Document:

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                                                                  EXHIBIT  10.18

                                                                  EXECUTION COPY

                                 LEASE AGREEMENT

                                 by and between

                           TELC (NJ) QRS 16-30, INC.,
                             a Delaware corporation

                                   as LANDLORD

                                       and

                          TELCORDIA TECHNOLOGIES, INC.,
                             a Delaware corporation,

                                    as TENANT

                           Premises: 1 Telcordia Drive
                                     Piscataway, New Jersey

                           Dated as of: March 15, 2005

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                                TABLE OF CONTENTS

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<S>                                                                               <C>
1.    Demise of Premises........................................................    1
2     Certain Definitions.......................................................    1
3.    Title and Condition.......................................................    8
4.    Use of Leased Premises; Quiet Enjoyment...................................    9
5.    Term......................................................................   10
6.    Basic Rent................................................................   10
7.    Additional Rent...........................................................   11
8.    Net Lease; Non-Terminability..............................................   12
9.    Payment of Impositions....................................................   12
10.   Compliance with Laws and Easement Agreements, Environmental Matters.......   14
11.   Liens; Recording..........................................................   16
12.   Maintenance and Repair....................................................   16
13.   Alterations and Improvements..............................................   17
14.   Permitted Contests........................................................   18
15.   Indemnification...........................................................   19
16.   Insurance.................................................................   20
17.   Casualty and Condemnation.................................................   22
18.   Termination Events........................................................   24
19.   Restoration...............................................................   25
20.   Procedures Upon Purchase..................................................   27
21.   Assignment and Subletting, Prohibition Against Leasehold Financing........   27
22.   Events of Default.........................................................   29
23.   Remedies and Damages upon Default.........................................   31
24.   Notices...................................................................   34
25.   Estoppel Certificate......................................................   34
26.   Surrender.................................................................   35
27.   No Merger of Title........................................................   35
28.   Books and Records.........................................................   35
29.   Determination of Value....................................................   36
30.   Non-Recourse as to Landlord, Etc..........................................   37
31.   Financing.................................................................   38
32.   Subordination, Non-Disturbance and Attornment; Landlord's Waiver...........   38
33.   Tax Treatment; Reporting..................................................   39
34.   Right of First Refusal....................................................   36
35.   Intentionally Omitted.....................................................   36
36.   Intentionally Omitted.....................................................   40
37.   Miscellaneous.............................................................   40
38.   Post-Closing Obligations..................................................   45
39.   Subdivision of Release Parcels............................................   46
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EXHIBITS

      Exhibit "A" - Premises
      Exhibit "B" - Equipment
      Exhibit "C" - Schedule of Permitted Encumbrances
      Exhibit "D" - Rent Schedule
      Exhibit "E" - Schedule of Termination Values
      Exhibit "F" - Post-Closing Obligations
      Exhibit "G" - Release Parcels
      Exhibit "H" - Form of Guaranty

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      LEASE AGREEMENT, made as of March 15, 2005, between TELC (NJ) QRS 16 -30,
INC., a Delaware corporation ("Landlord"), with an address c/o W.P. Carey & Co,
LLC, 50 Rockefeller Plaza, 2nd Floor, New York, New York 10020, and TELCORDIA
TECHNOLOGIES, INC., a Delaware corporation ('Tenant"), with an address at 1
Telcordia Drive, Piscataway, New Jersey 08854.

      In consideration of the rents and provisions herein stipulated to be paid
and performed, Landlord and Tenant hereby covenant and agree as follows:

      1. Demise of Premises. Landlord hereby demises and lets to Tenant, and
Tenant hereby takes and leases from Landlord, for the term and upon the
provisions hereinafter specified, the following described property
(collectively, the "Leased Premises"): (a) the land consisting of approximately
117.15 acres described in Exhibit "A" attached hereto together with the
Appurtenances (collectively, the "Land"): (b) the buildings containing
approximately 891,319 square feet, structures and other improvements now or
hereafter constructed on the Land (collectively, the "Improvements"): and (c)
the fixtures, machinery, equipment and other property described in Exhibit "B"
hereto (collectively, the "Equipment").

      2. Certain Definitions.

       "Additional Rent" shall mean Additional Rent as defined in
Paragraph 7.

       "Affiliate" of any Person shall mean any Person which shall (i)
control, (ii) be under the control of, or (iii) be under common control with
such Person (the term "control" as used herein shall be deemed to mean ownership
of more than 50% of the outstanding voting stock of a corporation or other
majority equity and control interest if such Person is not a corporation) and
the power to direct or cause the direction of the management or policies of such
Person.

            "Alterations" shall mean all changes, additions, improvements or
repairs to, all alterations, reconstructions, restorations, renewals,
replacements or removals of and all substitutions or replacements for any of the
Improvements or Equipment, both interior and exterior, structural and
non-structural, and ordinary and extraordinary.

            "Appurtenances" shall mean all tenements, hereditaments, easements,
rights-of-way, rights, privileges in and to the Land, including (a) easements
over other lands granted by any Easement Agreement and (b) any streets,
sidewalks, driveways ways, alleys, curbs, gores or strips of land adjoining the
Land.

            "Asset Transfer" shall mean Asset Transfer as defined in
Paragraph 21(i).

            "Assignment" shall mean any assignment of rents and leases from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified from time to time.

            "Basic Rent" shall mean Basic Rent as defined in Paragraph 6.

            "Basic Rent Payment Date" shall mean Basic Rent Payment Date as
defined in Paragraph 6.

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            "Casualty" shall mean any damage to or destruction of or which
affects the Leased Premises.

            "Commencement Date" shall mean Commencement Date as defined in
Paragraph 5.

            "Condemnation" shall mean a Taking and/or a Requisition.

            "Condemnation Notice" shall mean notice or knowledge of the
institution of or intention to institute any proceeding for Condemnation.

            "Costs" of a Person or associated with a specified transaction shall
mean all reasonable costs and expenses incurred by such Person or associated
with such transaction, including without limitation, attorneys, fees and
expenses, court costs, brokerage fees, escrow fees, title insurance premiums,
recording fees and transfer taxes, as the circumstances require, subject,
however, to the limitations set forth in Paragraph 31 hereof and excluding any
Income Taxes (other than as expressly provided in clause(A) of the proviso in
Paragraph 9(a)).

            "CPI Adjustment" shall mean adjustment to reflect increases in the
index known as United States Department of Labor, Bureau of Labor Statistics,
Consumer Price Index, All Urban Consumers, United States City Average, All
Items, (1982-84=100) ("CPI") or the successor index that most closely
approximates the CPI. If the CPI shall be discontinued with no successor or
comparable successor index, Landlord and Tenant shall attempt to agree upon a
substitute index or formula, but if they are unable to so agree, then the matter
shall be determined by arbitration in accordance with the rules of the American
Arbitration Association then prevailing in New York City. Any decision or award
resulting from such arbitration shall be final and binding upon Landlord and
Tenant and judgment thereon may be entered in any court of competent
jurisdiction; provided that, in no event shall any initial amount set forth in
this Lease and indicated to be subject to subsequent CPA Adjustment be reduced
below such initial amount as a result of such adjustment.

            "Credit Entity" shall mean, with respect to an assignment or
subletting under Paragraph 21, any Person that immediately following such
assignment or subletting and having given effect thereto will have (x) a net
worth of not less than Two Billion Dollars and (y) a published unsecured senior
debt rating of "A" or better from Moody's or a rating of "A" or better from S&P
(or, if such Person does not then have rated debt, a determination that by
either of such rating agencies its unsecured senior debt would be so rated by
such agency and will not be on "Negative Credit Watch"), and in the event both
such rating agencies cease to furnish such ratings, then a comparable rating by
any rating agency acceptable to Landlord and Lender

            "Default Rate" shall mean the Default Rate as defined in Paragraph
7(a)(iii).

            "Easement Agreement" shall mean any conditions, covenants,
restrictions, easements, declarations, licenses and other agreements listed as
Permitted Encumbrances or as may hereafter affect the Leased Premises.

            "Environmental Law" shall mean (a) whenever enacted or promulgated,
any applicable federal, state and local law, statute, ordinance, rule,
regulation, license, permit, authorization, approval, consent, court order,
judgment, decree, injunction, code, requirement or agreement with any
governmental entity, (i) relating to pollution (or the cleanup thereof), or the
protection of air, water vapor, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused by a Hazardous Substance or (ii) concerning exposure to,
or the use, containment, storage, recycling,

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reclamation, reuse, treatment, generation, discharge, transportation,
processing, handling, labeling, production, disposal or remediation of Hazardous
Substances, Hazardous Conditions or Hazardous Activities, in each case as
amended and as now or hereafter in effect, and (b) any common law or equitable
doctrine (including, without limitation, injunctive relief and tort doctrines
such as negligence, nuisance, trespass and strict liability) that may impose
liability or obligations for injuries or damages due to or threatened as a
result of the presence of, exposure to, or ingestion of, any Hazardous
Substance. The term Environmental Law includes, without limitation, the federal
Comprehensive Environmental Response Compensation and Liability Act of 1980, the
Superfund Amendments and Reauthorization Act, the federal Water Pollution
Control Act, the federal Clean Air Act, the federal Clean Water Act, the federal
Resources Conservation and Recovery Act of 1976 (including the Hazardous and
Solid Waste Amendments to RCRA), the federal Solid Waste Disposal Act, the
federal Toxic Substance Control Act, the federal Insecticide, Fungicide and
Rodenticide Act, the federal Occupational Safety and Health Act of 1970, the
federal National Environmental Policy Act and the federal Hazardous Materials
Transportation Act, the New Jersey Industrial Site Recovery Act (formerly known
as the Environmental Cleanup Responsibility Act), as amended (NJ.S.A. section
13:1K et seq.), and the New Jersey Spill Compensation Act and Control Act,
N.J.S.A. section 58:10.23.11b et seq., each as amended and as now or hereafter
in effect and any similar state or local Law.

            "Environmental Violation" shall mean (a) any direct or indirect
discharge, disposal, spillage, emission, escape, pumping, pouring, injection,
leaching, release, seepage, filtration or transporting of any Hazardous
Substance at, upon, under, onto or within the Leased Premises, or from the
Leased Premises to the environment, in violation of any Environmental Law or in
excess of any reportable quantity established under any Environmental Law or
which could result in any liability to Landlord, Tenant or Lender, any Federal,
state or local government or any other Person for the costs of any removal or
remedial action or natural resources damage or for bodily injury or property
damage, (b) any deposit, storage, dumping, placement or use of any Hazardous
Substance at, upon, under or within the Leased Premises in violation of any
Environmental Law or in excess of any reportable quantity established under any
Environmental Law or which could result in any liability to any Federal, state
or local government or to any other Person for the costs of any removal or
remedial action or natural resources damage or for bodily injury or property
damage, (c) the abandonment or discarding of any barrels, containers or other
receptacles containing any Hazardous Substances in violation of any
Environmental Laws, (d) any activity, occurrence or condition which could result
in any liability, cost or expense to Landlord or Lender or any other owner or
occupier of the Leased Premises, or which could result in a creation of a lien
on the Leased Premises under any Environmental Law, or (e) any violation of or
noncompliance with any Environmental Law.

            "Equipment" shall mean the Equipment as defined in Paragraph 1.

            "Event of Default" shall mean an Event of Default as defined in
Paragraph 22(a).

            "Fair Market Rental Value" shall mean the fair market rental value
of the Leased Premises for the relevant Renewal Term determined in accordance
with the procedure specified in Paragraph 29.

            "Fair Market Value Date" shall mean the date when the Fair Market
Rental Value is determined in accordance with Paragraph 29.

            "Federal Funds" shall mean federal or other immediately available
funds which at the time of payment are legal tender for the payment of public
and private debts in the United States of America.

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            "Guarantor" shall mean, subject to the terms of the Guaranty,
collectively, DATABASE SERVICE MANAGEMENT, INC., a Delaware corporation,
TELCORDIA TECHNOLOGIES INTERNATIONAL, INC., a Delaware corporation, GRANITE
SYSTEMS, INC., a Delaware corporation, GRANITE SYSTEMS HOLDING COMPANY, INC., a
Delaware corporation, MEDITERRANEAN VENTURES, LLC, a Delaware limited liability
company, ITALY HOLDINGS, LLC, a Delaware limited liability company and MESA
SOLUTIONS, INC., a Delaware corporation.

            "Guaranty" shall mean the Guaranty and Suretyship Agreement, dated
as of the date hereof, from Guarantor to Landlord guaranteeing the payment and
performance by Tenant of all of Tenant's obligations under the Lease, a form of
which is attached hereto as Exhibit "H".

            "Hazardous Activity" means any activity, process, procedure or
undertaking which directly or indirectly (a) procures, generates or creates any
Hazardous Substance; (b) causes or results in (or threatens to cause or result
in) the release, seepage, spill, leak, flow, discharge or emission of any
Hazardous Substance into the environment (including the air, ground water,
watercourses or water systems), (c) involves the containment or storage of any
Hazardous Substance; or (d) would cause the Leased Premises or any portion
thereof to become a hazardous waste treatment, recycling, reclamation,
processing, storage or disposal facility within the meaning of any Environmental
Law.

            "Hazardous Condition" means any condition which would support any
claim or liability under any Environmental Law, including the presence of
underground storage tanks.

            "Hazardous Substance" means (i) any substance, material, product,
petroleum, petroleum product, derivative, compound or mixture, mineral
(including asbestos), chemical, gas, medical waste, or other pollutant, in each
case whether naturally occurring, man-made or the by-product of any process,
that is toxic, harmful or hazardous or acutely hazardous to the environment or
public health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law. Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, microbial matter (including but not limited to
mold, mildew and other fungi or bacterial matter which reproduces through the
release of spores or the splitting of cells), urea formaldehyde foam insulation,
lead and polychlorinated biphenyls.

            "Impositions" shall mean the Impositions as definedin
            Paragraph  9(a).

            "Improvements" shall mean the Improvements as defined in
            Paragraph 1.

            "Income Taxes" shall mean any federal, state, local or foreign tax,
assessment, fee, levy, charge, withholding tax or similar charge imposed on or
measured by net income, net wealth, profits or overall gross income, and
franchise taxes to the extent imposed in lieu of taxes on such income or profits
(and all liabilities in connection therewith, including penalties and interest)
with respect thereto.

            "Indemnitee" shall mean an Indemnitee as defined in Paragraph 15.

            "Insurance Requirements" shall mean the requirements of all
insurance policies required to be maintained in accordance with this Lease.

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            "Land" shall mean the Land as defined in Paragraph 1.

            "Landlord's Agreement" shall mean the Landlord's Waiver and
Agreement by and among Landlord, Tenant and Tenant's senior and/or subordinate
lenders under the Credit Facility and /or the Capital Markets Security (as such
terms are defined in the Guaranty), dated as of the date hereof, in form and
substance acceptable to all parties thereto

            "Law" shall mean any constitution, statute, rule of law, code,
ordinance, order, judgment, decree, injunction, rule, regulation, policy,
requirement or administrative or judicial determination, even if unforeseen or
extraordinary, of every duly constituted governmental authority, court or
agency, now or hereafter enacted or in effect.

            "Lease" shall mean this Lease Agreement.

            "Lease Year" shall mean, with respect to the first Lease Year, the
period commencing on the Commencement Date and ending at midnight on the last
calendar day of the twelfth (12th) full consecutive calendar month following the
month in which the Commencement Date occurred, and each succeeding twelve (12)
month period during the Term.

            "Leased Premises" shall mean the Leased Premises as defined in
Paragraph 1.

            "Legal Requirements" shall mean the requirements of all present and
future Laws (including but not limited to Environmental Laws and Laws relating
to accessibility to, usability by, and discrimination against, disabled
individuals) and all covenants, restrictions and conditions now or hereafter of
record which may be applicable to Tenant or to any of the Leased Premises, or to
the use, manner of use, occupancy, possession, operation, maintenance,
alteration, repair or restoration of any of the Leased Premises, even if
compliance therewith necessitates structural changes or improvements or results
in interference with the use or enjoyment of any of the Leased Premises or
requires Tenant to carry insurance other than as required by this Lease.

            "Lender" shall mean any Person (and its respective successors and
assigns) which may, on or after the date hereof, make a Loan to Landlord or be
the holder of a Note.

            "Loan" shall mean any loan made by one or more Lenders to Landlord,
which loan is secured by a Mortgage and an Assignment and evidenced by a Note.

            "Monetary Obligations" shall mean Rent and all other sums payable by
Tenant under this Lease to Landlord, to any third party on behalf of Landlord or
to any Indemnitee.

            "Moody's" shall mean Moody's Investor Services, Inc.

            "Mortgage" shall mean any mortgage or deed of trust from Landlord to
a Lender which (a) encumbers any of the Leased Premises and (b) secures
Landlord's obligation to repay a Loan, as the same may be amended, supplemented
or modified.

            "Net Award" shall mean (a) the entire award payable to Landlord or
Lender by reason of a Condemnation whether pursuant to a judgment or by
agreement or otherwise, or (b) the entire proceeds of any insurance required
under clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv), (v)
or (vi) of Paragraph 16(a), as the case may be, less any Costs incurred by
Landlord and Lender in collecting such award or proceeds.

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            "Note" shall mean any promissory note evidencing Landlord's
obligation to repay a Loan, as the same may be amended, supplemented or
modified.

            "Partial Casualty" shall mean any Casualty that does not constitute
a Termination Event.

            "Partial Condemnation" shall mean any Condemnation that does not
constitute a Termination Event.

            "Permitted Encumbrances" shall mean those covenants, restrictions,
reservations, liens, conditions and easements and other encumbrances, other than
any Mortgage or Assignment, listed on Exhibit "C" hereto (but such listing shall
not be deemed to revive any such encumbrances that have expired or terminated or
are otherwise invalid or unenforceable).

            "Person" shall mean an individual, partnership, association,
corporation or other entity.

            "Post Closing Obligations" shall mean those obligations of Tenant
specified in Exhibit "F" hereto.

            "Prepayment Premium" shall mean, subject to the provisions of
Paragraph 31(c), any payment required to be made by Landlord to a Lender under
a Note or any other document evidencing or securing a Loan (other than payments
of principal and/or interest which Landlord is required to make under a Note or
a Mortgage) solely by reason of any prepayment or defeasance by Landlord of any
principal due under a Note or Mortgage, and which may without limitation take
the form of (a) a "make whole" or yield maintenance clause requiring a
prepayment premium or (b) a defeasance payment (such defeasance payment to be an
amount equal to the positive difference between (i) the total amount required to
defease a Loan and (ii) the outstanding principal balance of the Loan as of the
date of such defeasance plus reasonable Costs of Landlord and Lender.

            "Present Value" of any amount shall mean such amount discounted by a
rate per annum equal to nine and one-half percent (9.5%).

            "Prime Rate" shall mean the annual interest rate as published, from
time to time, in The Wall Street Journal as the "Prime Rate" in its column
entitled "Money Rate". The Prime Rate may not be the lowest rate of interest
charged by any "large U.S. money center commercial banks" and Landlord makes no
representations or warranties to that effect. In the event The Wall Street
Journal ceases publication or ceases to publish the "Prime Rate" as described
above, the Prime Rate shall be the average per annum discount rate (the
"Discount Rate") on ninety-one (91) day bills ("Treasury Bills") issued from
time to time by the United States Treasury at its most recent auction, plus
three hundred (300) basis points. If no such 91-day Treasury Bills are then
being issued, the Discount Rate shall be the discount rate on Treasury Bills
then being issued for the period of time closest to ninety-one (91) days.

            "Release Parcels" shall mean, collectively, the areas of undeveloped
land more particularly identified by hatching as "Release Parcel A" and "Release
Parcel B", respectively, on Exhibit "G" annexed hereto (and each of "Release
Parcel A" and "Release Parcel B", respectively, sometimes hereinafter referred
to individually as a "Release Parcel").

            "Relevant Date" shall mean the date on which Fair Market Rental
Value is determined in the event of an extension of this Lease for the third or
fourth Renewal Term pursuant to Paragraph 5(b), as applicable.

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            "Renewal Term" shall mean Renewal Term as defined in Paragraph 5.

            "Rent" shall mean, collectively, Basic Rent and Additional Rent.

            "Requisition" shall mean any temporary requisition or confiscation
of the use or occupancy of any of the Leased Premises occurring in whole or in
part during the Term by any governmental authority, civil or military, whether
pursuant to an agreement with such governmental authority in settlement of or
under threat of any such requisition or confiscation, or otherwise.

            "S&P" shall mean Standard & Poor's Rating Services, a division of
The McGraw Hill Companies.

            "Sales Contract" shall mean Sales Contract as defined in
Paragraph 34(a).

            "Site Assessment" shall mean a Site Assessment as defined in
Paragraph 10(c).

            "State" shall mean the State of New Jersey.

            "Subsidiary(ies)" shall mean a direct or indirect wholly-owned
subsidiary of a Person.

            "Surviving Obligations" shall mean any obligations of Tenant under
this Lease, actual or contingent, which arise on or prior to the expiration or
prior termination of this Lease or which survive such expiration or termination
by their own terms.

            "Taking" shall mean (a) any taking or damaging of all or a portion
of any of the Leased Premises (i) in or by condemnation or other eminent domain
proceedings pursuant to any Law, general or special, or (ii) by reason of any
agreement with any condemnor in settlement of or under threat of any such
condemnation or other eminent domain proceeding, or (iii) by any other means, or
(b) any de facto condemnation. The Taking shall be considered to have taken
place as of the later of the date actual physical possession is taken by the
condemnor, or the date on which the right to compensation and damages accrues
under the law applicable to the Leased Premises.

            "Term" shall mean the Term as defined in Paragraph 5.

            "Termination Amount" shall mean the applicable amount set forth on
Exhibit "E", "Termination Values"; provided that, with respect to a Termination
Event pursuant to Paragraph 18 occurring after the tenth (10th) anniversary of
the Commencement Date there shall be added to such amount any applicable
Prepayment Premium which Landlord will be required to pay in prepaying or
defeasing in whole or in part, as applicable, any Loan with proceeds of the
Termination Amount (subject to the provisions of Paragraph 31(c) hereof).

            "Termination Date" shall mean Termination Date as defined in
Paragraph 18.

            "Termination Event" shall mean a Termination Event as defined in
Paragraph 18.

            "Termination Notice" shall mean Termination Notice as defined in
Paragraph 18(a).

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            "Warranties" shall mean Warranties as defined in Paragraph 3(d).

            "Work" shall mean Work as defined in Paragraph 13(b).

      3. Title and Condition.

            (a) The Leased Premises are demised and let subject to (i) the
rights of any Persons in possession of the Leased Premises, (ii) the existing
state of title of any of the Leased Premises, including any Permitted
Encumbrances, (iii) any state of facts which an accurate survey or physical
inspection of the Leased Premises might show, (iv) all Legal Requirements,
including any existing violation of any thereof, and (v) the condition of the
Leased Premises as of the commencement of the Term, without representation or
warranty by Landlord.

            (b) Tenant Acknowledges That Tenant currently is in physical
occupancy of the Leased Premises and that the Leased Premises are in
satisfactory condition and repair at the inception of this Lease. LANDLORD
LEASES AND WILL LEASE AND TENANT TAKES AND WILL TAKE THE LEASED PREMISES AS IS.
TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS LANDLORD HEREUNDER OR IN
ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED
TO HAVE MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT
TO ANY OF THE LEASED PREMISES, INCLUDING ANY WARRANTY OR REPRESENTATION AS TO
(i) ITS FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE
QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY
DEFECT, LATENT OR PATENT, (iv) LANDLORD'S TITLE THERETO, (v) VALUE, (vi)
COMPLIANCE WITH SPECIFICATIONS, (vii) LOCATION, (viii) USE, (ix) CONDITION, (x)
MERCHANTABILITY, (xi) QUALITY, (xii) DESCRIPTION, (xiii) DURABILITY, (xiv)
OPERATION, (xv) THE EXISTENCE OF ANY HAZARDOUS SUBSTANCE, HAZARDOUS CONDITION OR
HAZARDOUS ACTIVITY OR (xvi) COMPLIANCE OF THE LEASED PREMISES WITH ANY LAW OR
LEGAL REQUIREMENT; AND ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT.
TENANT ACKNOWLEDGES THAT THE LEASED PREMISES IS OF ITS SELECTION AND TO ITS
SPECIFICATIONS AND THAT THE LEASED PREMISES HAS BEEN INSPECTED BY TENANT AND IS
SATISFACTORY TO IT. IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE
LEASED PREMISES OF ANY NATURE, WHETHER LATENT OR PATENT, LANDLORD SHALL NOT HAVE
ANY RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL OR
CONSEQUENTIAL DAMAGES (INCLUDING STRICT LIABILITY IN TORT). THE PROVISIONS OF
THIS PARAGRAPH 3(b) HAVE BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE
EXCLUSION AND NEGATION OF ANY WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH
RESPECT TO ANY OF THE LEASED PREMISES, ARISING PURSUANT TO THE UNIFORM
COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN EFFECT OR ARISING
OTHERWISE.

            (c) Tenant has examined the title to the Leased Premises prior to
the execution and delivery of this Lease and has found the same to be
satisfactory for the purposes contemplated hereby. Tenant acknowledges that (i)
fee simple title (both legal and equitable) is in Landlord and except as
provided in Paragraph 34 hereof with respect to certain rights of refusal to
purchase the Leased Premises that Tenant has only the leasehold right of
possession and use of the Leased Premises, as provided herein, (ii) the
Improvements conform to all material Legal Requirements and all insurance
Requirements, (iii) all easements necessary or appropriate for the use or
operation of the Leased Premises have been obtained, (iv) all

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contractors and subcontractors who have performed work on or supplied materials
to the Leased Premises have been fully paid, and all materials and supplies have
been fully paid for, (v) the Improvements have been fully completed in all
material respects and (vi) all Equipment necessary or appropriate for the use or
operation of the Leased Premises has been installed and is presently fully
operative in all material respects.

            (d) Landlord hereby assigns to Tenant, without recourse or warranty
whatsoever, all assignable warranties, guaranties, indemnities and similar
rights (collectively, "Warranties") which Landlord may have against any
manufacturer, seller, engineer, contractor or builder in respect of any of the
Leased Premises. Such assignment shall remain in effect until the expiration or
earlier termination of this Lease, whereupon such assignment shall cease and all
of the Warranties shall automatically revert to Landlord. In confirmation of
such reversion Tenant shall execute and deliver promptly any certificate or
other document reasonably required by Landlord. Landlord shall also retain the
right to enforce any Warranties upon the occurrence of an Event of Default.
Tenant shall enforce the Warranties in accordance with their respective terms.

          4. Use of Leased Premises; Quiet Enjoyment.

            (a) Tenant may occupy and use the Leased Premises for general,
executive and administrative offices, for software research and development
laboratory space, as a data center, customer briefing center and for uses
ancillary and incidental to any of the foregoing, including, without limitation,
a kitchen and cafeteria for use by the officers, employees and business invitees
of Tenant, a day care center for the children of officers and employees of
Tenant, a photocopying center in connection with Tenant's own business needs at
the Leased Premises and an employee training facility, and for no other purpose
without the prior written consent of Landlord, which consent shall not be
unreasonably, withheld, delayed or conditioned, Tenant shall not use or occupy
or permit any of the Leased Premises to be used or occupied, nor do or permit
anything to be done in or on any of the Leased Premises, in a manner which would
or might (i) violate any Law, Legal Requirement or Permitted Encumbrance, (ii)
make void or voidable or cause any insurer to cancel any insurance required by
this Lease, or make it difficult or impossible to obtain any such insurance at
commercially reasonable rates, (iii) make void or voidable, cancel or cause to
be cancelled or release any of the Warranties, (iv) cause structural injury to
any of the Improvements or (v) constitute a public or private nuisance or waste.
Nothing herein shall give or grant Tenant any right to apply for, obtain,
acquiesce in, or utilize all or any part of the Leased Premises for any purpose
that would require, a use variance, change in zoning or use classification, or
to apply for same, without the express written consent of Landlord in its sole
but reasonable discretion.

            (b) Subject to the provisions hereof, so long as no Event of Default
has occurred and is continuing, Tenant shall quietly hold, occupy and enjoy the
Leased Premises throughout the Term, without any hindrance, ejection or
molestation by Landlord or any Person claiming by, through, or under Landlord,
with respect to matters that arise after the date hereof; provided that,
Landlord or its agents, representatives or consultants may enter upon and
examine any of the Leased Premises at such reasonable times as Landlord may
select and upon not less than two (2) business days notice to Tenant (except in
the case of an emergency, in which event no notice shall be required) for the
purpose of inspecting the Leased Premises, verifying compliance or
non-compliance by Tenant with its obligations hereunder and the existence or
non-existence of an Event of Default or event which with the passage of time
and/or notice would constitute an Event of Default, showing the Leased Premises
to prospective Lenders and purchasers, making any repairs and taking such other
action with respect to the Leased Premises as is permitted by any provision
hereof. Landlord agrees that, except in the case of emergency, each entry upon
or examination of the Leased Premises shall be accompanied by a representative

                                      -9-
<PAGE>

of Tenant ;provided that Tenant makes such representative available to Landlord
or its agents, representatives or consultants at the time of scheduled visit.

            (c) Notwithstanding anything to the contrary contained in this
Paragraph 4 or Paragraph 21 hereof, in no event shall any portion of the Leased
Premises be used or occupied or permitted to be used or occupied for any of the
following purposes: (i) any nightclub, bar or discotheque; (ii) any adult
bookstore or video shop, nude or semi-nude or "adult" entertainment
establishment or any lewd, obscene or pornographic purpose; (iii) any store in
which a material portion of the inventory is not available for sale or rental to
children under 18 years of age because such inventory explicitly deals with,
relates to, or depicts human sexuality, or in which any of the inventory
constitutes drug paraphernalia of the kind associated with or sold by so-called
"head shops"; (iv) any dumping, disposing, incineration or reduction of garbage
(exclusive of appropriately screened dumpsters and/or recycling bins located in
the rear of any building and garbage disposal in the ordinary course of
business); (v) any mortuary; (vi) any fire sale, bankruptcy sale (unless
pursuant to a court order) or auction house operation; (vii) any gas station;
(viii) any central laundry or dry cleaning plant or Laundromat; (ix) any
automobile, truck, trailer or RV sales, leasing, display or repair; (x) any
"flea market", secondhand, surplus or other "off-price" or deep discount store;
(xi) any gambling or off-track betting operation, or (xii) any massage parlor or
carnival.

      5. Term.

            (a) Subject to the provisions hereof, Tenant shall have and hold the
Leased Premises for an initial term (such term, as extended or renewed in
accordance with the provisions hereof, being called the "Term") commencing on
the date hereof (the "Commencement Date") and ending on September 30, 2023 (the
"Expiration Date").

            (b) Provided that if, on or prior to the Expiration Date or any
other Renewal Date (as hereinafter defined) this Lease shall not have been
terminated pursuant to any provision hereof, then Tenant shall have the option
to extend the Term of this Lease on the Expiration Date and on the fifth (5th),
tenth (10th) and fifteenth (15th) anniversaries of the Expiration Date (the
Expiration Date and each such anniversary being referred to herein as a "Renewal
Date"), for an additional period of five (5) years (each such extension, a
"Renewal Term"), provided and upon condition that Tenant shall notify Landlord
in writing at least twelve (12), months prior to the next Renewal Date that
Tenant is electing to extend the Term of this Lease effective as of the next
Renewal Date. Any such extension of the Term shall be subject to all of the
provisions of this Lease, as the same may be amended, supplemented or modified
(except that Tenant shall not have the right to any additional Renewal Terms
other then the four (4) Renewal Terms initially set forth herein).

            (c) If Tenant does not exercise its option to extend or further
extend the Term, or if an Event of Default has occurred and is continuing and
Landlord has commenced its remedies under Paragraph 23 hereof to terminate this
Lease, then Landlord shall have the right during the remainder of the Term then
in effect and, in any event, Landlord shall have the right during the last year
of the Term (taking into account any exercised Renewal Term), to (i) advertise
the availability of the Leased Premises for sale or reletting and to erect upon
the Leased Premises signs indicating such availability and (ii) show the Leased
Premises to prospective purchasers or tenants or their agents, representatives
or consultants in accordance with Paragraph 4(b) above.

      6. Basic Rent. Tenant shall pay to Landlord, as annual rent for the Leased
Premises during the Term, the amounts determined in accordance with Exhibit "D"
hereto ("Basic Rent"), payable in advance for the next calendar month,
commencing on the twenty-fifth (25th) day of the first month following the date
hereof and continuing on the same day of each

                                      -10-
<PAGE>

month thereafter during the Term which shall be payable as set forth in said
Exhibit "D". The date that each payment of Basic Rent is due is hereinafter
referred to as a "Basic Rent Payment Date". Each such payment of Basic Rent
shall be made in Federal Funds on each Basic Rent Payment Date to Landlord
and/or to such one or more other Persons, pursuant to wire transfer instructions
delivered to Tenant from time to time at such addresses and in such proportions
as Landlord may direct by fifteen (15) days' prior written notice to Tenant (in
which event Tenant shall give Landlord notice of each such payment concurrent
with the making thereof).

      7. Additional Rent.

            (a) Tenant shall pay and discharge, as additional rent
(collectively, "Additional Rent"):

                  (i) except as otherwise specifically provided for or limited
in this Lease, all costs and expenses of Tenant, and all Costs of Landlord and
any other Persons specifically referenced herein, which are incurred in
connection or associated with (A) Tenant's (or any Person claiming by, through
or under Tenant) use, non-use, occupancy or possession of the Leased Premises or
their operations thereat, or the condition, design, construction, maintenance,
alteration, repair or restoration of any of the Leased Premises, (B) the
performance of any of Tenant's obligations under this Lease, (C) any sale or
other transfer of any of the Leased Premises to Tenant under this Lease (other
than any Income Taxes imposed upon the Landlord, as seller), (D) any
Condemnation proceedings, (E) the adjustment, settlement or compromise of any
insurance claims involving or arising from any of the Leased Premises, (F) the
prosecution, defense or settlement of any litigation involving or arising from
any of the Leased Premises, this Lease, or the sale of the Leased Premises to
Landlord, (G) the exercise or enforcement by Landlord, its successors and
assigns, of any of its rights under this Lease, (H) any amendment to or
modification or termination of this Lease made at the request of Tenant, (I)
Costs of Landlord's counsel and reasonable internal Costs of Landlord incurred
in connection with any act undertaken by Landlord (or its counsel) at the
request of Tenant or any act of Landlord performed on behalf of Tenant (to the
extent permitted by Landlord under the terms of this Lease), or the review and
monitoring of Tenant's compliance with its obligations under Paragraph 10 hereof
or with respect to any Post-Closing Obligations and (J) any other items
specifically required to be paid by Tenant under this Lease;

                  (ii) after the date all or any portion of any installment of
Basic Rent is due and not paid by the applicable Basic Rent Payment Date, an
amount (the "Late Charge") equal to five percent (5%) of the amount of such
unpaid installment or portion thereof to reimburse Landlord for its cost and
inconvenience incurred as a result of Tenant's delinquency, provided, however,
that with respect to the first two (2) late payments of all or any portion of
any installment of Basic Rent in any Lease Year, the Late Charge shall not be
due and payable unless the Basic Rent has not been paid within five (5) days
following the due date thereof;

                  (iii) interest at the rate (the "Default Rate") of five
percent (5%) over the Prime Rate per annum on any unpaid installment of Basic
Rent (or portion thereof) or any unpaid item of Additional Rent, (or portion
thereof), for the period beginning upon the expiration of the applicable notice
and cure period until the date that such amount is paid in full.

