable  at the option of the issuer  thereof
(including a depository  receipt issued

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<PAGE>

by a bank (as defined in Section 3(a)(2) of the United States  Securities  Act))
as custodian with respect to any such U.S.  Government  Securities or a specific
payment of principal of or interest on any such U.S. Government  Securities held
by such  custodian  for the  account of the holder of such  depository  receipt,
provided  that (except as required by law) such  custodian is not  authorized to
make any  deduction  from the amount  payable  to the holder of such  depository
receipt from any amount  received by the custodian in respect of the  securities
or the specific payment of principal of or interest on the securities  evidenced
by such depository receipt.

         E. If, after payment in full of all obligations  evidenced by this Note
or any other of the Loan Documents,  any of the Defeasance Deposit remains, then
on request by Borrower such remaining balance of the Defeasance Deposit shall be
returned  to  Borrower  (or to the  Successor  Borrower,  as the case may be) or
Lender  shall  assign to Borrower (or the  Successor  Borrower)  all of Lender's
right,  title,  and  interest  in the  Government  Securities  constituting  the
Defeasance Deposit.

         PREPAYMENT;  PREPAYMENT  CONSIDERATION.  If any  prepayment  (except as
expressly permitted in this Note) of all or any portion of the principal balance
hereunder occurs, whether in connection with Lender's acceleration of the unpaid
principal balance of this Note or in any other circumstances  whatsoever,  or if
the Instrument is satisfied or released by foreclosure (whether by power of sale
or judicial proceeding), deed in lieu of foreclosure or by any other means, then
Borrower shall be obligated to pay the Prepayment  Consideration.  The foregoing
shall  not  create  any  right  of  prepayment.  Borrower  shall  have no  right
whatsoever to prepay all or any portion of the  principal  balance of this Note,
except only as follows:

                  (i)  Borrower  shall have the right to prepay and shall not be
required to pay any Prepayment  Consideration or any other early payment penalty
or premium with respect to  prepayment  required by Lender  pursuant to the Loan
Agreement as a result of the  application of insurance  proceeds or condemnation
awards  under the Loan  Agreement  or as a result of  prepayment  of the  entire
principal  balance of this Note  remaining  due after  application  of insurance
proceeds  or  condemnation  awards  under  the  Instrument,  provided  that such
prepayment  is made within one hundred  twenty (120) days  following the date of
such application of insurance proceeds or condemnation awards.

                  (ii) Further, provided no Event of Default has occurred and is
continuing  hereunder  or under  any of the Loan  Documents  and  provided  that
Borrower  provides not less than thirty (30) days' prior written  notice thereof
to  Lender,  Borrower  shall  have the  right to pay all (but not less than all)
obligations then outstanding under the Loan Documents,  including the prepayment
of all  principal,  all accrued and unpaid  interest  hereunder  and any and all
other sums then due under this Note and the other Loan  Documents on any Payment
Date on or after  August 1, 2010.  In such case,  there  shall be no  Prepayment
Consideration  or other early payment penalty or premium due, except that if any
such prepayment occurs on any day other than a Payment Date, then in addition to
the prepayment  amount  Borrower also shall pay to Lender the amount of interest
that would have  accrued  under the Note on the amount  being  prepaid  from and
including the prepayment date to the next Payment Date.

                  The  "Prepayment  Consideration"  shall be the amount equal to
the  greater  of (i)  one  percent  (1%)  of the  Loan  balance  at the  time of
prepayment  or (ii) the  positive  difference,

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<PAGE>

if any,  between  (a) the  present  value  on the  date of such  prepayment  (by
acceleration or otherwise) of all future  installments of principal and interest
which Borrower would  otherwise be required to pay under this Note from the date
of such prepayment  until the Optional  Prepayment Date absent such  prepayment,
including  the unpaid  principal  amount  which might  otherwise be due upon the
Optional  Prepayment Date absent such prepayment,  with such present value being
determined  by the  use of a  discount  rate  equal  to the  yield  to  maturity
(adjusted  to a  "Mortgage  Equivalent  Basis"  pursuant  to the  standards  and
practices  of  the  Securities  Industry  Association),  on  the  date  of  such
prepayment of the United States  Treasury  Security  having the term to maturity
closest to the period from such prepayment date to the Optional  Prepayment Date
and (b) the principal balance of the Loan on the date of such prepayment.

         BORROWER HEREBY  EXPRESSLY  WAIVES THE RIGHT TO PREPAY THE INDEBTEDNESS
EVIDENCED  HEREBY IN WHOLE OR PART WITHOUT PENALTY EXCEPT AS EXPRESSLY SET FORTH
HEREIN,  AND EXPRESSLY AGREES TO PAY THE AMOUNTS REQUIRED HEREIN IN THE EVENT OF
AN  ACCELERATION.  BORROWER  AGREES THAT THE PREPAYMENT  CONSIDERATION  REQUIRED
HEREIN IS REASONABLE.  BORROWER HAS GIVEN INDIVIDUAL WEIGHT TO THE CONSIDERATION
IN THIS  TRANSACTION FOR THIS WAIVER AND AGREEMENT.  BORROWER  HEREBY  EXPRESSLY
WAIVES THE BENEFIT OF ANY APPLICABLE LAW TO THE CONTRARY.

         EVENTS OF DEFAULT;  ACCELERATION.  Upon and at any time  following  the
occurrence of any Event of Default (as defined in the Loan  Agreement),  then at
the option of Lender and without  notice,  the entire  principal  amount and all
interest  accrued and  outstanding  hereunder and all other amounts  outstanding
under any of the Loan Documents shall at once become due and payable, and Lender
may  exercise  any and all of its  rights  and  remedies  under  any of the Loan
Documents or pursuant to  applicable  law. The holder  hereof may so  accelerate
such  obligations and exercise such remedies at any time after the occurrence of
any Event of Default, regardless of any prior forbearance.

         LATE  CHARGES;  DEFAULT  INTEREST.  If an Event of Default  relating to
non-payment  of any  principal,  interest  or other  sums due under this Note or
under any of the other Loan  Documents  shall occur,  then Borrower shall pay to
Lender,  in addition to all sums  otherwise  due and  payable,  a late fee in an
amount equal to five percent (5%) of such principal,  interest or other sums due
hereunder  or under  any  other  Loan  Document  (or,  in the case of a  partial
payment, the unpaid portion thereof), such late charge to be immediately due and
payable without demand by Lender.

         Upon the occurrence  and during the  continuance of an Event of Default
and in any event from and after the Maturity Date of the Loan,  the  outstanding
principal  balance of this Note shall bear interest until paid in full at a rate
per annum (the  "Default  Rate")  equal to the sum of (i) five  percent (5%) and
(ii) the Interest Rate otherwise applicable under this Note.

         Borrower  agrees that such late charge and Default Rate of interest are
reasonable and do not constitute a penalty.

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<PAGE>

         LAWFUL  INTEREST.  The parties hereto intend to conform strictly to the
applicable  usury laws.  In no event,  whether by reason of demand for  payment,
prepayment, acceleration of the maturity hereof or otherwise, shall the interest
contracted for,  charged or received by the holder hereof hereunder or otherwise
exceed  the  maximum  amount  permissible  under  applicable  law.  If from  any
circumstance  whatsoever interest would otherwise be payable to Lender in excess
of the maximum  lawful amount,  the interest  payable to Lender shall be reduced
automatically to the maximum amount permitted by applicable law. If Lender shall
ever receive  anything of value deemed interest under applicable law which would
apart from this provision be in excess of the maximum  lawful amount,  an amount
equal to any amount which would have been excessive interest shall be applied to
the reduction of the principal  amount (without any Prepayment  Consideration or
any other early payment penalty or premium) owing hereunder in the inverse order
of its  maturity  and not to the payment of  interest,  or if such amount  which
would have been  excessive  interest  exceeds  the unpaid  balance of  principal
hereof,  such excess shall be refunded to Borrower.  All interest paid or agreed
to be paid to Lender  shall,  to the extent  permitted  by  applicable  law,  be
amortized,  prorated,  allocated,  and spread  throughout  the full  stated term
(including any renewal or extension) of such  indebtedness so that the amount of
interest on account of such  indebtedness  does not exceed the maximum permitted
by applicable  law. The provisions of this paragraph  shall control all existing
and future agreements between Borrower and Lender.

         CERTAIN RIGHTS AND WAIVERS.  From time to time,  without  affecting the
obligation  of  Borrower  or its  successors  or assigns to pay the  outstanding
principal balance of this Note, interest thereon and other amounts due hereunder
and to observe  the  covenants  contained  herein,  in the Loan  Agreement,  the
Instrument or in any other Loan Document,  without affecting the guaranty of any
person or entity for payment of the outstanding  principal balance of this Note,
without  giving notice to or obtaining the consent of Borrower or its successors
or assigns or any guarantors or indemnitor, and without liability on the part of
Lender,  Lender  may,  at  its  option,  extend  the  time  for  payment  of the
outstanding  principal  balance  of this Note or any part  thereof,  reduce  the
payments thereon,  release anyone liable for payment of all or a portion of said
indebtedness,  accept a  renewal  of this  Note,  modify  the  terms and time of
payment  of  said  outstanding  principal  balance,  join  in any  extension  or
subordination  agreement,  release any security given  herefor,  take or release
other or  additional  security,  and agree in writing  with the  undersigned  to
modify the rate of interest or period of amortization of this Note or change the
amount of the monthly installments payable hereunder.

         Presentment,  notice of  dishonor,  and  protest  are hereby  waived by
Borrower and all makers,  sureties,  guarantors and endorsers hereof.  This Note
shall be binding upon Borrower and its successors and assigns.

         EACH  OF  BORROWER  AND  LENDER  HEREBY   KNOWINGLY,   VOLUNTARILY  AND
INTENTIONALLY  WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY
LITIGATION  BASED HEREON,  OR ARISING OUT OF, UNDER OR IN CONJUNCTION  WITH THIS
NOTE, THE INSTRUMENT,  ANY OTHER LOAN DOCUMENT, ANY OTHER AGREEMENT CONTEMPLATED
TO BE  EXECUTED IN  CONNECTION  HEREWITH,  OR ANY COURSE OF  CONDUCT,  COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY.

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<PAGE>

         ASSIGNMENT AND TRANSFER OF NOTE.  Lender shall have the right to assign
or transfer,  in whole or in part  (including  the right to grant  participation
interests in) any or all of its obligations under this Note, the Loan Agreement,
the  Instrument  and any or all of the other  Loan  Documents.  Lender  shall be
released  of any  obligations  to the extent  that the same are so  assigned  or
transferred,  and the rights and obligations of "Lender"  hereunder shall become
the rights and  obligations of the transferee  holder.  Lender agrees to provide
Borrower  with notice of any such  assignment  and in no event shall  Borrower's
monetary obligations hereunder or under the other Loan Documents be increased as
a result of such assignment  (except in accordance with Section 10.2 of the Loan
Agreement);  provided, however, that Borrower's consent shall not be required in
connection  with any such  assignment  and no  failure  or  delay by  Lender  in
delivering such notice shall limit the effectiveness of such assignment.

         LIMITATION ON RECOURSE. Lender's rights of recourse for the obligations
of Borrower  hereunder  are limited in  accordance  with Article XII of the Loan
Agreement.  This  provision  shall  not limit  any  rights  of Lender  under the
Guaranty of Non-Recourse  Exceptions or the Environmental  Indemnity  Agreement,
each dated as of the date hereof.

         ATTORNEYS' FEES,  COSTS OF COLLECTION.  Borrower shall pay to Lender on
demand all out-of-pocket  costs and expenses,  including  reasonable  attorneys'
fees and expenses,  incurred by Lender in collecting  the  indebtedness  arising
hereunder  or under any other Loan  Documents  or secured  thereby or  otherwise
exercising any rights or remedies of Lender hereunder or thereunder or at law or
in equity or enforcing the obligations of any parties hereto or thereto, or as a
consequence  of any breach or default by Borrower or any guarantor  hereunder or
thereunder,  or otherwise as a consequence of any right  evidenced or secured by
this Note or the Loan Documents.  Without limitation, such costs and expenses to
be reimbursed by Borrower shall include reasonable  attorneys' fees and expenses
incurred in any Bankruptcy case or proceeding and in any appeal.

         APPLICABLE  LAW.  This  Note  shall be  governed  by and  construed  in
accordance with the laws of the State of New York and applicable federal law.

         TIME OF  ESSENCE.  Time shall be of the essence as to all of the terms,
covenants  and  conditions  of this  Note.  If the due date of any  payment  due
hereunder  or under any of the other  Loan  Documents  shall fall on a day other
than a Business Day, Borrower shall be required to make such payment on the next
succeeding Business Day.

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<PAGE>

         IN WITNESS  WHEREOF,  the undersigned has executed this Promissory Note
as of the date first written above.

                                    BORROWER:

                                    FRANKLIN PLAZA PROPERTY TRUST,
                                      a Maryland real estate investment trust

                                    By:     /s/ John A. Mannix
                                            Name:  John A. Mannix
                                            Title:   PresidentEXHIBIT 10.12

                                              This instrument is intended
                                              to be recorded in Philadelphia
                                              County, Pennsylvania

RETURN TO:

Sidley & Austin
875 Third Avenue
New York, New York 10022
Attn:  Robert L. Boyd, Esq.

                          OPEN-END LEASEHOLD MORTGAGE,
                              ASSIGNMENT OF LEASES
                               AND RENTS, SECURITY
                          AGREEMENT AND FIXTURE FILING

         THIS  OPEN-END  LEASEHOLD  MORTGAGE,  ASSIGNMENT  OF LEASES  AND RENTS,
SECURITY  AGREEMENT  AND FIXTURE  FILING (as the same may be amended,  restated,
extended,   supplemented   or  otherwise   modified  from  time  to  time,  this
"Mortgage"),  is made as of the 15th day of December,  2000,  by FRANKLIN  PLAZA
PROPERTY TRUST, a Maryland real estate  investment  trust,  having its principal
place  of  business  c/o HRPT  Properties  Trust,  400  Centre  Street,  Newton,
Massachusetts 02458-2076 ("Mortgagor"),  to and for the benefit of MERRILL LYNCH
MORTGAGE LENDING, INC., a Delaware corporation,  having its place of business at
100 Church  Street,  18th Floor,  New York,  New York 10080  (together  with its
successors and assigns, the "Mortgagee").  Capitalized terms used herein but not
otherwise  defined shall have the respective  meanings assigned to such terms in
the Loan Agreement (hereinafter defined).

         This  Mortgage  is  an  open-end  mortgage  as  set  forth  in  42  Pa.
C.S.A.ss.8143 and secures future advances.

                              W I T N E S S E T H:

         To secure the payment of a loan (the "Loan") in the original  principal
sum of FORTY-FOUR MILLION AND NO/100 DOLLARS ($44,000,000),  lawful money of the
United  States of America,  being made from  Mortgagee  to Mortgagor on the date
hereof  pursuant  to the terms and  conditions  of a certain  Loan and  Security
Agreement,  dated as of the date  hereof  (as  amended  or  modified,  the "Loan
Agreement"),  between Mortgagor and Mortgagee, which Loan is evidenced by and is
to be paid with interest according to a certain Promissory Note, dated as of the
date hereof (as amended,  modified,  renewed or restated  and together  with any
substitutes  or  replacements  therefor,  the  "Note"),  made  by  Mortgagor  to
Mortgagee  and all other sums due  hereunder,  or  otherwise  due under the Loan
Documents (as defined in the Loan Agreement) (the principal  amount of the Loan,
together  with  interest  thereon and all sums due  hereunder and
<PAGE>

under  the  Loan  Agreement,  the  Note  and  the  other  Loan  Documents  being
collectively  called  the  "Debt"),  and  all  of  the  agreements,   covenants,
conditions,  warranties,  representations  and other obligations  (other than to
repay the Debt) made or undertaken by Mortgagor or any other person or entity to
Mortgagee  or  others  as set  forth in the Loan  Documents  (collectively,  the
"Obligations"),  Mortgagor  has  mortgaged,  given,  granted,  bargained,  sold,
alienated,  enfeoffed,  conveyed, confirmed, pledged, assigned, and hypothecated
and by these presents does hereby mortgage,  give, grant, bargain,  sell, alien,
enfeoff,  convey, confirm,  pledge, assign and hypothecate unto Mortgagee all of
Mortgagor's leasehold interest in, to and under the Ground Lease (as hereinafter
defined) covering the real property  described on Exhibit A attached hereto (the
"Premises") and the buildings,  structures,  fixtures, additions,  enlargements,
extensions,   modifications,  repairs,  replacements  and  improvements  now  or
hereafter located thereon (the "Improvements");

         TOGETHER WITH: all right,  title,  interest and estate of Mortgagor now
owned,  or  hereafter  acquired,  in  and  to the  following  property,  rights,
interests and estates (the Ground Lease, the Premises, the Improvements together
with the following  property,  rights,  interests and estates being  hereinafter
described are collectively referred to herein as the "Mortgaged Property"):

               (a) all  easements,  rights-of-way,  strips  and  gores  of land,
streets,  ways, alleys,  passages,  sewer rights,  water,  water courses,  water
rights and powers, air rights and development  rights, and all estates,  rights,
titles,  interests,   privileges,   liberties,   tenements,   hereditaments  and
appurtenances  of any  nature  whatsoever,  in any way  belonging,  relating  or
pertaining  to  the  Premises  and  the   Improvements  and  the  reversion  and
reversions,  remainder  and  remainders,  and all  land  lying in the bed of any
street,  road or  avenue,  opened  or  proposed,  in front of or  adjoining  the
Premises,  to the center  line  thereof  and all the  estates,  rights,  titles,
interests, dower and rights of dower, courtesy and rights of courtesy, property,
possession, claim and demand whatsoever, both at law and in equity, of Mortgagor
of,  in and to the  Premises  and the  Improvements  and every  part and  parcel
thereof, with the appurtenances thereto;

               (b)  all  machinery,  equipment,  fixtures  (including,  but  not
limited to, all heating, air conditioning,  plumbing,  lighting,  communications
and  elevator  fixtures)  and other  property of every kind and nature,  whether
tangible or intangible, whatsoever owned by Mortgagor, or in which Mortgagor has
or shall have an interest,  now or  hereafter  located upon the Premises and the
Improvements,  or appurtenant thereto, and usable in connection with the present
or future  operation and occupancy of the Premises and the  Improvements and all
building  equipment,  materials and supplies of any nature  whatsoever  owned by
Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter
located upon the Premises and the  Improvements,  or  appurtenant  thereto,  and
usable in  connection  with the  present  or  future  operation,  enjoyment  and
occupancy of the Premises and the Improvements  (hereinafter collectively called
the  "Equipment"),  including  the  proceeds  of any  sale  or  transfer  of the
foregoing,  and the right,  title and interest of Mortgagor in and to any of the
Equipment  which may be subject  to any  security  interests,  as defined in the
Uniform Commercial Code, as adopted and enacted by the state or states where any
of the Mortgaged Property is located (the "Uniform Commercial Code") superior in
lien to the lien of this Mortgage;

                                       2
<PAGE>

               (c) all awards or payments, including interest thereon, which may
heretofore and hereafter be made with respect to the Mortgaged Property, whether
from the exercise of the right of eminent domain or condemnation (including, but
not limited to, any transfer made in lieu of or in  anticipation of the exercise
of said  rights),  or for a change  of  grade,  or for any  other  injury  to or
decrease in the value of the Mortgaged Property;

               (d)  all  leases,  tenancies,  licenses,  subleases,  assignments
and/or other rental or occupancy agreements (including,  without limitation, any
and all guarantees of any of the foregoing) heretofore or hereafter entered into
affecting the use,  enjoyment or occupancy of the Premises and the Improvements,
including  any  extensions,   renewals,   modifications  or  amendments  thereof
(collectively,  the "Leases") and all rents,  rent  equivalents  (including room
revenues,  if applicable),  moneys payable as damages or in lieu of rent or rent
equivalents,  royalties (including, without limitation, all oil and gas or other
mineral  royalties  and  bonuses),  income,  receivables,   receipts,  revenues,
deposits (including, without limitation,  security, utility and other deposits),
accounts,  cash,  issues,  profits,  charges for  services  rendered,  and other
consideration  of  whatever  form or  nature  received  by or paid to or for the
account of or benefit of Mortgagor  or its agents or employees  from any and all
sources arising from or attributable to the Premises and the  Improvements  (the
"Rents"),  together with all proceeds from the sale or other  disposition of the
Leases and the right to receive and apply the Rents to the payment of the Debt;

               (e) all  proceeds of and any unearned  premiums on any  insurance
policies covering the Mortgaged Property,  including,  without  limitation,  the
right to  receive  and  apply  the  proceeds  of any  insurance,  judgments,  or
settlements  made in lieu thereof,  for damage to the Mortgaged  Property or any
part thereof;

               (f) the right,  following an Event of Default, in the name and on
behalf of Mortgagor,  to appear in and defend any action or  proceeding  brought
with respect to the Mortgaged  Property and to commence any action or proceeding
to protect the interest of the Mortgagee in the  Mortgaged  Property or any part
thereof;

               (g) all  accounts,  escrows,  reserves,  documents,  instruments,
chattel paper, claims, deposits and general intangibles,  as the foregoing terms
are defined in the  Uniform  Commercial  Code,  and all books,  records,  plans,
specifications,  designs,  drawings,  permits, consents,  licenses,  franchises,
management   agreements,   contracts,   contract  rights   (including,   without
limitation,  any  contract  with any  architect  or  engineer  or with any other
provider  of goods  or  services  for or in  connection  with any  construction,
repair, or other work upon the Mortgaged Property),  approvals, actions, refunds
or real estate taxes and  assessments  (and any other  governmental  impositions
related to the Mortgaged  Property),  and causes of action that now or hereafter
relate  to,  are  derived  from or are used in  connection  with  the  Mortgaged
Property, or the use, operation,  management,  improvement,  alteration, repair,
maintenance,  occupancy or  enjoyment  thereof or the conduct of any business or
activities thereon;

               (h) any and all proceeds and products of any of the foregoing and
any and all other  security  and  collateral  of any nature  whatsoever,  now or
hereafter given for the repayment of the Debt and the performance of Mortgagor's
obligations  under  the  Loan  Documents,

                                       3
<PAGE>

including  (without  limitation)  the  Impositions  and Insurance  Reserve,  the
Replacement  Reserve,  the Hazardous  Materials  Remediation  Reserve,  the Loss
Proceeds  Account,  the Central  Account and the  Sub-Accounts  thereof (each as
defined  in the Cash  Management  Agreement,  dated as of the  date  hereof  (as
amended or modified the "Cash Management Agreement"),  by and between Mortgagor,
Mortgagee,  First Union  National  Bank,  and REIT  Management & Research,  Inc.
("Manager")), and any other escrows or reserves set forth in the Loan Documents;

               (i) all accounts receivable,  contract rights, interests,  estate
or other  claims,  both in law and in  equity,  which  Mortgagor  now has or may
hereafter acquire in the Mortgaged Property or any part thereof; and

               (j) all rights which Mortgagor now has or may hereafter  acquire,
to be indemnified and/or held harmless from any liability, loss, damage, cost or
expense  (including,  without  limitation,  attorneys'  fees and  disbursements)
relating to the Mortgaged Property or any part thereof.

         TO HAVE AND TO HOLD the above granted and described  Mortgaged Property
unto and to the use and benefit of Mortgagee,  and the successors and assigns of
Mortgagee, forever;

         PROVIDED,  HOWEVER, these presents are upon the express condition that,
if Mortgagor  shall well and truly pay to Mortgagee  the Debt at the time and in
the manner provided in the Note and this Mortgage and shall well and truly abide
by and comply with each and every covenant and condition set forth herein and in
the Note in a timely manner,  these presents and the estate hereby granted shall
cease, terminate and be void;

         AND Mortgagor  represents and warrants to and covenants and agrees with
Mortgagee as follows:

         1.  Payment of Debt and  Incorporation  of  Covenants,  Conditions  and
Agreements.  Mortgagor shall pay the Debt at the time and in the manner provided
in the Note, the Loan  Agreement and in this  Mortgage.  Mortgagor will duly and
punctually perform all of the covenants,  conditions and agreements contained in
the Note, the Loan Agreement,  this Mortgage and the other Loan Documents all of
which  covenants,  conditions  and  agreements  are  hereby  made a part of this
Mortgage  to the same  extent  and with the  same  force as if fully  set  forth
herein.

         2. Warranty of Title.  Mortgagor  warrants  that  Mortgagor has a good,
marketable and insurable  leasehold  interest in the Mortgaged  Property and has
the right to mortgage,  give,  grant,  bargain,  sell, alien,  enfeoff,  convey,
confirm,  pledge, assign and hypothecate the same and that Mortgagor possesses a
leasehold  estate  in the  Premises  and the  Improvements  and that it owns the
Mortgaged  Property  free  and  clear of all  liens,  encumbrances  and  charges
whatsoever  except for the  Permitted  Encumbrances.  Mortgagor  represents  and
warrants that none of the Permitted  Encumbrances  will materially and adversely
affect  (i)  Mortgagor's  ability  to  pay  in  full  in  a  timely  manner  its
obligations,  including,  without  limitation,  the  Debt,  (ii)  the use of the
Mortgaged Property for the use currently being made thereof, (iii) the operation
of the  Mortgaged  Property,  or  (iv)  the  value  of the  Mortgaged  Property.
Mortgagor shall forever warrant, defend

                                       4
<PAGE>

and  preserve  such  title and the  validity  and  priority  of the lien of this
Mortgage and shall forever warrant and defend the same to Mortgagee  against the
claims of all persons whomsoever.

         3.  Insurance.  (a)  Mortgagor,  at its sole  cost and  expense,  shall
maintain  or cause to be  maintained  insurance  with  respect to the  Mortgaged
Property  for the mutual  benefit of  Mortgagor  and  Mortgagee  as  required by
Section 5.4 of the Loan Agreement.

               (b) If the Mortgaged  Property shall be damaged or destroyed,  in
whole or in part, by fire or other casualty (an "Insured  Casualty"),  Mortgagor
shall give immediate  notice thereof to Mortgagee and to the insurance  carrier.
Subject to the terms of the Loan  Agreement,  Mortgagor  shall promptly  repair,
replace or rebuild the Mortgaged  Property in accordance  with,  and all amounts
paid  with  respect  to such  Insured  Casualty  under  all  insurance  policies
maintained  by  Mortgagor  shall be  governed  by, the terms and  conditions  of
Section 5.5 of the Loan  Agreement.  The  expenses  incurred by Mortgagee in the
adjustment  and  collection of insurance  proceeds shall become part of the Debt
and shall be secured  hereby and shall be  reimbursed  by Mortgagor to Mortgagee
upon demand.

         4. Payment of  Impositions  and Other  Charges.  Subject to Mortgagor's
right to  contest  set forth in  Section  5.3(B) of the Loan  Agreement  and the
provisions  of  Section 5 below,  and  pursuant  to the  provisions  of the Cash
Management  Agreement,  Mortgagor  shall cause to be paid all Impositions now or
hereafter  levied or assessed or imposed  against the Mortgaged  Property or any
part thereof as the same become due and payable.  Mortgagor  shall  promptly pay
for all utility  services  provided to the Mortgaged  Property.  Mortgagor shall
furnish to Mortgagee or its designee receipts for the payment of the Impositions
prior to the date the same shall  become  delinquent  (provided,  however,  that
Mortgagor  shall not be  required  to  furnish  such  receipts  for  payment  of
Impositions  in the event  that  such  Impositions  have been paid by  Mortgagee
pursuant to Section 5 hereof).

         5.  Impositions  and Insurance  Reserve.  Mortgagor  shall make monthly
deposits into the Impositions and Insurance Reserve of amounts sufficient to pay
Impositions and Insurance  Premiums (if and to the extent Insurance Premiums are
required to be escrowed under the Loan  Agreement) in accordance  with the terms
of Section 6.3 of the Loan Agreement and the Cash Management Agreement.

         6.  Condemnation.  (a) Mortgagor shall promptly give Mortgagee  written
notice of the actual or threatened  commencement of any  condemnation or eminent
domain  proceeding  affecting the Mortgaged  Property or any portion thereof and
shall  deliver to Mortgagee  copies of any and all papers  served in  connection
with such proceedings.  Subject to the terms of Section 6(b) below, Mortgagee is
hereby irrevocably  appointed as Mortgagor's  attorney-in-fact,  coupled with an
interest,  with  exclusive  power to  collect,  receive  and retain any award or
payment for said  condemnation  or eminent  domain and to make any compromise or
settlement in connection with such proceeding, subject to the provisions of this
Mortgage.  Notwithstanding  any taking by any public or quasi  public  authority
through  eminent domain or otherwise  (including but not limited to any transfer
made in lieu of or in  anticipation  of the exercise of such taking),  Mortgagor
shall  continue to pay the Debt at the time and in the manner  provided  for its
payment

                                       5
<PAGE>

in the Note,  in this  Mortgage and the other Loan  Documents and the Debt shall
not be reduced  until any award or  payment  therefor  shall have been  actually
received  after expenses of collection and applied by Mortgagee to the discharge
of the Debt in accordance  with the terms hereof.  In accordance  with the terms
hereof,  Mortgagor shall cause the award or payment made in any  condemnation or
eminent domain proceeding, which is payable to Mortgagor, to be paid directly to
Mortgagee.  Mortgagee  may apply any such award or payment to the  reduction  or
discharge of the Debt whether or not then due and payable;  such  application to
be without any Prepayment  Consideration (as defined in the Note), provided that
such payment is made within one hundred  twenty (120) days following the date of
receipt  of such  condemnation  award  except  that if an Event of  Default  has
occurred  and is  continuing,  then such  application  shall be  subject  to the
Prepayment  Consideration computed in accordance with the Note. If the Mortgaged
Property  is  sold  following  an  Event  of  Default,  through  foreclosure  or
otherwise, prior to the receipt by Mortgagee of such award or payment, Mortgagee
shall have the right,  whether or not a  deficiency  judgment  on the Note shall
have been sought,  recovered or denied,  to receive said award or payment,  or a
portion thereof sufficient to pay the Debt.