            (b) Tenant shall pay and discharge (i) any Additional Rent referred
to in Paragraph 7(a)(i) when the same shall become due, provided that amounts
which are billed to Landlord or any third party, but not to Tenant, shall be
paid within ten (10) days after Landlord's demand for payment thereof, and (ii)
any other Additional Rent, within ten (10) days after Landlord's demand for
payment thereof.

                                      -11-
<PAGE>

            (c) In no event shall amounts payable under Paragraph 7(a)(ii) and
(iii) or elsewhere in this Lease exceed the maximum amount permitted by
applicable Law.

      8. Net Lease; Non-Terminability.

            (a) This is a net lease and all Monetary Obligations shall be paid
without notice or demand and without set-off, counterclaim, recoupment,
abatement, suspension, deferment, diminution, deduction, reduction or defense
(collectively, a "Set-Off").

            (b) This Lease and the rights of Landlord and the obligations of
Tenant hereunder shall not be affected by any event or for any reason or cause
whatsoever foreseen or unforeseen.

            (c) The obligations of Tenant hereunder shall be separate and
independent covenants and agreements, all Monetary Obligations shall continue to
be payable in all events (or, in lieu thereof, Tenant shall pay amounts equal
thereto), and the obligations of Tenant hereunder shall continue unaffected
unless the requirement to pay or perform the same shall have been terminated
pursuant to an express provision of this Lease. The obligation to pay Rent or
amounts equal thereto shall not be affected by any collection of any sums by any
governmental body pursuant to any Imposition even if such sums are characterized
as "rent" by such governmental body. All Rent payable by Tenant hereunder shall
constitute "rent" for all purposes (including Section 502(b)(6) of the Federal
Bankruptcy Code).

            (d) Except as otherwise expressly provided herein, Tenant shall have
no right and hereby waives all rights which it may have under any Law (i) to
quit, terminate or surrender this Lease or any of the Leased Premises, or (ii)
to any Set-Off of any Monetary Obligations.

      9. Payment of Impositions.

            (a) Tenant shall, before interest or penalties are due thereon, pay
and discharge all taxes (including real and personal property, sales, use, gross
receipts and rent taxes, and franchise taxes imposed on Tenant), all charges for
any easement or agreement maintained for the benefit of any of the Leased
Premises, all assessments and levies, all permit, inspection and license fees,
all rents and charges for water, sewer, utility and communication services
relating to any of the Leased Premises, all ground rents and all other public
charges whether of a like or different nature, even if unforeseen or
extraordinary, imposed upon or assessed against (i) Tenant, (ii) Tenant's
leasehold interest in the Leased Premises, (iii) any of the Leased Premises,
(iv) Landlord as a result of or arising in respect of the acquisition,
ownership, occupancy, leasing, use or possession of any of the Leased Premises,
any activity conducted on any of the Leased Premises, or the Rent, or (v) any
Lender by reason of a default under clause (xi) of Paragraph 22(a) and/or in
connection with the recording any Note, Mortgage, Assignment or other document
evidencing or securing a Loan and which (as to this clause (v)) Landlord has
agreed to pay (collectively, the "Impositions"): provided, that nothing herein
shall obligate Tenant to pay (A) any Income Taxes of Landlord (or Lender)
(unless such Income Taxes are in lieu of or a substitute for any other tax,
assessment or other charge upon or with respect to the Leased Premises which, if
it were in effect, would be payable by Tenant under the provisions hereof or by
the terms of such tax, assessment or other charge), (B) any estate, inheritance,
succession, gift or similar tax imposed on Landlord, (C) any transfer tax,
mortgage recording tax or similar taxes imposed on Landlord in connection with
the sale of the Leased Premises to any Person, except as may be otherwise
expressly provided for in Paragraph 31(a) and (D) any Income Taxes, or sales or
use taxes or VAT or employment taxes, of Tenant unless the nonpayment or
delinquency thereof would have, or is reasonably likely to have, a material
adverse effect on Landlord, Lender or the Leased Premises or would result in a
final, non-appealable

                                      -12-
<PAGE>

claim or lien against Tenant for unpaid Taxes in an aggregate amount (including
interest and penalties) equal to or in excess of $5,000,000. Landlord shall have
the right to require Tenant to pay, together with scheduled installments of
Basic Rent, the amount of the gross receipts or rent tax, if any, payable with
respect to the amount of such installment of Basic Rent. If any Imposition may
be paid in installments without interest or penalty, Tenant shall have the
option to pay such Imposition in installments; in such event, Tenant shall be
liable only for those installments which accrue or become due and payable during
the Term. Tenant shall prepare and file all tax reports required by governmental
authorities which relate to the Impositions. Tenant shall deliver to Landlord
(1) copies of all settlements and notices pertaining to the Impositions which
may be issued by any governmental authority within ten (10) business days after
Tenant's receipt thereof, (2) receipts for payment of all taxes required to be
paid by Tenant hereunder within thirty (30) days after the due date thereof and
(3) receipts for payment of all other Impositions within ten (10) business days
after Landlord's request therefor.

            (b) If an Event of Default shall occur under this Lease or if
Tenant first-named herein (or any Affiliate of such Tenant) shall cease to be
the Tenant hereunder and as a result thereof Landlord is required by a Lender to
make periodic payments (whether monthly or quarterly, each an "Escrow Payment")
into escrow of funds necessary to pay Escrow Charges (as hereinafter defined) so
that there shall be in an escrow account an amount sufficient to pay the
applicable Escrow Charges as and when same become due, then Landlord shall
notify Tenant thereof in writing, shall make such Escrow Payments, and shall pay
or cause the Lender to pay the applicable Escrow Charges when due (i.e., before
any interest or penalties shall be due thereon). Tenant shall reimburse Landlord
in the amount of such Escrow Payments as Additional Rent hereunder, upon demand
(but not earlier than the date that such taxes, assessments or insurance
premiums would otherwise be due and payable by Tenant to such third parties had
such Escrow Payments not been required by Lender. As used herein, "Escrow
Charges" shall mean real estate taxes and assessments on or with respect to the
Leased Premises or payments in lieu thereof and premiums on any insurance
required by this Lease. If Lender shall subsequently no longer require Landlord
to make Escrow Payments, Landlord shall notify Tenant in writing and Tenant
shall thereafter again pay all Impositions and insurance premiums directly to
the applicable third parties

            (c) The provisions of this Paragraph 9(c) shall not be applicable to
Telcordia Technologies, Inc. or any of its Affiliates; provided that in the
event that neither Telcordia Technologies, Inc. nor any of its Affiliates is
"Tenant" under this Lease (nor liable for the performance of Tenant's
obligations under this Lease) then the provisions of Paragraph 9(b) shall be
deemed deleted in their entirety and the provisions of this Paragraph 9(c) shall
control. If (i) an Event of Default shall occur or (ii) at any time subsequent
to the tenth (10th) anniversary of the Commencement Date, Landlord is required
by a Lender to pay into escrow funds necessary to pay Escrow Charges (as
hereinafter defined), then Tenant shall pay periodically (but not more often
than monthly) Escrow Charges to Landlord (or as Landlord shall direct) in such
amounts (each an "Escrow Payment") so that there shall be in an escrow account
an amount sufficient to pay the Escrow Charges (as hereinafter defined) as they
become due. As used herein, "Escrow Charges" shall mean real estate taxes and
assessments on or with respect to the Leased Premises or payments in lieu
thereof and premiums on any insurance required by this Lease and any reserves
for capital improvements and/or deferred maintenance and repair required by
Landlord. Landlord shall reasonably determine the amount of the Escrow Charges
based upon actual taxes and insurance premiums due with respect to the Leased
Premises and then current institutional lending standards as to reserves for
improvements, maintenance and repairs (it being agreed that if such Escrow
Payments are required by a Lender, such amounts shall equal any corresponding
escrow installments required to be paid by Landlord) and the amount of each
Escrow Payment. As long as the Escrow Payments are being held by Landlord the
Escrow Payments shall not be commingled with other funds of Landlord or other
Persons and interest thereon shall accrue for the benefit of Tenant from the
date such monies are received and

                                      -13-
<PAGE>

invested until the date such monies are disbursed to pay Escrow Charges.
Landlord shall apply the Escrow Payments to the payment of the Escrow Charges in
such order or priority as Landlord shall determine or as required by law. If at
any time the Escrow Payments theretofore paid to Landlord shall be insufficient
for the payment of the Escrow Charges, Tenant, within ten (10) days after
Landlord's demand therefor, shall pay the amount of the deficiency to or at the
direction of Landlord. Landlord agrees that it shall, with respect to any
Lender, use its good faith and commercially reasonable efforts to have the
obligation to make Escrow Payments waived so long as no Event of Default occurs
and Tenant first-named herein remains in physical occupancy of the Leased
Premises.

             10. Compliance with Laws and Easement Agreements, Environmental
Matters.

            (a) Tenant shall, at its sole cost and expense, comply with and
conform to, and cause the Leased Premises and any other Person occupying any
part of the Leased Premises to comply, in all material respects with and conform
to, all Insurance Requirements and Legal Requirements (including, without
limitation, all applicable Environmental Laws and all Laws relating to parking,
building height, zoning, access, set-backs and related ordinances). Tenant shall
not at any time (i) cause, permit or suffer to occur any Environmental Violation
or (ii) permit any sublessee, assignee or other Person occupying the Leased
Premises under or through Tenant to cause, permit or suffer to occur any
Environmental Violation and, at the request of Landlord or Lender, Tenant shall
promptly remediate or undertake any other appropriate response action to correct
any existing Environmental Violation, and (iii) without the prior written
consent of Landlord and Lender, permit any drilling or exploration for or
extraction, removal, or production of any minerals from the surface or the
subsurface of the Land, regardless of the depth thereof or the method of mining
or extraction thereof. Any and all reports prepared for or by Landlord with
respect to the Leased Premises shall be for the sole benefit of Landlord and
Lender and no other Person shall have the right to rely on any such reports.
Nothing herein shall prevent Tenant from independently obtaining copies of such
reports or from separately obtaining the right to rely thereon from the Persons
preparing same pursuant to a separate agreement.

            (b) Tenant, at its sole cost and expense, will at all times promptly
and faithfully abide by, discharge and perform all of the covenants, conditions
and agreements contained in any Easement Agreement on the part of Landlord or
the occupier to be kept and performed thereunder. Tenant will not alter, modify,
amend or terminate any Easement Agreement, give any consent or approval
thereunder, or enter into any new Easement Agreement without, in each case, the
prior written consent of Landlord.

            (c) Upon not less than two (2) business days prior written notice
from Landlord, Tenant shall permit such persons as Landlord may designate ("Site
Reviewers") to visit the Leased Premises during normal business hours and in a
manner which does not unreasonably interfere with Tenant's operations and
perform, and to conduct environmental site investigations and assessments ("Site
Assessments") on the Leased Premises in any of the following circumstances: (i)
in connection with any sale, financing or refinancing of the Leased Premises,
(ii) within the six month period prior to the expiration of the Term, (iii) if
required by Lender or the terms of any credit facility to which Landlord is
bound, (iv) if an Event of Default exists, or (v) at any other time that, in the
opinion of Landlord or Lender, a reasonable basis exists to believe that an
Environmental Violation or any condition that could reasonably be expected to
result in any Environmental Violation exists. Such Site Assessments may include
both above and below the ground testing for Environmental Violations and such
other tests as may be necessary, in the opinion of the Site Reviewers, to
conduct the Site Assessments. Tenant

                                      -14-
<PAGE>

shall supply to the Site Reviewers such historical and operational information
regarding the Leased Premises as may be reasonably requested by the Site
Reviewers to facilitate the Site Assessments, and shall make available for
meetings with the Site Reviewers appropriate personnel having knowledge of such
matters. The costs of performing and reporting Site Assessments under clause
(ii) (but only one (1) time), under clause (iv), under clause (i) in connection
with either Landlord's initial financing of the Leased Premises or the sale of
any of the Leased Premises to Tenant or an Affiliate or designee of Tenant, and
under clause (v) if any Environmental Violation is discovered, shall be paid by
Tenant, otherwise such costs shall be paid by Landlord. Landlord shall repair
(or shall cause the Site Reviewers to repair) any incidental damage caused by
any inspection or test performed pursuant to Paragraph 10(c) and Landlord and
Tenant shall cooperate with each other to ensure that such Site Reviewers carry
appropriate insurance for the benefit of Landlord and Tenant to cover the costs
for the repair of any such damage or injury to any individual as a result of
such inspection. Notwithstanding anything to the contrary contained in this
Lease (including Paragraph 15), Tenant shall not be liable for, nor be required
to indemnify any Indemnitee against any Claim (as such terms are defined in
Paragraph 15) with respect to any damage to property or injury to persons caused
by or resulting from the entry by such Site Reviewers upon the Leased Premises
or the physical performance of the applicable Site Assessments, but nothing
herein shall limit Tenant's obligations in connection with any Environmental
Violations discovered thereby or the cost of any remedial action required.

            (d) If an Environmental Violation occurs or is found to exist and,
in Landlord's reasonable judgment, the cost of remediation of, or other response
action with respect to, the same is likely to exceed $1,000,000.00, then Tenant
shall provide to Landlord, within ten (10) days after Landlord's request
therefor, assurances that Tenant has the adequate financial resources to effect
such remediation in accordance with applicable Environmental Laws (which may
include Tenant's written confirmation of access to liquid assets necessary to
complete such remediation in light of the estimated costs thereof based upon a
Site Assessment performed pursuant to Paragraph 10(c) by a Site Reviewer.

            (e) Notwithstanding any other provision of this Lease, if an
Environmental Violation occurs or is found to exist during the Term and the Term
would otherwise terminate or expire, then, at the option of Landlord, the Term
shall be automatically extended beyond the date of termination or expiration and
this Lease (other than the obligation of Tenant to remain in occupancy of the
Leased Premises) shall remain in full force and effect beyond such date until
the earlier to occur of (i) the completion of all active remedial action in
accordance with applicable Environmental Laws (it being agreed that mere site
monitoring, such as periodic water or soil testing, shall not by itself prevent
a determination that remedial action has been completed) and (ii) the date
specified in a written notice from Landlord to Tenant terminating this Lease.

            (f) If Tenant shall default beyond any applicable notice and cure
period in its obligation to correct any Environmental Violation which occurs or
is found to exist, then Landlord shall have the right (but no obligation) to
take any and all actions as Landlord shall deem necessary or advisable in order
to cure such Environmental Violation in accordance with applicable Laws.

            (g) Tenant shall notify Landlord promptly after becoming aware of
any Environmental Violation (or alleged Environmental Violation) or
noncompliance with any of the covenants contained in this Paragraph 10 and shall
forward to Landlord immediately upon receipt thereof copies of all orders,
reports, notices, permits, applications or other communications relating to any
such violation or noncompliance.

                                      -15-
<PAGE>

            (h) Tenant shall not use the Leased Premises or any portion thereof
as a "Major Facility" (as such term is defined in the New Jersey Spill
Compensation Act and Control Act, N.J.S.A. section 58:10.23.11b et seq.).

            (i) Tenant shall not conduct or cause or permit to be conducted on
the Leased Premises any activity which constitutes an "Industrial
Establishment," as such term is defined in the New Jersey Industrial Site
Recovery Act (formerly known as the Environmental Cleanup Responsibility Act),
as amended (N.J.S.A. section 13: 1K et seq.) ("ISRA"). In the event that the
provisions of ISRA become applicable to the Leased Premises subsequent to the
date hereof, Tenant shall give prompt written notice thereof to Landlord and
shall take immediate requisite action to insure full compliance therewith.
Tenant shall promptly deliver to Landlord copies of all correspondence, notices
and submissions that it sends to or receives from the New Jersey Department of
Environmental Protection in connection with such ISRA compliance.

            (j) All future leases, subleases or concession agreements relating
to the Leased Premises entered into by Tenant shall contain covenants of the
other party not to at any time (i) cause any Environmental Violation to occur or
(ii) permit any Person occupying the Leased Premises through said subtenant or
concessionaire to cause any Environmental Violation to occur.

         11. Liens; Recording;

            (a) Tenant shall not, directly or indirectly, create or permit to be
created or to remain and shall promptly discharge or remove any lien, levy or
encumbrance on any of the Leased Premises or on any Rent or any other sums
payable by Tenant under this Lease, other than any Mortgage or Assignment, the
Permitted Encumbrances and any mortgage, lien, encumbrance or other charge
created by or resulting solely from any act or omission of Landlord. NOTICE IS
HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY LABOR, SERVICES OR
MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR TO ANYONE HOLDING OR
OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER TENANT, AND THAT NO
MECHANICS' OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH
TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED PREMISES.
LANDLORD MAY AT ANY TIME, AND AT LANDLORD'S REQUEST TENANT SHALL PROMPTLY, POST
ANY NOTICES ON THE LEASED PREMISES REGARDING SUCH NON-LIABILITY OF LANDLORD.

            (b) Each of Landlord and Tenant shall execute, deliver and record,
file or register (collectively, "record") all such instruments as may be
required or permitted by any present or future Law in order to evidence the
respective interests of Landlord and Tenant in the Leased Premises, and shall
cause a memorandum of this Lease (or, if such a memorandum cannot be recorded,
this Lease), and any supplement hereto or thereto, to be recorded in such manner
and in such places as may be required or permitted by any present or future Law
in order to protect the validity and priority of this Lease.

         12. Maintenance and Repair.

            (a) Tenant shall at all times maintain the Leased Premises in as
good repair and appearance as they are in on the date hereof and fit to be used
for their intended use in accordance with standards and practices previously
observed by Tenant with respect to the Leased Premises and a plan of maintenance
and repair reasonably consistent with sound real estate practices for similar
buildings similarly situated, and, in the case of the Equipment, in as good
mechanical condition as it was on the later of the date hereof or the date of
its installation, except for ordinary wear and tear and casualty or Condemnation
as to which Tenant is not

                                      -16-
<PAGE>

otherwise obligated to repair or restore in accordance with the terms of this
Lease. Tenant shall take every other action necessary or appropriate for the
preservation and safety of the Leased Premises. Tenant shall promptly make all
Alterations of every kind and nature, whether foreseen or unforeseen, which may
be required to comply with the foregoing requirements of this Paragraph 12(a).
Landlord shall not be required to make any Alteration, whether foreseen or
unforeseen, or to maintain any of the Leased Premises in any way, and Tenant
hereby expressly waives any right which may be provided for in any Law now or
hereafter in effect to make Alterations at the expense of Landlord or to require
Landlord to make Alterations. Any Alteration made by Tenant pursuant to this
Paragraph 12 shall be made in conformity with the provisions of Paragraph 13.

            (b) If any Improvement, now or hereafter constructed, shall (i)
encroach upon any setback or any property, street or right-of-way adjoining the
Leased Premises, (ii) violate the provisions of any restrictive covenant
affecting the Leased Premises, (iii) hinder or obstruct any easement or
right-of-way to which any of the Leased Premises is subject or (iv) impair the
rights of others in, to or under any of the foregoing, Tenant shall, promptly
after receiving notice or otherwise acquiring knowledge thereof, either (A)
obtain from all necessary parties waivers or settlements of all claims,
liabilities and damages resulting from each such encroachment, violation,
hindrance, obstruction or impairment, whether the same shall affect Landlord,
Tenant or both, or (B) take such action as shall be necessary to remove all such
encroachments, hindrances or obstructions and to end all such violations or
impairments, including, if necessary, making Alterations; provided however, that
with respect to any Improvements existing at the Leased Premises as of the date
of this Lease, Tenant shall not be required to take the actions required under
clauses (A) or (B) hereof unless (x) Tenant shall have received a notice to take
such actions from any governmental authority having jurisdiction over the Leased
Premises or (y) any Person other than Landlord shall commence any action or
proceeding with respect thereto.

         13. Alterations and Improvements.

            (a) Tenant shall have the right, without having obtained the prior
written consent of Landlord and Lender and provided that no Event of Default
then exists, (i) to make non-structural Alterations or a series of related
non-structural Alterations performed during any consecutive twelve (12) month
period that, as to any single Alterations does not cost in excess of
$3,000,000.00 or as to any such series of related Alterations, do not cost in
excess of $5,700,000.00 and (ii) to install Equipment in the Improvements or
accessions to the Equipment that, as to such Equipment or accessions, do not
cost in excess of $3,000,000.00, so long as at the time of construction or
installation of any such Equipment or Alterations no Event of Default exists and
the value and utility of the Leased Premises is not diminished thereby (provided
that the references herein to $3,000,000 and $5,700,000 shall be subject to CPI
Adjustment). If the cost of any non-structural Alterations, series of related
non-structural Alterations, Equipment or accessions thereto is in excess of the
applicable threshold amounts set forth above or if Tenant desires to make
structural Alterations to the Leased Premises, then, in each instance, the prior
written approval of Landlord shall be required; provided that, as to any
Alterations required by applicable Law (whether or not structural) and any other
non-structural Alterations only, Landlord agrees that (i) it shall not
unreasonably withhold, delay or condition its approval thereto and (ii)
Landlord's failure to approve or disapprove of such Alterations within thirty
(30) days after Tenant provides Landlord with the plans and specifications
therefor shall be deemed Landlord's approval thereof. Notwithstanding the
foregoing, Tenant shall not construct upon the Land any additional buildings
without having first obtained the prior written consent of Landlord in its sole
discretion. Landlord shall have the right to require Tenant to remove any
Alterations except for (i) Alterations required by Law, (ii) Alterations for
which Landlord's approval is not required hereunder or for which Landlord's
approval was deemed given as provided above or (iii) Alterations as to which
Landlord, at the time it approves same, fails to

                                      -17-
<PAGE>

notify Tenant that same would be required to be removed upon the expiration or
termination of the Term. With respect to any Alterations consented to or
approved by Landlord hereunder (or if no such consent or approval is required,
so long as such Alterations comply with the provisions of this Lease and
applicable Law), Landlord shall reasonably cooperate with Tenant (at no cost to
Landlord) and, upon the request of Tenant, shall execute, consent to, approve
and/or authorize, as applicable, such filings, plans, applications or the like
required by the applicable governmental authorities in order for Tenant to
obtain such governmental approvals and permits necessary to commence and
complete such Alterations.

            (b) If Tenant makes any Alterations pursuant to this Paragraph 13 or
Paragraph 35 or as required by Paragraph 12 or 17 (such Alterations and actions
being hereinafter collectively referred to as "Work") whether or not Landlord's
consent is required, then (i) the market value of the Leased Premises shall not
be lessened by any such Work or its usefulness impaired, (ii) all such Work
shall be performed by Tenant in a good and workmanlike manner, (iii) all such
Work shall be expeditiously completed in compliance with all Legal Requirements,
(iv) all such Work shall comply with the Insurance Requirements, (v) if any such
Work involves the replacement of Equipment or parts thereto, all replacement
Equipment or parts shall have a value and useful life equal to the greater of
(A) the value and useful life on the date hereof of the Equipment being replaced
or (B) the value and useful life of the Equipment being replaced immediately
prior to the occurrence of the event which required its replacement (assuming
such replaced Equipment was then in the condition required by this Lease), (vi)
Tenant shall promptly discharge or remove all liens filed against any of the
Leased Premises arising out of such Work, (vii) Tenant shall procure and pay for
all permits and licenses required in connection with any such Work, (viii) all
such Work shall be the property of Landlord and shall be subject to this Lease,
and Tenant shall execute and deliver to Landlord any document requested by
Landlord evidencing the assignment to Landlord of all estate, right, title and
interest (other than the leasehold estate created hereby) of Tenant or any other
Person thereto or therein, and (ix) Tenant shall comply, to the extent requested
by Landlord or required by this Lease, with the provisions of Paragraphs 12(a)
and 19(a), whether or not such Work involves restoration of the Leased Premises.

          14. Permitted Contests. Notwithstanding any other provision of this
Lease, Tenant shall not be required to (a) pay any Imposition, (b) comply with
any Legal Requirement, (c) discharge or remove any lien referred to in Paragraph
11 or 13, or (d) take any action with respect to any encroachment, violation,
hindrance, obstruction or impairment referred to in Paragraph 12(b) (such
non-compliance with the terms hereof being hereinafter referred to collectively
as "Permitted Violations") and may dispute or contest the same, so long as at
the time of such contest no Event of Default exists and so long as Tenant shall
contest, in good faith, the existence, amount or validity thereof, the amount of
the damages caused thereby, or the extent of its or Landlord's liability
therefor by appropriate proceedings which shall operate during the pendency
thereof to prevent or stay (i) the collection of, or other realization upon, the
Permitted Violation so contested, (ii) the sale, forfeiture or loss of any of
the Leased Premises or any Rent to satisfy or to pay any damages caused by any
Permitted Violation, (iii) any interference with the use or occupancy of any of
the Leased Premises, (iv) any interference with the payment of any Rent, or (v)
the cancellation or increase in the rate of any insurance policy or a statement
by the carrier that coverage will be denied or (vi) the enforcement or execution
of any injunction, order or Legal Requirement with respect to the Permitted
Violation. Tenant shall provide to Landlord a bond in such amount as is
reasonably required to assure that such Permitted Violation is corrected
(including any interest and penalties that may have been incurred in connection
therewith), and any and all Costs incurred by Landlord in connection therewith
shall be payable by Tenant upon Landlord's demand as Additional Rent. While any
proceedings which comply with the requirements of this Paragraph 14 are pending
and such bond is held by Landlord, Landlord shall not have the right to correct
any Permitted Violation thereby being contested unless Landlord is required by
law to correct such Permitted Violation

                                      -18-
<PAGE>

and Tenant's contest does not prevent or stay such requirement as to Landlord.
Upon the discharge of any applicable Permitted Violation, Landlord shall
promptly thereafter return the required bond to Tenant. Each such contest shall
be promptly and diligently prosecuted by Tenant to a final conclusion, except
that Tenant, so long as the conditions of this Paragraph 14 are at all times
complied with, has the right to attempt to settle or compromise such contest
through negotiations. Tenant shall pay any and all losses, judgments, decrees
and Costs in connection with any such contest and shall, promptly after the
final determination of such contest, fully pay and discharge the amounts which
shall be levied, assessed, charged or imposed or be determined to be payable
therein or in connection therewith, together with all penalties, fines, interest
and Costs thereof or in connection therewith, and perform all acts the
performance of which shall be ordered or decreed as a result thereof. No such
ontest shall subject Landlord to the risk of any civil or criminal liability.

        15. Indemnification.

            (a) Tenant shall pay, protect, indemnify, defend, save and hold
harmless Landlord, Lender and all other Persons described in Paragraph 30 (each
an "Indemnitee") from and against any and all liabilities, losses, damages
(including punitive damages), penalties, Costs (including reasonable attorneys'
fees and costs), causes of action, suits, claims, demands or judgments of any
nature whatsoever, howsoever caused, without regard to the form of action and
whether based on strict liability, negligence or any other theory of recovery at
law or in equity (any of the foregoing, a "Claim") and arising or accruing from
any facts or circumstances in existence at any time prior to the expiration of
the Term of the Lease (whether or not discovered thereafter), related to or in
connection with (i) any third party asserting or alleging any right or option to
use, occupy, own or acquire the Leased Premises or any part thereof or any
minerals or water therein or thereunder, (ii) the use, non-use, occupancy,
operation, condition, design, construction, maintenance, repair or restoration
of the Leased Premises, (iii) any casualty in any manner arising from the Leased
Premises, whether or not Indemnitee has or should have knowledge or notice of
any defect or condition causing or contributing to said casualty, (iv) any
violation by Tenant of any provision of this Lease, any contract or agreement to
which Tenant is a party affecting or in connection with the Leased Premises, any
Legal Requirement or any Permitted Encumbrance or any encumbrance consented to
by Tenant, to or the Mortgage or Assignment, or (v) any alleged, threatened or
actual Environmental Violation, including (A) liability for response costs and
for costs of removal and remedial action incurred by the United States
Government, any state or local governmental unit or any other Person, or damages
from injury to or destruction or loss of natural resources, including the
reasonable costs of assessing such injury, destruction or loss, incurred
pursuant to Section 107 of CERCLA, or any successor section or act or provision
of any similar state or local Law, (B) liability for costs and expenses of
abatement, correction or clean-up, fines, damages, response costs or penalties
which arise from the provisions of any of the other Environmental Laws and (C)
liability for personal injury or property damage arising under any statutory or
common-law tort theory, including damages assessed for the maintenance of a
public or private nuisance or for carrying on of a dangerous activity; provided
that, the foregoing indemnification shall not be applicable to any Claim
resulting from the gross negligence or willful misconduct of Landlord (it being
further agreed that for purposes of this Paragraph 15, as between Landlord and
Tenant, in no event shall any omission or failure to act on the part of
Landlord, or Landlord's mere absence from the Leased Premises or failure to be
aware of any condition thereat, be deemed to constitute gross negligence).

            (b) In case any action or proceeding is brought against any
Indemnitee by reason of any such Claim, (i) Tenant may, except in the event of a
conflict of interest or a dispute between Tenant and any such Indemnitee or
during the continuance of an Event of Default, retain its own counsel and defend
such action (it being understood that Landlord may employ counsel of its choice
to monitor the defense of any such action, the reasonable cost of

                                      -19-
<PAGE>

which shall be paid by Tenant) and (ii) such Indemnitee shall notify Tenant to
resist or defend such action or proceeding by retaining counsel reasonably
satisfactory to such Indemnitee, and such Indemnitee will cooperate and assist
in the defense of such action or proceeding if reasonably requested so to do by
Tenant. In the event of a conflict of interest or dispute or during the
continuance of an Event of Default, Landlord shall have the right to select
counsel, and the reasonable costs of such counsel shall by paid by Tenant.

            (c) The obligations of Tenant under this Paragraph 15 shall survive
any termination, expiration or rejection in bankruptcy of this Lease.

         16. Insurance.

            (a) Tenant shall obtain, pay for and maintain the following
insurance on or in connection with the Leased Premises:

                  (i) Insurance against all risk of physical loss or damage to
the Improvements and Equipment as provided under "Special Causes of Loss" form
coverage, and including customarily excluded perils of hail, windstorm, flood
coverage, earthquake and, to the extent required by Lender, terrorism insurance,
in amounts no less than the actual replacement cost of the Improvements and
Equipment; provided that, if Tenant's insurance company is unable or unwilling
to include any of all of such excluded perils, Tenant shall have the option of
purchasing coverage against such perils from another insurer on a "Difference in
Conditions" form. Such policies shall contain Replacement Cost and Agreed Amount
Endorsements and "Law and Ordinance" coverage (covering loss to the undamaged
portion of the applicable Improvements, demolition costs and any increased costs
of construction). Such policies and endorsements shall contain deductibles not
more than $250,000 per occurrence, except for earthquake, flood and "named"
storm wind coverage, in which cases the deductibles shall not exceed five (5%)
of the full replacement value of the Improvements at the Leased Premises,
subject to minimum deductible of $250,000.

                  (ii) Commercial General Liability Insurance, with limits of
$1,000,000 per occurrence and $2,000,000 in aggregate, with a combined single
limit of $1,000,000 and $10,000,000 in excess limits, against claims for
personal and bodily injury, death or property damage occurring on, in or as a
result of the use of the Leased Premises, on a claims occurrence basis, which
insurance may contain a deductible not to exceed $250,000.

                  (iii) Workers' compensation insurance in the amount required
by applicable Law and employers' liability insurance covering all persons
employed by Tenant in connection with any work done on or about any of the
Leased Premises.

                  (iv) Comprehensive Boiler and Machinery/Equipment Breakdown
Insurance on any of the Equipment or any other equipment on or in the Leased
Premises, in an amount not less than $5,000,000 per accident for damage to
property (and which may be carried as part of the coverage required under clause
(i) above or pursuant to a separate policy or endorsement). Either such Boiler
and Machinery policy or the Special Causes of Loss policy required in clause (i)
above shall include at least $3,000,000 per incidence for Off-Premises Service
Interruption, Expediting Expenses, Ammonia Contamination, and Hazardous
Materials Clean-Up Expense and may contain a deductible not to exceed $250,000.

                  (v) Business Income/Extra Expense Insurance at limits
sufficient to cover 100% of the period of indemnity not less than twelve (12)
months from time of loss, including extended period of indemnity which provides
that after the physical loss to the Improvements and Equipment has been
repaired, the continued loss of income will be insured until such income either
returns to the same level it was at prior to the loss, or the expiration of

                                      -20-
<PAGE>

two (2) months from the date that the Leased Premises are repaired or replaced
and operations are resumed, whichever first occurs.

                  (vi) During any period in which substantial Alterations at the
Leased Premises are being undertaken, builder's risk insurance covering the
total completed value, including all hard and soft costs (which shall include
business interruption coverage) with respect to the Improvements being
constructed, altered or repaired (on a completed value, non-reporting basis),
replacement cost of work performed and equipment, supplies and materials
furnished in connection with such construction, alteration or repair of
Improvements or Equipment, together with such other endorsements as Landlord may
reasonably require, and general liability, worker's compensation and automobile
liability insurance with respect to the Improvements being constructed, altered
or repaired; provided that Tenant shall either maintain the various coverage
required under this clause (vi) or cause the applicable contractor to maintain
same through insurers acceptable to Landlord.

                  (vii) Such other insurance, including mold insurance (or other
or different terms with respect to any insurance required pursuant to this
Paragraph 16, including, without limitation, amounts of coverage, deductibles,
form of mortgagee clause and/or insurer rating), on or in connection with any of
the Leased Premises as Landlord or Lender may reasonably require; provided that
such insurance is available to Tenant on a commercially reasonable basis and is
consistent, as to types of coverage and amounts, with the requirements generally
of institutional lenders or prudent owners or operators of similar properties.