                  (b)  Notwithstanding   the  foregoing,   Mortgagee  shall  not
exercise the foregoing  rights and  Mortgagor  may  prosecute  any  condemnation
proceeding  and settle or  compromise  and collect any claim  involving an award
and/or  claim for damages of not more than the  Restoration  Threshold  provided
that:  (i) no Event of Default  shall have occurred and be  continuing,  (ii) in
Mortgagee's sole good faith judgment,  such  condemnation or taking does not and
will not materially  restrict access to the Mortgaged Property or otherwise have
a Material  Adverse  Effect,  and the Mortgaged  Property  remaining  after such
condemnation  or taking is capable of being restored to an  economically  viable
whole of the same type which existed prior to the  condemnation or taking and in
compliance with all applicable  laws,  (iii)  Mortgagor  applies the proceeds of
such award to any  reconstruction or repair of the Mortgaged  Property necessary
as a result of such condemnation or taking,  (iv) Mortgagor  promptly  commences
and  diligently  prosecutes  such  reconstruction  or  repair to  completion  in
accordance  with  all  applicable  laws  and (v) at  Mortgagee's  request,  such
reconstruction  or  repair  shall  be  performed  under  the  supervision  of an
architect  or engineer  reasonably  acceptable  to  Mortgagee  and the plans and
specifications  for  such  work  shall  be  subject  to  Mortgagee's  reasonable
approval.  Mortgagor  authorizes  Mortgagee  to  apply  such  awards,  payments,
proceeds or damages,  after the  deduction of  Mortgagee's  reasonable  expenses
incurred  in  the  collection  of  such  amounts,   at  Mortgagee's  option,  to
restoration  or repair  of the  Mortgaged  Property  or to  payment  of the sums
secured by this  Mortgage,  whether or not then due, in the order  determined by
Mortgagee,  with the balance, if any, to Mortgagor.  In the event that Mortgagee
shall apply any such awards,  payments,  proceeds or damages to the indebtedness
secured hereby pursuant to the foregoing sentence,  no Prepayment  Consideration
or other  prepayment  premium or penalty shall be due and payable under the Note
in connection therewith. Subject to the provisions of clauses (i) through (v) of
this Section 6(b), Mortgagee shall not exercise Mortgagee's option to apply such
awards or damages to payment of the sums secured by this Mortgage  provided that
each of the conditions (as applicable) to the release of insurance  proceeds for
restoration  or repair of the Mortgaged  Property  under Section 5.5 of the Loan
Agreement  have been  satisfied  with  respect  to such  condemnation  awards or
damages.  Any  application of proceeds to principal shall not extend or postpone
the due date of the monthly installments due hereunder,  under the Note or under
any of

                                       6
<PAGE>

the Loan Documents or change the amount of such  installments.  Mortgagor agrees
to execute such further evidence of assignment of any awards, proceeds,  damages
or claims arising in connection  with such  condemnation  or taking as Mortgagee
may reasonably require.

         7.  Maintenance  of  Mortgaged  Property.  Mortgagor  shall  cause  the
Mortgaged  Property to be operated and  maintained in a good and safe  condition
and repair and in  keeping  with the  condition  and repair of  properties  of a
similar use,  value,  age,  nature and  construction.  Mortgagor  shall not use,
maintain or operate the  Mortgaged  Property in any manner which  constitutes  a
public or private  nuisance or which makes void,  voidable,  or  cancelable,  or
increases the premium of, any insurance then in force with respect thereto.  The
Improvements  and the  Equipment  shall  not be  removed  or  demolished  and no
Material  Alterations  shall be made thereto  (except for normal  replacement or
disposal of the  Equipment  and except as otherwise  expressly  permitted in the
Loan  Agreement)  without the consent of  Mortgagee,  which consent shall not be
unreasonably withheld,  delayed or conditioned.  Mortgagor shall promptly comply
in all material  respects  with all laws,  orders and  ordinances  affecting the
Mortgaged Property, or the use thereof.

         8. Use of Mortgaged  Property.  Mortgagor shall not initiate,  join in,
acquiesce  in, or  consent to any change in any  private  restrictive  covenant,
zoning law or other public or private restriction, limiting or defining the uses
which  may be made of the  Mortgaged  Property  or any part  thereof,  nor shall
Mortgagor  initiate,  join in,  acquiesce in, or consent to any zoning change or
zoning matter  affecting the Mortgaged  Property,  which in any of the foregoing
cases could  reasonably be expected to result in a Material  Adverse Effect.  If
under  applicable  zoning  provisions  the  use of all  or  any  portion  of the
Mortgaged  Property is or shall become a nonconforming  use,  Mortgagor will not
cause or permit such  nonconforming  use to be discontinued or abandoned without
the  express  written   consent  of  Mortgagee,   which  consent  shall  not  be
unreasonably  withheld.  Mortgagor shall not permit or suffer to occur any waste
on or to the Mortgaged Property or to any portion thereof and shall not take any
steps whatsoever to convert the Mortgaged Property, or any portion thereof, to a
condominium  or cooperative  form of  management.  Mortgagor will not install or
permit  to be  installed  on  the  Premises  any  underground  storage  tank  or
above-ground storage tank in violation of the Environmental Laws.

         9. Transfer or  Encumbrance  of the Mortgaged  Property.  (a) Mortgagor
acknowledges that Mortgagee has examined and relied on the  creditworthiness and
experience of Mortgagor in owning and operating properties such as the Mortgaged
Property in agreeing to make the Loan,  and that Mortgagee will continue to rely
on Mortgagor's ownership of the Mortgaged Property as a means of maintaining the
value of the Mortgaged Property as security for repayment of the Debt. Except as
expressly  permitted under this Mortgage,  the Loan Agreement or under the other
Loan Documents,  Mortgagor shall not cause or suffer to occur or exist, directly
or indirectly,  voluntarily or involuntarily,  by operation of law or otherwise,
any sale, transfer,  mortgage, pledge, lien or encumbrance (other than Permitted
Encumbrances)  (collectively,  "Transfers")  of  (i)  all  or  any  part  of the
Mortgaged  Property  or any  interest  therein,  or (ii) any direct or  indirect
beneficial  ownership interest (in whole or in part) in Mortgagor,  irrespective
of the  number of tiers of  ownership,  without  the prior  written  consent  of
Mortgagee.

                                       7
<PAGE>

               (b)  Notwithstanding  the foregoing,  Mortgagor may,  without the
consent of Mortgagee, (i) make immaterial transfers of portions of the Mortgaged
Property to any federal,  state or local government or any political subdivision
thereof (collectively,  "Governmental Authorities") for dedication or public use
(subject  to the  provisions  of  Section 6 hereof)  and (ii)  grant  easements,
restrictions,  covenants,  reservations and rights of way in the ordinary course
of business  for access,  water and sewer  lines,  telephone,  cellular,  cable,
internet and telegraph  lines,  electric  lines or other  utilities or for other
similar purposes,  provided that no such transfer or conveyance set forth in the
foregoing  clauses (i) and (ii) shall have a Material Adverse Effect;  provided,
however,  that  Mortgagor  shall give  Mortgagee  at least ten (10) days'  prior
written notice of any such transfer or conveyance  describing same in reasonable
detail and certifying  that such transfer or conveyance  satisfies the foregoing
conditions.

               (c) The occurrence of any Transfer in violation of this Section 9
shall  constitute  an Event of Default  hereunder,  whereupon  Mortgagee  at its
option,  without  being  required to  demonstrate  any actual  impairment of its
security  or any  increased  risk of default  hereunder,  may  declare  the Debt
immediately due and payable.

               (d) Mortgagee's consent to any Transfer of the Mortgaged Property
or any interest in Mortgagor  shall not be deemed to be a waiver of  Mortgagee's
right to require such consent to any future occurrence of same. Any attempted or
purported  Transfer  of the  Mortgaged  Property  or of any  direct or  indirect
interest in Mortgagor, if made in contravention of this Section 9, shall be null
and void and of no force and effect.

               (e)  Notwithstanding  the  foregoing  provisions  of Section 9(a)
above,  Mortgagor  shall have the right to sell or transfer all of the Mortgaged
Property with  Mortgagee's  consent  pursuant to a Transfer and  Assumption  (as
defined in the Loan  Agreement) in accordance  with the terms and  conditions of
Section 11.3 of the Loan Agreement.

         10.  Taxes  on  Security;  Documentary  Stamps;  Intangibles  Tax.  (a)
Mortgagor shall pay all taxes, charges, filing, registration and recording fees,
excises and levies payable with respect to the Note,  this Mortgage or the liens
created or secured by the Loan Documents, other than income, franchise and doing
business  taxes  imposed on  Mortgagee.  If there  shall be enacted  any law (i)
deducting the Loan from the value of the  Mortgaged  Property for the purpose of
taxation,  (ii) affecting any lien on the Mortgaged Property,  or (iii) changing
existing laws of taxation of mortgages, deeds of trust, security deeds, or debts
secured by real  property,  or changing the manner of collecting any such taxes,
Mortgagor  shall  promptly pay to  Mortgagee,  on demand,  all taxes,  costs and
charges for which Mortgagee is or may be liable as a result thereof; however, if
such payment would be prohibited by law or would render the Loan usurious,  then
instead of  collecting  such  payment,  Mortgagee  may declare all amounts owing
under the Loan  Documents  to be  immediately  due and  payable.  No  Prepayment
Consideration shall be imposed on any such payment.

               (b) If at any  time the  United  States  of  America,  any  State
thereof or any  subdivision  of any such State  shall  require  revenue or other
stamps to be  affixed to the Note or this  Mortgage,  or impose any other tax or
charge on the same, Mortgagor will pay for the same,

                                       8
<PAGE>

with interest and penalties  thereon,  if any.  Mortgagor hereby agrees that, in
the  event  that it is  determined  that  additional  documentary  stamp  tax or
intangible  tax is due hereon or any  mortgage or  promissory  note  executed in
connection herewith (including,  without limitation,  the Note), Mortgagor shall
indemnify and hold harmless  Mortgagee for all such documentary stamp tax and/or
intangible  tax,  including all  penalties  and interest  assessed or charged in
connection therewith. Mortgagor shall pay same within ten (10) days after demand
of payment from  Mortgagee and the payment of such sums shall be secured by this
Mortgage  and such sums shall bear  interest at the Default  Rate (as defined in
the Note)  from and after the  eleventh  (11th) day after  demand  until paid in
full.

               (c) Mortgagor  shall hold harmless and indemnify  Mortgagee,  its
successors  and  assigns,  against  any  liability  incurred  by  reason  of the
imposition of any tax on the making and recording of this Mortgage.

         11. No  Credits on  Account  of the Debt.  Mortgagor  will not claim or
demand or be  entitled  to any  credit or credits on account of the Debt for any
part of the Impositions  assessed  against the Mortgaged  Property,  or any part
thereof,  and no deduction  shall otherwise be made or claimed from the assessed
value of the  Mortgaged  Property,  or any part  thereof,  for real  estate  tax
purposes by reason of this Mortgage or the Debt. In the event such claim, credit
or  deduction  shall be required  by law,  Mortgagee  shall have the option,  by
written  notice  of not  less  than  ninety  (90)  days,  to  declare  the  Debt
immediately due and payable. No Prepayment Consideration shall be imposed on any
such payment.

         12.   Performance  of  Other  Agreements.   Mortgagor  shall  duly  and
punctually  observe  and  perform  each  and  every  material  term,  provision,
condition, and covenant to be observed or performed by Mortgagor pursuant to the
terms  of any  agreement  or  recorded  instrument  (including  all  instruments
comprising the Permitted  Encumbrances) affecting or pertaining to the Mortgaged
Property,  and will not suffer or permit any default or event of default  (after
giving effect to any applicable  notice  requirements and cure periods) to exist
under any of the foregoing.

         13. Further Acts; Secondary Market Transactions. (a) Mortgagor will, at
its sole cost and  expense,  and  without  expense to  Mortgagee,  do,  execute,
acknowledge  and deliver all and every such further  acts,  deeds,  conveyances,
mortgages, assignments, notices of assignment, Uniform Commercial Code financing
statements or  continuation  statements,  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  mortgaged,  given,  granted,  bargained,  sold,  alienated,
enfeoffed,  conveyed,  confirmed, pledged, assigned and hypothecated 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 for  filing,
registering or recording this Mortgage.  Mortgagor,  on demand, will execute and
deliver and,  upon  Mortgagor's  failure to do so within five (5) Business  Days
after Mortgagee's  request therefor,  hereby authorizes  Mortgagee to execute in
the name of  Mortgagor  or without  the  signature  of  Mortgagor  to the extent
Mortgagee  may  lawfully  do  so,  one or  more  financing  statements,  chattel
mortgages  or other  instruments,  to evidence  more  effectively  the  security
interest  of  Mortgagee

                                       9
<PAGE>

in the Mortgaged  Property.  Upon  foreclosure or the appointment of a receiver,
Mortgagor will, at its sole cost and expense,  cooperate fully and completely to
effect the assignment or transfer of any license, permit, agreement or any other
right necessary or useful to the operation of the Mortgaged Property.  Mortgagor
grants to Mortgagee an  irrevocable  power of attorney  coupled with an interest
for the purpose of  exercising  and  perfecting  any and all rights and remedies
available to Mortgagee at law and in equity, including, without limitation, such
rights and remedies available to Mortgagee pursuant to this Section.

               (b)  Subject  to the terms and  conditions  set forth in the Loan
Agreement,  Mortgagee  shall  have the right to engage in one or more  Secondary
Market  Transactions  and, in connection  therewith,  Mortgagee may transfer its
obligations  under this  Mortgage,  the Note,  the Loan  Agreement and under the
other Loan Documents (or may transfer the portion thereof  corresponding  to the
transferred  portion of the  Obligations),  and  thereafter  Mortgagee  shall be
relieved of any obligations hereunder and under the other Loan Documents arising
after the date of said transfer with respect to the transferred interest.