            (b) The insurance required by Paragraph 16(a) shall be written by
companies having a Best's rating of A-:VII or above and a claims paying ability
rating of AA or better by Standard & Poor's Rating Services, a division of the
McGraw Hill Companies, Inc. or equivalent rating agency approved by Landlord and
Lender in their sole discretion and are authorized to write insurance policies
by, the State Insurance Department (or its equivalent) for the State. The
insurance policies shall be for such policy periods as Landlord may reasonably
approve. If said insurance or any part thereof shall expire, be withdrawn,
become void, voidable, or deemed unreliable or unsafe for any reason (in
Landlord's or Lender's reasonable determination), including a breach of any
condition thereof by Tenant or the failure or impairment of the capital of any
insurer, or if for any other reason whatsoever said insurance shall become
reasonably unsatisfactory to Landlord, Tenant shall immediately obtain new or
additional insurance reasonably satisfactory to Landlord. Notwithstanding the
ratings and related criteria set forth in the first sentence of this Paragraph
16(b), Landlord and Lender hereby agree to accept and approve Factory Mutual as
Tenant's initial insurance carrier for purposes of the insurance required under
Paragraphs 16(a)(i), (iv) and (v), but such carrier shall be subject to the
rights of Landlord and Lender pursuant to the immediately preceding sentence of
this Paragraph 16(b). In the event that Tenant shall elect to change carriers at
any time hereafter, such new carrier must satisfy the criteria set forth in the
first sentence of this Paragraph 16(b)

            (c) Each insurance policy referred to in clauses (i), (iv), (v) and
(vi) of Paragraph 16(a) shall contain standard non-contributory mortgagee
clauses in favor of and acceptable to Lender. Each policy required by any
provision of Paragraph 16(a), except clause (iii) thereof, shall provide that it
may not be cancelled, substantially modified or allowed to lapse on any renewal
date except after thirty (30) days' prior written notice to Landlord and Lender.

            (d) Tenant shall pay as they become due all premiums for the
insurance required by Paragraph 16(a), shall renew or replace each policy and
deliver to Landlord evidence of the payment of the full premium therefor or
installment then due at least ten (10) days prior to the expiration date of such
policy, and shall promptly deliver to Landlord all original certificates of
insurance evidencing such coverages or, if required by Lender, a

                                      -21-
<PAGE>

duplicate original (if available) or certified copy of such policies. All
certificates of insurance (including liability coverage) provided to Landlord
and Lender shall be on appropriate and current ACORD Forms (or their
equivalent).

            (e) Anything in this Paragraph 16 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 16(a) may
be carried under a "blanket" policy or policies covering other properties of
Tenant or under an "umbrella" policy or policies covering other liabilities of
Tenant, as applicable; provided that, such blanket or umbrella policy or
policies otherwise comply with the provisions of this Paragraph 16, and upon
request, Tenant shall provide to Landlord a Statement of Values which may be
reviewed annually and shall be amended to the extent determined necessary by
Landlord based on revised Replacement Cost Valuations. A duplicate original (if
available) or a certified copy of each such blanket or umbrella policy shall
promptly be delivered to Landlord.

            (f) Tenant shall not carry separate insurance concurrent in form or
contributing in the event of a Casualty with that required in this Paragraph 16
unless (i) Landlord and Lender are included therein as named insureds, with loss
payable as provided herein, and (ii) such separate insurance complies with the
other provisions of this Paragraph 16. Tenant shall immediately notify Landlord
of such separate insurance and shall deliver to Landlord the original policies
or certified copies thereof.

            (g) Each policy (other than workers' compensation coverage) shall
contain an effective waiver by the carrier against all claims for payment of
insurance premiums against Landlord and shall contain a full waiver of
subrogation against the Landlord.

            (h) The proceeds of any insurance required under Paragraph 16(a)
shall be payable as follows:

                  (i) proceeds payable under clauses (ii), (iii) and (iv) of
Paragraph 16(a) and proceeds attributable to the general liability coverage of
Builder's Risk insurance under clause (vi) of Paragraph 16(a) shall be payable
to the Person entitled to receive such proceeds; and

                  (ii) proceeds of insurance required under clause (i) of
Paragraph 16(a) and proceeds attributable to Builder's Risk insurance (other
than its general liability coverage provisions) under clause (vi) of Paragraph
16(a) shall be payable to Landlord or Lender and applied as set forth in
Paragraph 17 or, if applicable, Paragraph 18. Tenant shall apply the Net Award
to restoration of the Leased Premises in accordance with the applicable
provisions of this Lease unless a Termination Event shall have occurred and
Tenant has given a Termination Notice.

      17. Casualty and Condemnation.

            (a) If any Casualty to the Leased Premises occurs, Tenant shall give
Landlord and Lender prompt notice thereof. Provided that no Event of Default has
occurred and is continuing, with respect to any and all claims under any of the
insurance policies required by Paragraph 16(a) (except public liability
insurance claims payable to a Person other than Tenant, Landlord or Lender) in
an amount of less than $4,000,000.00 (the "Threshold Amount"), Tenant shall be
and is hereby authorized to adjust, collect, settle and compromise same, in its
reasonable discretion and upon notice to Landlord and any Lender, so long as any
such settlement or compromise contains a full and unconditional release of
Landlord and Lender from any liability or obligation in connection therewith, if
applicable. Only Landlord and Lender are authorized to adjust, collect and
compromise, in their discretion, any and all claims under any of the insurance
policies required by Paragraph 16(a) (except public liability insurance claims
payable to a Person

                                      -22-
<PAGE>

other than Tenant, Landlord or Lender) in excess of the Threshold Amount (upon
notice to Tenant unless the giving or effectiveness of such notice is prohibited
by stay but with out any approval by Tenant if an Event of Default has occurred
and is continuing); provided that, if no Event of Default by Tenant shall have
occurred and be continuing hereunder, Tenant shall be entitled to participate
with Landlord and Lender in any adjustment, collection and compromise of the Net
Award payable in connection with a Casualty whether below or in excess of the
Threshold Amount and, except in the case of a Casualty where Landlord has
delivered a Rejection of Tenant's offer to pay the Termination Amount following
a Termination Event as described in Paragraph 18, all final adjustments,
settlements or compromises for claims above the Threshold Amount shall
nevertheless be subject to the approval of Tenant (such approval not to be
unreasonably withheld, delayed or conditioned). Subject to the foregoing, Tenant
agrees to sign, upon the request of Landlord and Lender, all such proofs of
loss, receipts, vouchers and releases, and if Tenant fails to do so or if an
Event of Default has occurred and is continuing, Landlord and Lender are each
hereby authorized to execute and deliver on behalf of Tenant all necessary
proofs of loss, receipts, vouchers and releases required by the insurers.
Notwithstanding the foregoing, for claims in excess of the Threshold Amount,
Landlord and Lender shall have the option to prosecute or contest, or to require
Tenant to prosecute or contest, any such claim, adjustment, settlement or
compromise ,and if Landlord or Lender so instructs in writing, Tenant shall
prosecute, contest, adjust, collect and compromise any and all such claims at it
own cost and expense in accordance with such instructions, and Landlord and
Lender shall have the right to join with Tenant therein. Any adjustment,
settlement or compromise of any such claim not consistent with such instructions
shall be subject to the prior written approval of Landlord and Lender. Each
insurer is hereby authorized and directed to make payment under said policies,
including return or unearned premiums, directly to Landlord or, if required by
the Mortgage, to Lender instead of to Landlord and Tenant jointly, and Tenant
hereby appoints each of Landlord and Lender as Tenant's attorneys-in-fact to
endorse any draft therefor. The rights of Landlord under this Paragraph 17(a)
shall be extended to Lender if and to the extent that any Mortgage so provides.

            (b) Tenant, promptly upon receiving a Condemnation Notice, shall
notify Landlord and Lender thereof. Only Landlord and Lender are authorized to
collect, settle and compromise, in their discretion (upon notice to Tenant
unless the giving or effectiveness of such notice is prohibited by stay), the
amount of any Net Award. Provided that no Event of Default has occurred and is
continuing, Tenant shall be entitled to participate with Landlord and Lender in
any Condemnation proceeding or negotiations under threat thereof and to contest
the Condemnation or the amount of the Net Award therefor. No agreement with any
condemning authority in settlement or under threat of any Condemnation shall be
made by Tenant without the written consent of Landlord and Lender. Subject to
the provisions of this Paragraph 17(b), Tenant hereby irrevocably assigns to
Landlord any award or payment to which Tenant is or may be entitled by reason of
any Condemnation, whether the same shall be paid or payable for Tenant's
leasehold interest hereunder or otherwise; but nothing in this Lease shall
impair Tenant's right to any award or payment on account of Tenant's trade
fixtures, equipment or other tangible property which is not part of the
Equipment, moving expenses or loss of business, if available, to the extent that
and so long as (i) Tenant shall have the right to make, and does make, a
separate claim therefor against the condemnor and (ii) such claim does not in
any way reduce either the amount of the award otherwise payable to Landlord for
the Condemnation of Landlord's fee interest in the Leased Premises or the amount
of the award (if any) otherwise payable for the Condemnation of Tenant's
leasehold interest hereunder. The rights of Landlord under this Paragraph 17(b)
shall also be extended to Lender if and to the extent that any Mortgage so
provides.

            (c) If any Partial Casualty (whether or not insured against) or any
Partial Condemnation shall occur, this Lease shall continue notwithstanding such
event, and there shall be no abatement or reduction of any Monetary Obligations.
Promptly after such

                                      -23-
<PAGE>

Partial Casualty or Partial Condemnation, Tenant, as required in Paragraphs
12(a) and 13(b), shall commence and diligently continue to restore the Leased
Premises as nearly as possible to its value, condition and character immediately
prior to such event (assuming the Leased Premises to have been in the condition
required by this Lease). So long as the actual Net Award (or any amount equal
thereto) is made available to Tenant (including through the Restoration Fund),
Tenant shall have the obligation to restore the Leased Premises in accordance
with the preceding sentence whether or not the Net Award is sufficient therefor,
and such restoration obligation shall remain in effect even if no Net Award is
available to Tenant from (i) the applicable governmental authority due to the
acts or omissions of Tenant or (ii) the Tenant's insurance carrier due to the
acts or omissions of Tenant or because of Tenant's failure to maintain the
insurance required to be carried under Paragraph 16. So long as no Event of
Default exists, any Net Award up to the Threshold Amount shall be paid by
Landlord to Tenant and Tenant shall restore the Leased Premises in accordance
with the requirements of Paragraphs 12(a) and 13(b) of this Lease, and any
balance shall promptly be refunded to Landlord. Any Net Award in excess of the
Threshold Amount shall (unless such Casualty or Condemnation resulting in the
Net Award is a Termination Event) be made available by Landlord (or by Lender,
if the Net Award is paid to Lender pursuant to the terms of any Mortgage, SNDA
or other document in connection with a Loan) to Tenant for the restoration of
any of the Leased Premises pursuant to and in accordance with the provisions of
Paragraph 19 hereof. If any Casualty or Condemnation which is not a Partial
Casualty or Partial Condemnation shall occur, Tenant shall comply with the terms
and conditions of Paragraph 18.

            (d) In the event of a Requisition of any of the Leased Premises, if
any Net Award payable by reason of such Requisition is actually received and
retained by Landlord, such Net Award shall be applied as a credit against the
next occurring installments of Basic Rent due hereunder until applied in full or
until the earlier to occur of (i) the expiration of the stated period of the
Requisition or (ii) the expiration of the Term; provided that any portion of the
Net Award that either exceeds the Basic Rent for the stated period or as to
which Landlord is not obligated to credit to Tenant hereunder, shall, upon the
expiration of the Term, be retained by Landlord without any further credit or
other compensation to Tenant.

            (e) Tenant hereby waives the benefits of N.J.S.A. 46:8-6 and 46:8-7,
and agrees that Tenant shall not be relieved of the obligations to pay Basic
Rent and Additional Rent in the event of damage to, or destruction of, the
Leased Premises, except as otherwise expressly provided in this Lease.

      18. Termination Events.

            (a) If either (i) the entire Leased Premises shall be taken by a
Taking or (ii) any substantial portion of the Leased Premises shall be taken by
a Taking or all or any substantial portion of the Leased Premises shall be
damaged or destroyed by a Casualty and, in such case, Tenant certifies and
covenants to Landlord that it has determined, in good faith, exercising its
reasonable judgment, that the required restoration and continued operation of
Tenant's business at the Leased Premises is not economically practicable (each
of the events described in the above clauses (i) and (ii) shall hereinafter be
referred to as a "Termination Event"), then (x) in the case of (i) above, Tenant
shall be obligated, within thirty (30) days after Tenant receives a Condemnation
Notice and (y) in the case of (ii) above, Tenant shall have the option, within
thirty (30) days after Tenant receives a Condemnation Notice or thirty (30) days
after the Casualty, as the case may be, to give to Landlord written notice in
the form described in Paragraph 18(b) of the Tenant's election to terminate this
Lease (a "Termination Notice"). If Tenant elects under clause (y) above not to
give Landlord a Termination Notice, then Tenant shall rebuild or repair the
Leased Premises in accordance with Paragraphs 17 and 19.

                                      -24-
<PAGE>

            (b) A Termination Notice shall contain (i) notice of Tenant's
intention to terminate this Lease on the first Basic Rent Payment Date which
occurs at least sixty (60) days after the date such Termination Notice is given
to Landlord (the "Termination Date"), (ii) a binding and irrevocable offer of
Tenant to pay to Landlord the Termination Amount and (iii) if the Termination
Event is an event described in Paragraph 18(a)(ii), the certification and
covenants described therein and a certified resolution of the Board of Directors
of Tenant authorizing the same.

            (c) If Landlord shall reject such offer by Tenant to pay to Landlord
the Termination Amount pursuant to Paragraph 18(b) above by written notice to
Tenant (a "Rejection"), which Rejection shall contain the written consent of
Lender to Landlord's rejection of Tenant's offer to pay the Termination Amount,
then this Lease shall terminate on the Termination Date; provided that, if
Tenant has not satisfied all Monetary Obligations and all other obligations
under this Lease which have arisen on or prior to the Termination Date
(collectively, "Remaining Obligations") as of the Termination Date, then
Landlord may, at its option, extend the effective date on which this Lease may
terminate to the date which is the last calendar day of the month subsequent to
Termination Date on which Tenant has satisfied all Remaining Obligations. Upon
such termination (i) all obligations of Tenant hereunder shall terminate except
for any Surviving Obligations, (ii) Tenant shall immediately vacate and shall
have no further right, title or interest in or to any of the Leased Premises and
(iii) the Net Award shall be retained by Landlord. Notwithstanding anything to
the contrary hereinabove contained, if Tenant shall have received a Rejection
and, on the date when this Lease would otherwise terminate, Landlord shall not
have received the agreed amount of the Net Award payable by reason of the
applicable Termination Event though no fault on the part of Landlord, then the
date on which this Lease is to terminate shall be automatically extended to the
date that is the last calendar day of the month in which Landlord receives the
agreed amount of the Net Award or the scheduled Expiration Date of this Lease,
whichever is earlier; provided that, if Tenant has not satisfied all Remaining
Obligations as of such date, then Landlord may, at its option, extend the date
on which this Lease may terminate to the date which is the last calendar day of
the month in which Tenant has satisfied all such Remaining Obligations.

            (d) Unless Tenant shall have received a Rejection not later than the
thirtieth (30th) day following the delivery of the Termination Notice, Landlord
shall be conclusively presumed to have accepted such offer from Tenant to pay
the Termination Amount. If such offer from Tenant to pay the Termination Amount
is accepted by Landlord then, on the Termination Date, Tenant shall pay to
Landlord the Termination Amount and all Remaining Obligations after deducting
therefrom (as consideration for Tenant's loss of its Leasehold rights and estate
hereunder), the amount of any Net Award actually received and retained by
Landlord or Lender as of the Termination Date, or if no Net Award shall have
been received and retained by Landlord or Lender as of such Termination Date,
Landlord shall assign to Tenant (and cause Lender to assign to Tenant), each of
Landlord's and Lender's respective entire interest in and to the Net Award.
Landlord shall retain title to the entire Leased Premises notwithstanding such
acceptance of the Termination Amount, except that in the case of Taking, to the
extent any portion of the Leased Premises is not subject to the Taking, Landlord
shall retain title to such remaining portion of the Leased Premises.

      19. Restoration.

            (a) If any Net Award is in excess of the Threshold Amount, Landlord
(or Lender if required by any Mortgage) shall hold the entire Net Award in a
fund (the "Restoration Fund") and disburse amounts from the Restoration Fund
only in accordance with the following conditions:

                                      -25-
<PAGE>

                  (i) prior to commencement of restoration, (A) the architects,
contracts, contactors, plans and specifications and a budget for the restoration
shall have been approved by Landlord, and (B) Tenant shall cause the applicable
contractors to provide Landlord and Lender with mechanics' lien insurance (if
available at commercially reasonable rates) and acceptable performance and
payment bonds which insure satisfactory completion of and payment for the
restoration, are in an amount and form and have a surety reasonably acceptable
to Landlord, and name Landlord and Lender as additional dual obligees;

                  (ii) at the time of any disbursement, no Event of Default
shall exist and no mechanics' or materialmen's liens shall have been filed
against any of the Leased Premises in connection with such restoration which
remain undischarged (other than liens removed of record by bond or otherwise);

                  (iii) disbursements shall be made from time to time in an
amount not exceeding the cost of the Work completed since the last disbursement,
upon receipt of (A) satisfactory evidence, including architects' certificates,
of the stage of completion, the estimated total cost of completion and
performance of the Work to date in a good and workmanlike manner in accordance
with the contracts, plans and specifications, (B) waivers of liens, (C)
contractors' and subcontractors' sworn statements as to completed Work and the
cost thereof for which payment is requested, (D) a satisfactory bringdown of
title insurance and (E) such other reasonable evidence of cost and payment so
that Landlord can verify that the amounts disbursed from time to time are
represented by Work that is completed, in place and free and clear of mechanics'
and materialmen's lien claims;

                  (iv) each request for disbursement shall be accompanied by a
certificate of Tenant, signed by the president or a vice president of Tenant,
describing the Work for which payment is requested, stating the cost incurred in
connection therewith, stating that Tenant has not previously received payment
for such Work and, upon completion of the Work, also stating that the Work has
been fully completed and complies with the applicable requirements of this
Lease;

                  (v) Landlord may retain 10% of the restoration fund until the
Work is 50% completed; five 5% of the restoration fund until the Work is
substantially completed and, thereafter, 125 % of the estimated cost of
completion of punch-list items;

                  (vi) if the Restoration Fund is held by Landlord, the
Restoration Fund shall not be commingled with Landlord's other funds and shall
bear interest at a rate agreed to by Landlord and Tenant; and

                  (vii) such other reasonable conditions as Landlord or Lender
may impose consistent with prudent institutional construction lending practices.

            (b) Prior to commencement of restoration and at any time during
restoration, if the estimated cost of completing the restoration Work free and
clear of all liens, as determined by Landlord, exceeds the amount of the Net
Award available for such restoration, the amount of such excess shall, upon
demand by Landlord, be paid by Tenant to Landlord to be added to the Restoration
Fund. Any sum so added by Tenant which remains in the Restoration Fund upon
completion of restoration shall be refunded to Tenant. For purposes of
determining the source of funds with respect to the disposition of funds
remaining after the completion of restoration, the Net Award shall be deemed to
be disbursed prior to any amount added by Tenant.

            (c) If any sum remains in the Restoration Fund after completion of
the Work and any refund to Tenant pursuant to Paragraph 19(b), such sum shall be
paid to Tenant.

                                      -26-
<PAGE>

      20. Procedures Upon Purchase.

            (a) If the Leased Premises is purchased by Tenant pursuant to the
provisions of Paragraph 34 of this Lease, Landlord shall convey the same, but no
better, state of title thereto than that which was conveyed to Landlord, and
Tenant shall accept such title, subject, however, to the Permitted Encumbrances
and to all other liens, exceptions and restrictions on, against or relating to
any of the Leased Premises and to all applicable Laws, but free of the lien of
and security interest created by any Mortgage or Assignment and liens,
exceptions and restrictions on, against or relating to the Leased Premises which
have been created by or resulted solely from acts of Landlord or Lender after
the date of this Lease, unless the same are Permitted Encumbrances or customary
utility easements benefiting the Leased Premises or were created with the
concurrence of Tenant or as a result of a default by Tenant under this Lease.

            (b) Upon the date fixed for any such purchase of the Leased Premises
pursuant to Paragraph 34 of this Lease (any such date the "Purchase Date"),
Tenant shall pay to Landlord, or to any Person to whom Landlord directs payment,
the applicable purchase price therefor, in Federal Funds, and Landlord shall
deliver to Tenant or its designee (i) a Bargain and Sale Deed with Covenants
Against Grantor's Acts which describes the premises being conveyed and conveys
the title thereto as provided in Paragraph 20(a), (ii) such other instruments as
shall be necessary to transfer to Tenant or its designee any other property then
required to be sold by Landlord to Tenant pursuant to this Lease, including a
customary affidavit of title as may be reasonably necessary for Tenant's title
insurance company to issue an owner's policy to Tenant, then Tenant shall pay to
Landlord on the Purchase Date the amount of such Monetary Obligations as a
condition to Landlord's obligation to convey the Leased Premises to Tenant. Upon
the completion of such purchase, this Lease and all obligations and liabilities
of Tenant hereunder shall terminate, except any Surviving Obligations. The Costs
of the purchase transaction contemplated by this Paragraph 20 shall be paid by
Tenant at the time of closing, except as otherwise provided in Paragraph 34
hereof.

            (c) If the completion of such purchase shall be delayed through no
fault of Landlord or Lender after the date scheduled for such purchase, then
Rent shall continue to be due and payable until completion of such purchase.

            (d) Any prepaid Monetary Obligations paid to Landlord shall be
prorated as of the Purchase Date, and the prorated unapplied balance shall be
deducted from the purchase price due to Landlord; provided, that no
apportionment of any Impositions shall be made upon any such purchase.

      21. Assignment and Subletting. Prohibition Against Leasehold Financing.

            (a) Except as otherwise expressly provided to the contrary in this
Paragraph 21 and Paragraph 4(c), Tenant shall have the right to assign this
Lease, whether by operation of law or otherwise (including through merger or
consolidation) to any Person, without the prior written consent of Landlord;
provided that, notwithstanding the foregoing or anything to the contrary
contained below in this Paragraph 21, Tenant shall not have the right to assign
this Lease (voluntarily or involuntarily, whether by operation of law or
otherwise), or sublet any of the Leased Premises to any Person at any time that
an Event of Default shall have occurred and then be continuing. Any purported
sublease or assignment in violation of this Paragraph 21 shall be null and void.

            (b) Subject to Paragraph 4(c), Tenant shall have the right to enter
into one or more subleases with any third parties for all or any portion of the
gross leaseable area of the Improvements at the Leased Premises, with no consent
or approval of Landlord being

                                      -27-
<PAGE>

required or necessary. Each sublease of any of the Leased Premises (1) shall be
expressly subject and subordinate to this Lease and any Mortgage encumbering the
Leased Premises; (2) not extend beyond the then current Term minus thirty
(30)days; (3) terminate upon any termination of this Lease, unless Landlord
elects in writing, to cause the sublessee to attorn to and recognize Landlord as
the lessor under such sublease, whereupon such sublease shall continue as a
direct lease between the sublessee and Landlord upon all the terms and
conditions of such sublease; and (4) bind the sublessee to all covenants
contained in Paragraph 4(a) and (c), 10 and 12 with respect to subleased
premises to the same extent as if the sublessee were the Tenant. In addition,
Tenant shall, within ten (10) days after the execution and delivery of any
sublease, deliver a duplicate original counterpart thereof to Landlord

            (c) If Tenant desires to assign this Lease or to enter into any
sublease or series of subleases to a single Person (including its Affiliates)
that demise, in the aggregate (including expansion options), in excess of ten
percent (10%) of the gross leaseable area of the Improvements at the Leased
Premises (a "Major Sublease"), then Tenant shall, not less than ten (10) days
prior to the date on which it desires to enter into such assignment or Major
Sublease, submit to Landlord (for Landlord's review and files, but not for
approval) reasonably detailed information regarding the following with respect
to the proposed assignee or subtenant: (1) credit, (2) capital structure, (3)
management, (4) operating history, and (5) proposed use of the Leased Premises.
With respect to any assignment to a Credit Entity in which Tenant seeks to be
released from its obligations under this Lease, at least thirty (30) days prior
to the effective date of such assignment, Tenant shall provide Landlord with
such information as reasonably required by Landlord to establish that the Person
involved in any such proposed assignment satisfies the criteria set forth in
this Lease for a Credit Entity.

            (d) If Tenant assigns all its rights and interest under this Lease,
the assignee under such assignment shall expressly assume all the obligations of
Tenant hereunder, actual or contingent, including obligations of Tenant which
may have arisen on or prior to the date of such assignment, by a written
instrument of assignment and assumption, a fully executed original counterpart
of which shall be delivered to Landlord at the time of such assignment. No
assignment or sublease shall affect or reduce any of the obligations of Tenant
hereunder, and all such obligations of Tenant shall continue in full force and
effect as obligations of a principal and not as obligations of a guarantor, as
if no assignment or sublease had been made, except that in the case of an
assignment of this Lease to a Credit Entity, Tenant shall have the right to
request a release of Tenant from all obligations under this Lease arising from
and after the date of such assignment and provided Landlord is able to confirm
that such assignee is in fact a Credit Entity by objective evidence, Landlord
agrees to grant such release in writing within five (5) business days after the
later to occur of (x) the effective date of such assignment or (y) the date
Tenant delivers to Landlord an original fully executed counterpart of such
assignment and assumption agreement. No assignment or sublease shall impose any
additional obligations on Landlord under this Lease.

            (e) Notwithstanding any provision in this Paragraph 21 or elsewhere
in this Lease to the contrary, including any right or option Tenant may have to
assign this Lease or sublease all or any portion of the Leased Premises without
Landlord's consent, Tenant shall, upon the request of Landlord, provide and
cause such assignee or sublessee to provide, such information (including,
without limitation, any certification) as to any proposed assignee or sublessee
and its principals as may be required for Landlord and Tenant to comply with
regulations administered by the Office of Foreign Asset Control ("OFAC") of the
Department of the Treasury, codified at 31 C.F.R. Part 500 (including those
named on OFAC's Specially Designated and Blocked Persons list) or under any
statute, executive order (including the September 24,2001, Executive Order
Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten
to Commit, or Support Terrorism), or other governmental action regarding persons
or entities with whom U.S. persons or entities are restricted from doing
business.

                                      -28-
<PAGE>

            (f) In addition to any remedy to which Landlord is entitled under
Paragraph 23 of this Lease and subject to the terms of the Landlord's Agreement,
Landlord shall have the right, at any time upon the occurrence and during the
continuance of a Event of Default under clause (i) of Paragraph 22(a) or upon
any default termination of this lease (upon notice to Tenant unless the giving
or effectiveness of such notice is stayed) to collect the rents and other sums
of money payable under any sublease or other occupancy agreement for any of the
Leased Premises and to retain the same, provided that any amounts collected
shall be applied to Rent payments next due and owing. At any time that an Event
of Default shall have occurred and during its continuance Tenant shall not
consent to, cause or allow any modification or alteration of any of the terms,
conditions or covenants of any of subleases or other occupancy agreement for any
of the Leased Premises without the prior written approval of Landlord, which
consent shall not be unreasonably withheld or delayed in the case of a
termination of such sublease or other agreement as a result of a default
thereunder by such subtenant or occupant, nor shall Tenant accept any rents more
than thirty (30) days in advance of the accrual thereof nor do nor permit
anything to be done, the doing of which, nor omit or refrain from doing
anything, the omission of which, will or could be a breach of or default in the
terms of any of the subleases.

            (g) Tenant shall not have the power to mortgage, pledge or otherwise
encumber its interest under this Lease or any sublease of the Leased Premises
except as expressly provided pursuant to Paragraph 32(c) of this Lease, and any
such mortgage, pledge or encumbrance made in violation of this Paragraph 21
shall be void and of no force and effect.

            (h) Subject to the provisions of Paragraphs 34 hereof Landlord may
sell or transfer the Leased Premises at any time without Tenant's consent to any
third party (each a "Third Party Purchaser"). In the event of any such transfer,
Tenant shall attorn to any Third Party Purchaser as Landlord so long as such
Third Party Purchaser and Landlord notify Tenant in writing of such transfer. At
the request of Landlord, Tenant will execute such documents confirming the
agreement referred to above and such other agreements as Landlord may reasonably
request, provided that such agreements do not increase the liabilities and
obligations of Tenant hereunder.

            (i) Notwithstanding the provisions of Paragraph 21 (a) above, Tenant
shall not, in a single transaction or series of transactions (including any
interim merger or consolidation), sell or convey, transfer or lease all or
substantially all of its assets (it being agreed that subsidiaries of Tenant
shall be deemed assets thereof) (an "Asset Transfer") to any Person, and any
such Asset Transfer shall be deemed an assignment in violation of this Lease;
unless either (i) Tenant has obtained Landlord's consent thereto or (ii) the
Asset Transfer is (A) to a Person that immediately following such transaction or
transactions, taken in the aggregate, has (or would have, on a pro forma basis)
a net worth equal to or better than that of Tenant as of the date immediately
prior to the Asset Transfer and (B) this Lease is assigned to and assumed by
such Person as a part of such Asset Transfer. In the event of an Asset Transfer
to a subsidiary of Tenant, any subsequent sale of the assets of the original
Tenant named herein by such subsidiary shall be governed by the requirements of
this subparagraph (i) irrespective of whether or not such sale would be
considered a sale of all or substantially all of the assets of such subsidiary.

      22. Events of Default.

            (a) The occurrence of any one or more of the following shall, at the
sole option of Landlord, constitute an "Event of Default" under this Lease:

                  (i) a failure by Tenant to (A) make any payment of Basic Rent
on or prior to its due date, regardless of the reason for such failure and such
failure continues for three (3) business days after Landlord has given Tenant
notice thereof, or (B) make any payment of any other Monetary Obligation on or
prior to its due date, regardless of the reason for such

                                      -29-
<PAGE>

failure, and such failure continues for twenty (20) days after Landlord has
given Tenant notice thereof;

                  (ii) a failure by Tenant duly to perform and observe, or a
violation or breach of, any other provision hereof not otherwise specifically
mentioned in this Paragraph 22(a) and, subject to the provisions of Paragraph
22(b) below, such failure continues for thirty (30) days after Landlord has
given Tenant notice thereof; provided that, if the default consists of the
failure to timely provide evidence of any insurance required to be maintained by
Paragraph 16, such failure continues for three (3) business days after Landlord
has given Tenant notice thereof and; provided further that, no notice or cure
period shall be required for any default that consists of a failure to maintain
any insurance required by Paragraph 16 or if the default is such that any delay
in the exercise of a remedy by Landlord could reasonably be expected to cause
irreparable harm to Landlord,

                  (iii) any material representation or warranty made by Tenant
herein or in any certificate, demand or request made pursuant hereto proves to
be incorrect, now or hereafter, in any material respect;

                  (iv) a default beyond any applicable cure period or at
maturity by Tenant in any payment of principal or interest on any obligations
for borrowed money having an original principal balance of $20,000,000 or more
in the aggregate, or in the performance of any other provision contained in any
instrument under which any such obligation is created or secured (including the
breach of any covenant thereunder), if (x) such payment default is for a payment
at maturity or a final payment, or (y) the effect of such default is to cause
the holder of such obligation to accelerate the balance due of such obligation
prior to its stated maturity and no waiver, extension or forbearance agreement
is then in effect; provided further that (A) any subsequent cure by payment or
satisfaction accepted by the holder of such obligation shall constitute a cure
of the default under this clause (iv), and (B) if the only Event of Default
having occurred and then continuing under this Lease is an Event of Default
under this clause (iv), then Landlord's remedy shall be limited to an
acceleration of the Basic Rent due under this Lease in accordance with the
provisions of Paragraph 23(a)(iii) hereof;

                  (v) a final, non-appealable judgment or judgments for the
payment of money in excess of $5,000,000 in the aggregate shall be rendered
against Tenant and the same shall remain undischarged for a period of sixty (60)
consecutive days;

                  (vi) Tenant shall (A) voluntarily be adjudicated a bankrupt or
insolvent, (B) seek or consent to the appointment of a receiver or trustee for
itself or for the Leased Premises, (C) file a petition seeking relief under the
bankruptcy or other similar laws of the United States, any state or any
jurisdiction, (D) make a general assignment for the benefit of creditors, or (E)
be unable to pay its debts as they mature;

                  (vii) a court shall enter an order, judgment or decree
appointing, without the consent of Tenant, a receiver or trustee for it or for
any of the Leased Premises or approving a petition filed against Tenant which
seeks relief under the bankruptcy or other similar laws of the United States,
any state or any jurisdiction, and such order, judgment or decree shall remain
undischarged or unstayed ninety (90) days after it is entered;

                  (viii) if (A) the entire Leased Premises shall have been (1)
abandoned or (2) vacated for a period in excess of thirty (30) consecutive days
(other than during a period of repair or restoration following a Casualty or
Taking or during the performance of Alterations to prepare the Leased Premises
for reletting pursuant to a executed assignment or sublease or (B) the entirety
of any one building at the Leased Premises shall have vacated for a period in
excess of thirty (30) consecutive days (other than during a period of repair or

                                      -30-
<PAGE>

restoration following a Casualty or Taking or during the performance of any
Alterations consistent with the provisions of this Lease), unless Tenant shall
have provided Landlord with reasonable evidence of its plan for the
preservation, maintenance and security of such building (including confirmation
that the insurance required to be carried under this Lease will remain in full
effect as to such building notwithstanding Tenant's election to vacate same);

                  (ix) Tenant shall be liquidated or dissolved or shall begin
proceedings towards its liquidation or dissolution;

                  (x) the estate or interest of Tenant in any of the Leased
Premises shall be levied upon or attached in any proceeding and such estate or
interest is about to be sold or transferred or such process shall not be vacated
or discharged within ninety (90) days after it is made;

                  (xi) a failure by Tenant to perform or observe, or a violation
or breach of, or a misrepresentation by Tenant under any provision of any
Assignment, SNDA, or any other document between Tenant and Lender or from Tenant
to Lender, if the result of such failure, violation, breach or misrepresentation
is Lender's declaration of a default beyond any applicable cure period with
respect to any Loan;

                  (xii) a failure by Tenant to maintain in effect any license or
permit necessary for the use, occupancy or operation of the Leased Premises and,
subject to the provisions of Paragraph 22(b) below, such failure continues for
thirty (30) days after Landlord has given Tenant notice thereof;

                  (xiii) a failure by Tenant to deliver the estoppel described
in Paragraph 25 within the time period specified therein and such failure
continues for ten (10) days after Landlord has given Tenant notice thereof;

                  (xiv) Tenant shall enter into an Asset Transfer in violation
of Paragraph 21; or

                  (xv) Tenant's failure to timely comply with any of Tenant's
Post-Closing Obligations and such failure continues for ten (10) days after
Landlord has given Tenant notice thereof.