         14. Recording of Mortgage, Etc. Upon the execution and delivery of this
Mortgage and thereafter,  from time to time, Mortgagor will cause this Mortgage,
and any security  instrument  creating a lien or security interest or evidencing
the lien hereof  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 fully to protect the lien or security interest hereof upon, and the interest
of  Mortgagee  in,  the  Mortgaged  Property.  Mortgagor  will  pay all  filing,
registration  or recording fees, and all expenses  incident to the  preparation,
execution and acknowledgment of this Mortgage, any mortgage supplemental hereto,
any  security  instrument  with  respect  to  the  Mortgaged  Property  and  any
instrument of further assurance,  and all federal,  state, county and municipal,
taxes, duties, imposts,  assessments and charges arising out of or in connection
with the  execution  and delivery of this  Mortgage,  any mortgage  supplemental
hereto,  any security  instrument with respect to the Mortgaged  Property or any
instrument of further assurance, except where prohibited by law so to do.

         15. Reporting  Requirements.  Mortgagor agrees to give prompt notice to
Mortgagee  of the  insolvency  or  bankruptcy  filing of Mortgagor or the death,
insolvency or bankruptcy filing of any Guarantor.

         16. Intentionally Deleted.

         17.  Remedies.  Upon the  occurrence  and during the  continuance of an
Event of Default,  Mortgagee may, at Mortgagee's option, by Mortgagee itself, or
otherwise, do any one or more of the following:

               (a) Right to Perform  Mortgagor's  Covenants.  If  Mortgagor  has
failed to keep or perform any covenant whatsoever  contained in this Mortgage or
the other Loan  Documents,  Mortgagee  may, but shall not be obligated to do so,
perform or attempt to perform  said  covenant;  and any payment  made or expense
incurred in the  performance  or  attempted  performance  of any such  covenant,
together  with any sum expended by Mortgagee  that is chargeable to Mortgagor or

                                       10
<PAGE>

subject to  reimbursement  by Mortgagor under the Loan  Documents,  shall be and
become a part of the  Debt,  and  Mortgagor  promises,  upon  demand,  to pay to
Mortgagee, at the place where the Note is payable, all sums so incurred, paid or
expended  by  Mortgagee,  with  interest  from the date when paid,  incurred  or
expended by Mortgagee at the Default Rate (as defined in the Note).

               (b) Right of Entry.  Mortgagee  may,  prior or  subsequent to the
institution of any foreclosure  proceedings,  enter upon the Mortgaged Property,
or any part thereof, and take exclusive possession of the Mortgaged Property and
of all books,  records,  and accounts  relating  thereto and to exercise without
interference  from Mortgagor any and all rights which Mortgagor has with respect
to the management,  possession,  operation,  protection,  or preservation of the
Mortgaged Property,  including,  without limitation,  the right to rent the same
for the account of Mortgagor and to deduct from such Rents all costs,  expenses,
and liabilities of every character  incurred by the Mortgagee in collecting such
Rents and in managing,  operating,  maintaining,  protecting,  or preserving the
Mortgaged  Property and to apply the remainder of such Rents on the Debt in such
manner as  Mortgagee  may  elect.  All such  costs,  expenses,  and  liabilities
incurred by  Mortgagee  in  collecting  such Rents and in  managing,  operating,
maintaining,  protecting,  or preserving the Mortgaged Property, if not paid out
of Rents as hereinabove provided,  shall constitute a demand obligation owing by
Mortgagor and shall bear interest from the date of expenditure until paid at the
Default Rate as specified in the Note,  all of which shall  constitute a portion
of the Debt. If Mortgagee elects to enter the Mortgaged Property as provided for
herein, Mortgagee may invoke any and all legal remedies to dispossess Mortgagor,
including  specifically  one or more  actions for forcible  entry and  detainer,
trespass to try title, and  restitution.  In connection with any action taken by
the Mortgagee pursuant to this subsection, Mortgagee shall not be liable for any
loss  sustained by  Mortgagor  resulting  from any failure to let the  Mortgaged
Property,  or any  part  thereof,  or from  any  other  act or  omission  of the
Mortgagee in managing the Mortgaged  Property  unless such loss is caused by the
willful  misconduct or gross negligence of Mortgagee,  its agents,  employees or
officers,  nor  shall  Mortgagee  be  obligated  to  perform  or  discharge  any
obligation,  duty, or liability  under any Lease or under or by reason hereof or
the exercise of rights or remedies  hereunder.  Mortgagor  shall and does hereby
agree to indemnify, defend and hold harmless the Indemnified Parties (as defined
in Section 23 below) from and against,  any and all  liability,  claim,  demand,
loss,  damage,  cost  or  expense  (including,  without  limitation,  reasonable
attorneys' fees and disbursements) which may or might be suffered or incurred by
any  Indemnified  Party under any such Lease or under or by reason hereof or the
exercise  of  rights  or  remedies  hereunder,  or  by  reason  of  any  alleged
obligations  or  undertakings  on its part to  perform or  discharge  any of the
terms, covenants, or agreements contained in any such Lease as and to the extent
provided  under Section 23 below.  Nothing in this  subsection  shall impose any
duty, obligation,  or responsibility upon any Indemnified Party for the control,
care,  management,  leasing,  or repair of the Mortgaged  Property,  nor for the
carrying out of any of the terms and  conditions  of any such Lease prior to the
transfer  of  title  to the  Mortgaged  Property  to any  Indemnified  Party  by
foreclosure,  deed-in-lieu  thereof,  exercise  of power  of sale or  otherwise.
Mortgagor hereby assents to,  ratifies,  and confirms any and all actions of the
Mortgagee with respect to the Mortgaged Property taken under this subsection.

                                       11
<PAGE>

               (c) Right to Accelerate. Mortgagee may, without notice or demand,
declare the entire unpaid balance of the Debt immediately due and payable.

               (d)  Foreclosure-Power  of Sale.  Mortgagee may from time to time
institute  a  proceeding  or   proceedings,   judicial,   or   nonjudicial,   by
advertisement  or  otherwise,  for the complete or partial  foreclosure  of this
Mortgage or the complete or partial  sale of the  Mortgaged  Property  under the
power  of sale  contained  herein  or under  any  applicable  provision  of law.
Mortgagee  may  sell the  Mortgaged  Property,  and all  estate,  right,  title,
interest,  claim and demand of Mortgagor  therein,  and all rights of redemption
thereof, at one or more sales, as an entirety or in parcels,  with such elements
of real and/or personal property, and at such time and place and upon such terms
as it may deem  expedient,  or as may be required by applicable  law, and in the
event of a sale, by foreclosure or otherwise,  of less than all of the Mortgaged
Property,  this Mortgage shall  continue as a lien and security  interest on the
remaining portion of the Mortgaged Property.

               (e) Rights  Pertaining to Sales.  Subject to the  requirements of
applicable law and except as otherwise provided herein, the following provisions
shall apply to any sale or sales of all or any portion of the Mortgaged Property
under or by virtue of Subsection (d) above, whether made under the power of sale
herein  granted or by virtue of judicial  proceedings or of a judgment or decree
of foreclosure and sale:

                  (i)  Mortgagee  may  conduct  any number of sales from time to
         time.  The power of sale set forth above shall not be  exhausted by any
         one or more such sales as to any part of the Mortgaged  Property  which
         shall not have been sold,  nor by any sale which is not completed or is
         defective in Mortgagee's  opinion,  until the Debt shall have been paid
         in full.

                  (ii)  Any  sale  may  be  postponed  or  adjourned  by  public
         announcement  at the time and place appointed for such sale or for such
         postponed or adjourned sale without further notice.

                  (iii)  After each sale,  Mortgagee  or an officer of any court
         empowered  to do so shall  execute  and  deliver  to the  purchaser  or
         purchasers at such sale a good and sufficient instrument or instruments
         granting,  conveying,  assigning and transferring all right,  title and
         interest of  Mortgagor in and to the property and rights sold and shall
         receive  the  proceeds  of said  sale or sales  and  apply  the same as
         specified in the Loan Agreement. Mortgagee is hereby appointed the true
         and  lawful   attorney-in-fact  of  Mortgagor,   which  appointment  is
         irrevocable  and shall be deemed to be  coupled  with an  interest,  in
         Mortgagor's  name  and  stead,  to  make  all  necessary   conveyances,
         assignments,  transfers  and  deliveries  of the property and rights so
         sold,  Mortgagor hereby ratifying and confirming all that said attorney
         or such substitute or substitutes  shall lawfully do by virtue thereof.
         Nevertheless,  Mortgagor,  if requested by Mortgagee,  shall ratify and
         confirm any such sale or sales by executing and delivering to Mortgagee
         or  such  purchaser  or

                                       12
<PAGE>

         purchasers  all such  instruments  as may be advisable,  in Mortgagee's
         judgment, for the purposes as may be designated in such request.

                  (iv) Any and all  statements of fact or other recitals made in
         any of the instruments  referred to in Subsection  (e)(iii) above given
         by  Mortgagee  shall be taken as  conclusive  and  binding  against all
         persons as to evidence of the truth of the facts so stated and recited.

                  (v) Any such sale or sales shall  operate to divest all of the
         estate, right, title, interest, claim and demand whatsoever, whether at
         law or in equity,  of Mortgagor in and to the  properties and rights so
         sold,  and shall be a perpetual  bar both at law and in equity  against
         Mortgagor  and any and all persons  claiming or who may claim the same,
         or any part  thereof  or any  interest  therein,  by,  through or under
         Mortgagor to the fullest extent permitted by applicable law.

                  (vi) Upon any such sale or  sales,  Mortgagee  may bid for and
         acquire the Mortgaged  Property  and, in lieu of paying cash  therefor,
         may make a settlement for the purchase  price by crediting  against the
         Debt the amount of the bid made therefor, after deducting therefrom the
         expenses of the sale, the cost of any enforcement proceeding hereunder,
         and any other sums which  Mortgagee is  authorized  to deduct under the
         terms hereof, to the extent necessary to satisfy such bid.

                  (vii)  Upon  any such  sale,  it shall  not be  necessary  for
         Mortgagee  or any public  officer  acting  under  execution or order of
         court to have present or  constructively  in its  possession any of the
         Mortgaged Property.

               (f) Mortgagee's Judicial Remedies.  Mortgagee may proceed by suit
or suits,  at law or in equity,  to enforce the payment of the Debt to foreclose
the liens and security  interests of this Mortgage as against all or any part of
the Mortgaged  Property,  and to have all or any part of the Mortgaged  Property
sold under the  judgment or decree of a court of  competent  jurisdiction.  This
remedy shall be cumulative of any other  nonjudicial  remedies  available to the
Mortgagee  under this Mortgage or the other Loan  Documents.  Proceeding  with a
request or receiving a judgment for legal relief shall not be or be deemed to be
an  election  of  remedies  or  bar  any  available  nonjudicial  remedy  of the
Mortgagee.

               (g) Mortgagee's Right to Appointment of Receiver. Mortgagee, as a
matter of right and (i) without  regard to the  sufficiency  of the security for
repayment of the Debt and without notice to Mortgagor,  (ii) without any showing
of insolvency,  fraud, or mismanagement on the part of Mortgagor,  (iii) without
the  necessity  of  filing  any  judicial  or other  proceeding  other  than the
proceeding for  appointment  of a receiver,  and (iv) without regard to the then
value of the  Mortgaged  Property,  shall be  entitled to the  appointment  of a
receiver or receivers for the protection,  possession,  control,  management and
operation of the Mortgaged Property,  including (without limitation),  the power
to  collect  the  Rents,  enforce  this  Mortgage  and,  in case  of a sale  and
deficiency,  during the full statutory  period of redemption  (if any),  whether
there  be a  redemption  or not,  as well  as  during  any  further  times  when
Mortgagor,  except for the

                                       13
<PAGE>

intervention  of such  receiver,  would be entitled to collection of such Rents.
Mortgagor  hereby  irrevocably  consents  to the  appointment  of a receiver  or
receivers.  Any receiver appointed pursuant to the provisions of this subsection
shall have the usual powers and duties of receivers in such matters.

               (h) Mortgagee's  Uniform Commercial Code Remedies.  Mortgagee may
exercise its rights of enforcement  under the Uniform  Commercial Code in effect
in the state in which the Mortgaged Property is located.

               (i) Other  Rights.  Mortgagee  (i) may  surrender  the  insurance
policies maintained pursuant to the Loan Agreement or any part thereof, and upon
receipt of the proceeds shall apply the unearned  Insurance Premiums as a credit
on the Debt, and, in connection  therewith,  Mortgagor hereby appoints Mortgagee
as  agent  and  attorney-in-fact  (which  is  coupled  with an  interest  and is
therefore  irrevocable) for Mortgagor to collect such Insurance  Premiums;  (ii)
may apply the Impositions  and Insurance  Reserve and/or any other Reserves held
pursuant to this Mortgage or the other Loan Documents,  and any other funds held
by Mortgagee  toward  payment of the Debt; and (iii) shall have and may exercise
any and all other  rights and  remedies  which  Mortgagee  may have at law or in
equity, or by virtue of any of the Loan Documents, or otherwise.

               (j) Discontinuance of Remedies. If Mortgagee shall have proceeded
to invoke any right,  remedy, or recourse permitted under the Loan Documents and
shall thereafter elect to discontinue or abandon same for any reason,  Mortgagee
shall have the  unqualified  right so to do and,  in such event,  Mortgagor  and
Mortgagee shall be restored to their former  positions with respect to the Debt,
the Loan  Documents,  the  Mortgaged  Property  or  otherwise,  and the  rights,
remedies,  recourses and powers of Mortgagee shall continue as if same had never
been invoked.

               (k) Remedies Cumulative.  All rights,  remedies, and recourses of
Mortgagee  granted in the Note, this Mortgage and the other Loan Documents,  any
other pledge of collateral,  or otherwise  available at law or equity: (i) shall
be cumulative;  (ii) may be pursued  separately,  successively,  or concurrently
against Mortgagor,  the Mortgaged Property,  or any one or more of them, at such
time and in such order as Mortgagee may determine in its sole discretion;  (iii)
may be exercised as often as occasion  therefor shall arise,  it being agreed by
Mortgagor that the exercise or failure to exercise any of same shall in no event
be construed as a waiver or release  thereof or of any other right,  remedy,  or
recourse;  (iv) shall be nonexclusive of any other right,  power or remedy which
Mortgagee  may  have  against  Mortgagor  pursuant  to this  Mortgage,  the Loan
Agreement  or the other Loan  Documents,  or  otherwise  available  at law or in
equity;  (v) shall not be conditioned upon Mortgagee  exercising or pursuing any
remedy in relation to the Mortgaged Property prior to Mortgagee bringing suit to
recover the Debt;  and (vi) in the event  Mortgagee  elects to bring suit on the
Debt and obtains a judgment  against  Mortgagor prior to exercising any remedies
in  relation  to the  Mortgaged  Property,  all  liens and  security  interests,
including the lien of this  Mortgage,  shall remain in full force and effect and
may be exercised thereafter at Mortgagee's option.

                                       14
<PAGE>

               (l) Election of Remedies.  Mortgagee  may release,  regardless of
consideration,  any part of the Mortgaged Property without, as to the remainder,
in any  way  impairing,  affecting,  subordinating,  or  releasing  the  lien or
security  interests  evidenced by this  Mortgage or the other Loan  Documents or
affecting the  obligations  of Mortgagor or any other party to pay the Debt. For
payment of the Debt, Mortgagee may resort to any collateral securing the payment
of the Debt in such order and manner as Mortgagee may elect. No collateral taken
by Mortgagee shall in any manner impair or affect the lien or security interests
given  pursuant  to the Loan  Documents,  and all  collateral  shall  be  taken,
considered, and held as cumulative.

               (m) Bankruptcy  Acknowledgment.  If the Mortgaged Property or any
portion  thereof or any  interest  therein  becomes  property of any  bankruptcy
estate or subject to any state or federal insolvency proceeding, or in the event
of the filing of any voluntary or involuntary petition under the Bankruptcy Code
by or against  Mortgagor then Mortgagee shall  immediately  become entitled,  in
addition  to all other  relief to which  Mortgagee  may be  entitled  under this
Mortgage,  to obtain (i) an order from any bankruptcy court or other appropriate
court granting  immediate  relief from the automatic stay pursuant to ss. 362 of
the Bankruptcy Code so as to permit  Mortgagee to pursue its rights and remedies
against  Mortgagor  as provided  under this  Mortgage  and all other  rights and
remedies of Mortgagee at law and in equity under  applicable state law, and (ii)
an order from the  Bankruptcy  Court  prohibiting  Mortgagor's  use of all "cash
collateral" as defined under ss. 363 of the Bankruptcy Code. Mortgagor shall not
assert or request any other party to assert,  that the automatic  stay under ss.
362 of the  Bankruptcy  Code  operate  or be  interpreted  to  stay,  interdict,
condition,  reduce or inhibit the ability of  Mortgagee to enforce any rights it
has by virtue of this Mortgage,  or any other rights that Mortgagee has, whether
now or hereafter  acquired,  against any guarantor of the Debt.  Mortgagor shall
not  seek a  supplemental  stay  or any  other  relief,  whether  injunctive  or
otherwise,  pursuant to ss. 105 of the  Bankruptcy  Code or any other  provision
therein  to stay,  interdict,  condition,  reduce  or  inhibit  the  ability  of
Mortgagee  to enforce any rights it has by virtue of this  Mortgage  against any
guarantor  of the Debt.  Any  bankruptcy  petition or other  action taken by the
Mortgagor to stay, condition,  or inhibit Mortgagee from exercising its remedies
are hereby admitted by Mortgagor to be in bad faith and Mortgagor further admits
that Mortgagee would have just cause for relief from the automatic stay in order
to take such actions authorized under state law.

               (n) Application of Proceeds.  The proceeds from any sale,  lease,
or other  disposition  made pursuant to this Mortgage,  or the proceeds from the
surrender of any insurance  policies  pursuant hereto, or any Rents collected by
Mortgagee from the Mortgaged  Property or the Impositions and Insurance  Reserve
or other Reserves under the Cash Management  Agreement or sums received pursuant
to Section 6 hereof,  or proceeds from insurance which Mortgagee elects to apply
to the Debt  pursuant to Section 3 hereof,  shall be applied by Mortgagee to the
Debt in such order, priority and proportions as Mortgagee in its sole discretion
shall determine.

               (o) Confession of Judgment.

                  (i) MORTGAGEE MAY HAVE JUDGMENT ENTERED BY CONFESSION PURSUANT
         TO ANY POWER TO CONFESS  JUDGMENT

                                       15
<PAGE>

         CONTAINED IN THIS MORTGAGE OR IN ANY OF THE LOAN DOCUMENTS.

                  (ii) MORTGAGOR HEREBY  AUTHORIZES AND EMPOWERS ANY ATTORNEY OR
         ATTORNEYS OF ANY COURT OF THE  COMMONWEALTH  OF  PENNSYLVANIA TO APPEAR
         FOR MORTGAGOR  AND, AS ATTORNEY FOR MORTGAGOR,  TO CONFESS  JUDGMENT IN
         EJECTMENT  AGAINST  MORTGAGOR (AND, AT THE ELECTION OF SAID ATTORNEY OR
         ATTORNEYS,  AGAINST ANY PERSON CLAIMING UNDER, BY OR THROUGH MORTGAGOR,
         SUBJECT TO THE  RIGHTS OF TENANTS  UNDER  LEASES  EXISTING  ON THE DATE
         HEREOF (PROVIDED THAT SUCH LEASES ARE EXPRESSLY IDENTIFIED AS PERMITTED
         ENCUMBRANCES)  OR  SUBSEQUENTLY  ENTERED  INTO WITH  MORTGAGEE'S  PRIOR
         WRITTEN  CONSENT,  AND FURTHER  SUBJECT TO  NON-DISTURBANCE  AGREEMENTS
         ENTERED  INTO  BETWEEN  MORTGAGEE  AND ANY  SUCH  TENANT)  IN  FAVOR OF
         MORTGAGEE FOR THE POSSESSION OF THE MORTGAGED PROPERTY OF MORTGAGOR OR,
         AT THE ELECTION OF SAID ATTORNEY OR ATTORNEYS,  ANY PORTION OR PORTIONS
         OF SUCH MORTGAGED PROPERTY. THE FOREGOING AUTHORITY TO CONFESS JUDGMENT
         IS GRANTED INDEPENDENTLY BY MORTGAGOR, AND SHALL BE EXERCISABLE AGAINST
         MORTGAGOR,  AND THE EXERCISE  AGAINST  MORTGAGOR  SHALL NOT EXHAUST THE
         EXERCISE THEREOF AGAINST MORTGAGOR,  BUT SHALL CONTINUE UNTIL MORTGAGEE
         IS FULLY AND FINALLY VESTED WITH POSSESSION OF THE MORTGAGED  PROPERTY.
         MORTGAGOR  EXPRESSLY  AGREES  THAT  ANY  JUDGMENT  ENTERED  AGAINST  IT
         PURSUANT  TO THE  FOREGOING  AUTHORITY  SHALL BE FINAL WITH  RESPECT TO
         MORTGAGOR AND RELEASES TO MORTGAGEE,  AND TO ANY ATTORNEY APPEARING FOR
         MORTGAGEE,  ALL ERRORS IN SAID PROCEEDINGS AND ALL LIABILITY  THEREFOR.
         UPON  CONFESSION  OF JUDGMENT IN  EJECTMENT  PURSUANT TO THE  FOREGOING
         AUTHORITY,  A WRIT OF POSSESSION (OR LIKE WRIT  APPROPRIATE  UNDER THEN
         APPLICABLE LAW) MAY ISSUE FORTHWITH  WITHOUT ANY PRIOR  PROCEEDINGS AND
         MAY INCLUDE THE COSTS OF MORTGAGEE. JUDGMENT MAY BE ENTERED PURSUANT TO
         THE  FOREGOING  AUTHORITY  ON  THE  BASIS  OF  ANY  AFFIDAVIT  MADE  ON
         MORTGAGEE'S  BEHALF AND SETTING FORTH THE RELEVANT FACTS, AND IF A TRUE
         COPY OF THIS  MORTGAGE  IS FILED IN ANY  ACTION FOR SUCH  JUDGMENT,  IT
         SHALL NOT BE NECESSARY TO FILE THE ORIGINAL OF THIS MORTGAGE. MORTGAGEE
         MAY CONFESS  JUDGMENT IN EJECTMENT BEFORE OR AFTER: (A) THE INSTITUTION
         OF  FORECLOSURE  PROCEEDINGS  UNDER  THIS  MORTGAGE,  (B) THE  ENTRY OF
         JUDGMENT  HEREUNDER OR UNDER

                                       16
<PAGE>

         ANY  NOTE  OR  OTHER  LOAN  DOCUMENT,  OR (C) A  SHERIFF'S  SALE OF THE
         MORTGAGED PROPERTY.

         18. Security Agreement.  This Mortgage is both a real property mortgage
and a "security  agreement"  within the meaning of the Uniform  Commercial Code.
The Mortgaged  Property  includes both real and personal  property and all other
rights and interests,  whether tangible or intangible in nature, of Mortgagor in
the Mortgaged Property.  Mortgagor by executing and delivering this Mortgage has
granted and hereby  grants to  Mortgagee,  as security  for the Debt, a security
interest  in the  Mortgaged  Property  to the full  extent  that  the  Mortgaged
Property  may be subject to the  Uniform  Commercial  Code (said  portion of the
Mortgaged  Property so subject to the Uniform  Commercial  Code being  called in
this  Section 18 the  "Collateral").  Mortgagor  hereby  agrees to  execute  and
deliver  to  Mortgagee,   in  form  and  substance  reasonably  satisfactory  to
Mortgagee,  such financing  statements and such further  assurances as Mortgagee
may from time to time  reasonably  consider  necessary to create,  perfect,  and
preserve Mortgagee's security interest herein granted.  This Mortgage shall also
constitute a "fixture filing" for the purposes of the Uniform Commercial Code as
to all or any part of the Mortgaged  Property which now or hereafter  constitute
"fixtures"  under  the  Uniform  Commercial  Code.  Information  concerning  the
security  interest  herein  granted  may be  obtained  from the  parties  at the
addresses of the parties set forth in the first  paragraph of this Mortgage.  If
an Event of Default shall occur,  Mortgagee, in addition to any other rights and
remedies which it may have, shall have and may exercise  immediately and without
demand,  any and all rights and remedies granted to a secured party upon default
under the Uniform Commercial Code, including, without limiting the generality of
the  foregoing,  the  right to take  possession  of the  Collateral  or any part
thereof, and to take such other measures as Mortgagee may deem necessary for the
care,  protection and preservation of the Collateral.  Upon request or demand of
Mortgagee,  Mortgagor  shall at its expense  assemble the Collateral and make it
available to Mortgagee at a convenient place acceptable to Mortgagee.  Mortgagor
shall pay to Mortgagee on demand any and all expenses,  including legal expenses
and attorneys' fees, incurred or paid by Mortgagee in protecting the interest in
the  Collateral  and in  enforcing  the  rights  hereunder  with  respect to the
Collateral.  Any  notice  of sale,  disposition  or  other  intended  action  by
Mortgagee  with respect to the Collateral  sent to Mortgagor in accordance  with
the  provisions  hereof  at  least  five (5) days  prior to such  action,  shall
constitute  commercially  reasonable  notice to  Mortgagor.  The proceeds of any
disposition of the Collateral,  or any part thereof, may be applied by Mortgagee
to the payment of the Debt in such priority and  proportions as Mortgagee in its
discretion  shall deem proper.  In the event of any change in name,  identity or
structure of any Mortgagor,  such Mortgagor shall notify  Mortgagee  thereof and
promptly after Mortgagee's  request shall execute,  file and record such Uniform
Commercial  Code forms as are necessary to maintain the priority of  Mortgagee's
lien upon and security  interest in the  Collateral,  and shall pay all expenses
and fees in connection with the filing and recording thereof. If Mortgagee shall
require the filing or recording of additional  Uniform  Commercial Code forms or
continuation statements,  Mortgagor shall, promptly after request, execute, file
and record such Uniform  Commercial  Code forms or  continuation  statements  as
Mortgagee  shall  deem  necessary,  and  shall  pay  all  expenses  and  fees in
connection  with the filing  and  recording  thereof,  it being  understood  and
agreed,  however,  that no such additional  documents shall increase Mortgagor's
obligations  under  the  Note,  this  Mortgage  and the  other  Loan  Documents.
Mortgagor hereby

                                       17
<PAGE>

irrevocably appoints Mortgagee as its attorney-in-fact, coupled with an interest
upon Mortgagor's failure to do so within five (5) Business Days after request by
Mortgagee,  to file  with  the  appropriate  public  office  on its  behalf  any
financing  or  other  statements  signed  only  by  Mortgagee,   as  Mortgagor's
attorney-in-fact,  in connection  with the Collateral  covered by this Mortgage.
Notwithstanding  the foregoing,  Mortgagor shall appear and defend in any action
or proceeding which affects or purports to affect the Mortgaged Property and any
interest or right therein,  whether such  proceeding  affects title or any other
rights in the Mortgaged Property (and in conjunction therewith,  Mortgagor shall
fully  cooperate with Mortgagee in the event Mortgagee is a party to such action
or proceeding).

         19.  Actions  and  Proceedings.  Upon the  occurrence  and  during  the
continuance  of an Event of  Default,  Mortgagee  has the right to appear in and
defend any action or proceeding  brought with respect to the Mortgaged  Property
and to bring any action or  proceeding,  in the name and on behalf of Mortgagor,
which  Mortgagee,  in its  discretion,  decides should be brought to protect its
interest  in  the  Mortgaged  Property.  Mortgagee  shall,  at  its  option,  be
subrogated to the lien of any mortgage or other security  instrument  discharged
in  whole  or in part  by the  Debt,  and  any  such  subrogation  rights  shall
constitute additional security for the payment of the Debt.

         20.  Waiver  of  Setoff  and  Counterclaim,   Marshalling,  Statute  of
Limitations, Automatic or Supplemental Stay, Etc. (a) All amounts due under this
Mortgage, the Note and the other Loan Documents shall be payable without setoff,
counterclaim or any deduction  whatsoever.  Mortgagor hereby waives the right to
assert a setoff,  counterclaim or deduction in any action or proceeding in which
Mortgagee is a participant,  or arising out of or in any way connected with this
Mortgage, the Note, any of the other Loan Documents, or the Debt.

               (b) Mortgagor hereby expressly,  irrevocably, and unconditionally
waives and  releases,  to the  extent  permitted  by law (i) the  benefit of all
appraisement,  valuation, stay, extension, reinstatement and redemption laws now
or hereafter in force and all rights of  marshalling,  sale in the inverse order
of  alienation,  or any other right to direct in any manner the order or sale of
any of the  Mortgaged  Property  in the  event  of  any  sale  hereunder  of the
Mortgaged Property or any part thereof or any interest therein; (ii) any and all
rights of redemption  from sale under any order or decree of foreclosure of this
Mortgage  on  behalf  of  Mortgagor,  and on  behalf  of each and  every  person
acquiring any interest in or title to the Mortgaged  Property  subsequent to the
date of this  Mortgage  and on behalf of all persons to the extent  permitted by
applicable  law; and (iii) all benefits that might accrue to Mortgagor by virtue
of any present or future law exempting the Mortgaged  Property from  attachment,
levy or sale on execution or providing for any appraisement,  valuation, stay of
execution,  exemption from civil process,  redemption,  or extension of time for
payment.  Mortgagee  shall not be under any  obligation to marshal any assets in
favor of any Person or against or in payment of any or all of the Obligations.