            (b) Except as expressly set forth in Paragraph 22(a) above no notice
and cure period shall be required as a condition precedent to the occurrence of
an Event of Default. If the default consists of a default under clause (ii) or
(xii) of Paragraph 22(a) (other than the failure to maintain or provide evidence
of any insurance required by Paragraph 16), then if the default cannot be cured
within such thirty (30) day period and delay in the exercise of a remedy would
not (in Landlord's reasonable judgment) cause any material adverse harm to
Landlord or any of the Leased Premises, the cure period shall be extended for
the period required to cure the default (but such cure period, including any
extension, shall not in the aggregate exceed ninety (90) days), provided that
Tenant shall commence to cure the default within the said thirty (30) day period
and shall actively, diligently and in good faith proceed with and continue the
curing of the default until it shall be fully cured.

      23. Remedies and Damages upon Default.

            (a) If an Event of Default shall have occurred and is continuing,
Landlord shall have the right, at its sole option, then or at any time
thereafter, to exercise its remedies and to collect damages from Tenant in
accordance with this Paragraph 23, subject in all

                                      -31-
<PAGE>

events to applicable Law, without demand upon or notice to Tenant except as
otherwise provided in Paragraph 22 and this Paragraph 23.

                  (i) Landlord may give Tenant notice of Landlord's intention to
terminate this Lease on a date specified in such notice. Upon such date, this
Lease, the estate hereby granted and all rights of Tenant hereunder shall expire
and terminate. Upon such termination, Tenant shall immediately surrender and
deliver possession of the Leased Premises to Landlord in accordance with
Paragraph 26. If Tenant does not so surrender and deliver possession of the
Leased Premises, Landlord may re-enter and repossess the Leased Premises by any
available legal process. Upon or at any time after taking possession of the
Leased Premises, Landlord may, by legal process, remove any Persons or property
therefrom. Landlord shall be under no liability for or by reason of any such
entry, repossession or removal. Notwithstanding such termination of the Lease,
Landlord may collect the damages set forth in Paragraph 23(b)(i) or 23(b)(ii).

                  (ii) Landlord may terminate Tenant's right of possession (but
not this Lease) and may repossess the Leased Premises by any available legal
process without thereby releasing Tenant from any liability hereunder and
without demand or notice of any kind to Tenant and without terminating this
Lease. After repossession of the Leased Premises pursuant hereto, Landlord shall
have the right to relet any of the Leased Premises to such tenant or tenants,
for such term or terms, for such rent, on such conditions and for such uses as
Landlord in its sole discretion may determine, and collect and receive any rents
payable by reason of such reletting. Landlord may make such Alterations in
connection with such reletting as it may deem advisable in its sole discretion.
Notwithstanding any such termination of Tenant's right of possession of the
Leased Premises, Landlord may exercise the remedy set forth in and collect the
damages set forth in or permitted by Paragraph 23(b)(ii) or, at any time
thereafter, elect to terminate this Lease and in such event Landlord shall have
the right and remedies specified in the last sentence of Paragraph 23(a)(i).

                  (iii) Unless Landlord shall have terminated this Lease or
Tenant's right of possession of the Leased Premises, Landlord may declare by
notice to Tenant the entire Basic Rent (in the amount of Basic Rent then in
effect) for the remainder of the then current Term to be immediately due and
payable. Tenant shall immediately pay to Landlord all such Basic Rent discounted
to its Present Value, all accrued Rent then due and unpaid, all other Monetary
Obligations which are then due and unpaid and all Monetary Obligations which
arise or become due by reason of such Event of Default (including any Costs of
Landlord). Upon receipt by Landlord of all such accelerated Basic Rent and
Monetary Obligations, this Lease shall remain in full force and effect and
Tenant shall have the right to possession of the Leased Premises from the date
of such receipt by Landlord to the end of the Term, and subject to all the
provisions of this Lease, including the obligation to pay all increases in Basic
Rent and all Monetary Obligations that subsequently become due, except that (A)
no Basic Rent or other Monetary Obligations which have been prepaid hereunder
shall be due thereafter during the said Term, (B) Tenant shall have no option to
extend or renew the Term and (C) Tenant shall have no further rights under
Paragraph 34.

            (b) The following constitute damages to which Landlord shall be
entitled if Landlord exercises its remedies under Paragraph 23(a)(i) or
23(a)(ii):

                  (i) If Landlord exercises its remedy under Paragraph 23(a)(i)
but not its remedy under Paragraph 23(a)(ii) (or attempts to exercise such
remedy and is unsuccessful in reletting the Leased Premises) then, upon written
demand from Landlord, Tenant shall pay to Landlord, as liquidated and agreed
final damages for Tenant's default and in lieu of all current damages beyond the
date of such demand (it being agreed that it would be impracticable or extremely
difficult to fix the actual damages), an amount equal to the Present

                                      -32-
<PAGE>

Value of the excess, if any, of (A) all Basic Rent from the date of such demand
to the date on which the Term is scheduled to expire hereunder in the absence of
any earlier termination, reentry or repossession over (B) as consideration for
the loss of Tenant's leasehold rights and estate hereunder, the then fair market
rental value of the Leased Premises for the same period. Tenant shall also pay
to Landlord all accrued Rent then due and unpaid, all other Monetary Obligations
which are then due and unpaid, all Monetary Obligations which arise or become
due by reason of such Event of Default, including any Costs of Landlord in
connection with the repossession of the Leased Premises and any attempted
reletting thereof, including all brokerage commissions, reasonable attorneys'
fees and expenses, employees' expenses, costs of Alterations and expenses and
preparation for reletting.

                  (ii) If Landlord exercises its remedy under Paragraph 23(a)(i)
or its remedies under Paragraph 23(a)(i) and 23(a)(ii), then Tenant shall, until
the end of what would have been the Term in the absence of the termination of
the Lease, and whether or not any of the Leased Premises shall have been relet,
be liable to Landlord for, and shall pay to Landlord, as liquidated and agreed
current damages all Monetary Obligations which would be payable under this Lease
by Tenant in the absence of such termination less, as consideration for the loss
of Tenant's lease rights, the net proceeds, if any, of any reletting pursuant to
Paragraph 23(a)(ii), after deducting from such proceeds all accrued Rent then
due and unpaid, all other Monetary Obligations which are then due and unpaid,
all Monetary Obligations which arise or become due by reason of such Event of
Default, including any Costs of Landlord incurred in connection with such
repossessing and reletting, including all brokerage commissions, legal expenses
attorneys' fees, employees' expenses, costs of Alterations and expenses and
preparation for reletting; provided, that if Landlord has not relet the Leased
Premises, such Costs of Landlord shall be considered to be Monetary Obligations
payable by Tenant.

                  (iii) Tenant shall be and remain liable for all sums
aforesaid, and Landlord may recover such damages from Tenant and institute and
maintain successive actions or legal proceedings against Tenant for the recovery
of such damages as and when same are due and payable under this Lease. Nothing
herein contained shall be deemed to require Landlord to wait to begin such
action or other legal proceedings until the date when the Term would have
expired by its own terms had there been no such Event of Default.

            (c) Notwithstanding anything to the contrary herein contained, in
lieu of or in addition to any of the foregoing remedies and damages, Landlord
may exercise any remedies and collect any damages available to it at law or in
equity. If Landlord is unable to obtain full satisfaction pursuant to the
exercise of any remedy, it may pursue any other remedy which it has hereunder or
at law or in equity.

            (d) Landlord shall not be required to mitigate any of its damages
hereunder unless required to by applicable Law. If any Law shall validly limit
the amount of any damages provided for herein to an amount which is less than
the amount agreed to herein, Landlord shall be entitled to the maximum amount
available under such Law.

            (e) No termination of this Lease, repossession or reletting of the
Leased Premises, exercise of any remedy or collection of any damages pursuant to
this Paragraph 23 shall relieve Tenant of any Surviving Obligations.

            (f) WITH RESPECT TO ANY REMEDY OR PROCEEDING OF LANDLORD OR TENANT
HEREUNDER, LANDLORD AND TENANT HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY.

            (g) Upon the occurrence and during the continuance of any Event of
Default, Landlord shall have the right (but no obligation) to perform any act
required of Tenant

                                      -33-
<PAGE>

hereunder and, if performance of such act requires that Landlord enter the
Leased Premises, Landlord may enter the Leased Premises for such purpose.

            (h) No failure of Landlord (i) to insist at any time upon the strict
performance of any provision of this Lease or (ii) to exercise any option,
right, power or remedy contained in this Lease shall be construed as a waiver,
modification or relinquishment thereof. A receipt by Landlord of any sum in
satisfaction of any Monetary Obligation with knowledge of the breach of any
provision hereof shall not be deemed a waiver of such breach, and no waiver by
Landlord of any provision hereof shall be deemed to have been made unless
expressed in a writing signed by Landlord.

            (i) Tenant hereby waives and surrenders, for itself and all those
claiming under it, including creditors of all kinds, (i) any right and privilege
which it or any of them may have under any present or future Law to redeem any
of the Leased Premises or to have a continuance of this Lease after termination
of this Lease or of Tenant's right of occupancy or possession pursuant to any
court order or any provision hereof, and (ii) the benefits of any present or
future Law which exempts property from liability for debt or for distress for
rent.

            (j) Except as otherwise provided herein, all remedies are cumulative
and concurrent and no remedy is exclusive of any other remedy. Each remedy may
be exercised at any time an Event of Default has occurred and is continuing and
may be exercised from time to time. No remedy shall be exhausted by any exercise
thereof.

      24. Notices. All notices, demands, requests, consents, approvals, offers,
statements and other instruments or communications required or permitted to be
given pursuant to the provisions of this Lease shall be in writing and shall be
deemed to have been given and received for all purposes when delivered in person
or by Federal Express or other reliable 24- hour delivery service or five (5)
business days after being deposited in the United States mail, by registered or
certified mail, return receipt requested, postage prepaid, addressed to the
other party at its address stated on page one of this Lease or when delivery is
refused. Notices sent to Landlord shall be to the attention of Director, Asset
Management, and notices to Tenant shall be to the attention of Chief Financial
Officer and shall simultaneously be given by Landlord to Willkie Farr &
Gallagher LLP, 787 Seventh Avenue, New York, New York 10019, Attention: Steven
J. Gartner, Esq. A copy of any notice given by Tenant to Landlord shall be
addressed to the attention of Director, Asset Management and shall
simultaneously be given by Tenant to Reed Smith LLP, 2500 One Liberty Place,
Philadelphia, PA 19103, Attention: Chairman, Real Estate Department. For the
purposes of this Paragraph, any party may substitute another address stated
above (or substituted by a previous notice) for its address by giving fifteen
(15) days' notice of the new address to the other party, in the manner provided
above.

      25. Estoppel Certificate. At any time upon not less than twenty (20) days'
prior written request by either Landlord or Tenant (the "Requesting Party") to
the other party (the "Responding Party"), the Responding Party shall deliver to
the Requesting Party a statement in writing, executed by an authorized officer
of the Responding Party, certifying (a) that, except as otherwise specified,
this Lease is unmodified and in full force and effect, (b) the dates to which
Basic Rent, Additional Rent and all other Monetary Obligations have been paid,
(c) that, to the knowledge of the signer of such certificate and except as
otherwise specified, no default by either Landlord or Tenant exists hereunder,
(d) such other matters as the Requesting Party may reasonably request, and (e)
if Tenant is the Responding Party that, except as otherwise specified, there are
no proceedings pending or, to the knowledge of the signer, threatened, against
Tenant before or by any court or administrative agency which, if adversely
decided, would materially and adversely affect the financial condition and
operations of Tenant. Any such statements by the Responding Party may be relied
upon by the Requesting Party, any Person whom the Requesting Party notifies the
Responding Party in its request for the Certificate is an intended

                                      -34-
<PAGE>

recipient or beneficiary of the Certificate, any Lender or their assignees and
by any prospective purchaser or mortgagee of any of the Leased Premises. Any
certificate required under this Paragraph 25 and delivered by Tenant shall state
the title of the signatory thereto and that such person is duly authorized to
execute and deliver same on behalf of Tenant.

      26. Surrender. Upon the expiration or earlier termination of this Lease,
Tenant shall peaceably leave and surrender the Leased Premises to Landlord in
the same condition in which the Leased Premises was at the commencement of this
Lease, except as repaired, rebuilt, restored, altered, replaced or added to as
permitted or required by any provision of this Lease, and ordinary wear and
tear, and damage from Casualty or Condemnation for which Tenant is not otherwise
required to repair or restore under the terms of this Lease, expected. Upon such
surrender, Tenant shall (a) remove from the Leased Premises all property which
is owned by Tenant or third parties other than Landlord and Alterations required
to be removed pursuant to Paragraph 13 hereof and (b) repair any damage caused
by such removal. Property not so removed shall become the property of Landlord,
and Landlord may thereafter cause such property to be removed from the Leased
Premises. The Costs of removing and disposing of such property and repairing any
damage to any of the Leased Premises caused by such removal shall be paid by
Tenant to Landlord upon demand. Landlord shall not in any manner or to any
extent be obligated to reimburse Tenant for any such property which becomes the
property of Landlord pursuant to this Paragraph 26.

      27. No Merger of Title. There shall be no merger of the leasehold estate
created by this Lease with the fee estate in any of the Leased Premises by
reason of the fact that the same Person may acquire or hold or own, directly or
indirectly, (a) the leasehold estate created hereby or any part thereof or
interest therein and (b) the fee estate in any of the Leased Premises or any
part thereof or interest therein, unless and until all Persons haying any
interest in the interests described in (a) and (b) above which are sought to be
merged shall join in a written instrument effecting such merger and shall duly
record the same.

      28. Books and Records.

            (a) Tenant shall keep adequate records and books of account with
respect to the finances and business of Tenant generally and with respect to the
Leased Premises, in accordance with generally accepted accounting principles
("GAAP") consistently applied, and shall permit Landlord and Lender by their
respective agents, accountants and attorneys, upon reasonable notice to Tenant,
to visit and inspect the Leased Premises and examine (and make copies of) the
records and books of account and to discuss the finances and business with the
officers of Tenant, at such reasonable times as may be requested by Landlord.
Upon the request of Lender or Landlord (either telephonically or in writing),
Tenant shall provide the requesting party with copies of any information to
which such party would be entitled in the course of a personal visit.

            (b) Tenant shall deliver to Landlord and Lender within ninety (90)
days of the close of each fiscal year of Tenant annual audited financial
statements of Tenant certified by a nationally recognized firm of independent
certified public accountants. Notwithstanding the foregoing, Tenant's audited
annual financial statements for the fiscal year ending January 31, 2005 shall be
delivered to Landlord no later than the ninetieth (90th) day following the date
of this Lease. Tenant shall also furnish to Landlord within forty-five (45) days
after the end of each of the three remaining quarters unaudited financial
statements and all other quarterly reports of Tenant, certified by Tenant's
chief financial officer, and all filings, if any, of Form 10-K, Form 10-Q and
other required filings with the Securities and Exchange Commission pursuant to
the provisions of the Securities Exchange Act of 1934, as amended, or any other
Law. All financial statements shall be prepared in accordance with GAAP
consistently applied. All annual financial statements shall be accompanied (i)
by an opinion of said

                                      -35-
<PAGE>

accounting firm stating that (A) there are no qualifications as to the scope of
the audit and (B) the audit was performed in accordance with GAAP and (ii) by
the affidavit of the president or a vice president of Tenant, dated within five
(5) days of the delivery of such statement, stating that (A) the affiant knows
of no Event of Default, or event which, upon notice or the passage of time or
both, would become an Event of Default which has occurred and is continuing
hereunder or, if any such event has occurred and is continuing, specifying the
nature and period of existence thereof and what action Tenant has taken or
proposes to take with respect thereto and (B) except as otherwise specified in
such affidavit, that, to the best knowledge of the affiant, Tenant has fulfilled
all of its obligations under this Lease which are required to be fulfilled on or
prior to the date of such affidavit.

      29. Determination of Value.

            (a) Whenever a determination of Fair Market Rental Value is required
pursuant to this Lease, such Fair Market Rental Value shall be determined in
accordance with the following procedure:

                  (i) Landlord and Tenant shall endeavor to agree on Fair Market
Rental Value on the date (an "Applicable Initial Date") which is six (6)
calendar months prior to the expiration of the then current Term if Tenant has
previously exercised its option pursuant to Paragraph 5(b) to have the Term
extended for the third or fourth Renewal Terms. Upon reaching such agreement,
the parties shall execute an agreement setting forth the amount of such Fair
Market Rental Value.

                  (ii) If the parties shall not have signed such agreement
within thirty (30) days after the Applicable Initial Date, Tenant shall within
thirty (30) days after the Applicable Initial Date select an appraiser and
notify Landlord in writing of the name, address and qualifications of such
appraiser. Within twenty (20) days following Landlord's receipt of Tenant's
notice of the appraiser selected by Tenant, Landlord shall select an appraiser
and notify Tenant of the name, address and qualifications of such appraiser.
Such two appraisers shall endeavor to agree upon Fair Market Rental Value based
on a written appraisal made by each of them (and given to Landlord by Tenant) as
of the Relevant Date. If such two appraisers shall agree upon a Fair Market
Rental Value, the amount of such Fair Market Rental Value as so agreed shall be
binding and conclusive upon Landlord and Tenant.

                  (iii) If such two appraisers shall be unable to agree upon a
Fair Market Rental Value within twenty (20) days after the selection of an
appraiser by Landlord, then such appraisers shall advise Landlord and Tenant of
their respective determination of Fair Rental Market Value and shall select a
third appraiser to make the determination of Fair Market Rental Value. The
selection of the third appraiser shall be binding and conclusive upon Landlord
and Tenant.

                  (iv) If such two appraisers shall be unable to agree upon the
designation of a third appraiser within ten (10) days after the expiration of
the twenty (20) day period referred to in clause (iii) above, or if such third
appraiser does not make a determination of Fair Market Rental Value within
twenty (20) days after his selection, then such third appraiser or a substituted
third appraiser, as applicable, shall, at the request of either party hereto, be
appointed by the President or Chairman of the American Arbitration Association
in New York, New York. The determination of Fair Market Rental Value made by the
third appraiser appointed pursuant hereto shall be made within twenty (20) days
after such appointment.

                  (v) If a third appraiser is selected, Fair Market Rental Value
shall be the average of the determination of Fair Market Rental Value made by
the third appraiser and the determination of Fair Market Rental Value made by
the appraiser (selected

                                      -36-
<PAGE>

pursuant to Paragraph 29(a)(ii) hereof) whose determination of Fair Market
Rental Value is nearest to that of the third appraiser. Such average shall be
binding and conclusive upon Landlord and Tenant.

                  (vi) All appraisers selected or appointed pursuant to this
Paragraph 29(a) shall (A) be independent qualified MAI appraisers (B) have no
right, power or authority to alter or modify the provisions of this Lease, (C)
utilize the definition of Fair Market Rental Value hereinabove set forth above,
and (D) be registered in the State if such State provides for or requires such
registration.

                  (vii) Each party shall bear the Costs of its own appraiser and
the Costs of the third appraiser shall be split equally by Landlord and Tenant.

            (b) If, by virtue of any delay, Fair Market Rental Value is not
determined by the expiration or termination of the then current Term, then until
Fair Market Rental Value is determined, Tenant shall continue to pay Basic Rent
during the succeeding Renewal Term in the same amount which it was obligated
under this Lease to pay prior to the commencement of the Renewal Term. When Fair
Market Rental Value is determined, the appropriate Basic Rent shall be
calculated retroactive to the commencement of the Renewal Term and Tenant shall
either receive a refund from Landlord (in the case of an overpayment) or shall
pay any deficiency to Landlord (in the case of an underpayment).

            (c) In determining Fair Market Rental Value, the appraisers shall
determine the amount that a willing tenant would pay, and a willing landlord of
a comparable building located in a radius of 25 miles of the Leased Premises
would accept, at arm's length, to rent a building of comparable size and quality
as the Improvements, taking into account: (i) the age, quality, condition (as
required by the Lease) of the Improvements; (ii) that the Leased Premises
will-be leased as a whole or substantially as a whole to a single user; (iii) a
lease term equal to the Renewal Term; (iv) an absolute triple net lease; and (v)
such other items that professional real estate appraisers customarily consider.

      30. Non-Recourse as to Landlord, etc. (a) Anything contained herein to
the contrary notwithstanding, any claim based on or in respect of any liability
of Landlord under this Lease shall be limited to actual damages and shall be
enforced only against the Leased Premises and not against any other assets,
properties or funds of (i) Landlord, (ii) any director, officer, member, general
partner, shareholder, limited partner, beneficiary, employee or agent of
Landlord or any members or general partners of Landlord (or any legal
representative, heir, estate, successor or assign of any thereof), (iii) any
predecessor or successor partnership or corporation (or other entity) of
Landlord or any of its general partners, shareholders, officers, directors,
members, employees or agents, either directly or through Landlord or its general
partners, shareholders, officers, directors, employees of agents or any
predecessor or successor partnership or corporation (or other entity), or (iv)
any Person affiliated with any of the foregoing, or any director, officer,
employee or agent of any thereof. Anything contained herein to the contrary
notwithstanding, any claim based on or in respect of any liability of Tenant
under this Lease shall be limited to actual damages and shall be enforced only
against the Tenant and not against any assets, properties or funds of any
director, officer, member, shareholder, limited partner, beneficiary, employee
or agent of Tenant (or any legal representative, heir, estate, successor or
assign of any thereof).

            (b) Tenant shall not be precluded from instituting legal proceedings
for the purpose of making a claim against Landlord on account of an alleged
violation of Landlord's obligations under this Lease, subject, however, to the
limitations of Paragraph 30(a) above. Except as may be the result of a holding
over by Tenant, neither party shall be liable to the other hereunder for any
consequential, indirect, or special damages.

                                      -37-
<PAGE>

      31. Financing.

            (a) Tenant agrees to pay, within five (5) business days following
written request from Landlord (or upon the date of this Lease with respect to
Costs incurred as of such date), (i) all Costs incurred by Landlord in
connection with the initial purchase and leasing of the Leased Premises as
contemplated by this Lease, including, without limitation, transfer taxes and
recording fees, the cost of appraisals, environmental reports, engineering
reports and zoning reports, UCC and related searches, title insurance charges
and premiums, the cost of surveys, reliance letters and the fees and expenses of
Landlord's counsel; provided that Tenant's payment obligations hereunder with
respect the fees and expenses of Landlord's counsel shall not exceed an
aggregate amount of $200,000 for the initial purchase and leasing and the
initial Loan (the "Cost Cap"); provided further, however, in the event that
there exists at the Leased Premises a material Environmental Violation or a
Hazardous Condition such that a Phase II Site Assessment must be performed or
additional expenditures are incurred (including additional or extraordinary due
diligence and the reasonable legal fees and expenses of Landlord's and Lender's
counsel in connection therewith), then the cost of such Phase II Site Assessment
and such additional due diligence and/or reasonable attorneys' fees and expenses
of Landlord or Lender shall be paid by Tenant in addition such Cost Cap.

            (b) If Landlord desires to obtain or refinance any Loan, Tenant
shall negotiate in good faith with Landlord concerning any request made by any
Lender or proposed Lender for changes or modifications in this Lease. In
particular, Tenant shall agree, upon request of Landlord, to supply any such
Lender with such notices and information as Tenant is required to give to
Landlord hereunder and to extend the rights of Landlord hereunder to any such
Lender and to consent to such financing if such consent is requested by such
Lender. Tenant shall provide any other consent or statement and shall execute
any and all other documents that such Lender reasonably requires in connection
with such financing, including any environmental indemnity agreement and
subordination, non-disturbance and attornment agreement, so long as the same do
not adversely affect any right, benefit or privilege of Tenant under this Lease
or increase any Monetary Obligations or materially increase any non-monetary
obligations of Tenant under this Lease. Such subordination, nondisturbance and
attornment agreement ("SNDA") may require Tenant to confirm that (a) Lender and
its assigns will not be liable for any misrepresentation, act or omission of
Landlord and (b) Lender and its assigns will not be subject to any counterclaim,
demand or offset which Tenant may have against Landlord. Notwithstanding
anything to the contrary herein, Tenant shall not be responsible for any Costs
associated with Landlord's refinancing, or modification of the initial Loan

            (c) In connection with any Loan, Landlord agrees that it shall use
good faith and commercially reasonable efforts to negotiate then current
"market" or customary prepayment premiums in connection with any such Loan,
taking into account the credit and financial standing of Tenant at the time Loan
is made, current market circumstances and the type and amounts of prepayment
Premiums or penalties which are generally being required in connection with
mortgages held by an institutional lender for similar properties, similarly
situated (including, without limitation, mortgages anticipated to be subject to
a securitization). Landlord further agrees that, notwithstanding the fact that
Landlord may have elected to refinance the initial Loan prior to its stated
maturity date, from the Commencement Date until the date that is the tenth (10)
anniversary of the Commencement Date of this Lease the Prepayment Premium for
which Tenant shall be responsible under the terms of Paragraph 18 of this Lease
shall not exceed the Prepayment Premium that Tenant would have been otherwise
obligated to pay at such time and under such circumstances had such initial Loan
remained in place.

      32. Subordination, Non-Disturbance and Attornment: Landlord's Waiver, (a)
This Lease and Tenant's interest hereunder shall be subordinate to any Mortgage
or other

                                      -38-
<PAGE>

security instrument hereafter placed upon the Leased Premises by Landlord, and
to any and all advances made or to be made thereunder, to the interest thereon,
and all renewals, replacements and extensions thereof, provided that any holder
of such Mortgage or other security instrument shall provide for the recognition
of this Lease and all Tenant's rights hereunder unless and until an Event of
Default exists or Landlord shall have the right to terminate this Lease pursuant
to any applicable provision hereof, in any event, pursuant to an SNDA in
recordable form and in substance reasonably acceptable to Tenant.

            (b) Landlord agrees that, upon the request of any Person that shall
be Tenant's senior secured lender, subordinate senior lender, purchase money
equipment lender or an equipment lessor of Tenant, Landlord shall execute and
deliver a commercially reasonable waiver of Landlord's statutory lien rights, if
any, and a consent and agreement with respect to the respective rights of
Landlord and such Person regarding the security interests in, and the timing and
removal of, any inventory, equipment or other collateral in which such Person
has a secured interest (the "Collateral"), in form and substance reasonably
acceptable to Landlord and such Person, so long as such waiver and agreement (i)
provides for the indemnification of Landlord against any claims by Tenant or any
Person claiming through Tenant, and against any physical damage caused to the
Leased Premises, in connection with the removal of any of the Collateral by such
Person, (ii) expressly excludes any claim by such Person to any right, title or
interest in or to any of the Equipment as defined in this Lease, (iii) provides
for a reasonable, but limited, time frame for the removal of such Collateral by
such Person after the expiration of which same shall be deemed abandoned, and
(iv) provides for the per diem payment of Basic Rent due hereunder by such
Person for each day after the fifth (5th) Business Day following the date of the
expiration or termination of this Lease that Landlord permits such Person's
Collateral to remain in the Leased Premises.

            (c) Concurrently with the execution of this Lease, each of Landlord
and Tenant agrees that it shall enter into the Landlord's Agreement, permitting
Tenant to pledge its interest, as lessee, in this Lease, subject to the
provisions and limitations set forth in such Landlord's Agreement.

      33. Tax Treatment; Reporting. (a) Landlord and Tenant each acknowledge
that each shall treat this transaction as a true lease for state law purposes
and shall report this transaction as a true lease for Federal income tax
purposes. For Federal income tax purposes each shall report this Lease as a true
lease with Landlord as the owner of the Leased Premises and Equipment and Tenant
as the lessee of such Leased Premises and Equipment including: (1) treating
Landlord as the owner of the property eligible to claim depreciation deductions
under Section 167 or 168 of the Internal Revenue Code of 1986 (the "Code") with
respect to the Leased Premises and Equipment, (2) Tenant reporting its Rent
payments as rent expense under Section 162 of the Code, and (3) Landlord
reporting the Rent payments as rental income. For the avoidance of doubt,
nothing in this Lease shall be deemed to constitute a guaranty, warranty or
representation by either Landlord or Tenant as to the actual treatment of this
transaction for state law purposes and for federal income tax purposes.

            (b) Landlord shall deliver to Tenant two duly signed, properly
completed copies of IRS Form W-9 prior to the first date when Tenant is required
hereunder to make a payment to Landlord, certifying that Landlord is entitled to
exemption from United States backup withholding tax, or any successor form.
Landlord shall promptly provide Tenant with updated, duly signed, and properly
completed copies of IRS Form W-9 (or successor form) if events occur that cause
the copies of IRS Form W-9 already in the possession of Tenant no longer to be
true, accurate and complete.

                                      -39-
<PAGE>

      34. Right of First Refusal.

            (a) Except as otherwise provided in clause (f) of this Paragraph 34,
and provided an Event of Default does not then exist, if Landlord shall enter
into a contract for the sale (the "Sale Contract") of the Leased Premises based
upon a bona fide, arms-length offer from a third party purchaser unaffiliated
with Landlord or Tenant (a "Third Party Purchaser") (which sale Contract may
include other property owned by Landlord so long as a specific purchase price is
allocated to the Leased Premises), which Sale Contract shall be conditioned upon
Tenant's failure to exercise its right under this Paragraph 34, then Landlord
shall give written notice to Tenant of the Sale Contract, together with a copy
of the executed Sale Contract and the name and business address of the Third
Party Purchaser.

            (b) For a period of fifteen (15) days following receipt of such
notice, Tenant shall have the right, exercisable by written notice to Landlord
given within said fifteen (15) day period, to elect to purchase the Leased
Premises at the purchase price and upon all the terms and conditions set forth
in such Sale Contract except that no contingencies contained in such Sale
Contract as to environmental assessments, engineering studies, inspection of the
Leased Premises, availability of financing, sale of other property, state of the
title to or encumbrances on the Leased Premises (other than as set forth in
Paragraph 20 hereof), or any other condition or contingency to the Third Party
Purchaser's obligation to purchase the Leased Premises which would otherwise be
the obligation of Tenant under this Lease, shall apply to Tenant's obligation to
purchase the Leased Premises under this Paragraph 34, and Tenant shall be
obligated to purchase the Leased Premises without any such condition or
contingency.

            (c) If at the expiration of the aforesaid fifteen (15) day period
Tenant shall have failed to exercise the aforesaid option by written notice to
Landlord, Landlord may sell the Leased Premises to such Third Party Purchaser
upon the terms set forth in such Sale Contract. Time shall be of the essence
with respect to such fifteen (15) day period.

            (d) Except as otherwise specifically provided herein, the closing
date for any purchase of the Leased Premises by Tenant pursuant to this
Paragraph 34 shall be the earlier to occur of (i) ninety (90) days after the
date of Tenant's notice to Landlord of its intention to purchase the Leased
Premises upon the terms of a Sale Contract with a Third Party Purchaser or (ii)
the closing date provided in such Sale Contract. At such closing Landlord shall
convey the Leased Premises to Tenant in accordance with, and Tenant shall pay to
Landlord the purchase price and other consideration set forth in, the applicable
contract and Paragraph 20 of this Lease.

            (e) If Tenant does not exercise its right of first refusal to
purchase the Leased Premises and the Leased Premises are transferred to a Third
Party Purchaser, Tenant will attorn to any Third Party Purchaser as Landlord so
long as such Third Party Purchaser and Landlord notify Tenant in writing of such
transfer. At the request of Landlord, Tenant will execute such documents
confirming the agreement referred to above and such other agreements as Landlord
may reasonably request, provided that such agreements do not increase the
liabilities or obligations of Tenant hereunder.

            (f) The provisions of this Paragraph 34 shall not apply to or
prohibit (i) any mortgaging, subjection to deed of trust or other hypothecation
of Landlord's interest in the Leased Premises, (ii) any sale of the Leased
Premises pursuant to a private power of sale under or judicial foreclosure of
any Mortgage or other security instrument or device to which Landlord's interest
in the Leased Premises is now or hereafter subject, (iii) any transfer of
Landlord's interest in the Leased Premises to a Lender, beneficiary under deed
of trust or other holder of a security interest therein or their designees by
deed in lieu of foreclosure, (iv) the sale or transfer of the Leased Premises by
such Lender (or a beneficiary under deed of trust or other

                                      -40-
<PAGE>

holder of a security interest therein or their designees) to a third party
purchaser for value subsequent to such Lender's obtaining fee title to the
Leased Premises by deed in lieu of foreclosure, private power of sale under or
judicial foreclosure of any Mortgage or other security instrument or device to
which Landlord's interest in the Leased Premises is now or hereafter subject,
(v) any transfer of the Leased Premises to any governmental or
quasi-governmental agency with power of condemnation, (vi) any transfer of the
Leased Premises or any interest therein or in Landlord to any Affiliate of
Landlord or to any entity (or a Subsidiary thereof) to whom all or substantial
portion of the assets of the parent company of Landlord is transferred, or to
any of the so-called "Corporate Property Associates" family of REIT funds (such
as, CIP, CPA:12, CPA:14, CPA:15), whether now or hereafter created, as part of a
roll-up or other corporate restructuring or reorganization and for whom W.P.
Carey & Co. LLC or any of their Affiliates or successors provides investment
advisory services, and (vii) any transfer of the Leased Premises to any of the
successors or assigns of any of the Persons referred to in the foregoing clauses
(i) through (v).

      35. Intentionally Omitted.

      36. Intentionally Omitted.

      37. Miscellaneous.

            (a) The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.

            (b) As used in this Lease, the singular shall include the plural and
any gender shall include all genders as the context requires and the following
words and phrases shall have the following meanings: (i) "including" shall mean
"including without limitation"; (ii) "provisions" shall mean "provisions, terms,
agreements, covenants and/or conditions"; (iii) "lien" shall mean "lien, charge,
encumbrance, title retention agreement, pledge, security interest, mortgage
and/or deed of trust"; (iv) "obligation" shall mean "obligation, duty,
agreement, liability, covenant and/or condition"; (v) "any of the Leased
Premises" shall mean "the Leased Premises or any part thereof or interest
therein"; (vi) "any of the Land" shall mean "the Land or any part thereof or
interest therein"; (vii) "any of the Improvements" shall mean "the Improvements
or any part thereof or interest therein"; and (viii) "any of the Equipment"
shall mean "the Equipment or any part thereof or interest therein".