               (c) To the extent permitted by applicable law, Mortgagee's rights
hereunder  shall  continue even to the extent that a suit for  collection of the
Debt, or part thereof,  is barred by a statute of limitations.  Mortgagor hereby
expressly  waives and  releases  to the fullest  extent  permitted  by law,  the
pleading of any statute of limitations as a defense to payment of the Debt.

                                       18
<PAGE>

         21.  Recovery  of Sums  Required to Be Paid.  Mortgagee  shall have the
right  from  time to  time  to take  action  to  recover  any sum or sums  which
constitute a part of the Debt as the same become due,  without regard to whether
or not the balance of the Debt shall be due, and without  prejudice to the right
of Mortgagee thereafter to bring an action of foreclosure,  or any other action,
for a default or defaults by Mortgagor  existing at the time such earlier action
was commenced.

         22.  Handicapped  Access.  (a)  Mortgagor  agrees  that  the  Mortgaged
Property  shall at all times comply in all  material  respects  with  applicable
requirements  of the Americans with  Disabilities  Act of 1990, the Fair Housing
Amendments  Act of 1988,  all state and local  laws and  ordinances  related  to
handicapped  access  and all rules,  regulations,  and  orders  issued  pursuant
thereto  including,  without  limitation,  the Americans with  Disabilities  Act
Accessibility  Guidelines  for Buildings and  Facilities  (collectively  "Access
Laws").

                  (b) Mortgagor agrees to give prompt notice to Mortgagee of the
receipt by Mortgagor of any  complaints  related to violation of any Access Laws
and of the  commencement  of any proceedings or  investigations  which relate to
compliance  with  applicable  Access  Laws  but  only to the  extent  that  such
complaints, proceedings or investigations, if adversely determined, could have a
Material Adverse Effect.

         23.  Indemnification;  Limitation  of  Liability.  In  addition  to the
payment  of  expenses  as  required  elsewhere  herein  and  in the  other  Loan
Documents,  Mortgagor  agrees  to  indemnify,  defend,  protect,  pay  and  hold
Mortgagee,  its  successors  and assigns  (including,  without  limitation,  the
trustee and/or the trust under any trust  agreement  executed in connection with
any  Securitization  backed in whole or in part by the Loan and any other person
which may hereafter be the holder of the Note or any interest therein),  and the
officers,  directors,  stockholders,  partners, members, employees,  agents, and
Affiliates  of Mortgagee  and such  successors  and assigns  (collectively,  the
"Indemnified  Parties")  harmless  from  and  against  any and all  liabilities,
obligations,  claims, damages,  penalties,  causes of action, costs and expenses
(including   without  limitation   reasonable   attorneys'  fees  and  expenses)
(collectively,  the  "Indemnified  Claims"),  imposed  upon  or  incurred  by or
asserted against any Indemnified Party by reason of any of the following (to the
extent that  insurance  proceeds  paid to the  applicable  Indemnified  Party on
account of the following  shall be  inadequate):  (i) ownership of the Mortgage,
the Mortgaged Property or any interest therein or receipt of any rents; (ii) any
accident,  injury  to or death  of  persons  or loss of or  damage  to  property
occurring in, on or about the  Mortgaged  Property or any part thereof or on the
adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets
or ways;  (iii) any use,  nonuse  or  condition  in,  on or about the  Mortgaged
Property or any part  thereof or on the  adjoining  sidewalks,  curbs,  adjacent
property or adjacent  parking areas,  streets or ways;  (iv)  performance of any
labor or  services  or the  furnishing  of any  materials  or other  property in
respect of the Mortgaged  Property or any part  thereof;  (v) any failure of the
Premises or the Improvements to comply with any applicable law,  statute,  code,
ordinance,  rule or  regulation;  (vi)  any  default  by  Mortgagor  under  this
Mortgage,  the Loan  Agreement  or any other Loan  Documents;  (vii) any actions
taken by any Indemnified Party in the enforcement of this Mortgage and the other
Loan Documents in accordance with their respective terms;  (viii) any failure to
act on the  part  of any  Indemnified  Party  hereunder;  (ix)  the  payment  or
nonpayment of

                                       19
<PAGE>

any  brokerage  commissions  to any  party in  connection  with the  transaction
contemplated  hereby;  and (x) the failure of  Mortgagor to file timely with the
Internal  Revenue  Service an accurate Form 1099-B,  Statement for Recipients of
Proceeds from Real Estate, Broker and Barter Exchange Transactions, which may be
required in  connection  with this  Agreement,  or to supply a copy thereof in a
timely fashion to the recipient of the proceeds of the transaction in connection
with which this  Agreement is made.  Notwithstanding  the  foregoing,  Mortgagor
shall  not be  liable  for any  Indemnified  Claims  arising  (A) from the gross
negligence or willful  misconduct of any Indemnified  Party or (B) under clauses
(i) - (v) above to the extent the facts, events or circumstances  giving rise to
such  Indemnified  Claim arise after the date that any  Indemnified  Party takes
title to the  Mortgaged  Property  by  foreclosure,  deed-in-lieu  thereof,  the
exercise  of  any  power  of  sale  or  otherwise.  Any  amounts  payable  to an
Indemnified  Party by reason of the  application  of this  Section  shall become
immediately due and payable and shall bear interest at the Default Rate from the
date loss or damage is sustained by such Indemnified Party until paid.

         24. Notices.  Any notice,  demand,  statement,  request or consent made
hereunder  shall be in  writing,  addressed  to the  intended  recipient  at its
address set forth in the Loan  Agreement,  and shall be made and deemed given in
accordance  with the  terms of the Loan  Agreement.  All  notices  to  Mortgagee
pursuant to 42 Pa. C.S.A.ss. 8143 shall be given as follows:

                  c/o Merrill Lynch & Co.
                  100 Church Street
                  18th Floor
                  New York, New York 10080
                  Attn:  Andrea Balkan

                  With a copy to:

                  Sidley & Austin
                  875 Third Avenue
                  New York, New York 10022
                  Attn:  Robert L. Boyd, Esq.

         25.  Authority.  (a) Mortgagor (and the undersigned  representative  of
Mortgagor,  if any) has full power, authority and right to execute,  deliver and
perform its obligations pursuant to this Mortgage, and to mortgage, give, grant,
bargain, sell, alien, enfeoff, convey, confirm, warrant, pledge, hypothecate and
assign  the  Mortgaged  Property  pursuant  to the terms  hereof and to keep and
observe all of the terms of this Mortgage on  Mortgagor's  part to be performed;
and (b)  Mortgagor  represents  and  warrants  that  Mortgagor is not a "foreign
person" within the meaning of Section 1445(f)(3) of the Internal Revenue Code of
1986, as amended and the related Treasury Department regulations.

         26. Waiver of Notice. Mortgagor shall not be entitled to any notices of
any nature  whatsoever  from Mortgagee  except with respect to matters for which
this Mortgage  specifically  and expressly  provides for the giving of notice by
Mortgagee to Mortgagor and except with respect to matters for which Mortgagee is
required by applicable law to give notice, and

                                       20
<PAGE>

Mortgagor hereby expressly waives the right to receive any notice from Mortgagee
with respect to any matter for which this  Mortgage  does not  specifically  and
expressly provide for the giving of notice by Mortgagee to Mortgagor.

         27. Remedies of Mortgagor. In the event that a claim or adjudication is
made that Mortgagee has acted unreasonably or unreasonably delayed acting in any
case where by law or under the Note,  this Mortgage or the other Loan Documents,
it has an  obligation  to act  reasonably  or promptly,  Mortgagee  shall not be
liable for any monetary  damages,  and Mortgagor's  remedies shall be limited to
injunctive relief or declaratory judgment.

         28. Sole Discretion of Mortgagee. Whenever pursuant to this Mortgage or
the other Loan Documents,  Mortgagee exercises any right given to it to consent,
approve or  disapprove,  or any  arrangement  or term is to be  satisfactory  to
Mortgagee,  the decision of Mortgagee to consent,  approve or disapprove,  or to
decide that arrangements or terms are satisfactory or not satisfactory  shall be
in the sole discretion of Mortgagee and shall be final and conclusive, except as
may be otherwise  expressly and specifically  provided  herein.  Notwithstanding
anything to the contrary  contained  herein,  it shall be understood  and agreed
that any such consent, approval, or disapproval may be conditioned,  among other
things,  upon Mortgagee  obtaining  confirmation by the Rating Agencies that the
action or other matter subject to Mortgagee's consent,  approval, or disapproval
shall not adversely  affect the rating of any securities  issued or to be issued
in connection with any Secondary Market Transaction,  notwithstanding  that such
condition  may not be expressly  set forth in the provision or provisions of the
Loan Documents which require that Mortgagee's consent be obtained.

         29.  Non-Waiver.  The  failure  of  Mortgagee  to  insist  upon  strict
performance of any term hereof shall not be deemed to be a waiver of any term of
this  Mortgage.  Mortgagor  shall not be  relieved  of  Mortgagor's  obligations
hereunder  by reason of (a) the failure of  Mortgagee to comply with any request
of  Mortgagor or  Guarantor  to take any action to  foreclose  this  Mortgage or
otherwise  enforce  any of the  provisions  hereof or of the Note or other  Loan
Documents,  (b) the release,  regardless of  consideration,  of the whole or any
part of the  Mortgaged  Property,  or of any  person  liable for the Debt or any
portion thereof,  or (c) any agreement or stipulation by Mortgagee extending the
time of payment or otherwise  modifying or supplementing  the terms of the Note,
this Mortgage, or the other Loan Documents. Mortgagee may resort for the payment
of the Debt to any other  security held by Mortgagee in such order and manner as
Mortgagee,  in its discretion,  may elect.  Mortgagee may take action to recover
the Debt,  or any portion  thereof,  or to enforce any covenant  hereof  without
prejudice to the right of Mortgagee thereafter to foreclosure this Mortgage. The
rights and remedies of Mortgagee under this Mortgage shall be separate, distinct
and cumulative and none shall be given effect to the exclusion of the others. No
act of  Mortgagee  shall be  construed  as an election to proceed  under any one
provision herein to the exclusion of any other provision. Mortgagee shall not be
limited  exclusively  to the  rights  and  remedies  herein  stated but shall be
entitled  to every  right and  remedy  now or  hereafter  afforded  at law or in
equity.

         30.  Liability.  If  Mortgagor  consists of more than one  person,  the
obligations  and  liabilities of each such person  hereunder  shall be joint and
several.  Subject to the provisions

                                       21
<PAGE>

hereof requiring  Mortgagee's consent to any transfer of the Mortgaged Property,
this  Mortgage  shall be binding upon and inure to the benefit of Mortgagor  and
Mortgagee and their respective successors and assigns forever.

         31. Inapplicable Provisions. If any term, covenant or condition of this
Mortgage is held to be invalid,  illegal or unenforceable  in any respect,  this
Mortgage shall be construed without such provision.

         32.  Headings,  Etc. The  headings and captions of various  Sections of
this Mortgage are for  convenience of reference only and are not to be construed
as  defining  or  limiting,  in any way,  the scope or intent of the  provisions
hereof.

         33.  Counterparts.  This  Mortgage  may be  executed  in any  number of
counterparts  each of which shall be deemed to be an  original  but all of which
when taken together shall constitute one agreement.

         34. Definitions. Unless the context clearly indicates a contrary intent
or unless otherwise  specifically  provided herein,  words used in this Mortgage
may be used  interchangeably in singular or plural form and the word "Mortgagor"
shall mean "each  Mortgagor and any subsequent  owner or owners of the Mortgaged
Property or any part  thereof or any  interest  therein,"  the word  "Mortgagee"
shall mean  "Mortgagee and any  subsequent  holder of the Note," the word "Debt"
shall  mean "the Note and any other  evidence  of  indebtedness  secured by this
Mortgage,"  the  word  "person"   shall  include  an  individual,   corporation,
partnership,   trust,  unincorporated  association,   government,   governmental
authority,  and any other  entity,  and the  words  "Mortgaged  Property"  shall
include any portion of the Mortgaged  Property and any interest  therein and the
words  "attorneys'  fees" shall include any and all reasonable  attorneys' fees,
paralegal  and law  clerk  fees,  including,  but not  limited  to,  fees at the
pre-trial,  trial  and  appellate  levels  incurred  or  paid  by  Mortgagee  in
protecting  its interest in the Mortgaged  Property and Collateral and enforcing
its rights hereunder. Whenever the context may require, any pronouns used herein
shall include the  corresponding  masculine,  feminine or neuter forms,  and the
singular form of nouns and pronouns shall include the plural and vice versa.

         35. Homestead.  Mortgagor hereby waives and renounces all homestead and
exemption  rights provided by the constitution and the laws of the United States
and of any state,  in and to the Premises as against the collection of the Debt,
or any part hereof.

         36.  Assignments.  Mortgagee shall have the right to assign or transfer
its rights under this Mortgage and the other Loan Documents without  limitation,
including,  without limitation,  the right to assign or transfer its rights to a
servicing  agent.  Any  assignee  or  transferee  shall be  entitled  to all the
benefits  afforded  Mortgagee  under this Mortgage and the other Loan Documents.
Mortgagee agrees to provide Mortgagor with notice of any such assignment, and in
no event shall Mortgagor's  monetary  obligations  hereunder and under the other
Loan Documents be increased as a result of such assignment (except in accordance
with Section 10.2 of the Loan Agreement);  provided,  however,  that Mortgagor's
consent  shall not be required in  connection

                                       22
<PAGE>

with any such  assignment  and no delay or failure by  Mortgagee to provide such
notice shall limit the effectiveness of such assignment.

         37.   Survival   of    Obligations;    Survival   of   Warranties   and
Representations. Each and all of the covenants, obligations, representations and
warranties  of Mortgagor  shall  survive the  execution and delivery of the Loan
Documents and the transfer or assignment  of this Mortgage  (including,  without
limitation,  any  transfer of the  Mortgage by  Mortgagee  of any of its rights,
title and interest in and to the Mortgaged Property to any party, whether or not
affiliated with Mortgagee).

         38.  Covenants  Running  with  the  Land.  All  covenants,  conditions,
warranties, representations and other obligations contained in this Mortgage and
the other Loan  Documents  are  intended by Mortgagor  and  Mortgagee to be, and
shall be construed as, covenants  running with the Mortgaged  Property until the
lien of this Mortgage has been fully released by Mortgagee.

         39.  Governing Law;  Jurisdiction.  THIS MORTGAGE WAS NEGOTIATED IN THE
STATE OF NEW YORK AND WAS MADE BY  MORTGAGOR  AND  ACCEPTED BY  MORTGAGEE IN THE
STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE WERE DISBURSED FROM THE STATE OF
NEW YORK,  WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL  RELATIONSHIP  TO THE
PARTIES  AND TO THE  UNDERLYING  TRANSACTION,  AND  IN ALL  RESPECTS  INCLUDING,
WITHOUT  LIMITING THE  GENERALITY  OF THE  FOREGOING,  MATTERS OF  CONSTRUCTION,
VALIDITY AND PERFORMANCE.  THIS MORTGAGE AND THE OBLIGATIONS  ARISING  HEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THE STATE OF NEW YORK AND
ANY  APPLICABLE  LAWS OF THE UNITED STATES OF AMERICA,  EXCEPT THAT AT ALL TIMES
THE  PROVISIONS FOR THE CREATION,  PERFECTION  AND  ENFORCEMENT OF THE LIENS AND
SECURITY  INTERESTS  CREATED  PURSUANT TO THIS MORTGAGE SHALL BE GOVERNED BY THE
LAWS OF THE STATE WHERE THE MORTGAGED PROPERTY IS LOCATED.

         40.  Time of  Essence.  Time is of the  essence as to all of the terms,
covenants and condition of this Mortgage and the other Loan Documents.

         41. No Third-Party  Beneficiaries.  The provisions of this Mortgage and
the other Loan  Documents  are for the benefit of Mortgagor  and  Mortgagee  and
shall not inure to the benefit of any third party  (other than any  successor or
assignee of Mortgagee or permitted assignee of Mortgagor). This Mortgage and the
other Loan  Documents  shall not be construed as creating any rights,  claims or
causes of action against Mortgagee or any of its officers,  directors, agents or
employees in favor of any party other than  Mortgagor  including but not limited
to any claims to any sums held in the Impositions  and Insurance  Reserve or any
other Reserve.

         42.  Relationship  of  Parties.   The  relationship  of  Mortgagee  and
Mortgagor is solely that of debtor and creditor,  and Mortgagee has no fiduciary
or other special  relationship  with the

                                       23
<PAGE>

Mortgagor,  and no term or  condition  of any of the  Loan  Documents  shall  be
construed to be other than that of debtor and creditor. Mortgagor represents and
acknowledges  that neither the Loan Documents nor any course of dealing  between
the parties  creates any  partnership  or joint  venture  between  Mortgagor and
Mortgagee or any other person,  nor does it provide for any shared  appreciation
rights or other equity participation interest.

         43.  Successors  and Assigns.  This Mortgage  shall be binding upon and
inure to the benefit of the parties hereto and their  respective  successors and
assigns,  except  that  Mortgagor  may not  assign  its  rights  or  obligations
hereunder except as expressly provided in Section 9 hereof or as permitted under
the Loan Agreement.

         44. Investigations. Any and all representations,  warranties, covenants
and  agreements  made in this Mortgage  (and/or in other Loan  Documents)  shall
survive any investigation or inspection made by or on behalf of Mortgagee.

         45.  Assignment  of Leases and Rents.  (a) Mortgagor  acknowledges  and
confirms  that it has executed and  delivered to  Mortgagee  the  Assignment  of
Leases intending that such instrument create a present,  absolute  assignment to
Mortgagee of the Leases and Rents. Without limiting the intended benefits or the
remedies  provided under the Assignment of Leases,  Mortgagor  hereby assigns to
Mortgagee, as further security for the Debt and the Obligations,  the Leases and
Rents.  While  any Event of  Default  exists,  Mortgagee  shall be  entitled  to
exercise any or all of the remedies  provided in the Assignment of Leases and in
Section 17 hereof, including,  without limitation,  the right to have a receiver
appointed. If any conflict or inconsistency exists between the Assignment of the
Leases and this Mortgage and the absolute assignment of the Leases and the Rents
in the  Assignment  of  Leases,  the terms of the  Assignment  of  Leases  shall
control.

                  (b) So  long  as any  part of the  Debt  and  the  Obligations
secured hereby remain unpaid and undischarged,  the fee and leasehold estates to
the Mortgaged  Property shall not merge, but shall remain separate and distinct,
notwithstanding  the union of such estates either in Mortgagor,  Mortgagee,  any
lessee or any third party by purchase or otherwise.

         46.  Waiver of Right to Trial by Jury.  EACH OF MORTGAGOR AND MORTGAGEE
HEREBY  AGREES  NOT TO ELECT A TRIAL BY JURY OF ANY  ISSUE  TRIABLE  OF RIGHT BY
JURY,  AND WAIVES  ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT  THAT ANY SUCH
RIGHT SHALL NOW OR  HEREAFTER  EXIST WITH  REGARD TO THIS  MORTGAGE OR THE OTHER
LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION
THEREWITH.  THIS  WAIVER  OF  RIGHT TO  TRIAL  BY JURY IS  GIVEN  KNOWINGLY  AND
VOLUNTARILY  BY EACH OF MORTGAGOR  AND  MORTGAGEE,  AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY  EACH  INSTANCE  AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE  ACCRUE.  MORTGAGEE IS HEREBY  AUTHORIZED TO FILE A COPY OF
THIS  SECTION  IN ANY  PROCEEDING  AS  CONCLUSIVE  EVIDENCE  OF THIS  WAIVER  BY
MORTGAGOR.

                                       24
<PAGE>

         47. Expenses and Attorneys' Fees.  Mortgagor agrees to promptly pay all
reasonable fees, costs and expenses incurred by Mortgagee in connection with any
matters  contemplated  by or  arising  out of this  Mortgage  and the other Loan
Documents,  including,  without limitation,  reasonable fees, costs and expenses
(including reasonable  attorneys' fees and fees of other professionals  retained
by Mortgagee)  incurred in any action to enforce this Mortgage or the other Loan
Documents or to collect any payments due from Mortgagor under this Mortgage, the
Note or any other Loan Document or incurred in connection  with any  refinancing
or  restructuring  of the  credit  arrangements  provided  under  this  Mortgage
incurred in connection  with a "workout" or in connection with any insolvency or
bankruptcy  proceedings with respect to Mortgagor,  and all such fees, costs and
expenses shall be part of the Obligations, payable on demand.

         48.  Amendments and Waivers.  Except as otherwise  provided herein,  no
amendment,  modification,  termination  or  waiver  of  any  provision  of  this
Mortgage,  the Note or any other Loan  Document,  or  consent  to any  departure
therefrom,  shall in any event be effective  unless the same shall be in writing
and signed by  Mortgagee  and any other  party to be  charged.  Each  amendment,
modification,  termination  or waiver  shall be  effective  only in the specific
instance  and for the specific  purpose for which it was given.  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.

         49. Servicer. Mortgagee shall have the right at any time throughout the
term of the Loan to  designate or appoint one or more  Servicers  (as defined in
the Loan  Agreement) to administer  this Mortgage and the other Loan  Documents,
and to change or replace any  Servicer.  All of  Mortgagee's  rights  under this
Mortgage and the other Loan  Documents  may be  exercised  by any such  Servicer
designated by Mortgagee.  Any such Servicer  shall be entitled to the benefit of
all obligations of Mortgagor in favor of Mortgagee.

         50. Special State Provisions.  This Mortgage is an "OPEN-END  MORTGAGE"
as set forth in 42 Pa.  C.S.A.  ss. 8143,  and this  Mortgage is given to secure
Mortgagor's  obligations  under,  or in respect  of, the Loan  Documents,  up to
$44,000,000,  and shall  secure not only  obligations  with respect to presently
existing indebtedness under the foregoing documents and agreements, but also any
and all  other  indebtedness  now  owing  or  which  may  hereafter  be owing by
Mortgagor  to  Mortgagee,   however  incurred,  whether  interest,  discount  or
otherwise,  and  whether  the same shall be  deferred,  accrued or  capitalized,
including  future  advances and  re-advances,  pursuant to this Mortgage and the
other Loan  Documents,  advances  for the payment of taxes and  assessments  and
municipal claims,  maintenance charges,  insurance premiums,  costs incurred for
the protection of the Mortgaged Property or the lien of this Mortgage,  expenses
incurred by Mortgagee by reason of default by Mortgagor under this Mortgage,  or
for any other permissible purpose, whether such advances are obligatory or to be
made at the option of  Mortgagee,  or  otherwise,  to the same extent as if such
future  advances  were made on the date of the execution of this  Mortgage.  The
lien of this  Mortgage  shall be valid as to all  indebtedness  secured  hereby,
including  future  advances,  from  the time of its  filing  for  record  in the
recorder's office of the county in which the Mortgaged Property is located;  and
the lien of all present  and future  advances  shall  relate back to the date of
this Mortgage. This Mortgage is intended to and shall be valid and have priority
over all subsequent liens and encumbrances, including statutory

                                       25
<PAGE>

liens,  excepting solely taxes and assessments levied on the real estate, to the
extent of the maximum amount secured hereby, and Permitted Encumbrances existing
on the date hereof.

         All notices to be given to Mortgagee  pursuant to 42 Pa.  C.S.A.ss.8143
shall be given as set forth in Section 24 of this Mortgage.

         51. Limitation on Recourse.  The obligations of Mortgagor hereunder are
subject to  limitations  on  recourse  as  provided  in Article  XII of the Loan
Agreement.

         52.  Satisfaction  of  Mortgage.  Upon  payment  of the  Debt in  full,
Mortgagee,  at Mortgagor's sole cost and upon Mortgagor's request, shall execute
and deliver to  Mortgagor a  satisfaction  or  reconveyance  of  Mortgage,  duly
acknowledged and in recordable form, UCC-3 financing statements  terminating any
UCC-1  financing  statements  filed  by  Mortgagee  relating  to  the  Mortgaged
Property,  and such other documents or instruments as may be required to release
the Lien of the Loan Documents from the Mortgaged Property.

         53. Ground Lease.

               (a) As used  herein,  the term  "Ground  Lease"  shall  mean that
certain Ground Lease dated as of December __, 2000 between HUB Properties Trust,
a Maryland real estate investment trust, as ground lessor (the "Ground Lessor"),
and  Mortgagor,  as the ground  lessee,  which  relates to the  Premises and the
Improvements  and  any  modifications,   amendments,  extensions,  renewals  and
restatements  thereof that  hereafter may be executed and approved in writing in
advance by Mortgagee.

               (b)  Representations  and  Warranties   Regarding  Ground  Lease.
Mortgagor represents and warrants in favor of Mortgagee as follows:

                  (i) The Ground Lease  contains the entire  agreement of Ground
Lessor and  Mortgagor  pertaining to the  Mortgaged  Property.  Mortgagor has no
estate,  right,  or interest in or to the  Mortgaged  Property  except under and
pursuant to the Ground Lease.  No  modifications  or amendments have occurred to
the Ground Lease,  and no such  modifications  or amendments  are  contemplated.
Ground Lessor and Mortgagor  have no agreements  pertaining to any real property
or improvements other than the agreements set forth in the Ground Lease.

                  (ii) To the  knowledge  of  Mortgagor,  Ground  Lessor  is the
exclusive fee simple owner of the Mortgaged Property, subject only to the Ground
Lease and the Permitted Encumbrances, and Ground Lessor is the sole owner of the
lessor's interest in the Ground Lease.

                  (iii)  The  Ground  Lease is in full  force  and  effect.  All
conditions and  contingencies  to the  effectiveness of the Ground Lease and the
commencement  of the regular term  thereof  (the "Ground  Lease Term") have been
satisfied.  The Ground Lease Term has commenced,  is in effect, and is scheduled
to expire on October 31,  2030.  There are no options to extend the Ground Lease
Term  except  for two (2)  options  to  extend  the Term each for a period of 29
years,  11 months.  There are no rights to terminate the Ground Lease other than
Ground Lessor's right to terminate by reason of default or condemnation, in each
case as  expressly  set

                                       26
<PAGE>

forth in the Ground  Lease.  Mortgagor  has no right to purchase any interest in
the Mortgaged Property.

                  (iv) No breach or  default  or event  that with the  giving of
notice or passage of time would  constitute  a breach or default of or under the
Ground  Lease (a  "Ground  Lease  Default")  exists  or has  occurred  (A) as to
Mortgagor's   obligations  under  the  Ground  Lease,  nor  (B)  to  Mortgagor's
knowledge,  as to Ground Lessor's obligations under the Ground Lease.  Mortgagor
has not received any notice,  communication,  or information that a Ground Lease
Default has occurred or exists, or that Ground Lessor or any third party alleges
the same to have occurred or exist.

                  (v) Mortgagor is the exclusive owner of the lessee's  interest
under and pursuant to the Ground Lease. Mortgagor has not assigned, transferred,
or encumbered its interest in, to, or under the Ground Lease, except in favor of
Mortgagee  pursuant  to this  Mortgage  and the other Loan  Documents,  and also
except for subleases as to which Mortgagor is the sublessor.

               (c)  Grant  of  After-Acquired  Interest.  As  security  for  all
obligations  secured by this  Mortgage,  Mortgagor  hereby  irrevocably  grants,
conveys,  transfers  and assigns to  Mortgagee,  with power of sale and right of
entry and  possession,  all right,  title,  and interest in and to the Mortgaged
Property that may hereafter be acquired by Mortgagor.  Without limitation of the
foregoing,  if Mortgagor should acquire the fee estate in the Mortgaged Property
or in any land or  improvements  comprising  the  same,  or should  acquire  any
interest or estate in the  Mortgaged  Property  or any  component  thereof  that
Mortgagor  does not  presently  hold,  then this  Mortgage  shall  encumber  and
constitute a lien upon any and all of such interest or estate,  without  further
act or instrument by Mortgagor or any third party.  Mortgagor  immediately shall
notify Mortgagee of any such acquisition.  Upon request of Mortgagee and without
cost or expense to Mortgagee,  Mortgagor will execute,  acknowledge  and deliver
all such  further  instruments  and  assurances  as Mortgagee  shall  reasonably
require to ratify,  confirm,  or perfect  Mortgagee's lien on any right,  title,
interest  or  estate  in or to the  Mortgaged  Property  acquired  at  any  time
hereafter.

               (d)   Non-Merger.   No  merger  shall  occur  by  reason  of  any
acquisition by Mortgagor of any additional right,  title,  interest or estate in
or to the Mortgaged Property or any component thereof. Without limitation of the
foregoing,  unless Mortgagee shall otherwise expressly consent in writing, which
consent may be withheld by Mortgagee in its sole and  absolute  discretion,  the
leasehold  estate under the Ground Lease and any other interest or estate in the
Mortgaged  Property  shall  not  merge  but shall  always  remain  separate  and
distinct,  notwithstanding  any common ownership of the leasehold estate and any
other interest or estate.