            (c) Any act which Landlord is permitted to perform under this Lease
may be performed at any time and from time to time by Landlord or any person or
entity designated by Landlord. Each appointment of Landlord as attorney-in-fact
for Tenant hereunder is irrevocable and coupled with an interest. Landlord shall
not unreasonably withhold or delay its consent whenever such consent is required
under this Lease, except as otherwise specifically provided herein and except
that with respect to any assignment of this Lease or subletting of the Leased
Premises not expressly permitted by the terms of this Lease, Landlord may
withhold its consent for any reason or no reason. In any instance in which
Landlord agrees not to act unreasonably, Tenant hereby waives any claim for
damages against or liability of Landlord which is based upon a claim that
Landlord has unreasonably withheld or unreasonably delayed any consent or
approval requested by Tenant, and Tenant agrees that its sole remedy shall be an
action for declaratory judgment. If with respect to any required consent or
approval Landlord is required by the express provisions of this Lease not to
unreasonably withhold or delay its consent or approval, and if it is determined
in any such proceeding referred to in the preceding sentence that Landlord acted
unreasonably, the requested consent or approval shall be deemed to have been
granted; however, Landlord shall have no liability whatsoever to Tenant for its
refusal or failure to give such consent or approval. Tenant's sole remedy for
Landlord's unreasonably

                                      -41-
<PAGE>

withholding or delaying, consent or approval shall be as provided in this
Paragraph. Time is of the essence with respect to the performance by Tenant of
its obligations under Paragraphs 5(b); 6(a); 7(a)(ii) and 7(b); 18; 22; 24; 25;
26; 28(b); 29; 31(a); 34(b),(c) and (d); 35(f); and 36 of this Lease.

            (d) Landlord shall in no event be construed for any purpose to be a
partner, joint venturer or associate of Tenant or of any subtenant, operator,
concessionaire or licensee of Tenant with respect to any of the Leased Premises
or otherwise in the conduct of their respective businesses.

            (e) This Lease and any documents which may be executed by Tenant on
or about the effective date hereof at Landlord's request constitute the entire
agreement between the parties and supersede all prior understandings and
agreements, whether written or oral, between the parties hereto relating to the
Leased Premises and the transactions provided for herein. Landlord and Tenant
are business entities having substantial experience with the subject matter of
this Lease and have each fully participated in the negotiation and drafting of
this Lease. Accordingly, this Lease shall be construed without regard to the
rule that ambiguities in a document are to be construed against the drafter.

            (f) This Lease may be modified, amended, discharged or waived only
by an agreement in writing signed by the party against whom enforcement of any
such modification, amendment, discharge or waiver is sought.

            (g) The covenants of this Lease shall run with the land and bind
Tenant, its successors and assigns and all present and subsequent encumbrancers
and subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns. If there is more than one Tenant, the
obligations of each shall be joint and several.

            (h) If any one or more of the provisions contained in this Lease
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Lease, but this Lease shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.

            (i) All exhibits attached hereto are incorporated herein as if fully
set forth.

            (j) This Lease shall be governed by and construed and enforced in
accordance with the laws of the State.

            (k) Tenant is not, nor will Tenant become, a Person with whom U.S.
persons or entities are restricted from doing business under regulations of the
Office of Foreign Asset Control ("OFAC") of the Department of the Treasury
(including those named on OFAC's Specially Designated and Blocked Persons list)
or under any statute, executive order (including the September 24, 2001,
Executive Order Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit, or Support Terrorism), or other governmental action
and Tenant not will engage in any dealings or transactions or be otherwise
associated with such persons or entities.

            (l) This Lease may be executed in a number of counterparts and by
different parties hereto in separate counterparts each of which, when so
executed, shall be deemed to be an original and all of which taken together
shall constitute but one and the same agreement.

                                      -42-
<PAGE>

            (m) Each of Landlord and Tenant represents, warrants and confirms to
and for the benefit of the other party that it has dealt with no broker, agent,
finder or consultant, other than NVD Consulting, Inc. ("NVD") and Cushman &
Wakefield, Inc. ("C&W") with respect to this Lease. And each of Landlord and
Tenant hereby agrees to indemnify and save the other harmless of, from and
against any and all claims (and all expenses and fees including, without
limitation, attorneys' fees, related thereto) for commissions, fees or other
compensation made by any other broker or entity alleging to have dealt with such
party or arising out of or based upon the acts of such party or its employees,
officers, shareholders, partners and/or agents, subject to payment obligations
of the respective parties as set forth at the end of this Paragraph 37(m). In
case any action hereunder or proceeding shall be instituted against Landlord for
the payment of any such commissions, fees or other compensation, arising out of
or based upon any such acts of Tenant, its employees, officers, partners and/or
agents, then Tenant, upon notice from Landlord and at Tenant's sole cost and
expense, shall resist and defend such action or proceeding by counsel chosen by
and paid for by Tenant, who shall be reasonably satisfactory to Landlord, and
Landlord shall also have the right, but not the obligation, to participate in
the defense of any such action or proceeding by counsel of its own choice. In
case any action hereunder or proceeding shall be instituted against Tenant for
the payment of any such commissions, fees or other compensation, arising out of
or based upon any such acts of Landlord, its employees, officers, partners
and/or agents, then Landlord, upon notice from Tenant and at Landlord's sole
cost and expense, shall resist and defend such action or proceeding by counsel
chosen by and paid for by Landlord, who shall be reasonably satisfactory to
Tenant, and Tenant shall also have the right, but not the obligation, to
participate in the defense of any such action or proceeding by counsel of its
own choice. Landlord shall pay any commission or other fee or compensation due
NVD pursuant to the terms of a separate agreement. Tenant shall pay any
commission or other fee or compensation due C&W pursuant to the terms of
separate agreement. The provisions of this Paragraph 37(m) shall survive the
Expiration Date or any earlier termination of this Lease.

      38. Post Closing Obligations.

            Pursuant to (i) that certain Phase I Site Assessment Report of the
Leased Premises performed by Engineering Consulting Services Inc. and dated as
of January 19, 2005, (ii) that certain Property Condition Report performed by
RPMS Consulting Engineers and dated as of January 25, 2005, and (iii) that
certain Loss Prevention Report from Factory Mutual Insurance Company dated
January 8, 2004, Tenant shall complete, remediate or obtain or caused to be
completed, remediated or obtained the Post Closing Obligations within the time
periods specified in Exhibit "F".

      39. Subdivision of Release Parcels.

            Landlord shall have the right, at any time during the Term, to cause
the subdivision of the Release Parcels (or either of them), subject to the
compliance with the following provisions and criteria (which may be satisfied by
means of the express terms of the amendment or pursuant to separate use, right
of way, access and/or easement agreements executed in connection with the
proposed release): (1) the Release Parcel shall have been legally subdivided
from the remainder of the Leased Premises (also the "Retained Premises") in
compliance with all applicable subdivision laws, Legal Requirements (including
zoning, access and parking requirements) and Easement Agreements so that the
Release Parcel(s), and the Retained Premises are separate tracts and tax lots,
and in compliance with applicable Laws, Legal Requirements and Easements
Agreements, (2) the subdivision and/or release of the applicable Release
Parcel(s) does not adversely impact the functional use, legal use or
availability of the Retained Premises, (3) the Retained Premises continues to
have available to it all necessary utilities and adequate, free, unimpeded and
unencumbered access for pedestrian and vehicular ingress and egress onto
adjacent public roads, (4) any requirements of Lender set forth

                                      -43-
<PAGE>

in the Mortgage (or any other loan documents executed by Landlord in connection
with the Loan) with respect to the subdivision and /or release of the Release
Parcel(s) have been satisfied, and (5) the costs and expenses of the release and
any subsequent conveyance of the Release Parcel and in complying with the above
conditions shall be borne by Landlord. Notwithstanding the foregoing provisions
of this Paragraph 39, Landlord's right to subdivide the Release Parcels and to
cause the Release Parcels (or either of them) to be released and severed from
the lien of the Mortgage shall not include the right to release and sever the
Release Parcel from the leasehold estate created by this Lease unless Tenant
shall have, in its sole and absolute discretion, consented thereto in advance in
writing.

                   REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

                                      -44-
<PAGE>
                      Lease-Telcordia       March 15, 2005
                      ------------------------------------

      IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be duly
executed under seal as of the day and year first above written.

                                       LANDLORD:

                                       TELC (NJ) QRS 16-30, INC.,
                                       a Delaware corporation

                                       By:   Jason Fox
                                           -------------------------------------
                                       Name: Jason Fox
                                             -----------------------------------

                                       Title: Vice President
                                              ----------------------------------

ATTEST:                                TENANT:

                                       TELCORDIA TECHNOLOGIES, INC.
                                       a Delaware corporation

By: /s/ JOHN C. BRAUN, JR.             By: /s/ Joseph Giordano
    -------------------------------        -----------------------------------
Name: JOHN C. BRAUN, JR.               Name: JOSEPH GIORDANO
Title: ASSISTANT SECRETARY             Title: CVP. AND DEPUTY GENERAL COUNSEL

[Corporate Seal]

                       SIGNATURE PAGE TO LEASE AGREEMENT

<PAGE>

      IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be duly
executed under seal as of the day and year first above written.

                                       LANDLORD:

                                       TELC (NJ) QRS 16-30, INC.,
                                       a Delaware corporation

                                       By: /s/ Jason Fox
                                       -----------------
                                       Name: JASON FOX
                                       Title: VP

ATTEST:                                TENANT:

                                       TELCORDIA TECHNOLOGIES, INC.
                                       a Delaware corporation

By: ________________________________   By: _____________________________________
Name: ______________________________   Name: ___________________________________
Title: _____________________________   Title: __________________________________

[Corporate Seal]

                       SIGNATURE PAGE TO LEASE AGREEMENT

<PAGE>

                                    EXHIBIT A
                              PROPERTY DESCRIPTION

ALL THAT CERTAIN PLOT, PIECE OR PARCEL OF LAND, WITH THE BUILDING AND
IMPROVEMENTS THEREON ERECTED, SITUATE, LYING AND BEING IN THE Township OF
Piscataway, COUNTY OF Middlesex, STATE OF NEW JERSEY, BOUNDED AND DESCRIBED AS
FOLLOWS:

PARCEL ONE - BLOCK 591, LOT 2.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency; thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet; thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet; thence

                                 1
<PAGE>

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 34
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds East and a chord distance of 820.56 feet to a
            point of tangency; thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to the POINT of BEGINNING.

The above described being known as a description of Block 591, Lots 2.01, said
Lot being shown on the Piscataway Township Tax Map Sheet 51, also being shown on
a plat entitled "Reverse Subdivision Plan" prepared by Donald H. Stires
Associates, 43 West High Street, Somerville, New Jersey dated May 26, 1999.

PARCEL ONE - BLOCK 591, LOT 2.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency; thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

                                       2
<PAGE>

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet; thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet; thence

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 54
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds East and a chord distance of 820.56 feet to a
            point of tangency; thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to a point of curvature; thence

      22.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 5052.02 feet, a length along the arc of 60.70
            feet, a bearing along the chord of South 12 degrees 38 minutes 34
            seconds East and a chord distance of 60.70 feet to the Point of
            BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:

            Commonly known as: 1 Telcordia Drive / 444 Hoes Lane, Piscataway,
            New Jersey Block 591, Lot 2.01 - Tax Map of the Township of
            Piscataway

                                       3
<PAGE>

PARCEL TWO - BLOCK 501.1, LOT 6.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 25
            minutes 40 seconds East, a distance of 20.89 feet; thence

      2.    South 70 degrees 22 minutes 20 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 25 minutes 40 seconds East, a distance of 250.00
            feet; thence

      4.    North 70 degrees 22 minutes 20 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 25 minutes 40 seconds East, a
            distance of 536.53 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 528.81
            feet, a bearing along the chord of South 22 degrees 06 minutes 50
            seconds East and a chord distance of 528.69 feet to a point of
            tangency; thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet; thence

      10.   North 00 degrees 42 minutes 10 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525.75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 09 minutes 55 seconds East and a chord distance of
            172.87 feet to a point of tangency; thence

      12.   North 19 degrees 37 minutes 40 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 40.36 feet, a bearing along the chord of
            North 58 degrees 10 minutes 06 seconds West and a chord distance of
            37.38 feet to a point on a non-tangent curve in the southerly
            sideline of Knightsbridge Road; thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 42

                                       4
<PAGE>

            minutes 26 seconds East and a chord distance of 99.31 feet to a
            point of tangency; thence

      15.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 25 minutes 40
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 01 minutes 40 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above described being known as a Consolidated description of Block 501.1,
Lots 6, 9.01 and 10, said Lots being shown on the Piscataway Township Tax Map
Sheet 44C, also being shown on a plat entitled "Reverse Subdivision Plan"
prepared by Donald H. Stires Associates, 43 West High Street, Somerville, New
Jersey, dated May 26, 1999.

PARCEL TWO - BLOCK 501.1, LOT 6.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 49
            minutes 32 seconds East, a distance of 20.89 feet; thence

      2.    South 69 degrees 58 minutes 28 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 49 minutes 32 seconds East, a distance of 250.00
            feet; thence

      4.    North 69 degrees 58 minutes 28 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 49 minutes 32 seconds East, a
            distance of 535.73 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 537.85
            feet, a bearing along the chord of South 22 degrees 30 minutes 27
            seconds East and a chord distance of 537.71 feet to a point of
            tangency; thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

                                       5
<PAGE>

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet; thence

      10.   North 01 degrees 06 minutes 02 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525.75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 33 minutes 47 seconds West and a chord distance of
            172.87 feet to a point of tangency; thence

      12.   North 20 degrees 01 minutes 32 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 40.36 feet, a bearing along the chord of
            North 58 degrees 33 minutes 57 seconds West and a chord distance of
            37.38 feet to a point on a non-tangent curve in the southerly
            sideline of Knightsbridge Road; thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 18 minutes 34 seconds East and a
            chord distance of 99.31 feet to a point of tangency; thence

      15.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 49 minutes 31
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 25 minutes 32 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:
Commonly known as:    50 Knightsbridge Road
                      Piscataway, New Jersey
                      Block 501.01, Lot 6.01 - Tax Map of the Township of
                      Piscataway

                                       6
<PAGE>

                                                                       EXHIBIT B

                                    EQUIPMENT

All fixtures, machinery, apparatus, equipment, fittings and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fire extinguishing and
ventilating systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all personal property and all trade fixtures, machinery, office,
manufacturing and warehouse equipment which are not necessary to the operation
of the buildings which constitute part of the Leased Premises for the uses
permitted under Paragraph 4(a) of this Lease, including, but not limited to, the
following:

      a. All data center equipment -- PDU's, A/C units, batteries, UPS units,
         etc.
      b. Two 1500 KW generators and ancillary equipment
      c. Mechanics' tools and equipment
      d. Laboratory equipment and furniture
      e. A/C units specific to a lab or office
      f. Built-in and portable audio/visual equipment
      g. Portable kitchen equipment
      h. Office furniture
      i. Personal computers
      j. Computer Servers
      k. Vehicles

                                   EXHIBIT B-1
<PAGE>

                                                                       EXHIBIT C

                             PERMITTED ENCUMBRANCES

1.    Encroachments, overlaps, boundary line disputes, and any other matters
      which would be disclosed by an accurate survey and inspection of the
      premises.

2.    Easement to the Defense Plant Corporation recorded in Deed Book 1235, Page
      263; an Easement to Texas Eastern Transmission Corporation recorded in
      Deed Book 2157, Page 85; as confirmed by Agreement recorded in Deed Book
      2238, Page 52; as further confirmed by Agreement recorded in Deed Book
      2426, Page 439; and as shown on the Survey prepared by Richard C. Mathews,
      PLS of Stires Associates, PA, dated January 10, 2005, last revised January
      24, 2005 (affects Parcel One).

3.    Subject to the benefits and burdens of those certain Easements with The
      New Jersey Bell Telephone Company recorded in Deed Book 2604, Page 802;
      Deed Book 2766, Page 463; and Deed Book 2762, Page 1172; and as shown on
      the Survey prepared by Richard C. Mathews, PLS of Stires Associates, PA,
      dated January 10, 2005, last revised January 24, 2005 (affects Parcel
      One).

4.    Sewer Agreement with the Township of Piscataway recorded in Deed Book
      2610, Page 423 (affects Parcel One).

5.    Easement to Public Service Electric and Gas Company recorded in Deed Book
      2642, Page 88; and as shown on the Survey prepared by Richard C. Mathews,
      PLS of Stires Associates, PA, dated January 10, 2005, last revised January
      24, 2005 (affects Parcel One).

6.    Matters shown on that certain Map entitled "Survey Map of Proposed
      Easement, Part of Lot 2A, Block 591, Tax Map, Piscataway Twp., Middlesex
      Co., N.J." filed March 9, 1988 as Map No. 1801, File No. 479, including,
      but not limited to: Proposed twenty-five. (25') foot NJ. Bell Tel. Co.
      Easement; and as shown on the Survey prepared by Richard C. Mathews, PLS
      of Stires Associates, PA, dated January 10, 2005, last revised January 24,
      2005 (affects Parcel One).

7.    Easements to Public Service Electric and Gas Company and/or New Jersey
      Bell Telephone Company recorded in Deed Book 3034, Page 629; Deed Book
      3061, Page 921; Deed Book 3077, Page 851; and Deed Book 4853, Page 615;
      and as shown on the Survey prepared by Richard C. Mathews, PLS of Stires
      Associates, PA, dated January 10, 2005, last revised January 24, 2005
      (affects Parcel Two).

8.    Restrictive Covenant recorded in Deed Book 4770, Page 570 (affects Parcel
      One and Parcel Two).

9.    Developer's Agreement recorded in Deed Book 4793, Page 447 (affects Parcel
      One and Parcel Two).

                                   EXHIBIT D-1
<PAGE>

10.   Rights of the following licensees and tenants having rights as licensees
      only, none of which have an option to purchase or right of first refusal
      affecting the Premises: MCImetro Access Transmission Services, LLC
      ("MCImetro"), Sprint Spectrum L.P. ("Sprint'), SkyTel Corp., a DE
      corporation, ("SkyTel"), New York SMSA Limited Partnership ("NY SMSA"),
      and Toshiba, a __ ("Toshiba").

11.   Taxes and assessments for the year 2005 and subsequent years.

12.   Rights or claims of parties in possession not shown by the public records.

13.   Easements, or claims of easements, roads, ways or streams not shown by the
      public records.

14.   Any facts, rights, interests, or claims which are not shown by the public
      records but which could be ascertained by an inspection of said land or by
      making inquiry of persons in possession thereof.

15.   Any lien, or right to a lien, for services, labor or material heretofore
      or hereafter furnished, imposed by law and not shown by the public
      records.

16.   Planning, zoning and subdivision regulations and restrictions.

<PAGE>

                                                                       EXHIBIT D

                              BASIC RENT PAYMENTS

1.    Basic Rent.

      (a) Initial Term. Subject to the adjustments provided for in below in this
Exhibit D, Basic Rent payable in respect of the Term shall be US $8,913,190.00
per annum, payable monthly, in advance on each Basic Rent Payment Date, in equal
installments of US $742,765.83 each. Pro rata Basic Rent for the period from the
date hereof through the last day of the calendar month in which the Commencement
Date of this Lease occurs shall be paid on the date hereof.

(b) Renewal Term. Annual Basic Rent for each Renewal Term shall be payable
monthly, in advance, on each Basic Rent Payment Date, in equal installments, as
follows: (i) for the first Renewal Term, the Basic Rent for the first Lease Year
of such first Renewal Term shall be an amount equal to 120% of the Basic Rent in
effect as of the First Full Basic Rent Payment Date under this Lease and shall
be subject to the applicable annual adjustments provided for below in this
Exhibit D, (ii) for the second Renewal Term, the Basic Rent for the first Lease
Year of such second Renewal Term shall be an amount equal to 120% of the Basic
Rent in effect as of the First Full Basic Rent Payment Date under this Lease
and, thereafter, shall be subject to the applicable annual adjustments provided
below in this Exhibit D, (iii) for the third Renewal Term, the Basic Rent for
such third Renewal Term shall be an amount equal to 94% of the Fair Market
Rental Value as of the first day of such third Renewal Term, as determined in
accordance with Paragraph 29 of this Lease, and (iv) for the fourth Renewal
Term, the Basic Rent for such Renewal Term shall be an amount equal to 94% of
the Fair Market Rental Value as of the first day of such fourth Renewal Term, as
determined in accordance with Paragraph 29 of this Lease.

2.    Initial Term Adjustments to Basic Rent.

            (a) Basic Rent shall during the Initial Term not be adjusted until
the first (1st) anniversary of the Basic Rent Payment Date on which the first
full monthly installment of Basic Rent shall be due and payable (the "First Full
Basic Rent Payment Date") As of the first (1st) anniversary of the First Full
Basic Rent Payment Date and, thereafter, on each subsequent anniversary date
(each such date being hereinafter referred to as the "Basic Rent Adjustment
Date") of the First Full Basic Rent Payment Date occurring during the Initial
Term, Basic Rent shall be adjusted as follows:

            (i) commencing on the first (1st) anniversary of the First Full
      Basic Rent Payment Date and continuing for each Basic Rent Adjustment Date
      occurring through and including the fourth (4th) anniversary date thereof,
      by increasing the Basic Rent then in effect by the lesser of (x) the CPI
      Increase (as defined below) and (y) two percent (2%) per annum over the
      adjusted Basic Rent then in effect immediately preceding each such
      anniversary date;

            (ii) for the Lease Year commencing upon the fifth (5th) anniversary
      of the First Full Basic Rent Payment Date, to an amount equal to the
      greater of (A) the amount obtained by multiplying US $8,913,190.00 by the
      lesser of (x) (100% plus the cumulative percentage CPI Increase over the
      CPI in effect as of the First Full Basic Rent Payment Date) and (y)
      113.14%, and (B) the Basic Rent then in effect immediately prior to such
      fifth (5th) anniversary of the First Full Basic Rent Payment Date.

            (iii) commencing upon the sixth (6th) anniversary of the First Full
      Basic Rent Payment Date and continuing for each Basic Rent Adjustment Date
      occurring

                                   EXHIBIT D-1
<PAGE>

      during the Initial Term by increasing the Basic Rent then in effect by the
      lesser of (x) the actual CPI increase and (y) two and one half percent
      (2.5%) per annum over the adjusted Basic Rent then in effect immediately
      preceding each such anniversary date;

            (iv) notwithstanding the provisions of clause (iii) above, if, as of
      any Basic Rent Adjustment Date occurring after the eleventh (11th)
      anniversary of the First Full Basic Rent Payment Date (such date, the
      "Calculation Date"), (1) the sum of (x) the aggregate Basic Rent due and
      payable for the period up to and as of the applicable Basic Rent
      Adjustment Date plus (y) the aggregate Basic Rent that remains due and
      payable for the balance of the initial Term of the Lease without further
      adjustment, equals or exceeds US $199,943,274.00, then, in such event, the
      adjustments to Basic Rent set forth in clause (iii) above shall thereafter
      cease and the Basic Rent for the balance of the initial Term of the Lease
      shall remain at the amount per annum due and payable as of the date
      immediately preceding such Calculation Date; provided that, (A) the
      provisions of this clause (iv) shall not be self-operative and shall only
      be effective and applicable if Tenant shall notify Landlord in writing of
      its desire to declare the next occurring anniversary of the First Full
      Basic Rent Payment Date as a Calculation Date, (B) in no event shall there
      be any reduction in Basic Rent below the amount in effect as of the date
      immediately preceding the Calculation Date as a result of the application
      of this clause (iv), and (C) in no event shall Landlord be obligated to
      disgorge or otherwise repay or reimburse Tenant (or any other party
      claiming through Tenant) for any Basic Rent previously paid by Tenant as
      of such Calculation Date for any reason (including an inadvertent failure
      of Tenant to cause the application of the provisions of this clause (iv)).

      (b) CPI Adjustment. As of each Basic Rent Adjustment Date during the
initial Term, whenever the CPI Increase is less than the applicable Adjustment
Cap, the Basic Rent in effect immediately prior to the applicable Basic Rent
Adjustment Date shall be multiplied the applicable CPI Increase, and such
product shall be added to the Basic Rent in effect immediately prior to such
Basic Rent Adjustment Date.

      (c) During the Initial Term, notice of the new annual Basic Rent shall be
delivered to Tenant on or before the tenth (10th) day preceding each Basic Rent
Adjustment Date, but any failure to do so by Landlord shall not be or be deemed
to be a waiver by Landlord of Landlord's rights to collect such sums. Tenant
shall pay to Landlord, within ten (10) days after a notice of the new annual
Basic Rent is delivered to Tenant, all amounts due from Tenant, but unpaid,
because the stated amount as set forth above was not delivered to Tenant at
least ten (10) days preceding the Basic Rent Adjustment Date in question.

3.    Renewal Term Adjustments to Basic Rent.

      (a) During each of the first and second Renewal Terms, Basic Rent shall
not be adjusted until the first (1st) anniversary of the Basic Rent Payment Date
on which the first full monthly installment of Basic Rent during such Renewal
Term shall be due and payable (the "Renewal Term First Basic Rent Payment
Date"). As of the first (1st) anniversary of the Renewal Term First Basic Rent
Payment Date for each Renewal Term and, thereafter, on each subsequent
anniversary date of the Renewal Term First Basic Rent Payment Date during the
applicable Renewal Term, Basic Rent shall be adjusted by increasing the Basic
Rent then in effect by two percent (2%) per annum over the Basic Rent hi effect
for the Lease Year immediately preceding each such anniversary date (each such
date being hereinafter referred to as the "Renewal Term Rent Adjustment Date").

      (b) During each of the first and second Renewal Terms, notice of the new
annual Basic Rent shall be delivered to Tenant on or before the tenth (10th) day
preceding each Renewal Term Rent Adjustment Date, but any failure to do so by
Landlord shall not be or be deemed to be

                                   EXHIBIT D-2
<PAGE>

a waiver by Landlord of Landlord's rights to collect such sums. Tenant shall pay
to Landlord, within ten (10) days after a notice of the new annual Basic Rent is
delivered to Tenant, all amounts due from Tenant, but unpaid, because the stated
amount as set forth above was not delivered to Tenant at least ten (10) days
preceding the Renewal Term Rent Adjustment Date in question.

4.    Definitions.

      As used in this Exhibit D and as referred to in the Lease, the following
terms shall have the following meanings:

      "Adjustment Cap" shall mean (A) two percent (2%) during the period
commencing on the First Full Basic Rent Payment Date and ending on the fifth
(5th) anniversary of the First Full Basic Rent Payment Date and (B) two and
one-half percent (2.5%) during the period commencing on the sixth (6th)
anniversary of the First Full Basic Rent Payment Date and continuing until the
end of the initial Term.

      "Anniversary Month" shall mean, commencing with January, 2006, each
January during the Term of the Lease.

      "Comparison Month" shall mean the calendar month which is exactly one year
prior to Anniversary Month.

      "CPI" shall mean the index known as United States Department of Labor,
Bureau of Labor Statistics, Consumer Price Index, All Urban Consumers, United
States City Average, All Items, (1982-84=100) or the successor index that most
closely approximates the CPI. If the CPI shall be discontinued with no successor
or comparable successor index, Landlord and Tenant shall attempt to agree upon a
substitute index or formula, but if they are unable to so agree, then the
matter shall be determined by arbitration in accordance with the rules of the
American Arbitration Association then prevailing in New York City. Any decision
or award resulting from such arbitration shall be final and binding upon
Landlord and Tenant and judgment thereon may be entered in any court of
competent jurisdiction. In no event shall the annual Basic Rent be adjusted
downward as a result of the application of any CPI adjustment.

      "CPI Increase" shall mean the percentage increase in CPI from the Prior
Year CPI, which percentage increase shall be equal to the fraction, (A) the
numerator of which shall be (x) the CPI in the applicable Anniversary Month(s),
less (y) the Prior Year CPI, and (B) the denominator of which shall be the Prior
Year CPI.

      "Prior Year CPI" shall mean the CPI in effect for the Comparison Month.

                                   EXHIBIT D-3
<PAGE>

                                                                      EXHIBIT E

                               TERMINATION VALUES

<TABLE>
<CAPTION>
  Year           Termination Amount
----------       ------------------
<S>              <C>
    1             $ 137,228,637
    2               137,222,967
    3               137,273,257
    4               137,323,167
    5               137,367,297
    6               137,198,517
    7               137,268,767
    8               136,187,719
    9               135,163,902
    10              133,948,564
    11              132,995,487
    12              131,853,949
    13              130,757,562
    14              129,687,094
    15              128,641,547
    16              127,502,819
    17              126,375,642
    18              125,344,854
Thereafter          125,341,824
</TABLE>

                                   EXHIBIT D-1
<PAGE>

                                                                       EXHIBIT F

                            POST-CLOSING OBLIGATIONS

A.    Deferred Maintenance; Immediate Repairs, Etc.:

      Tenant shall perform the following actions and provide Landlord with
written confirmation, satisfactory to Landlord, of completion of the activities
listed below for the 1 Telcordia Drive (a/k/a 444 Hoes Lane) property in
Piscataway, New Jersey. Tenant shall pay all costs associated with these Post
Closing Obligations, including oversight costs, in accordance with provisions of
the Lease:

      1. On or before the later to occur of (x) the date that is one (1) year of
the date of this Lease and (y) sixty (60) days after the written request of
Landlord, evidence reasonably satisfactory to Landlord (and Lender, if so
required under the applicable Loan documents) that the Leased Premises is in
full compliance with all applicable zoning laws and ordinances relating to the
minimum number parking spaces (both regular and handicapped) required in light
of the current use and density of the Leased Premises; provided that, if despite
Tenant's commercially reasonable efforts such evidence cannot be obtained within
the time period set forth hereinabove, such time period for Tenant's compliance
with the foregoing obligations shall be tolled during any period that Tenant is
contesting any alleged claim of noncompliance pursuant to and in accordance with
Paragraph 14 of this Lease and such tolling shall continue until a final, non-
appealable decision on such contest is rendered.

      2. Within ninety (90) days of the date of this Lease, each of the items of
repair or replacement identified on Schedule F-l annexed hereto as more fully
described in the Property Condition Report performed by RPMS Consulting
Engineers and dated as of January 25, 2005.

      3. Within ninety (90) days of the date of this Lease, to the extent not
completed as of the date hereof, each of the items under the headings Priority
#1, Priority #2 and Special Consideration identified on Schedule F-2 annexed
hereto as more fully described in the Loss Prevention Report from Factory Mutual
Insurance Company dated January 8, 2004.

B.    Environmental Conditions:

      Tenant shall perform the following actions and provide Landlord with
written confirmation, satisfactory to Landlord, of completion of the activities
listed below for the 1 Telcordia Drive (a/k/a 444 Hoes Lane) property in
Piscataway, New Jersey. Tenant shall pay all costs associated with these Post
Closing Obligations, including oversight costs, in accordance with provisions of
the Lease (As used hereinbelow, the term "Closing Date" shall mean the date of
this Lease):

      1. Former Heating Oil Underground Storage Tank ("UST") - Within sixty (60)
days of the Closing Date, Tenant shall provide Landlord with documentation,
satisfactory to Landlord, regarding the removal of the former 3,000-gallon
heating oil UST and the results of any historical sampling indicating that no
release from the former UST occurred. If Tenant is unable to provide
satisfactory documentation, then within ninety (90) days of the Closing Date,
Tenant shall cause an environmental consulting firm acceptable to Landlord to
take at lease two subsurface soil samples in the area of the former heating oil
UST to confirm that no release from the UST occurred. The samples shall be
collected from a depth which is sufficient to detect any release from the former
UST and the soil samples shall be sampled for parameters which are regulated by
the State of New Jersey in connection with petroleum product releases and also
for

                                    ADDENDA-1
<PAGE>

any additional parameters which are specific to the nature of the substances
formerly stored in the UST.

      2. Adjacent Leaking Underground Storage Tank ("LUST") Site - Within ninety
(90) days of the Closing Date, Tenant shall have engaged an environmental
consulting firm acceptable to Landlord to conduct a file review of relevant
environmental agency files to obtain additional documentation on the LUST site
abutting the property to the south (4 Skiles Lane) and shall provide Landlord
with a written report summarizing the results of that file review.

      3. Oil/Water Separator - Within one hundred twenty (120) days of the
Closing Date, Tenant will arrange for the removal of the oil/water separator
located in the area of the large drain to the west of the maintenance garage
aboveground storage tank ("AST") and shall conduct subsurface soil sampling in
the area of the former oil/water separator to determine whether any releases to
the environment have occurred. In the alternative, Tenant may conduct subsurface
soil sampling outside the physical boundary of the oil/water separator to
determine whether any release to the environment has occurred; shall remove all
contents from the oil/water separator and steam clean (or equivalent cleaning
process) the interior of the oil/water separator and shall then fill the
oil/water separator with concrete. If the results of subsurface sampling
document that a release to the environment from the oil/water separator has
occurred, Tenant shall use its best efforts to promptly remediate such release
to the New Jersey cleanup standards which are consistent with the current use of
the property.

      4. Repair of Aboveground Storage Tank ("AST") Secondary Containment -
Within ninety (90) days of the Closing Date, weather permitting, Tenant shall
have repaired the compromised secondary containment surrounding the 2,000-gallon
heating oil AST located to the west of the maintenance garage. The secondary
containment shall be sufficient to contain 110% of the liquid contents of the
tank in the event of a complete release from the tank.

      5. Repair of Fitting and/or Piping on Maintenance Garage Boiler Unit -
Within thirty (30) days of the Closing Date, Tenant shall have either repaired
the fitting on the product line adjacent to the boiler unit in the maintenance
garage or shall have repaired the piping line itself to prevent continued
petroleum leaks from the fitting.

      6. Removal of Impacted Soils - Within one hundred twenty (120) days of the
Closing Date, Tenant shall have removed all impacted soils in the vicinity of
the former 1,000-gallon leaded gasoline UST and shall have conducted
confirmatory soil sampling to confirm that any residual contamination levels are
below applicable New Jersey cleanup standards applicable to the current use of
the property.

      7. Unlabeled Drums of Freon-Within thirty (30) days of the Closing Date,
Tenant shall have placed appropriate labeling on the unlabeled drums of Freon
located within the mechanical room of Building RRC-3.