               (e) No  Modification.  Mortgagor  shall  not  cause,  join in, or
suffer to occur any actual or purported modification,  amendment,  surrender, or
termination of the Ground Lease,  and Mortgagor  shall have no right or power to
modify,  amend,  terminate,  or surrender the Ground Lease, in each case without
the prior  written  consent of  Mortgagee,  which  consent  may be  withheld  by
Mortgagee  in its sole and  absolute  discretion.  Any  attempted  or  purported

                                       27
<PAGE>

modification,  amendment,  surrender or  termination of the Ground Lease without
Mortgagee's  prior  written  consent  shall  be null and void and of no force or
effect.

               (f) Performance of Ground Lease. Mortgagor shall fully perform as
and  when  due  each  and all of its  obligations  under  the  Ground  Lease  in
accordance with the terms of the Ground Lease,  and shall not cause or suffer to
occur any breach or default in any of such obligations. Mortgagor shall keep and
maintain the Ground Lease in full force and effect.  If Mortgagor  shall receive
forbearance  from  Ground  Lessor or  otherwise  shall be excused  from full and
timely  performance of any of its obligations  under the Ground Lease,  the same
shall not postpone,  excuse,  diminish,  or otherwise  affect the obligations of
Mortgagor under this Section 53. Mortgagor shall exercise any option to renew or
extend the Ground Lease and give written  confirmation  thereof to Lender within
thirty (30) days after such option becomes exercisable.

               Notwithstanding  that certain of  Mortgagor's  obligations  under
this Mortgage may be similar or identical to certain of Mortgagor's  obligations
under the Ground Lease, all of Mortgagor's  obligations  under this Mortgage are
and shall be separate from and in addition to its  obligations  under the Ground
Lease.

               If Mortgagor  shall have or receive  notice or  information  that
compliance with any of Mortgagor's obligations under either this Mortgage or the
Ground Lease may  constitute or give rise to a breach or default under the other
of them,  then Mortgagor  immediately  shall notify  Mortgagee in writing of the
same. If Mortgagee  shall have or receive any such notice or  information,  then
Mortgagee  may (but shall not be  obligated  to) give  written  instructions  to
Mortgagor, in which case Mortgagor shall comply with such instructions.

               (g) Notice of  Default.  If  Mortgagor  shall have or receive any
notice or information that any Ground Lease Default has occurred, then Mortgagor
immediately  shall notify Mortgagee in writing of the same and immediately shall
deliver to  Mortgagee a true and  complete  copy of each such  notice.  Further,
Mortgagor  immediately shall provide such documents and information as Mortgagee
shall request concerning the Ground Lease Default.

               (h) Mortgagee's  Right to Cure. If any Ground Lease Default shall
occur,  or if Mortgagee  reasonably  believes  that a Ground  Lease  Default has
occurred,  or if Ground Lessor  asserts that a Ground Lease Default has occurred
(whether or not Mortgagor  questions or denies such  assertion),  then Mortgagee
may (but  shall  not be  obligated  to) take any  action  that  Mortgagee  deems
necessary or  desirable,  including,  without  limitation,  (i)  performance  or
attempted performance of any of Mortgagor's  obligations under the Ground Lease,
(ii) curing or attempting to cure any actual or purported  Ground Lease Default,
(iii)  mitigating or attempting to mitigate any damages or  consequences  of the
same,  and  (iv)  entry  upon  the  Mortgaged  Property  for  any or all of such
purposes. Upon Mortgagee's request, Mortgagor shall submit satisfactory evidence
of payment or  performance  of any of its  obligations  under the Ground  Lease.
Mortgagee  may pay and  expend  such  sums of  money  as  Mortgagee  in its sole
discretion  deems  necessary or desirable  for any such  purpose,  and Mortgagor
shall pay to Mortgagee immediately upon demand all such sums so paid or expended
by Mortgagee, together with interest thereon from the date of expenditure at the
Default Rate (as defined in the Note).

                                       28
<PAGE>

               (i) Intentionally Omitted.

               (j)  Acquisition of New  Interests.  If the Ground Lease shall be
rejected, canceled, or terminated, and if Mortgagee or its nominee thereafter or
in connection therewith shall acquire any right, title, interest or estate in or
to the Mortgaged Property (which may include without limitation any new lease of
the Mortgaged Property) then Mortgagor shall have no right,  title,  interest or
estate in or to such new  lease,  or the  leasehold  estate  created by such new
lease,  or any other  interest  of  Mortgagee  or its  nominee in the  Mortgaged
Property.

               (k) Legal  Action.  Mortgagor  shall not  commence  any action or
proceeding  against  Ground  Lessor or affecting or  potentially  affecting  the
Ground Lease or Mortgagor's or Mortgagee's  interest  therein  without the prior
written  consent of  Mortgagee,  which  Mortgagee  may  withhold in its sole and
absolute discretion.  Mortgagor shall notify Mortgagee immediately if any action
or  proceeding  shall be  commenced  between  Ground  Lessor and  Mortgagor,  or
affecting  or   potentially   affecting  the  Ground  Lease  or  Mortgagor's  or
Mortgagee's interest therein (including,  without limitation, any case commenced
by or against Ground Lessor under the Bankruptcy Code). Mortgagee shall have the
option,  exercisable  upon notice from  Mortgagee to  Mortgagor,  to conduct and
control  any such  action or  proceeding  with  counsel of  Mortgagee's  choice.
Mortgagee may proceed in its own name or in the name of Mortgagor in such action
or proceeding,  and Mortgagor shall  cooperate with  Mortgagee,  comply with the
instructions  of  Mortgagee  (which  may  include  withdrawal  or  exclusion  of
Mortgagor  from such  action or  proceeding),  and  execute  any and all powers,
authorizations,  consents or other documents reasonably required by Mortgagee in
connection therewith.

               (l) Estoppel  Certificate.  Mortgagor shall obtain and deliver to
Mortgagee  within  twenty  (20) days  after  written  request by  Mortgagee,  an
estoppel  certificate from Ground Lessor setting forth (i) the identities of the
original  lessor and lessee under the Ground Lease and each of their  respective
successors,  (ii) that the Ground Lease has not been modified or, if it has been
modified,  the date of each  modification  (together  with  copies  of each such
modification),  (iii) the rent payable under the Ground Lease, (iv) the dates to
which all rent and other  charges  have been  paid,  (v)  whether  there are any
alleged  Ground Lease  Defaults and, if so,  setting forth the nature thereof in
reasonable  detail,  and (vi) such other  matters as  Mortgagee  may  reasonably
request.

               (m) No  Assignment.  Notwithstanding  anything  to  the  contrary
contained herein, this Mortgage shall not constitute an assignment of the Ground
Lease, and Mortgagee shall have no liability or obligation  thereunder by reason
of its acceptance of this Mortgage.

               (n) Bankruptcy.

                           (i) If Ground  Lessor  shall  reject the Ground Lease
                  under or pursuant to Section 365 of Title 11 of the Bankruptcy
                  Code,  Mortgagor  shall not elect to treat the Ground Lease as
                  terminated  but shall  elect to remain  in  possession  of the
                  Mortgaged  Property and the leasehold  estate under the Ground
                  Lease.  The lien of this Mortgage does and shall  encumber and
                  attach to all of  Mortgagor's  rights and remedies at any time
                  arising  under or pursuant  to Section  365 of the  Bankruptcy

                                       29
<PAGE>

                  Code, including without limitation,  all of Mortgagor's rights
                  to remain in  possession  of the  Mortgaged  Property  and the
                  leasehold estate.

                           (ii)  Mortgagor  acknowledges  and agrees that in any
                  case  commenced by or against  Mortgagor  under the Bankruptcy
                  Code,  Mortgagee  by reason of the  liens and  rights  granted
                  under  this  Mortgage  and the  Loan  Documents  shall  have a
                  substantial  and  material   interest  in  the  treatment  and
                  preservation of Mortgagor's  rights and obligations  under the
                  Ground Lease, and that Mortgagor shall, in any such bankruptcy
                  case, provide to Mortgagee  immediate and continuous  adequate
                  protection of such  interests.  Mortgagor and Mortgagee  agree
                  that such  adequate  protection  shall  include  but shall not
                  necessarily be limited to the following:

                                    A. Mortgagee  shall be deemed a party to the
                  Ground Lease (but shall not have any  obligations  thereunder)
                  for purposes of Section 365 of the Bankruptcy  Code, and shall
                  have  standing  to appear  and act as a party in  interest  in
                  relation to any matter arising out of or related to the Ground
                  Lease or the Mortgaged Property.

                                    B.  Mortgagor  shall  serve  Mortgagee  with
                  copies of all notices,  pleadings and other documents relating
                  to or affecting  the Ground Lease or the  Mortgaged  Property.
                  Any notice,  pleading or document  served by  Mortgagor on any
                  other party in the bankruptcy case shall be  contemporaneously
                  served by Mortgagor on Mortgagee,  and any notice, pleading or
                  document  served upon or received by Mortgagor  from any other
                  party in the  bankruptcy  case shall be served by Mortgagor on
                  Mortgagee immediately upon receipt by Mortgagor.

                                    C.  Upon  written   request  of   Mortgagee,
                  Mortgagor  shall assume the Ground Lease,  and shall take such
                  steps as are necessary to preserve Mortgagor's right to assume
                  the  Ground  Lease,  including  without  limitation  obtaining
                  extensions  of time to assume or reject the Ground Lease under
                  Subsection  365(d) of the Bankruptcy  Code to the extent it is
                  applicable.

                                    D. If  Mortgagor  or Ground  Lessor seeks to
                  reject  the  Ground  Lease or have  the  Ground  Lease  deemed
                  rejected,   then  prior  to  the  hearing  on  such  rejection
                  Mortgagee shall be given no less than twenty (20) days' notice
                  and  opportunity  to  elect in lieu of  rejection  to have the
                  Ground Lease  assumed and assigned to a nominee of  Mortgagee.
                  If  Mortgagee  shall so elect to assume  and assign the Ground
                  Lease, then Mortgagor shall continue any request to reject the
                  Ground  Lease  until after the motion to assume and assign has
                  been heard.  If Mortgagee shall not elect to assume and assign
                  the Ground Lease, then Mortgagee may obtain in connection with
                  the rejection of the Ground Lease a determination  that Ground
                  Lessor,  at Mortgagee's  option,  shall (1) agree to terminate
                  the Ground Lease and enter into a new lease with  Mortgagee on
                  the same terms and  conditions  as the Ground  Lease,  for the
                  remaining  term of the Ground  Lease,  or (2) treat the Ground
                  Lease as  breached  and provide  Mortgagee  with the rights to

                                       30
<PAGE>

                  cure defaults  under the Ground Lease and to assume the rights
                  and benefits of the Ground Lease.

                  Mortgagor shall join with and support any request by Mortgagee
to grant and approve the  foregoing as  necessary  for  adequate  protection  of
Mortgagee's  interests.   Notwithstanding  the  foregoing,  Mortgagee  may  seek
additional   terms  and   conditions,   including  such  economic  and  monetary
protections as it deems appropriate to adequately protect its interests, and any
request  for  such  additional  terms or  conditions  shall  not  delay or limit
Mortgagee's  right to receive the specific  elements of adequate  protection set
forth herein.

                  Mortgagor hereby appoints Mortgagee as its attorney in fact to
act on behalf of Mortgagor in connection with all matters relating to or arising
out of the assumption or rejection of the Ground Lease, in which the other party
to the lease is a debtor in a case  under the  Bankruptcy  Code.  This  grant of
power of attorney is present,  unconditional,  irrevocable,  durable and coupled
with an interest.

         Where  reference  is made to any code  section or other  law,  the same
shall  include  any  successor  statute  or  provisions  of law to the  same  or
substantially the same effect.

               (o) Predecessors,  Successors.  Where reference herein is made to
the rights or  obligations of Mortgagor or Ground Lessor under the Ground Lease,
the same shall  include  the  rights and  obligations  of their  successors  and
assigns.

         54. Non-liability of Trustees. The Declaration of Trust of Mortgagor, a
copy of which is duly filed with the Department of  Assessments  and Taxation of
the  State  of  Maryland,  provides  that the name of  Mortgagor  refers  to the
trustees  under such  Declaration  of Trust  collectively  as trustees,  but not
individually or personally, and that no trustee, officer, shareholder,  employee
or agent  of  Mortgagor  shall be held to any  personal  liability,  jointly  or
severally,  for any  obligation  of,  or claim  against,  Mortgagor.  Except  as
otherwise  expressly  provided in the Loan  Agreement,  all persons dealing with
Mortgagor in any way shall look only to the assets of Mortgagor  for the payment
of any sum or the performance of any obligation hereunder.

                            [SIGNATURE PAGE FOLLOWS]

                                       31
<PAGE>

         IN WITNESS  WHEREOF,  and intending to be legally bound,  Mortgagor has
executed this instrument as of the day and year first above written.

         WITNESS:                    MORTGAGOR:
                                     ---------

                                     FRANKLIN PLAZA PROPERTY TRUST
                                     a Maryland real estate investment trust

                                     By: /s/ John A. Mannix
                                         Name:  John A. Mannix
                                         Title:  President

CERTIFICATION OF MORTGAGEE'S ADDRESS:

The undersigned certifies that a current business address of Mortgagee as of the
date of this Mortgage is:

                  c/o Merrill Lynch & Co.
                  100 Church Street
                  18th Floor
                  New York, New York 10080

MERRILL LYNCH MORTGAGE LENDING, INC.

By: /s/ Andrea Balkam
    Name:  Andrea Balkam
    Title:    Vice President

<PAGE>

STATE OF NEW YORK                 )
SS
COUNTY OF NEW YORK                )

On  this,  the 14th day of  December,  2000,  before  me,  a notary  public  the
undersigned  officer,  personally  appeared  John  A.  Mannix  who  acknowledged
himself/herself to be the President of Franklin Plaza Property Trust, a Maryland
real estate  investment  trust, and that he/she as such officer being authorized
to do so, executed the foregoing  instrument for the purposes therein  contained
by signing the name of such real estate investment trust by  himself/herself  in
such capacity.

In Witness Whereof, I hereunto set my hand and official seal.

                                      /s/ Mary Caliendo
                                      Notary Public

                                      My Commission Expires:     June 5, 2001

<PAGE>

                                Omitted Exhibits

         The following exhibit to the Open-End Leasehold Mortgage, Assignemnt of
Leases and Rents, Security Agreement and Fixture Filing has been omitted:

          Exhibit Letter                        Exhibit Title

          A                                     Premises

         The Registrant agrees to furnish supplementally a copy of the foregoing
omitted exhibit to the Securities and Exchange Commission upon request.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00019-of-00352.parquet"}]]