                                    ADDENDA-2
<PAGE>

      8. Notices: Copies of all written documentation and any other
correspondence related to the Post Closing obligations of Tenant shall be sent
to Landlord either via electronic delivery or overnight mail to:

            Reed Smith LLP                     TELC (NJ) QRS 16-30, INC.
            Attn: Louis A. Naugle, Esq.        c/o W. P. Carey & Co., LLC
            435 Sixth Avenue                   Attn: Donna Neiley
            Pittsburgh, PA 15219               Asset Management Department
            (412) 288-8587 telephone           50 Rockefeller Plaza
            (412) 288-3063 fax                 New York, NY 10020
            lnaugle@reedsmith.com              (212) 492-1100 telephone
                                               (212) 429-3022 fax
                                               dneiley@wpcarey.com

                                    ADDENDA-3
<PAGE>

                                   SHEDULE F-1

DATE:                                  January 20, 2005
RPMS PROJECT NO.:                      4089
PROJECT NAME:                          Telcordia Raritan River Campus
STREET ADDRESS:                        1 Telcordia Way
CITY, STATE:                           Piscataway, New Jersey

<TABLE>
<CAPTION>
ID No.                       ITEM                          QTY.  UNIT   UNIT COST   TOTAL COST
------  -------------------------------------------------  ----  ----  -----------  -----------
<S>     <C>                                                <C>   <C>   <C>          <C>
  1     Refinish soffit reveal                              980   LF   $      1.27  $     1,245
  2     Refinish exterior walls                             300   SF   $      1.45  $       435
  3     Repair concrete block dock fndn.                     48   SF   $     20.43  $       981
  4     Repoint concrete block                             1185   SF   $      1.22  $     1,446
  5     Repair loose cement parge                          1185   SF   $      2.05  $     2,429
  6     Repaint patched wall areas                         1185   SF   $      1.45  $     1,718
  7     Replace overhead door                                 1   EA   $  3,355.00  $     3,355
  8     Replace exterior door assembly                        1   EA   $  1,212.10  $     1,212
  9     Reailgn overhead doors                                3   EA   $    195.00  $       585
  10    Refinish bridge soffit access doors                  12   EA   $     42.50  $       510
  11    Repair spalled precast conc. Panel                        LS                $     2,000
  12    Examine bridge soffit plenums                             LS                $     1,500
  13    Install new 1.275 MBTU/HR boiler in RRC-5             1   EA   $ 17,600.00  $    17,600
  14    Replace double doors                                      LS                $       150
  15    Refinish toilet room floor and walls                      LS                $       400
  16    Scrape, clean and paint oil circuit breaker I-191         LS                $     5,000
  17    Investigate & repair oil leak on Transformer #1           LS                $     3,000
  18    Investigate & repair oil leak on Transformer #2           LS                $     3,000
  19    Repair oil leak on transformer OC1 -7                     LS                $     9,000
  20    Replace damaged light pole                                LS                $       800
                                                                                    -----------
                                    TOTAL                                           $ 56,365.54
                                                                                    ===========
</TABLE>

                                    ADDENDA-4
<PAGE>

                                                                    SCHEDULE F-2

                                  ADDENDA - 2
<PAGE>

FACTORY MUTUAL INSURANCE COMPANY                                [FM GLOBAL LOGO]
21860 Burbank Boulevand, Suite 300
Woodland Hills, California 91367
Tel: (818) 704-1133
FAX :(818)883-0759

Mailing Address: P.O. Box 9270 - Van Nuys, CA 91409

                                                                January 08, 2004

                                                             IN REPLY  REFER TO:
                                                             Account No. 1-17989
Mr. John Rofulowitz                                           Index No. 31791 66
Science Applications International
Raritan River Software Systems Center
444 Hoes Lane
Piscataway, NJ 08854

Subject: LOSS PREVENTION REPORT dated December 5, 2003

Dear Mr. Rofulowitz:

Enclosed is the loss prevention report confirming FM Global's focused loss
prevention visit to the subject location to conduct a re-inspection for fire
and associated perils. We are working together with Deborah Smith of your
Corporate Risk Management (858-826-4801) to maintain a high level of property
loss prevention at this facility. The following are our suggestions for the
recommendations listed on the report:

PRIORITY#1 (Low Cost Recommendations) The following recommendations are
relatively low cost. We suggest they be completed within 60 days:

      -     03-12-001: All sprinkler control valves in Bldg. 4 should be locked
            in the open position.

      -     02-08-003: Weekly visual and monthly physical inspections should be
            conducted for all sprinkler control valves.

      -     02-08-004: All sprinkler flow alarms should be tested on a monthly
            frequency.

PRIORITY#2 (Moderate Cost Recommendations) The following recommendations will
require a moderate cost to complete. We suggest they be investigated for
completion within 90 days and be completed within six months.

      -     02-08-001: Automatic sprinklers should be provided in the Bldg. 4
            Elevator Room.

      -     93-01-001: Automatic Sprinklers should be provided in the Turbine
            Generator Room.

PRIORITY#3(Advisory Recommendations) The following recommendations are
considered advisory and do not require immediate action. Although they do not
require immediate action, they are valid recommendations that would improve
property loss prevention at this facility.

      -     02-08-005: Plans for new construction, renovation, repairs, changes
            in fire protection, etc. should be submitted to FM Global Plan
            Review prior to the commencement of work.

                                       1
<PAGE>
SAIC
1/8/04
31797.66
Pg. 2

SPECIAL CONSIDERATION The following recommendations do not fit into the priority
classes listed above and need special consideration:

      -     86-10-001 B.D.F: Automatic sprinklers should be installed in the
            following areas:

            -     Building 3 Engine Room 3D-107 and the cafeteria cooler boxes.

            -     UPS Building attached to Bldg. 5.

            -     Building 4 Mechanical Room and Penthouse.

These items were originally presented as loss prevention recommendations in
1986. Since that time, sprinkler protection has been added in several other
areas of this complex.

These items rise a significant hazard to both life safety, and property
protection at your facility. Your corporate Risk Management Department has
requested that we solicit a response from you within 60 days confirming action
taken to eliminate the hazard under recommendation 86-10-00).

If you have any questions or comments, please call me at 818-596-5005. I am also
available to discuss potential alternatives to the recommendations.

Very truly yours,

/s/ David W. Skaar

David W. Skaar
Account Engineer
FM Global, Los Angeles
office: 818-596-5505
email :david, skaar@fmglobal.com

Ec:  Deborah Smith, SAIC, Deborah.a.smith@cpmx.saic.com
     Tom Repking, Marah, Inc., Thomes.j.repking@marshmine.com
     Follow Up 3/6/04
     A.Zwayer/S. Shivley-FM Global
     Index

                                       2
<PAGE>
<Table>
<S>                    <C>
Part B.                PROVIDE AUTOMATIC SPRINKLERS IN BUILDING NO.3 ENGINE
                       ROOM 3D-107 AND THE CAFETERIA COOLER BOXES.

"KEY EXPOSURE"

STATUS                 According to Mr. John Rofulowitz. the recommendation
                       will be studied for possible completion.

Part D.                PROVIDE AUTOMATIC SPRINKLERS IN THE UPS BUILDING (NOW
                       USED FOR STORAGE) ATTACHED TO BUILDING NO. 5.

"KEY EXPOSURE"

STATUS                 According to Mr. John Rofulowitz, the recommendation will
                       be studied for possible completion.

Part F.                PROVIDE SPRINKLERS IN  BUILDING NO.4 MECHANICAL ROOM AND
                       PENTHOUSE.

"KEY EXPOSURE"

STATUS                 According to Mr. John Rofulowitz.the recommendation will
                       be studied for possible completion.

02-08-001              PROVIDE AUTOMATIC SPRINKLERS IN THE FREIGHT ELEVATOR
                       EQUIPMENT ROOM IN BUILDING NO.4.

"KEY EXPOSURE"

THE HAZARD             Having adequate sprinkler protection will
                       ensure that if the unthinkable  happens, your business
                       will suffer only a limited interruption. Sprinkler
                       protection not only minimizes fire damage, but also
                       water and smoke damage, and allows for quick resumption
                       of  normal operations,Promptly restarting operations will
                       help you retain your customers and market share.

STATUS                 Mr. John Rofulowitz, Fire Safety Specialist, stated that
                       this is a corporate decision.

93-01-001              PROVIDE AUTOMATIC SPRINKLERS IN THE TURBINE GENERATOR
                       ROOM.

"KEY EXPOSURE"         Automatic sprinkler protection should be provided in the
                       Turbine Generator Room, at main roof level and below
                       the grated metal mezzanine in Building No. 3.
</Table>
Index: 031791.66-04                                             [FM GLOBAL LOGO]
Account: 01-17989
Order ID: 0000582842-13

                                       3
<PAGE>
\
<TABLE>
<S>                           <C>                     <C>
93-01-001                     THE HAZARD              A sprinkler system is the best defense  against fire,
(continued)                                           Sprinklers are tried and tested  and have proven to be
                                                      the most practical and reliable means of controlling a
                                                      fire. Sprinkler  protection minimizes not only the fire
                                                      damage, but also water and smoke damage, and allows
                                                      for quick resumption of normal operations. Extending the
                                                      automatic  sprinkler system  into this area will ensure
                                                      a adequate protection  is provided.

                              TECHNICAL DETAIL        Automatic sprinklers should be  165 deg.F below the
                                                      mezzanine and 286 deg.F above. This installation
                                                      should be capable of providing 0.20. gpm/sq.ft over the
                                                      entire room area (approximately 2,400 sq.ft)on both
                                                      levels concurrently , allowing 250 gpm for hose streams.
                                                      A standard wet pipe system  should be used, and
                                                      sprinklers below the mezzanine  should be equipped with
                                                      water shields.

                              STATUS                  Mr. John  Rofulowitz  stated that there are plans to
                                                      remove the existing generator and  replace it with a new
                                                      generator. Sprinklers will most likely  be installed
                                                      as a part of this project. Expected completion date is
                                                      unknown.

                              03-12-001               ALL SPRINKLERS CONTROL VALUES IN BUILDING NO. 4 SHOULD
                                                      BE LOCKED IN THE FULLY OPEN POSITION.

                                                      All fire service control values  larger than 1-1/2 in or
                                                      controlling more than five sprinklers should be secured
                                                      in the fully-open position with locks and chains. Locks
                                                      and chains should be sturdy and resistant to
                                                      breakage except by heavy bolt cutters. Keys should be
                                                      distributed to  personnel directly responsible for the
                                                      protection.

                              THE HAZARD              FM Global  loss experience  shows that fires occurring
                                                      where the sprinkler protection is disabled can cause
                                                      severe fire damage  and even collapse of an entire
                                                      building. Where sprinklers are fully operational, fire damage is
                                                      usually limited  to a few hundred square  feet.
                                                      Securing each valve open with a lock and chain helps
                                                      ensure the sprinkler valves will be open and protection
                                                      systems will operate at their full capacity during a
                                                      fire emergency.

                              STATUS                  According to Mr. John Rofulowitz, the recommendation
                                                      will be completed by May 2004.
</TABLE>

Index: 031791066-04                                             [FM GLOBAL LOGO]
Account: 01-17989
Order ID: 0000582842-13

                                       4
<PAGE>

02-08-003             IMPROVE THE EXISTING VALUE SUPERVISION PROGRAM INSPECTION
                      FREQUENCIES.

                      Improve the existing value supervision program to
                      virually inspect all sprinkler control valves on a
                      weekly basis (currently monthly) and physically try all
                      non-indicating sprinkler control valves on monthly basis
                      (currently semi-annually).

THE HAZARD            An automatic sprinkler protection system is the best
                      defense against, fire, Small fires, which are capable of
                      being controlled, grow into large uncontrollable fires as
                      a result of improperly impaired fire protection Systems.
                      FM Global has experienced many losses at fully protected
                      facilities where the fire protection systems were
                      improperly impaired. In many of these losses, the impaired
                      systems were maintained out-of-service longer than
                      necessary. Frequent documented inspection and supervision
                      of sprinkler control valves will help ensure the sprinkler
                      system is operational in the event of fire. All of the
                      valves are electrically supervised, but electronic
                      supervision is not considered reliable enough to
                      substitute for weekly recorded inspections.

STATUS                According to Mr. John Rofulowitz, the recommendation will
                      be studied for possible completion.

02-08-004             IMPROVE THE EXISTING ALARM SUPERVISION PROGRAM
                      FREQUENCIES.

                      All sprinkler system waterflow, alarms should be tested
                      atleast monthly (currently quarterly) by flowing water
                      through the Inspector's Test Connections.

THE HAZARD            Frequent testing of the sprinkler waterflow alarms is
                      needed to ensure that the alarm equipment remains in good
                      working condition and the sprinkler piping is free of
                      obstructions. The results of the tests should be
                      recorded,reviewed by management and retained on file for
                      prompt correction of noted deficiencies.

STATUS                According to Mr. John Rofulowitz, the recommendation will
                      be studied for possible completion.

02-08-005             SUBMIT PLANS TO FM GLOBAL FOR REVIEW.

                      Plans and specifications for any new construction, roofing
                      or roof repairs, changes in fire protection, installation
                      of gas-fired equipment, or occupancy changes should be
                      forwarded to FM Global for review and comment prior to the
                      start of the work.

Index: 031791-66-04                                             [FM GLOBAL LOGO]
Account: 01-17989
Order ID: 0000582842-13

                                       5

<PAGE>

<TABLE>
<S>                     <C>                   <C>
02-08-005               THE HAZARD            Local code requirements may or may not cover needed
(continued)                                   property conservation issues as they pertain to
                                              construction, automatic protection etc. This may cause
                                              buildings or occupancies at the facility to be subject to
                                              severe damage during an emerfency leading to extensive
                                              downtime to everyday operations.

                        STATUS                The final conference did not focus on this
                                              recommendations.
</TABLE>

risk reduction        Recommendations that have been completed or otherwise
                      removed are summarized in this section. HUMAN ELEMENT
                      RECOMMENDATIONS that have been completed often do not have
                      an associated loss estimate since they usually serve to
                      lower. The frequency and/or severity of a loss. For this
                      reason. We quantify them by counting the number of such
                      items that have been completed .

                      The "counts" of recommendations referenced in this section
                      include each part of multi-part recommendations except in
                      cases where each part represents optional ways to address
                      a single hazard. IN such cases, the recommendation is only
                      counted once.

physical              No physical recommendations have been completed or removed
                      since our last evaluation.

recommendations

                        PHYSICAL RISK REDUCTION HISTORY
                           (COUNT OF RECOMMENDATIONS)

                                   [BAR GRAPH]

Index: 03179166-04                                              [FM GLOBAL LOGO]
Account: 01-17989
Order ID: 0000582842-13

                                        6
<PAGE>

Human Element Recommendations

The following HUMAN ELEMENT recommendations have been completed or removed as a
result of this evaluation:

<TABLE>
<CAPTION>
   REC                                                            REMOVAL
  NUMBER              RECOMMENDATION SYNOPSIS                     METHOD
---------   --------------------------------------------------   ---------
<S>         <C>                                                  <C>
02-08-002   Lock all fire protection valves in Building No. 6.   Completed
                                                                 05 Dec 03

95-03-001   Remove misc. storage and improve housekeeping in     Completed
            Building No. 4computer rooms.                        05 Dec 03
</TABLE>

                          HUMAN ELEMENT RISK REDUCTION
                            (COUNT OF RECOMMENDATIONS)

                                  [PIE CHART]

                      HUMAN ELEMENT RISK REDUCTION HISTORY
                            (COUNT OF RECOMMENDATIONS)

                                  [BAR GRAPH]

Index: 03179166-04                                              [FM GLOBAL LOGO]
Account: 01-17989
Order ID: 0000582842-13

                                       7
<PAGE>

                                                                       EXHIBIT G

                         DESCRIPTION OF RELEASE PARCELS

                                    ADDENDA-3
<PAGE>

                               [RELEASE PANEL A]

                                     [PLAN]

<PAGE>

                               [RELEASE PANEL B]

                                     [PLAN]

<PAGE>

                              [GROUND LEASE PANEL]

                                     [PLAN]

<PAGE>

                                                                       EXHIBIT H

                                FORM OF GUARANTY

<PAGE>

                                                                  EXECUTION COPY

                  SUBORDINATE GUARANTY AND SURETYSHIP AGREEMENT

      THIS SUBORDINATE GUARANTY AND SURETYSHIP AGREEMENT (this "Guaranty"),
dated as of the day of_____, 2005, made by each of the entities executing this
Guaranty as a guarantor on the signature pages hereof (each, a "Guarantor" and
collectively the "Guarantors"), to TELC (NJ) QRS 16-30, INC., a Delaware
corporation ("Landlord").

                                   WITNESSETH:

      WHEREAS, Landlord, as lessor, has entered into a Lease Agreement of even
date herewith (the "Lease"), in which Landlord leased to TELCORDIA TECHNOLOGIES,
INC., a Delaware corporation ("Tenant"), certain premises situate in Piscataway
(the "Leased Premises");

      WHEREAS, each Guarantor is a wholly owned subsidiary of Tenant; and

      WHEREAS, the execution and delivery by each Guarantor of this Guaranty is
a material inducement to Landlord to execute the Lease, and each Guarantor
expects to derive financial benefit from the Lease.

      NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt of which is hereby acknowledged by each
Guarantor, and intending to be legally bound, each Guarantor hereby covenants
and agrees as follows:

                                    ARTICLE I
                                    GUARANTEE

      Section 1.01 Guaranteed Obligations. Each Guarantor hereby jointly and
severally absolutely unconditionally and irrevocably guarantees to and becomes
surety for Landlord and its successors and assigns for the due, punctual and
full payment, performance and observance of, and covenants with Landlord to
duly, punctually and fully pay and perform, the following (collectively, the
"Guaranteed Obligations"):

            (a) the full and timely payment of all Rent and all other amounts
due or to become due to Landlord from Tenant under the Lease or any other
agreement or instrument executed in connection therewith, including without
limitation the Seller/Lessee's Certificate of even date therewith in favor of
Landlord, whether now existing or hereafter arising, contracted or incurred
(collectively, the "Monetary Obligations"); and

            (b) all covenants, agreements, terms, obligations and conditions,
undertakings and duties contained in the Lease to be observed, performed by or
imposed upon Tenant under the Lease, whether now existing or hereafter arising,
contracted or incurred but excluding any of the foregoing constituting Monetary
Obligations (collectively, the "Performance Obligations"),

as and when such payment, performance or observance shall become due (whether by
acceleration or otherwise) in accordance with the terms of the Lease, which
terms are incorporated herein by reference. The Guaranteed Obligations shall not
be affected by the Tenant's voluntary or involuntary bankruptcy, assignment for
the benefit of creditors, reorganization or similar proceeding affecting the
Tenant. If for any reason any Monetary

                                      -1-
<PAGE>

Obligation shall not be paid promptly when due, each Guarantor shall,
immediately upon demand, pay the same to Landlord when due under the terms of
the Lease. If for any reason Tenant shall fail to perform or observe any
Performance Obligation, each Guarantor shall, immediately upon demand, but
subject to Section 1.05, perform and observe the same or cause the same to be
performed or observed. If, by reason of any bankruptcy, insolvency or similar
laws affecting the rights of creditors, Landlord shall be prohibited from
exercising any of Landlord's rights and remedies, including, but not limited to,
enforcement of the terms of the Lease against the Tenant, then as to each
Guarantor such prohibition shall be of no force and effect, and Landlord shall
have the right to make demand upon, and receive payment and/or performance from
each Guarantor of all Guaranteed obligations and such Guarantor's obligation in
this respect shall be primary and not secondary, but in each case subject to
Section 1.05. Each Guarantor acknowledges and agrees that the Monetary
Obligations include, without limitation, Rent and other sums accruing and/or
becoming due under the Lease following the commencement by or against Tenant of
any action under the United States Bankruptcy Code or other similar statute. The
Guarantors shall pay or cause to be paid any Monetary Obligations if and when
due under the terms of this Guaranty to Landlord at the address and in the
manner set forth in the Lease or at such other address as Landlord shall notify
Guarantors in writing.

      Section 1.02 Guarantee Unconditional. Subject to the provisions of Section
1.05 of this Guaranty, the obligations of each Guarantor hereunder are
continuing, absolute and unconditional, irrespective of any circumstance
whatsoever which might otherwise constitute a legal or equitable discharge or
defense of a guarantor or surety. Without limiting the generality of the
foregoing, the obligations of each Guarantor hereunder shall remain in full
force and effect without regard to, and shall not be released, discharged,
abated, impaired or in any way affected by any of the following, all of which
may be given or done without notice to, or consent of, any Guarantor:

            (a) any amendment, modification, extension, renewal or supplement to
the Lease or any termination of the Lease or any interest therein;

            (b) any assumption by any party of Tenant's or any other party's
obligations under, or Tenant's or any other party's assignment of any of its
interest in, the Lease;

            (c) any exercise or nonexercise of or delay in exercising any right,
remedy, power or privilege under or in respect of this Guaranty or the Lease or
pursuant to applicable law (even if any such right, remedy, power or privilege
shall be lost thereby), including, without limitation, any so-called self-help
remedies, or any waiver, consent, compromise, settlement, indulgence or other
action or inaction in respect thereof;

            (d) any change in the financial condition of Tenant, the voluntary
or involuntary liquidation, dissolution, sale of all or substantially all of the
assets, marshalling of assets and liabilities, receivership, conservatorship,
insolvency, bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition or readjustment of, or other similar proceeding
affecting Landlord, Tenant or any Guarantor or any of their assets or any
impairment, modification, release or limitation of liability of Landlord, Tenant
or any Guarantor or their respective estates in bankruptcy or of any remedy for
the enforcement of such liability resulting from the operation of any present or
future provision of the United States Bankruptcy Code or other similar statute
or from the decision of any court;

            (e) any extension of time for payment or performance of the
Guaranteed Obligations or any part thereof;

            (f) the genuineness, invalidity or unenforceability of all or any
portion or provision of the Lease;

                                      -2-
<PAGE>

            (g) any defense that may arise by reason of the failure of Landlord
to file or enforce a claim against the estate of Tenant in any bankruptcy or
other proceeding;

            (h) the release or discharge of or accord and satisfaction with of
Tenant or any other person or entity from performance or observance of any of
the agreements, covenants, terms or conditions contained in the Lease by
operation of law or otherwise;

            (i) the failure of Landlord to keep any Guarantor advised of
Tenant's financial condition, regardless of the existence of any duty to do so;

            (j) any assignment by Landlord of all of Landlord's right, title and
interest in, to and under the Lease and/or this Guaranty as collateral security
for any Loan;

            (k) any present or future law or order of any government (de jure or
de facto) or of any agency thereof purporting to reduce, amend or otherwise
affect the Guaranteed Obligations or any or all of the obligations, covenants or
agreements of Tenant under the Lease (except by payment in full of all
Guaranteed Obligations) or any Guarantor under this Guaranty (except by payment
in full of all Guaranteed Obligations);

            (l) the default or failure of any Guarantor fully to perform any of
its obligations set forth in this Guaranty;

            (m) any actual, purported or attempted sale, assignment or other
transfer by Landlord of the Lease or the Leased Premises or any part thereof or
of any of its rights, interests or obligations thereunder;

            (n) any merger or consolidation of Tenant into or with any other
entity, or any sale, lease, transfer or other disposition of any or all of
Tenant's assets or any sale, transfer or other disposition of any or all of the
shares of capital stock or other securities of Tenant or any affiliate of Tenant
to any other person or entity;

            (o) Tenant's failure to obtain, protect, preserve or enforce any
rights in or to the Lease or the Leased Premises or any interest therein against
any party or the invalidity or unenforeeability of any such rights; or

            (p) any other event, action, omission or circumstances which might
in any manner or to any extent impose any risk to any Guarantor or which might
otherwise constitute a legal or equitable release or discharge of a guarantor or
surety.

No setoff, claim, reduction or diminution of any obligation, or any defense of
any kind or nature which Tenant or any Guarantor now has or hereafter may have
against Landlord shall be available hereunder to any Guarantor against Landlord.

      Section 1.03 No Notice or Duty to Exhaust Remedies. (a) Each Guarantor
hereby waives notice of any default in the payment or non-performance of any of
the Guaranteed Obligations (except as expressly required hereunder), diligence,
presentment, demand, protest and all notices of any kind. Each Guarantor agrees
that liability under this Guaranty shall be primary and hereby waives any
requirement that Landlord exhaust any right or remedy, or proceed first or at
any time, against Tenant or any other guarantor of, or any security for, any of
the Guaranteed Obligations. Each Guarantor hereby waives notice of any
acceptance of this Guaranty and all matters and rights which may be raised in
avoidance of, or in defense against, any action to enforce the obligations of
any Guarantor hereunder. Each Guarantor hereby waives any and all suretyship
defenses or defenses in the nature thereof without in any manner limiting

                                      -3-
<PAGE>

any other provision of this Guaranty. This Guaranty constitutes an agreement of
suretyship as well as of guaranty, and Landlord may pursue its rights and
remedies under this Guaranty and under the Lease in whatever order, or
collectively, and shall be entitled to payment and performance hereunder
notwithstanding any action taken by Landlord or inaction by Landlord to enforce
any of its rights or remedies against any other guarantor, person, entity or
property whatsoever. This Guaranty is a guaranty of payment and performance and
not merely of collection.

            (b) Landlord may pursue its rights and remedies under this Guaranty
notwithstanding any other guarantor of or security for the Guaranteed
Obligations or any part thereof. Each Guarantor authorizes Landlord, at its sole
option, without notice or demand and without affecting the liability of any
Guarantor under this Guaranty, to terminate the Lease, either in whole or in
part, in accordance with its terms.

            (c) Each default on any of the Guaranteed Obligations shall give
rise to a separate cause of action and separate suits may be brought hereunder
as each cause of action arises or, at the option of Landlord any and all causes
of action which arise prior to or after any suit is commenced hereunder may be
included in such suit.

      Section 1.04 Subrogation. Notwithstanding any payments made or obligations
performed by any Guarantor by reason of this Guaranty (including but not limited
to application of funds on account of such payments or obligations), each
Guarantor hereby defers until one (1) year and one (1) day following the date on
which all Monetary Obligations have been paid in full in cash and the Senior
Indebtedness shall have been paid in full in cash, any and all rights it may
have, at any time, whether arising directly or indirectly, by operation of law,
contract or otherwise, to assert any claim against Tenant or any other Guarantor
or any other person or entity or against any direct or indirect security on
account of payments made or obligations performed under or pursuant to this
Guaranty, including without limitation any and all rights of subrogation,
reimbursement, exoneration, contribution or indemnity, and any and all rights
that would result in any Guarantor being deemed a "creditor" under the United
States Bankruptcy Code of Tenant or any other Guarantor or any other person or
entity. If any payment shall be paid to any Guarantor on account of any
subrogation rights prior to such payment in full in cash of all Monetary
Obligations and the Senior Indebtedness shall have been paid in full in cash,
each and every amount so paid shall immediately be paid to Landlord to be
credited and applied upon any of the Guaranteed Obligations, whether or not then
due and payable. Every claim or demand which any Guarantor may have against
Tenant or any other Guarantor arising from or in connection with any payment or
performance of any Guaranteed Obligations shall be fully subordinated to all
Guaranteed Obligations to the same extent that the claims of the Guarantors
against Tenant and/or any other Guarantor are subordinated to the Senior
Indebtedness (as defined below).

      Section 1.05 Subordination to Senior Indebtedness.

      (a) Notwithstanding any provision contained in this Guaranty to the
contrary, all indebtedness, liabilities and obligations evidenced hereby or
arising under this Guaranty in respect of the Guaranteed Obligations
(hereinbelow referred to as the "Junior Indebtedness") shall be subordinated and
subject in right of prior payment in full in cash of the Senior Indebtedness to
the extent and in the manner set forth below in this Section 1.05. For the
purpose hereof, the term "Senior Indebtedness" shall mean all monetary
obligations of whatever nature (including principal, interest, premium, fees,
commissions, expense reimbursement, indemnities and reimbursement obligations in
respect of drawn and undrawn letters of credit) of the Guarantors as guarantor,
issuer, borrower or otherwise (i) under that certain Credit Agreement, to be
dated on or about March __, 2005, among the Tenant, the Lenders parties thereto,
Deutsche Bank Trust Company Americas and Lehman Commercial Paper Inc., as Co-

                                      -4-
<PAGE>
 Documentation Agents, Bear Stearns Corporate Lending Inc., as Syndication
Agent, and JPMorgan Chase Bank, N.A., as Administrative Agent (unless otherwise
defined herein, terms defined in the Credit Agreement and used herein shall have
the meanings given to them in the Credit Agreement as defined below) including
any related notes, letters of credit, guarantees, collateral documents, cash
management agreements and arrangements, interest rate and currency hedging
agreements and arrangements of any kind, instruments and agreements executed in
connection therein, and, in each case, as amended, restated, supplemented,
modified, renewed, increased, extended, replaced, refinanced or refunded from
time to time in one or more agreements or indentures (in each case with the same
or new lenders or investors), including any agreement extending the maturity
thereof or otherwise restructuring all or any portion of the indebtedness
thereunder or increasing the amount loaned or issued thereunder or altering the
maturity thereof (the foregoing, collectively, as amended, restated,
supplemented, modified, renewed, increased, extended, replaced, refinanced or
refunded from time to time, in one or more agreements, the "Credit Agreement");
(ii) under the senior subordinated notes described in the Offering Memorandum
dated as of February_____, 2005, and any other capital market bonds, notes or
debentures, letters of credit and related guarantees, cash management
obligations and interest rate and currency hedging agreements and arrangements
of any kind issued from time to time (the foregoing, collectively, as amended,
restated, supplemented, modified, renewed, increased, extended, replaced,
refinanced or refunded from time to time in one or more agreements or
indentures, each a "Capital Market Security"); and (iii) any other indebtedness
("Other Senior Indebtedness") for borrowed money, notes, letters of credit,
bonds and debentures payable to a bank, insurer or other institutional type
lender and properly classified by Tenant as Senior Indebtedness at the time
incurred; provided that, Other Senior Indebtedness shall not, in any event,
include: (1) any trade payables (or unsecured obligations in connection
therewith), (2) tax obligations of Tenant or any Guarantor, (3) any preferred
shares of any Guarantor or of Tenant, (4) any indebtedness resulting from a
conversion of equity interests in Tenant or any Guarantor to debt from and after
the date of this Guaranty, or (5) any other indebtedness for borrowed money
from, through, or on behalf of, (x) any officer, director or principal of any
Guarantor or of Tenant (or any family member of any such officer or director or
trust for the benefit of such person and/or their family), (y) Tenant, or any
other affiliate or subsidiary of Tenant that is not a Guarantor, or (z) any
person, if such indebtedness is convertible to equity at the option of any
Guarantor or Tenant (as opposed to the option of the holder of such
indebtedness). Senior Indebtedness shall include any interest payable in respect
of any of the foregoing obligations described in clauses (i) through (iii) above
subsequent to the commencement of any proceeding against or with respect to the
Guarantors under any chapter of the Bankruptcy Code, 11 U.S.C. section 101 et
seq. (the "Bankruptcy Code"), whether or not such interest would be an allowed
claim in such proceeding.

      (b) Unless and until the Senior Indebtedness shall have been paid in full
in cash, (i) no payment or distribution, whether in cash, property or
securities, in respect of the Junior Indebtedness (whether by scheduled payment,
prepayment, redemption, purchase, defeasance or otherwise) shall be made by any
Guarantor with respect to any Junior Indebtedness, and (ii) the holders of the
Junior Indebtedness shall not seek, file, or join in any action, petition or
proceeding for the purpose of commencing an involuntary bankruptcy or insolvency
proceeding against any Guarantor under the Bankruptcy Code or any applicable
state insolvency law. Unless and until the payment obligations under the loans
incurred in connection with Tenant's principal Credit Agreement (as determined
in good faith by Tenant) have been accelerated or the payment obligations in
connection with Tenant's principal Capital Market Securities have been
accelerated, the holders of the Junior Indebtedness shall refrain from declaring
any Junior Indebtedness to be immediately due and payable, or joining with any
other person in any such declaration, or otherwise taking any action against any
Guarantor to enforce or collect to attempt any Junior Indebtedness, including,
without limitation, commencing any legal action (including any proceeding for
the liquidation, dissolution, or other winding up of any

                                      -5-
<PAGE>

Guarantor) against any Guarantor or making any demand for payment of any Junior
Indebtedness; provided that nothing herein shall prevent such holder of the
Junior Indebted ness of notifying each or any Guarantor of the existence of a
subordinate obligation hereunder in accordance with Section 3.01(b) hereof. Any
payment or distribution to (or recovery made by) or for the benefit of the
holders of the Junior Indebtedness shall be paid over to the holders of the
Senior Indebtedness in accordance with Section 1.05(d).

      (c) Upon any payment or distribution of assets of any kind or character,
whether in cash, property or securities, to creditors upon any dissolution or
winding up or total or partial liquidation or reorganization of any Guarantor,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all Senior Indebtedness of the Guarantors shall first be paid
in full in cash before any payment or distribution is made with respect to the
Junior Indebtedness; and upon any such acceleration, declaration of acceleration
or dissolution or winding up or liquidation reorganization or proceeding, any
payment or distribution of assets of any kind or character, whether in cash,
property or securities, to which the holders of Junior Indebtedness would be
entitled except for the provisions hereof, shall be paid by the Guarantors or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, or by the holders of Junior Indebtedness if
received by them, directly to the holders of Senior Indebtedness or their
representatives to the extent necessary to pay all Senior Indebtedness in full
in cash, after giving effect to any concurrent prepayment or distribution to or
for the benefit of the holders of Senior Indebtedness, before any payment or
distribution is made to the holders of Junior Indebtedness. In furtherance of
the foregoing, but not by way of limitation thereof, in the event that any
Guarantor shall file or have filed against it a petition under any chapter of
the Bankruptcy Code or be adjudicated a bankrupt thereunder, with the result
that such Guarantor is excused from the obligation to pay all or any part of the
interest otherwise payable in respect of any Senior Indebtedness during the
period subsequent to the commencement of any such proceedings under the
Bankruptcy Code, each holder of Junior Indebtedness by its acceptance hereof
does hereby agree that all or such part of such interest, as the case may be,
shall be payable out of, and to that extent diminish and be at the expense of,
reorganization dividends or other distributions in respect of such Junior
Indebtedness.

      (d) In the event that any payment or distribution of any kind or
character, whether in cash, property or securities, not permitted by the
foregoing provisions of this Section 1.05 shall be received by any holder of any
Junior Indebtedness from any Guarantor, such payment or distribution shall be
held in trust for the benefit of, and shall be paid over or delivered to, the
holders of the Senior Indebtedness or their representative or representatives,
or to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any Senior Indebtedness may have been issued or under
which such instruments are pledged or issued, as their respective interests may
appear, for application to the payment of all Senior Indebtedness remaining
unpaid to the extent necessary to pay all Senior Indebtedness in full in cash in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness.

      (e) The provisions hereof are solely for the purpose of defining the
relative rights of the holders of Senior Indebtedness on the one hand and the
holders of the Junior Indebtedness on the other hand, and nothing herein shall
impair, as between the Guarantors and Landlord, the obligations of the
Guarantors under this Guaranty which are unconditional and absolute

      (f) The holders of Senior Indebtedness under clauses (i) and (ii) of
Section 1.05(a) above shall be entitled to rely (and shall be deemed
conclusively to have relied) upon the terms and conditions of this Guaranty and
no amendment, modification or supplement of this

                                      -6-
<PAGE>

Guaranty shall be permitted, or effective and/or binding upon such holders,
unless same shall be consented to in writing by such holders in advance.

                                    ARTICLE II

                         REPRESENTATIONS AND WARRANTIES

      Section 2.01 Representations and Warranties. The representations and
warranties made by each Guarantor in that certain Guarantor's Certificate of
even date herewith made by each Guarantor in favor of Landlord are hereby
incorporated by reference herein (with all related definitions). Each Guarantor
hereby represents and warrants to Landlord as provided therein.

      Section 2.03 Notice of Certain Events. Promptly upon becoming aware
thereof, Guarantors (or any one of them) shall give Landlord notice of (i) any
"event of default" (or equivalent event) by Tenant under all or any portion of
the Senior indebtedness, or (ii) any claims by any holders of the Senior
Indebtedness for non-payment against any Guarantor under any guaranty thereof.

                                   ARTICLE III
                               EVENTS OF DEFAULT

      Section 3.01 (a) Events of Default. The occurrence of any one or more of
the following shall constitute an "Event of Default" under this Guaranty:

            (i) a failure by any Guarantor to make any payment of any Monetary
Obligation, regardless of the reason for such failure;

            (ii) a failure by any Guarantor duly to perform and observe, or a
violation or breach of, any other provision hereof not otherwise specifically
mentioned in this Section 3.01 and such failure continues for thirty (30) days
after notice from Landlord thereof; or

            (iii) any material representation or warranty made by any Guarantor
herein or in any certificate, demand or request made pursuant hereto proves to
be untrue or incorrect, in any material respect, on the date made.

                   (b) Notwithstanding the occurrence of any one or more of the
foregoing Events of Default and Landlord's notice to any Guarantor of the
existence of a claim against any Guarantor, Landlord's right and ability to
commence any action against, recover any sums from, or to otherwise exercise or
enforce any remedies, or attempt to collect any damages hereunder for any
Guaranteed Obligations shall be subject to the terms and limitations of Section
1.05 hereof.

                                   ARTICLE IV
                                  MISCELLANEOUS

      Section 4.01 Effect Of Bankruptcy Proceedings. This Guaranty shall
continue to be effective, or be automatically reinstated, as the case may be, if
at any time payment, in whole or in part, of any of the Guaranteed Obligations
is rescinded or must otherwise be restored or returned by Landlord as a
preference, fraudulent conveyance or otherwise under any bankruptcy, insolvency
or similar law, all as though such payment had not been made. Each Guarantor
hereby agrees to indemnify Landlord against, and to save and hold Landlord
harmless from any required return by Landlord, or recovery from Landlord, of any
such payment because of its being deemed preferential under applicable
bankruptcy, receivership or insolvency laws, or for any other reason. If an
Event of Default at any time shall have occurred and be continuing or

                                      -7-
<PAGE>

exist and declaration of default or acceleration under or with respect to the
Lease shall at such time be prevented by reason of the pendency against Tenant
of a case or proceeding under any bankruptcy or insolvency law, each Guarantor
agrees that, for purposes of this Guaranty and its obligations hereunder, the
Lease shall be deemed to have been declared in default or accelerated with the
same effect as if the Lease had been declared in default and accelerated in
accordance with the terms thereof, and each Guarantor shall, subject to Section
1.05, forthwith pay and perform the Guaranteed Obligations in full without
further notice or demand.

      Section 4.02 Further Assurances. From time to time upon the request of
Landlord, each Guarantor shall promptly and duly execute, acknowledge and
deliver any and all such further instruments and documents as Landlord may deem
necessary or desirable to confirm this Guaranty, to carry out the purpose and
intent hereof or to enable Landlord to enforce any of its rights hereunder.

      Section 4.03 Amendments, Waivers, Etc. This Guaranty cannot be amended,
modified, waived, changed, discharged or terminated except by an instrument in
writing signed by the party against whom enforcement of such amendment,
modification, waiver, change, discharge or termination is sought.

      Section 4.04 No Implied Waiver: Cumulative Remedies. No course of dealing
and no delay or failure of Landlord in exercising any right, power or privilege
under this Guaranty or the Lease shall affect any other or future exercise
thereof or exercise of any other right, power or privilege; nor shall any single
or partial exercise of any such right, power or privilege or any abandonment or
discontinuance of steps to enforce such a right, power or privilege preclude any
further exercise thereof or of any other right, power or privilege. The rights
and remedies of Landlord under this Guaranty are cumulative and not exclusive of
any rights or remedies which Landlord would otherwise have under the Lease, at
law or in equity.

      Section 4.05 Notices. All notices, requests, demands, directions and other
communications (collectively "notices") under the provisions of this Guaranty
shall be in writing (including telexed communication) unless otherwise expressly
permitted hereunder and shall be sent by first-class or first-class express
mail, or by telex with confirmation in writing mailed first-class, in all cases
with charges prepaid, and any such properly given notice shall be effective when
received. All notices shall be sent to the applicable party addressed, if to
Landlord, at the address set forth in the Lease with a copy to Reed Smith LLP,
599 Lexington Avenue, 29th Floor, New York, New York 10022, attention: Real
Estate Dept. Chairman, and, if to any Guarantor c/o Tenant at the Leased
Premises, Attention: Chief Financial Officer, with a copy to Wilke, Farr &
Gallagher LLP, 787 Seventh Avenue, New York, New York 10019, Attention: Steven
J. Gartner, Esq., or in accordance with the last unrevoked written direction
from such party to the other party.

      Section 4.06 Expenses. Each Guarantor agrees to pay or cause to be paid
and to save Landlord harmless against liability for the payment of all
reasonable out-of-pocket expenses, including fees and expenses of counsel for
Landlord, incurred by Landlord from time to time arising in connection with
Landlord's enforcement or preservation of rights under this Guaranty or the
Lease, including but not limited to such expenses as may be incurred by Landlord
in connection with any default by any Guarantor of any of its obligations
hereunder or by Tenant of any of its obligations under the Lease.

      Section 4.07 Survival. All obligations of each Guarantor to make payments
to or indemnify Landlord shall survive the payment and performance in full of
the Guaranteed Obligations.

                                      -8-
<PAGE>

      Section 4.08 Severability. If any term or provision of this Guaranty or
the application thereof to any person or circumstance shall to any extent be
invalid or unenforceable, the remainder of this Guaranty, or the application of
such term or provision to persons or cirumstances other than those as to which
it is invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Guaranty shall be valid and enforceable to the fullest extent
permitted by law.

      Section 4.09 Counterparts. This Guaranty may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument.

      Section 4.10 Governing Law. This Guaranty was negotiated in New York, and
accepted by Landlord in the State of New York, which State the parties agree has
a substantial relationship to the parties and to the underlying transaction
embodied hereby, and in all respects, including, without limiting the generality
of the foregoing, matters of construction, validity and performance, this
Guaranty and the obligations arising hereunder shall be governed by, and
construed in accordance with, the laws of the State of New York applicable to
contract made and performed in such State and any applicable law of the United
States of America. To the fullest extent permitted by law, each Guarantor hereby
unconditionally and irrevocably waives any claim to assert that the law of any
other jurisdiction governs this Guaranty, and the Guaranty shall be governed by
and construed in accordance with the laws of the State of New York pursuant to.
section 5-1401 of the New York General Obligations Law.

      Section 4.11 Successors and Assigns; Joint and Several. This Guaranty
shall bind each Guarantor and its successors and assigns, and shall inure to the
benefit of Landlord and its successors and assigns. The obligations and
liabilities of each Guarantor under this Guaranty shall be joint and several. As
used in this Guaranty, the singular shall include the plural and vice-versa.

      Section 4.12 Incorporation of Recitals: Definitions. The recitals set
forth on page 1 of this Guaranty are hereby specifically incorporated into the
operative terms of this Guaranty as if fully set forth. Terms not otherwise
specifically defined herein shall have the meanings set forth in the Lease.

      Section 4.13 Rights of Lender. Each Guarantor acknowledges that the rights
of Landlord under this Guaranty may be assigned to Lender and upon such
assignment Lender shall have all of the rights and benefits and obligations of
Landlord hereunder if such Lender succeeds to the interest of Landlord under the
Lease.

      Section 4.14. Release. Notwithstanding any provision hereof to the
contrary, the obligations of each applicable Guarantor under this Guaranty shall
cease to be effective immediately upon notice to Landlord upon the earliest to
occur of the following dates:

            (a) The date of the payment in full satisfaction of all Guaranteed
Obligations (but subject to the provisions of Section 4.01 and 4.l4(c)).

            (b) The date (hat such Guarantor is released and discharged (other
than in any bankruptcy or insolvency proceeding) from its obligations as a
guarantor under all guaranties of the Senior Indebtedness under Tenant's
principal Credit Agreement and Capital Market Security (as determined in good
faith by Tenant) for any reason, except: (i) a release granted as consideration,
in whole or in part, for a partial pay-down of Senior Indebtedness either under
Tenant's principal Credit Agreement or principal Capital Market Security (as
determined in good faith by Tenant), unless such release is in connection with a
bona fide sale of such Guarantor to a third party and the consideration paid for
such sale inures (directly or indirectly)

                                      -9-
<PAGE>

to the financial benefit of Tenant or any other Guarantor hereunder), (ii) a
release in connection with a refinancing or replacement of any Senior
Indebtedness if such new Senior Indebtedness is itself guaranteed by such
Guarantor, and (iii) a release in connection with the addition of a substitute
or replacement guarantor as a guarantor of any Senior Indebtedness, unless such
replacement guarantor is a Guarantor hereunder. Upon notice of any such release
(and, if requested, evidence thereof) provided to Landlord shall confirm such
release but the failure to do so shall not affect such release.

            (c) The date on which the Tenant's obligations under its Credit
Agreement or under its long term unsecured noncredit enhanced debt are rated at
least BBB+ (or equivalent) by Standard & Poor's Ratings Services ("S&P") (or any
successor thereto) or Baal (or equivalent) by Moody's Investor's Services, Inc.
(or any successor thereto) ("Moody's") or the equivalent ratings (or if neither
Moody's nor S&P cease to rate such indebtedness of Tenant (collectively, the
"Credit Rating Threshold"), from any other "nationally recognized statistical
ratings organization" within the meaning of Rule 15c3(c)(2)(vi)(F) of the
Securities Exchange Act of 1934, as amended or replaced, as selected by Tenant
as a replacement rating agency. Notwithstanding the foregoing, if, any time
after a release of any or all of the Guarantors under this subsection (c),
Tenant's long term unsecured noncredit enhanced debt rating shall fall below the
Credit Rating Threshold then the obligations of each Guarantor not previously
released pursuant to subsection 4.14(b) above shall be automatically reinstated
without the need for any notice or action of the part of Landlord or such
Guarantors, provided however, that upon the request of Landlord, each Guarantor
shall execute a ratification and confirmation of the reinstatement and
continuing effectiveness of this Guaranty.

                       [SIGNATURES ON THE FOLLOWING PAGES]

                                      -10-
<PAGE>
      IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this
Subordinate Guaranty and Suretyship Agreement as of the date first above
written.

                               GUARANTORS:

ATTEST:                        DATABASE SERVICE MANAGEMENT, INC., a Delaware
                               corporation

By: _________________________  By: __________________________________________
Name: _______________________  Name: ________________________________________
Title: ______________________  Title: _______________________________________

                               TELCORDIA TECHNOLOGIES INTERNATIONAL, INC.,
                               a Delaware corporation

By: _________________________  By: __________________________________________
Name: _______________________  Name: ________________________________________
Title: ______________________  Title: _______________________________________

                               GRANITE SYSTEMS, INC., a Delaware corporation

By: _________________________  By: __________________________________________
Name: _______________________  Name: ________________________________________
Title: ______________________  Title: _______________________________________

                               GRANITE SYSTEMS HOLDING COMPANY, INC., a Delaware
                               corporation

By:__________________________  By:___________________________________________
Name:________________________  Name:_________________________________________
Title:_______________________  Title:________________________________________

                               MEDITERRANEAN VENTURES, LLC, a Delaware limited
                               liability company

By:__________________________  By:___________________________________________
Name:________________________  Name:_________________________________________
Title:_______________________  Title:________________________________________

                                      -11-
<PAGE>

                               ITALY HOLDINGS, LLC, a Delaware limited liability
                               company

By: __________________________  By: ___________________________________________
Name: ________________________  Name: _________________________________________
Title: _______________________  Title: ________________________________________

                               MESA SOLUTIONS, INC., a Delaware corporation

By: __________________________  By: ___________________________________________
Name: ________________________  Name: _________________________________________
Title: _______________________  Title: ________________________________________

                                      -12-<PAGE>

                                                                   EXHIBIT 10.19

================================================================================

                                 LOAN AGREEMENT

                           Dated as of March 14, 2005

                                     Between

                           TELC (NJ) QRS 16-30, INC.,
                                   as Borrower

                                       and

                      MORGAN STANLEY MORTGAGE CAPITAL INC.,
                                    as Lender

================================================================================

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                   Page
                                                                   ----
<S>                                                                <C>
I.     DEFINITIONS; PRINCIPLES OF CONSTRUCTION .................     1
       Section 1.1     Definitions .............................     1
       Section 1.2     Principles of Construction ..............    15
II.    THE LOAN.................................................    15
       Section 2.1     The Loan ...... .........................    15
       Section 2.2     Interest Rate ...........................    15
       Section 2.3     Loan Payments ...........................    16
       Section 2.4     Prepayments .............................    18
       Section 2.5     Defeasance ..............................    18
III.   REPRESENTATIONS AND WARRANTIES ..........................    25
       Section 3.1     Borrower Representations ................    25
       Section 3.2     Survival of Representations .............    37
IV.    BORROWER COVENANTS ......................................    37
       Section 4.1     Borrower Affirmative Covenants ..........    37
       Section 4.2     Borrower Negative Covenants .............    44
V.     INSURANCE, CASUALTY AND CONDEMNATION ....................    47
       Section 5.1     Insurance ...............................    47
       Section 5.2     Casualty and Condemnation ...............    51
       Section 5.3     Delivery of Net Proceeds ................    53
VI.    RESERVE FUNDS ...........................................    56
       Section 6.1     Required Repair Funds ...................    56
       Section 6.2     Tax Funds ...............................    57
       Section 6.3     Insurance Funds .........................    57
       Section 6.4     Capital Expenditure Funds ...............    58
       Section 6.5     Rollover Funds ..........................    59
       Section 6.6     Intentionally omitted ...................    60
       Section 6.7     Application of Reserve Funds ............    61
       Section 6.8     Security Interest in Reserve Funds.......    61
VII.   PROPERTY MANAGEMENT .....................................    63
       VIII.           TRANSFERS
</TABLE>

                                       -i-
<PAGE>

<TABLE>
<S>                                                                    <C>
IX.    SALE AND SECURITIZATION OF MORTGAGE ........................    65
       Section 9.1     Sale of Mortgage and Securitization.........    65
       Section 9.2     Securitization Indemnification  ............    67
       Section 9.3     Rating Surveillance ........................    69
X.     DEFAULTS....................................................    70
       Section 10.1    Event of Default ...........................    70
       Section 10.2    Remedies ...................................    72
       Section 10.3    Right to Cure Defaults .....................    73
       Section 10.4    Remedies Cumulative ........................    74
XI.    MISCELLANEOUS ..............................................    74
       Section 11.1    Successors and Assigns .....................    74
       Section 11.2    Lender's Discretion ........................    74
       Section 11.3    Governing Law ..............................    74
       Section 11.4    Modification, Waiver in Writing ............    76
       Section 11.5    Delay Not a Waiver .........................    76
       Section 11.6    Notices.....................................    76
       Section 11.7    Trial by Jury...............................    77
       Section 11.8    Headings ...................................    77
       Section 11.9    Severability ...............................    78
       Section 11.10   Preferences ................................    78
       Section 11.11   Waiver of Notice ...........................    78
       Section 11.12   Remedies of Borrower .......................    78
       Section 11.13   Expenses; Indemnity ........................    78
       Section 11.14   Schedules Incorporated .....................    79
       Section 11.15   Offsets, Counterclaims and Defenses ........    80
       Section 11.16   No Joint Venture or Partnership;
                         No Third Party Beneficiaries .............    80
       Section 11.17   Publicity ..................................    80
       Section 11.18   Waiver of Marshalling of Assets ............    80
       Section 11.19   Waiver of Offsets/Defenses/Counterclaims....    81
       Section 11.20   Conflict; Construction of Documents;
                         Reliance..................................    81
       Section 11.21   Brokers and Financial Advisors .............    81
       Section 11.22   Exculpation ................................    81
       Section 11.23   Prior Agreements ...........................    84
</TABLE>

                                      -ii-
<PAGE>

<TABLE>
<S>                                                                 <C>
       Section 11.24   Servicer ................................    84
       Section 11.25   Joint and Several Liability .............    85
       Section 11.26   Creation of Security Interest ...........    85
       Section 11.27   Assignments and Participations ..........    85
       Section 11.28   Set-Off. ................................    85
       Section 11.29   Partial Release - Expansion .............    86
       Section 11.30   Component Notes .........................    91
</TABLE>

                                     SCHEDULES

Schedule I   -   Rent Roll
Schedule II  -   Required Repairs
Schedule III -   Organizational Chart
Schedule IV  -   Form of Subordination, Non-Disturbance and Attornment Agreement
Schedule V   -   Ground Lease Parcel
Schedule VI-A-   Monthly Operating Statement
Schedule VI-B-   Quarterly Operating Statement
Schedule VI-B-   Annual Operating Statement
Schedule VII -   Balance Sheet
Schedule VIII-   Expansion Parcel

                                            -iii-
<PAGE>

                                 LOAN AGREEMENT

      THIS LOAN AGREEMENT, dated as of March 14, 2005 (as amended, restated,
replaced, supplemented or otherwise modified from time to time, this
"Agreement"), between MORGAN STANLEY MORTGAGE CAPITAL INC., a New York
corporation, having an address at c/o ARCap Servicing, Inc., 5605 N. MacArthur
Boulevard, Suite 950, LB 26, Irving, Texas 75038 ("Lender") and TELC (NJ) QRS
16-30, INC., a Delaware corporation, having an address at c/o W.P. Carey & Co.
LLC, 50 Rockefeller Plaza, 2nd Floor, New York, New York 10020 ("Borrower").

      All capitalized terms used herein shall have the respective meanings set
forth in Article I hereof.

                                   WITNESSETH:

      WHEREAS, Borrower desires to obtain the Loan from Lender; and

      WHEREAS, Lender is willing to make the Loan to Borrower, subject to and in
accordance with the conditions and terms of this Agreement and the other Loan
Documents.

      NOW, THEREFORE, in consideration of the covenants set forth in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree,
represent and warrant as follows:

      I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION

      SECTION 1.1 DEFINITIONS.

      For all purposes of this Agreement, except as otherwise expressly
provided:

      "ACCRUED INTEREST" shall have the meaning set forth in Section 2.3.2.

      "ACQUIRED PROPERTY STATEMENTS" shall have the meaning set forth in Section
9.1(c).

      "AFFILIATE" shall mean, as to any Person, any other Person that, directly
or indirectly, owns more than forty percent (40%) of, is in control of, is
controlled by or is under common ownership or control with such Person or is a
director or officer of such Person or of an Affiliate of such Person. As used in
this definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management,
policies or activities of a Person, whether through ownership of voting
securities, by contract or otherwise.

      "AGENT" shall mean Wells Fargo Bank, N.A. and any successor Eligible
Institution thereto.

      "ALTA" shall mean American Land Title Association, or any successor
thereto.

                                      -1-
<PAGE>

      "ALTERATION THRESHOLD" shall mean $3,000,000 with respect to any single
alteration and $5,700,000 with respect to a series of related alterations.

      "ANNUAL BUDGET" shall have the meaning set forth in Section 4.1.6(a)(V).

      "APPLICABLE INTEREST RATE" shall mean the Initial Interest Rate or the
Default Rate, as applicable.

      "ASSIGNMENT OF LEASES" shall mean that certain first priority Assignment
of Leases and Rents, dated as of the date hereof, from Borrower, as assignor, to
Lender, as assignee, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.

      "AWARD" shall mean any compensation paid by any Governmental Authority in
connection with a Condemnation in respect of all or any part of the Property.

      "BANKRUPTCY CODE" shall mean Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time, and any successor statute or
statutes and all rules and regulations from time to time promulgated thereunder,
and any comparable foreign laws relating to bankruptcy, insolvency or creditors'
rights.

      "BASIC CARRYING COSTS" shall mean the sum of the following costs
associated with the Property for the relevant Fiscal Year or payment period: (i)
Taxes and (ii) Insurance Premiums.

      "BORROWER" shall mean TELC (NJ) QRS 16-30, INC., a Delaware corporation,
together with its permitted successors and permitted assigns.

      "BUSINESS DAY" shall mean any day other than a Saturday, a Sunday or a
legal holiday on which national banks are not open for general business in (i)
the State of New York, (ii) the state where the corporate trust office of the
Trustee is located, or (iii) the state where the servicing offices of the
Servicer are located.

      "CAPITAL EXPENDITURES" for any period shall mean amounts expended for
replacements and alterations to the Property and required to be capitalized
according to GAAP.

      "CAPITAL EXPENDITURE FUNDS" shall have the meaning set forth in Section
6.4.1.

      "CAPITAL EXPENDITURES WORK" shall mean any labor performed or materials
installed in connection with any Capital Expenditure.

      "CASH MANAGEMENT AGREEMENT" shall mean that certain Cash Management
Agreement of even date herewith among Lender, Borrower and Agent.

      "CASUALTY" shall mean the occurrence of any casualty, damage or injury, by
fire or otherwise, to the Property or any part thereof.

      "CASUALTY CONSULTANT" shall have the meaning set forth in Section
5.3.2(c).

                                      -2-
<PAGE>

      "CLOSING DATE" shall mean the date of funding the Loan.

      "CODE" shall mean the Internal Revenue Code of 1986, as amended, and as it
may be further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.

      "CONDEMNATION" shall mean a temporary or permanent taking by any
Governmental Authority as the result or in lieu or in anticipation of the
exercise of the right of condemnation or eminent domain, of all or any part of
the Property, or any interest therein or right accruing thereto, including any
right of access thereto or any change of grade affecting the Property or any
part thereof.

      "DEBT" shall mean the outstanding principal amount of the Loan together
with all interest accrued and unpaid thereon and all other sums (including the
Yield Maintenance Premium) due to Lender in respect of the Loan under the Note,
this Agreement, the Mortgage, the Environmental Indemnity or any other Loan
Document.

      "DEBT SERVICE" shall mean, with respect to any particular period of time,
scheduled principal and interest payments under the Note.

      "DEBT SERVICE COVERAGE RATIO" shall mean the ratio of (i) Underwritable
Cash Flow for the twelve (12) calendar month period immediately preceding the
date of calculation to (ii) the projected Debt Service that would be due for the
twelve (12) calendar month period immediately following such calculation.

      "DEFAULT"shall mean the occurrence of any event hereunder or under any
other Loan Document which, but for the giving of notice or passage of time, or
both, would be an Event of Default.

      "DEFAULT RATE" shall mean, with respect to the Loan, a rate per annum
equal to the lesser of (i) the maximum rate permitted by applicable law, or (ii)
five percent (5%) above the Initial Interest Rate.

      "DEFEASANCE COLLATERAL" shall mean U.S. Obligations, which provide
payments (i) on or prior to, but as close as possible to, the Business Day
immediately preceding all Monthly Payment Dates and other scheduled payment
dates, if any, under the Note after the Defeasance Date and up to and including
the Maturity Date, and (ii) in amounts equal to or greater than the Scheduled
Defeasance Payments relating to such Monthly Payment Dates and other scheduled
payment dates.

      "DEFEASANCE COLLATERAL ACCOUNT" shall have the meaning set forth in
Section 2.5.3.

      "DEFEASANCE DATE" shall have the meaning set forth in Section 2.5.1(a)(i).

      "DEFEASANCE EVENT" shall have the meaning set forth in Section 2.5.1(a).

      "DISCLOSURE DOCUMENT" shall have the meaning set forth in Section 9.2(a).

                                      -3-
<PAGE>

      "DISCLOSURE DOCUMENT DATE" shall have the meaning set forth in Section
9.1(c)(iv).

      "ELIGIBLE ACCOUNT" shall mean a separate and identifiable account from all
other funds held by the holding institution that is either (i) an account or
accounts maintained with a federal or state-chartered depository institution or
trust company which complies with the definition of Eligible Institution or (ii)
a segregated trust account or accounts maintained with the corporate trust
department of a federal or state chartered depository institution or trust
company acting in its fiduciary capacity which, in the case of a state chartered
depository institution or trust company is subject to regulations substantially
similar to 12 C.F.R. Section 9.10(b), having in either case a combined capital
and surplus of at least $50,000,000 and subject to supervision or examination by
federal and state authority. An Eligible Account will not be evidenced by a
certificate of deposit, passbook or other instrument.

      "ELIGIBLE INSTITUTION" shall mean a depository institution or trust
company insured by the Federal Deposit Insurance Corporation the short term
unsecured debt obligations or commercial paper of which are rated at least A-l
by S&P, P-l by Moody's and F-1+ by Fitch in the case of accounts in which funds
are held for thirty (30) days or less or, in the case of Letters of Credit or
accounts in which funds are held for more than thirty (30) days, the long term
unsecured debt obligations of which are rated at least "AA" by Fitch and S&P and
"Aa2" by Moody's.

      "ENVIRONMENTAL INDEMNITY" shall mean that certain Environmental Indemnity
Agreement dated as of the date hereof executed by Borrower and Guarantor in
connection with the Loan for the benefit of Lender.

      "EQUIPMENT" shall have the meaning set forth in the granting clause of the
Mortgage.

      "ERISA" shall have the meaning set forth in Section 4.2.11.

      "EVENT OF DEFAULT" shall have the meaning set forth in Section 10.1.

      "EXCHANGE ACT" shall have the meaning set forth in Section 9.2(a).

      "EXCHANGE ACT FILING" shall have the meaning set forth in Section
9.1(c)(vi).

      "EXPANSION DATE" shall have the meaning set forth in Section 11.29(a)(i).

      "EXPANSION PARCELS" shall mean, individually or collectively, the area of
the Property cross-hatched on Schedule VIII hereto and marked as "Release Parcel
A" and the area of the Property cross-hatched on Schedule VIII hereto and marked
as "Release Parcel B" (or such lesser area within such cross-hatched area
necessary to construct the proposed improvements described in Section 11.29
hereof and to provide parking adjacent to such improvements necessary for the
use and operation of such improvements).

      "EXTRAORDINARY EXPENSE" shall have the meaning set forth in Section
4.1.6(e).

                                      -4-
<PAGE>

      "FISCAL YEAR" shall mean each twelve month period commencing on January 1
and ending on December 31 during each year of the term of the Loan.

      "FITCH" shall mean Fitch, Inc.

      "GAAP" shall mean generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the accounting
profession), or in such other statements by such entity as may be in general use
by significant segments of the U.S. accounting profession.

      "GOVERNMENTAL AUTHORITY" shall mean any court, board, agency, commission,
office or authority of any nature whatsoever or any governmental unit (federal,
state, county, district, municipal, city or otherwise) whether now or hereafter
in existence.

      "GROSS REVENUE" shall mean all revenue, derived from the ownership and
operation of the Property from whatever source, including, but not limited to,
Rents, but excluding sales, use and occupancy or other taxes on receipts
required to be accounted for by Borrower to any Governmental Authority,
non-recurring revenues as reasonably determined by Lender, proceeds from the
sale or refinancing of the Property, security deposits (except to the extent
determined by Lender to be properly utilized to offset a loss of Rent), refunds
and uncollectible accounts, proceeds of casualty insurance and Awards (other
than business interruption or other loss of income insurance related to business
interruption or loss of income for the period in question), and any
disbursements to Borrower from the Reserve Funds or any other fund established
by the Loan Documents.

      "GROUND LEASE PARCEL" shall mean an area of the Property cross-hatched on
Schedule VI hereto and marked as "Ground Lease Parcel" (or such lesser area
within such cross-hatched area necessary to construct the proposed improvements
described in Section 11.29 hereof and to provide parking adjacent to such
improvements necessary for the use and operation of such improvements).

      "GUARANTOR" shall mean CORPORATE PROPERTY ASSOCIATES 16-GLOBAL
INCORPORATED, a Maryland corporation.

      "GUARANTY" shall mean that certain Guaranty of even date herewith from
Guarantor for the benefit of Lender.

      "IMPROVEMENTS" shall have the meaning set forth in the granting clause of
the Mortgage.

      "INDEBTEDNESS" shall mean, for any Person, without duplication: (i) all
indebtedness of such Person for borrowed money, for amounts drawn under a letter
of credit, or for the deferred purchase price of property for which such Person
or its assets is liable, (ii) all unfunded amounts under a loan agreement,
letter of credit, or other credit facility for which such Person would be liable
if such amounts were advanced thereunder, (iii) all amounts required to be paid
by such Person as a guaranteed payment to partners or a preferred or special
dividend,

                                       -5-
<PAGE>

including any mandatory redemption of shares or interests, (iv) all indebtedness
guaranteed by such Person, directly or indirectly, (v) all obligations under
leases that constitute capital leases for which such Person is liable, and (vi)
all obligations of such Person under interest rate swaps, caps, floors, collars
and other interest hedge agreements, in each case whether such Person is liable
contingently or otherwise, as obligor, guarantor or otherwise, or in respect of
which obligations such Person otherwise assures a creditor against loss.

      "INDEMNIFIED LIABILITIES" shall have the meaning set forth in Section
11.13(b).

      "INDEPENDENT DIRECTOR" shall have the meaning set forth in Section
3.1.24(p).

      "INITIAL INTEREST RATE" shall mean a rate per annum equal to Five and
Forty-Nine Hundredths Percent (5.49%).

      "INSOLVENCY OPINION" shall mean that certain bankruptcy nonconsolidation
opinion letter dated the date hereof delivered by Reed Smith LLP in connection
with the Loan.

      "INSURANCE FUNDS" shall have the meaning set forth in Section 6.3.1.

      "INSURANCE PREMIUMS" shall have the meaning set forth in Section 5.1.1(b).

      "LEASE" shall mean any lease, sublease or subsublease, letting, license,
concession or other agreement (whether written or oral and whether now or
hereafter in effect) pursuant to which any Person is granted a possessory
interest in, or right to use or occupy all or any portion of any space in the
Property, and every modification, amendment or other agreement relating to such
lease, sublease, subsublease, or other agreement entered into in connection with
such lease, sublease, subsublease, or other agreement and every guarantee of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto.

      "LEGAL REQUIREMENTS" shall mean all federal, state, county, municipal and
other governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and injunctions of Governmental Authorities affecting
Borrower or the Property or any part thereof or the construction, use,
alteration or operation thereof, or any part thereof, whether now or hereafter
enacted and in force, including, without limitation, the Americans with
Disabilities Act of 1990, and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instruments, either of record or known to
Borrower, at any time in force affecting the Property or any part thereof,
including, without limitation, any which may (i) require repairs, modifications
or alterations in or to the Property or any part thereof, or (ii) in any way
limit the use and enjoyment thereof.

      "LENDER" shall mean MORGAN STANLEY MORTGAGE CAPITAL INC., a New York
corporation, together with its successors and assigns.

      "LENDER INDEMNITEES" shall have the meaning set forth in Section 11.13(b).

      "LETTER OF CREDIT" shall mean an irrevocable, unconditional, transferable,
clean sight draft letter of credit acceptable to Lender and the Rating Agencies
(either an evergreen

                                      -6-
<PAGE>
letter of credit or one which does not expire until at least thirty (30)
Business Days after the Maturity Date) in favor of Lender and entitling Lender
to draw, (in full or partially) thereon in New York, New York, issued by a
domestic Eligible Institution or the U.S. agency or branch of a foreign Eligible
Institution. If at any time the bank issuing any such Letter of Credit shall
cease to be an Eligible Institution, Lender shall have the right immediately to
draw down the same in full and hold the proceeds of such draw in accordance with
the applicable provisions hereof.

      "LIABILITIES" shall have the meaning set forth in Section 9.2(b).

      "LIEN" shall mean any mortgage, deed of trust, lien, pledge,
hypothecation, assignment, security interest, or any other encumbrance, charge
or transfer of, on or affecting the Property or any portion thereof or Borrower,
or any interest therein, including, without limitation, any conditional sale or
other title retention agreement, any financing lease having substantially the
same economic effect as any of the foregoing, the filing of any financing
statement, and mechanic's, materialmen's and other similar liens and
encumbrances.

      "LOAN" shall mean the loan in the original principal amount of
SEVENTY-NINE MILLION SIX HUNDRED EIGHTY-SIX THOUSAND AND NO/100 DOLLARS
($79,686,000) made by Lender to Borrower pursuant to this Agreement.

      "LOAN DOCUMENTS" shall mean, collectively, this Agreement, the Note, the
Mortgage, the Assignment of Leases, the Cash Management Agreement, the
Environmental Indemnity, the Guaranty and any other document pertaining to the
Property as well as all other documents now or hereafter executed and/or
delivered in connection with the Loan.

      "MATERIAL AGREEMENTS" means each contract and agreement relating to the
ownership, management, development, use, operation, leasing, maintenance, repair
or improvement of the Property, other than the Leases, under which there is an
obligation of Borrower to pay more than $1,000,000 per annum.

      "MATURITY DATE" shall mean April 1, 2015 or such other date on which the
final payment of principal of the Note becomes due and payable as therein or
herein provided, whether at such stated maturity date, by declaration of
acceleration, or otherwise.

      "MAXIMUM LEGAL RATE" shall mean the maximum nonusurious interest rate, if
any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the indebtedness evidenced by the Note and as
provided for herein or the other Loan Documents, under the laws of such state or
states whose laws are held by any court of competent jurisdiction to govern the
interest rate provisions of the Loan.

      "MINIMUM DISBURSEMENT AMOUNT" shall mean Twenty-Five Thousand and No/100
Dollars ($25,000).

      "MONTHLY DEBT SERVICE PAYMENT AMOUNT" shall mean a constant monthly
payment of Four Hundred Sixty Four Thousand Eight Hundred Forty Eight Dollars
and 57/100 ($464,848.57).

                                       -7-
<PAGE>

      "MONTHLY PAYMENT DATE" shall mean the first (1st) day of every calendar
month occurring during the term of the Loan.

      "MOODY'S" shall mean Moody's Investors Service, Inc.

      "MORGAN STANLEY" shall have the meaning set forth in Section 9.2(b).

      "MORGAN STANLEY GROUP" shall have the meaning set forth in Section 9.2(b).

      "MORTGAGE" shall mean that certain first priority Mortgage, Assignment of
Leases and Rents and Security Agreement, dated the date hereof, executed and
delivered by Borrower as security for the Loan and encumbering the Property, as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time.

      "NET PROCEEDS" shall mean: (i) the net amount of all insurance proceeds
payable as a result of a Casualty to the Property, after deduction of reasonable
costs and expenses (including, but not limited to, reasonable attorneys' fees),
if any, in collecting such insurance proceeds, or (ii) the net amount of the
Award, after deduction of reasonable costs and expenses (including, but not
limited to, reasonable attorneys' fees), if any, in collecting such Award.

      "NET PROCEEDS DEFICIENCY" shall have the meaning set forth in Section
5.3.2(f).

      "NOTE" shall have the meaning set forth in Section 2.1.3.

      "NOTICE" shall have the meaning set forth in Section 11.6.

      "OFFICER'S CERTIFICATE" shall mean a certificate delivered to Lender by
Borrower which is signed by an authorized senior officer of Borrower.

      "OPERATING AGREEMENTS" shall mean any reciprocal easement agreement and
any other covenants, restrictions or agreements of record relating to the
construction, operation or use of the Property.

      "OPERATING EXPENSES" shall mean all costs and expenses relating to the
operation, maintenance and management of the Property, including, without
limitation, utilities, repairs and maintenance, insurance, property taxes and
assessments, advertising expenses, payroll and related taxes, equipment lease
payments, but excluding actual Capital Expenditures, depreciation, amortization
and deposits required to be made to the Reserve Funds; provided, however such
costs and expenses shall be subject to adjustment by Lender to normalize such
costs and expenses.

      "OTHER CHARGES" shall mean all ground rents, maintenance charges,
impositions other than Taxes, and any other charges, including, without
limitation, vault charges and license fees for the use of vaults, chutes and
similar areas adjoining the Property, now or hereafter levied or assessed or
imposed against the Property or any part thereof.

      "OTHERWISE RATED INSURER" shall have the meaning set forth in Section
5.1.2.

                                      -8-
<PAGE>

      "PERMITTED ENCUMBRANCES" shall mean, collectively, (i) the Liens and
security interests created by the Loan Documents, (ii) all Liens, encumbrances
and other matters disclosed in the Title Insurance Policy, (iii) Liens, if any,
for Taxes imposed by any Governmental Authority not yet due or delinquent, and
(iv) such other title and survey exceptions as Lender has approved or may
approve in writing in Lender's sole discretion.

      "PERMITTED INVESTMENTS" shall have the meaning set forth in the Cash
Management Agreement.

      "PERMITTED PREPAYMENT DATE" shall mean any day during the 90 day period
prior to the Maturity Date.

      "PERSON" shall mean any individual, corporation, partnership, limited
liability company, joint venture, estate, trust, unincorporated association, any
other entity, any federal, state, county or municipal government or any bureau,
department or agency thereof and any fiduciary acting in such capacity on behalf
of any of the foregoing.

      "POLICIES" shall have the meaning specified in Section 5.1.1(b).

      "PRELIMINARY EXPANSION DOCUMENTS" shall have the meaning set forth in
Section 11.29(e).

      "PREPAYMENT DATE" shall mean the date on which the Loan is prepaid in
accordance with the terms hereof.

      "PRESCRIBED LAWS" shall mean, collectively (a) the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Public Law 107-56) (The USA PATRIOT Act), (b)
Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001,
and relating to Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism, (c) the International
Emergency Economic Power Act, 50 U.S.C. Section 1701 et seq. and (d) all other
Legal Requirements relating to terrorism.

      "PROPERTY" shall mean the parcel of real property, the Improvements
thereon and all personal property owned by Borrower and encumbered by the
Mortgage, together with all rights pertaining to such property and Improvements,
all as more particularly described in the Granting Clauses of the Mortgage.

      "RATING AGENCIES" shall mean, prior to the final Securitization of the
Loan, each of S&P, Moody's and Fitch, or any other nationally-recognized
statistical rating agency which has been designated by Lender and, after the
final Securitization of the Loan, shall mean any of the foregoing that have
rated any of the Securities.

      "RATING AGENCY CONFIRMATION" shall mean a written affirmation from each of
the Rating Agencies that the credit rating of the Securities by such Rating
Agency immediately prior to the occurrence of the event with respect to which
such Rating Agency Confirmation is sought will not be qualified, downgraded or
withdrawn as a result of the occurrence of such

                                       -9-
<PAGE>

event, which affirmation may be granted or withheld in such Rating Agency's sole
and absolute discretion.

      "RATING SURVEILLANCE CHARGE" shall have the meaning set forth in Section
9.3.

      "REGISTRATION STATEMENT" shall have the meaning set forth in Section
9.2(b).

      "RELEASE DATE" shall mean the earlier to occur of (i) the third
anniversary of the Closing Date and (ii) the date that is two (2) years from the
"startup day" (within the meaning of Section 860G(a)(9) of the Code) of the
REMIC Trust established in connection with the last Securitization involving any
portion of this Loan.

      "REMIC TRUST" shall mean a "real estate mortgage investment conduit"
within the meaning of Section 860D of the Code that holds the Note.

      "RENTS" shall mean all rents, moneys payable as damages or in lieu of
rent, 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 Borrower or its agents or employees from any and
all sources arising from or attributable to the Property.

      "REQUIRED REPAIR FUNDS" shall have the meaning set forth in Section 6.1.1.

      "REQUIRED REPAIRS" shall have the meaning set forth in Section 6.1.1.

      "RESERVE FUNDS" shall mean, collectively, Capital Expenditure Funds, the
Insurance Funds, the Tax Funds, the Required Repair Funds and the Rollover
Funds.

      "RESTORATION" shall have the meaning set forth in Section 5.3(a).

      "RESTORATION THRESHOLD" shall mean $4,000,000.

      "ROLLOVER FUNDS" shall have the meaning set forth in Section 6.5.1.

      "S&P" shall mean Standard & Poor's Ratings Services, a division of the
McGraw-Hill Companies, Inc.

      "SCHEDULED DEFEASANCE PAYMENTS" shall mean scheduled payments of interest
and principal under the Note for all Monthly Payment Dates occurring after the
Defeasance Date and up to and including the Maturity Date (including the
outstanding principal balance on the Note as of the Maturity Date), and all
payments required after the Defeasance Date, if any, under the Loan Documents
for servicing fees, Rating Surveillance Charges and other similar charges.

      "SECONDARY MARKET TRANSACTION" shall have the meaning set forth in Section
9.1(a).

      "SECURITIES" shall have the meaning set forth in Section 9.1 (a).

      "SECURITIES ACT" shall have the meaning set forth in Section 9.2(a).

                                      -10-
<PAGE>

      "SECURITIZATION" shall have the meaning set forth in Section 9.1(a).

      "SECURITY AGREEMENT" shall mean a security agreement in form and substance
that would be satisfactory to a prudent lender pursuant to which Borrower grants
Lender a perfected, first priority security interest in the Defeasance
Collateral Account and the Defeasance Collateral.

      "SERVICER" shall have the meaning set forth in Section 11.24.

      "SERVICING AGREEMENT" shall have the meaning set forth in Section 11.24.

      "SEVERED LOAN DOCUMENTS" shall have the meaning set forth in Section
10.2(c).

      "STANDARD STATEMENT" shall have the meaning set forth in Section 9.1(c).

      "STATE" shall mean the State or Commonwealth in which the Property or any
part thereof is located.

      "SUCCESSOR BORROWER" shall have the meaning set forth in Section 2.5.3.

      "SURVEY" shall mean a survey of the Property prepared by a surveyor
licensed in the State and satisfactory to Lender and the company or companies
issuing the Title Insurance Policy, and containing a certification of such
surveyor satisfactory to Lender.

      "TAX FUNDS" shall have the meaning set forth in Section 6.2.1.

      "TAXES" shall mean all real estate and personal property taxes,
assessments, water rates or sewer rents, now or hereafter levied or assessed or
imposed against the Property or part thereof, together with all interest and
penalties thereon.

      "TENANT" shall mean any Person obligated by contract or otherwise to pay
monies (including a percentage of gross income, revenue or profits) under any
Lease now or hereafter affecting all or any part of the Property.

      "TITLE INSURANCE POLICY" shall mean the ALTA mortgagee title insurance
policy issued in connection with the closing of the loan and insuring the lien
of the Mortgage on the Property.

      "TRUSTEE" shall mean any trustee holding the Loan in a Securitization.

      "UCC" or "UNIFORM COMMERCIAL CODE" shall mean the Uniform Commercial Code
as in effect in the State.

      "UNDERWRITABLE CASH FLOW" shall mean the excess of Gross Revenue over
Operating Expenses. Lender's calculation of Underwritable Cash Flow (including
determination of items that do not qualify as Gross Revenue or Operating
Expenses) shall be calculated by Lender based upon Lender's determination of
Rating Agency criteria and shall be final absent manifest error.

                                      -11-
<PAGE>

      "UNDERWRITER GROUP" shall have the meaning set forth in Section 9.2(b).

      "U.S. OBLIGATIONS" shall mean direct full faith and credit obligations of
the United States of America that are not subject to prepayment, call or early
redemption.

      "YIELD MAINTENANCE PREMIUM" shall mean an amount equal to the greater of:
(i) one percent (1%) of the principal amount of the Loan being prepaid or (ii)
the present value as of the Prepayment Date of the Calculated Payments from the
Prepayment Date through the Maturity Date determined by discounting such
payments at the Discount Rate. As used in this definition, the term "Prepayment
Date" shall mean the date on which prepayment is made. As used in this
definition, the term "Calculated Payments" shall mean the monthly payments of
interest only which would be due based on the principal amount of the Loan being
prepaid on the Prepayment Date and assuming an interest rate per annum equal to
the difference (if such difference is greater than zero) between (y) the Initial
Merest Rate and (z) the Yield Maintenance Treasury Rate. As used in this
definition, the term "Discount Rate" shall mean the rate which, when compounded
monthly, is equivalent to the Yield Maintenance Treasury Rate, when compounded
semi-annually. As used in this definition, the term "Yield Maintenance Treasury
Rate" shall mean the yield calculated by Lender by the linear interpolation of
the yields, as reported in the Federal Reserve Statistical Release H.15-Selected
Interest Rates under the heading U.S. Government Securities/Treasury Constant
Maturities for the week ending prior to the Prepayment Date, of U.S. Treasury
Constant Maturities with maturity dates (one longer or one shorter) most nearly
approximating the Maturity Date. In the event Release H.15 is no longer
published, Lender shall select a comparable publication to determine the Yield
Maintenance Treasury Rate. In no event, however, shall Lender be required to
reinvest any prepayment proceeds in U.S. Treasury obligations or otherwise.

      SECTION 1.2 PRINCIPLES OF CONSTRUCTION.

      All references to sections and schedules are to sections and schedules in
or to this Agreement unless otherwise specified. Unless otherwise specified, the
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. Unless otherwise specified, all meanings
attributed to defined terms herein shall be equally applicable to both the
singular and plural forms of the terms so defined.

      II. THE LOAN

      SECTION 2.1 THE LOAN.

      2.1.1 AGREEMENT TO LEND AND BORROW. Subject to and upon the terms and
conditions set forth herein, Lender shall make the Loan to Borrower and Borrower
shall accept the Loan from Lender on the Closing Date.

      2.1.2 SINGLE DISBURSEMENT TO BORROWER. Borrower shall receive only one
borrowing hereunder in respect of the Loan and any amount borrowed and repaid
hereunder in respect of the Loan may not be reborrowed.

                                      -12-
<PAGE>

      2.1.3 THE NOTE. The Loan shall be evidenced by that certain Promissory
Note of even date herewith, in the stated principal amount of SEVENTY-NINE
MILLION SIX HUNDRED EIGHTY-SIX THOUSAND AND NO/100 DOLLARS ($79,686,000.00)
executed by Borrower and payable to the order of Lender in evidence of the Loan
(as the same may hereafter be amended, supplemented, restated, increased,
extended or consolidated from time to time (the "Note") and shall be repaid in
accordance with the terms of this Agreement and the Note.

      2.1.4 USE OF PROCEEDS. Borrower shall use proceeds of the Loan to (i) pay
and discharge any existing loans relating to the Property, (ii) pay all past-due
Basic Carrying Costs, if any, in respect of the Property, (iii) deposit the
Reserve Funds, (iv) pay costs and expenses incurred in connection with the
closing of the Loan, (v) fund any working capital requirements of the Property,
as approved by Lender and (vi) retain the balance, if any.

      SECTION 2.2 INTEREST RATE.

      2.2.1 APPLICABLE INTEREST RATE. Except as herein provided with respect to
interest accruing at the Default Rate, interest on the principal balance of the
Loan outstanding from time to time shall accrue from the Closing Date up to but
excluding the Maturity Date at the Initial Interest Rate.

      2.2.2 DEFAULT RATE. In the event that, and for so long as, any Event of
Default shall have occurred and be continuing, the outstanding principal balance
of the Loan and, to the extent permitted by law, overdue interest in respect of
the Loan, shall accrue interest at the Default Rate, calculated from the date
such payment was due without regard to any grace or cure periods contained
herein.

      2.2.3 INTENTIONALLY OMITTED.

      2.2.4 INTEREST CALCULATION. Interest on the outstanding principal balance
of the Loan shall be calculated by multiplying (a) the actual number of days
elapsed in the period for which the calculation is being made by (b) a daily
rate based on a three hundred sixty (360) day year (that is, the Applicable
Interest Rate or the Default Rate, as then applicable, expressed as an annual
rate divided by 360) by (c) the outstanding principal balance. The accrual
period for calculating interest due on each Monthly Payment Date shall be the
calendar month immediately prior to such Monthly Payment Date.

      2.2.5 USURY SAVINGS. This Agreement and the other Loan Documents are
subject to the express condition that at no time shall Borrower be required to
pay interest on the principal balance of the Loan at a rate which could subject
Lender to either civil or criminal liability as a result of being in excess of
the Maximum Legal Rate. If by the terms of this Agreement or the other Loan
Documents, Borrower is at any time required or obligated to pay interest on the
principal balance due hereunder at a rate in excess of the Maximum Legal Rate,
the Applicable Interest Rate or the Default Rate, as the case may be, shall be
deemed to be immediately reduced to the Maximum Legal Rate and all previous
payments in excess of the Maximum Legal Rate shall be deemed to have been
payments in reduction of principal without prepayment premium or penalty and not
on account of the interest due hereunder. All sums paid

                                      -13-
<PAGE>

or agreed to be paid to Lender for the use, forbearance, or detention of the
sums due under the Loan, shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated term of
the Loan until payment in full so that the rate or amount of interest on account
of the Loan does not exceed the Maximum Legal Rate from time to time in effect
and applicable to the Loan for so long as the Loan is outstanding.

      SECTION 2.3 LOAN PAYMENTS.

      2.3.1 PAYMENT BEFORE MATURITY DATE. Borrower shall make a payment to
Lender of interest only on the Closing Date for the period from the Closing Date
through the last day of the month in which the Closing Date occurs (unless the
Closing Date is the first day of a calendar month, in which case no such
separate payment of interest shall be due) and a payment of interest only on
each Monthly Payment Date from May 1, 2005 until April 1, 2007. Borrower shall
make a payment to Lender of principal and interest in the amount of the Monthly
Debt Service Payment Amount on the Monthly Payment Date occurring in May, 2007
and on each Monthly Payment Date thereafter to and including the Maturity Date.
Each payment shall be applied first to accrued and unpaid interest and the
balance to principal. The Monthly Debt Service Payment Amount required hereunder
is based upon a twenty eight (28) year amortization schedule.

      2.3.2 PAYMENT ON MATURITY DATE. Borrower shall pay to Lender on the
Maturity Date the outstanding principal balance of the Loan, all accrued and
unpaid interest and all other amounts due hereunder and under the Note, the
Mortgage and the other Loan Documents. Lender shall have the right, at any time
prior to a Securitization, without charge to Borrower and without changing the
Permitted Prepayment Date, to change the Maturity Date from the Maturity Date
stated herein to a later date which coincides with a date important to the
Securitization upon notice to Borrower (in which event such change shall then be
deemed effective. If requested by Lender, Borrower shall promptly at no cost or
expense to Borrower execute an amendment to this Agreement and any other Loan
Documents to evidence such change.

      2.3.3 INTEREST RATE AND PAYMENT AFTER DEFAULT. In the event that, and for
so long as, any Event of Default shall have occurred and be continuing, the
outstanding principal balance of the Loan shall accrue interest at the Default
Rate, calculated from the date the Default occurred which led to such an Event
of Default without regard to any grace or cure periods contained herein. If all
or any part of the principal amount of the Loan is prepaid upon acceleration of
the Loan following the occurrence of an Event of Default, Borrower shall be
required to pay (i) to Lender, in addition to all other amounts then payable
hereunder (including, without limitation, (i) in the event that such prepayment
is received on a Monthly Payment Date, interest accruing on such amount
calculated through and including the end of the Interest Period in which such
Monthly Payment Date occurs, or (ii) in the event that such prepayment is
received on a date other than a Monthly Payment Date, interest accruing on such
amount calculated through and including the end of the Interest Period in which
the next Monthly Payment Date occurs), a prepayment fee equal to 1% of the
amount of principal being repaid, together with a Yield Maintenance Premium
calculated with respect to the amount of principal being repaid and (ii) to
Lender, the Yield Maintenance Premium.

                                      -14-
<PAGE>

      2.3.4 LATE PAYMENT CHARGE. If any principal, interest or any other sum due
under the Loan Documents, other than the payment of principal due on the
Maturity Date, is not paid by Borrower within five (5) days of the date on which
it is due, Borrower shall pay to Lender upon demand an amount equal to the
lesser of five percent (5%) of such unpaid sum or the maximum amount permitted
by applicable law in order to defray the expense incurred by Lender in handling
and processing such delinquent payment and to compensate Lender for the loss of
the use of such delinquent payment. Any such amount shall be secured by the
Mortgage and the other Loan Documents.

      2.3.5 METHOD AND PLACE OF PAYMENT. (a) Except as otherwise specifically
provided herein, all payments and prepayments under this Agreement and the Note
shall be made to Lender not later than 1:00 P.M., New York City time, on the
date when due and shall be made in lawful money of the United States of America
in immediately available funds at Lender's office, and any funds received by
Lender after such time shall, for all purposes hereof, be deemed to have been
paid on the next succeeding Business Day.

      (b) Whenever any payment to be made hereunder or under any other Loan
Document shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal due on the Maturity Date, interest shall be
payable at the Applicable Interest Rate or the Default Rate, as the case may be,
during such extension.

      (c) All payments required to be made by Borrower hereunder or under the
Note or the other Loan Documents shall be made irrespective of, and without
deduction for, any setoff, claim or counterclaim and shall be made irrespective
of any defense thereto.

      SECTION 2.4 PREPAYMENTS.

      2.4.1 VOLUNTARY PREPAYMENTS. Except as otherwise provided herein, Borrower
shall not have the right to prepay the Loan in whole or in part. At any time on
or after the Permitted Prepayment Date, Borrower may, provided no Event of
Default has occurred and is continuing, at its option and upon thirty (30) days
prior notice to Lender (or such shorter time period as may be permitted by
Lender), prepay the Debt in whole, but not in part, on any date without payment
of the Yield Maintenance Premium or any other prepayment premium or penalty.

      2.4.2 MANDATORY PREPAYMENTS. On each date on which Lender actually
receives a distribution of Net Proceeds, and if Lender does not make such Net
Proceeds available to Borrower for a Restoration, Borrower shall prepay the
outstanding principal balance of the Note in an amount equal to one hundred
percent (100%) of such Net Proceeds together with interest that would have
accrued on such amounts through the next Monthly Payment Date. No Yield
Maintenance Premium or any other prepayment premium or penalty shall be due in
connection with any prepayment made pursuant to this Section 2.4.2. Any
prepayment received by Lender pursuant to this Section 2.4.2 on a date other
than a Monthly Payment Date shall be held by Lender as collateral security for
the Loan in an interest bearing account, with such interest accruing to the
benefit of Borrower, and shall be applied by Lender on the next Monthly Payment
Date.

                                      -15-
<PAGE>

      2.4.3 PREPAYMENTS AFTER DEFAULT. If after an Event of Default, payment of
all or any part of the principal of the Loan is tendered by Borrower, a
purchaser at foreclosure or any other Person, such tender shall be deemed an
attempt to circumvent the prohibition against prepayment set forth in Section
2.4.1 and Borrower, such purchaser at foreclosure or other Person shall pay to
Lender the Yield Maintenance Premium, in addition to the outstanding principal
balance, all accrued and unpaid interest and other amounts payable under the
Loan Documents.

      SECTION 2.5 DEFEASANCE.

      2.5.1 TOTAL DEFEASANCE. (a) Provided no Event of Default shall have
occurred and remain uncured, Borrower shall have the right at any time after the
Release Date and prior to the Maturity Date to voluntarily defease the entire
Loan and obtain a release of the lien of the Mortgage by providing Lender with
the Defeasance Collateral (hereinafter, a "Defeasance Event"), subject to the
satisfaction of the following conditions precedent:

      (i) Borrower shall provide Lender not less than thirty (30) days notice
(or such shorter period of time if permitted by Lender in its sole discretion)
specifying a date (the "Defeasance Date") on which the Defeasance Event is to
occur;

      (ii) Borrower shall pay to Lender (A) all payments of principal and
interest due on the Loan to and including the Defeasance Date and (B) all other
sums, then due under the Note, this Agreement, the Mortgage and the other Loan
Documents;

      (iii) Borrower shall deposit the Defeasance Collateral into the Defeasance
Collateral Account and otherwise comply with the provisions of Sections 2.5.2
and 2.5.3 hereof;

      (iv) Borrower shall execute and deliver to Lender a Security Agreement in
respect of the Defeasance Collateral Account and the Defeasance Collateral;

      (v) Borrower shall deliver to Lender an opinion of counsel for Borrower
that is standard in commercial lending transactions and subject only to
customary qualifications, assumptions and exceptions opining, among other
things, that (A) Lender has a legal and valid perfected first priority security
interest in the Defeasance Collateral Account and the Defeasance Collateral, (B)
if a Securitization has occurred, the REMIC Trust formed pursuant to such
Securitization will not fail to maintain its status as a "real estate mortgage
investment conduit" within the meaning of Section 860D of the Code as a result
of a Defeasance Event pursuant to this Section 2.5, (C) the Defeasance Event
will not result in a deemed exchange for purposes of the Code and will not
adversely affect the status of the Note as indebtedness for federal income tax
purposes, (D) delivery of the Defeasance Collateral and the grant of a security
interest therein to Lender shall not constitute an avoidable preference under
Section 547 of the Bankruptcy Code or applicable state law and (E) a
non-consolidation opinion with respect to the Successor Borrower, subject to
customary qualifications, assumptions and exceptions, including the application
of equitable principles, whether such enforcement is sought by proceedings in
equity or at law;

      (vi) Borrower shall deliver to Lender a Rating Agency Confirmation as to
the Defeasance Event;

                                      -16-
<PAGE>

      (vii) Borrower shall deliver an Officer's Certificate certifying that the
requirements set forth in this Section 2.5 have been satisfied;

      (viii) Borrower shall deliver a certificate of a "big four" or other
nationally recognized public accounting firm reasonably acceptable to Lender
certifying that the Defeasance Collateral will generate monthly amounts equal to
or greater than the Scheduled Defeasance Payments;

      (ix) Borrower shall deliver such other certificates, opinions, documents
and instruments as Lender may reasonably request; and

      (x) Borrower shall pay all out of pocket costs and expenses of Lender
incurred in connection with the Defeasance Event, including Lender's reasonable
attorneys' fees and expenses and Rating Agency fees and expenses.

      (b) If Borrower has elected to defease the entire Note and the
requirements of this Section 2.5 have been satisfied, the Property shall be
released from the lien of the Mortgage and the Defeasance Collateral pledged
pursuant to the Security Agreement shall be the sole source of collateral
securing the Note. In connection with the release of the Lien, Borrower shall
submit to Lender, not less than thirty (30) days prior to the Defeasance Date
(or such shorter time as is acceptable to Lender in its sole discretion), a
release of Lien (and related Loan Documents) for execution by Lender. Such
release shall be in a form appropriate in the jurisdiction in which the Property
is located and that is reasonably acceptable to Lender. In addition, Borrower
shall provide all other documentation Lender reasonably requires to be delivered
by Borrower in connection with such release, together with an Officer's
Certificate certifying that such documentation (i) is in compliance with all
Legal Requirements, and (ii) will effect such release in accordance with the
terms of this Agreement. Borrower shall pay all costs, taxes and expenses
associated with the release of the lien of the Mortgage, including Lender's
reasonable attorneys' fees. Except as set forth in this Agreement, no repayment,
prepayment or defeasance of all or any portion of the Note shall cause, give
rise to a right to require, or otherwise result in, the release of the lien of
the Mortgage and this Agreement on the Property.

      2.5.2 DEFEASANCE COLLATERAL ACCOUNT. On or before the date on which
Borrower delivers the Defeasance Collateral, Borrower shall open at any Eligible
Institution the defeasance collateral account (the "Defeasance Collateral
Account") which shall at all times be an Eligible Account. The Defeasance
Collateral Account shall contain only (i) Defeasance Collateral, and (ii) cash
from interest and principal paid on the Defeasance Collateral. All cash from
interest and principal payments paid on the Defeasance Collateral shall be paid
over to Lender on each Monthly Payment Date and applied first to accrued and
unpaid interest and then to principal. Any cash from interest and principal paid
on the Defeasance Collateral not needed to pay accrued and unpaid interest or
principal shall be retained in the Defeasance Collateral Account as additional
collateral for the Loan. Borrower shall cause the Eligible Institution at which
the Defeasance Collateral is deposited to enter an agreement with Borrower and
Lender, satisfactory to Lender in its reasonable discretion, pursuant to which
such Eligible Institution shall agree to hold and distribute the Defeasance
Collateral in accordance with this Agreement. The Borrower or Successor
Borrower, as applicable, shall be the owner of the Defeasance Collateral Account
and shall report all income accrued on Defeasance Collateral for federal, state

                                      -17-
<PAGE>

and local income tax purposes in its income tax return. Borrower shall prepay
all cost and expenses associated with opening and maintaining the Defeasance
Collateral Account. Lender shall not in any way be liable by reason of any
insufficiency in the Defeasance Collateral Account. Any portion of the
Defeasance Collateral remaining after Lender has been paid in full shall be paid
to Borrower.

      2.5.3 SUCCESSOR BORROWER. In connection with a Defeasance Event under this
Section 2.5, Borrower shall, if required by the Rating Agencies or if Borrower
elects to do so, establish or designate a successor entity (the "Successor
Borrower") which shall be a single purpose bankruptcy remote entity and which
shall be approved by the Rating Agencies. Any such Successor Borrower may, at
Borrower's option, be an Affiliate of Borrower unless the Rating Agencies shall
require otherwise. Borrower shall transfer and assign all obligations, rights
and duties under and to the Note, together with the Defeasance Collateral to
such Successor Borrower. Such Successor Borrower shall assume the obligations
under the Note and the Security Agreement and Borrower shall be relieved of its
obligations under such documents. Borrower shall pay a minimum of $1,000 to any
such Successor Borrower as consideration for assuming the obligations under the
Note and the Security Agreement. Borrower shall pay all out of pocket costs and
expenses actually incurred by Lender, including Lender's reasonable attorney's
fees and expenses, incurred in connection therewith.

      III. REPRESENTATIONS AND WARRANTIES

      SECTION 3.1 BORROWER REPRESENTATIONS.

      Borrower represents and warrants that:

      3.1.1 ORGANIZATION. (a) Borrower is duly organized, validly existing and
in good standing with full power and authority to own its assets and conduct its
business, and is duly qualified in all jurisdictions in which the ownership or
lease of its property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have a
material adverse effect on its ability to perform its obligations hereunder, and
Borrower has taken all necessary action to authorize the execution, delivery and
performance of this Agreement and the other Loan Documents by it, and has the
power and authority to execute, deliver and perform under this Agreement, the
other Loan Documents and all the transactions contemplated hereby.

      (b) Borrower's exact legal name is correctly set forth in the first
paragraph of this Agreement. Borrower is an organization of the type specified
in the first paragraph of this Agreement. Borrower is incorporated or organized
under the laws of the state specified in the first paragraph of this Agreement.
Borrower's principal place of business and chief executive office, and the place
where Borrower keeps its books and records, including recorded data of any kind
or nature, regardless of the medium of recording, including software, writings,
plans, specifications and schematics, has been for the preceding four (4) months
(or, if less than four (4) months, the entire period of the existence of
Borrower) and will continue to be the address of Borrower set forth in the first
paragraph of this Agreement (unless Borrower notifies Lender in writing at least
thirty (30) days prior to the date of such change). Borrower's organizational
identification number, if any, assigned by the state of its incorporation or
organization is

                                      -18-
<PAGE>

3905446. Borrower's federal tax identification number is 20-2237811. Borrower is
not subject to back-up withholding taxes.

      3.1.2 PROCEEDINGS. This Agreement and the other Loan Documents have been
duly authorized, executed and delivered by Borrower and constitute a legal,
valid and binding obligation of Borrower, enforceable against Borrower in
accordance with their respective terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, and by general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

      3.1.3 NO CONFLICTS. The execution and delivery of this Agreement and the
other Loan Documents by Borrower and the performance of its obligations
hereunder and thereunder will not conflict with any provision of any law or
regulation to which Borrower is subject, or conflict with, result in a breach
of, or constitute a default under, any of the terms, conditions or provisions of
any of Borrower's organizational documents or any agreement or instrument to
which Borrower is a party or by which it is bound, or any order or decree
applicable to Borrower, or result in the creation or imposition of any lien on
any of Borrower's assets or property (other than pursuant to the Loan
Documents).

      3.1.4 LITIGATION. There is no action, suit, proceeding or investigation
pending or, to Borrower's knowledge, threatened against Borrower in any court or
by or before any other Governmental Authority which would materially and
adversely affect the ability of Borrower to carry out the transactions
contemplated by this Agreement that has not been fully disclosed to Lender in
writing prior to the Closing Date.

      3.1.5 AGREEMENTS. Borrower is not in default with respect to any order or
decree of any court or any order, regulation or demand of any Governmental
Authority, which default is reasonably likely to have consequences that would
materially and adversely affect the condition (financial or other) or operations
of Borrower or its properties or is reasonably likely to have consequences that
would adversely affect its performance hereunder.

      3.1.6 CONSENTS. No consent, approval, authorization or order of any court
or Governmental Authority is required for the execution, delivery and
performance by Borrower of, or compliance by Borrower with, this Agreement or
the consummation of the transactions contemplated hereby, other than those which
have been obtained by Borrower.

      3.1.7 TITLE. Borrower has good, marketable and insurable fee simple title
to the real property comprising part of the Property and good title to the
balance of the Property owned by it, free and clear of all Liens whatsoever
except the Permitted Encumbrances. The Mortgage, when properly recorded in the
appropriate records, together with any Uniform Commercial Code financing
statements required to be filed in connection therewith, will create (i) a
valid, first priority, perfected lien on the Property, subject only to Permitted
Encumbrances and (ii) perfected security interests in and to, and perfected
collateral assignments of, all personalty (including the Leases), all in
accordance with the terms thereof, in each case subject only to any Permitted
Encumbrances. There are no mechanics', materialman's or other similar liens or
claims which have been filed for work, labor or materials affecting the Property
which are or

                                      -19-
<PAGE>

may be liens prior to, or equal or coordinate with, the lien of the Mortgage.
None of the Permitted Encumbrances, individually or in the aggregate, materially
interfere with the benefits of the security intended to be provided by the
Mortgage and this Loan Agreement, materially and adversely affect the value of
the Property, impair the use or operations of the Property or impair Borrower's
ability to pay its obligations in a timely manner.

      3.1.8 NO PLAN ASSETS. As of the date hereof and throughout the term of the
Loan (a) Borrower is not and will not be an "employee benefit plan," as defined
in Section 3(3) of ERISA, subject to Title I of ERISA, (b) none of the assets of
Borrower constitutes or will constitute "plan assets" of one or more such plans
within the meaning of 29 C.F.R. Section 2510.3-101, (c) Borrower is not and will
not be a "governmental plan" within the meaning of Section 3(32) of ERISA, and
(d) transactions by or with Borrower are not and will not be subject to any
state statute regulating investments of, or fiduciary obligations with respect
to, governmental plans.

      3.1.9 COMPLIANCE. Borrower and the Property and the use thereof comply in
all material respects with all applicable Legal Requirements, including, without
limitation, building and zoning ordinances and codes and Prescribed Laws.
Borrower is not in default or violation of any order, writ, injunction, decree
or demand of any Governmental Authority, the violation of which is reasonably
likely to materially adversely affect the condition (financial or otherwise) or
business of Borrower except as specifically disclosed to Lender pursuant to the
Zoning Info, Inc. reports (the "Zoning Reports") delivered to Lender on or
before the Closing Date. Borrower has not committed any act which is reasonably
likely to give any Governmental Authority the right to cause Borrower to forfeit
the Property or any part thereof or any monies paid in performance of Borrower's
obligations under any of the Loan Documents.

      3.1.10 FINANCIAL INFORMATION. All financial data with respect to Borrower,
Guarantor or, to Borrower's knowledge, the Property, including, without
limitation, the statements of cash flow and income and operating expense, that
have been delivered to Lender by or on behalf of Borrower (i) are true, complete
and correct in all material respects, (ii) accurately represent the financial
condition of the Property as of the date of such reports, and (iii) have been
prepared in accordance with GAAP throughout the periods covered, except as
disclosed therein. Borrower does not have any contingent liabilities,
liabilities for taxes, unusual forward or long-term commitments or unrealized or
anticipated losses from any unfavorable commitments that are known to Borrower
and reasonably likely to have a materially adverse effect on the Property or the
operation thereof, except as referred to or reflected in said financial
statements. Since the date of the financial statements, there has been no
material adverse change in the financial condition, operations or business of
Borrower or, to Borrower's knowledge, the Property from that set forth in said
financial statements.

      3.1.11 CONDEMNATION. Borrower has not received written notice that any,
and to Borrower's knowledge, no Condemnation or other proceeding has been
commenced or, to Borrower's best knowledge, is contemplated with respect to all
or any portion of the Property or for the relocation of roadways providing
access to the Property, except as disclosed in the Zoning Reports.

                                      -20-
<PAGE>

      3.1.12 UTILITIES AND PUBLIC ACCESS. To the best of Borrower's knowledge,
the Property has rights of access to public ways and is served by water, sewer,
sanitary sewer and storm drain facilities adequate to service the Property for
its intended uses.

      3.1.13 SEPARATE LOTS. The Property is comprised of one (1) or more parcels
which constitute separate tax lots and do not constitute a portion of any other
tax lot not a part of the Property.

      3.1.14 ASSESSMENTS. To the best of Borrower's knowledge, there are no
pending or proposed special or other assessments for public improvements or
otherwise affecting the Property, nor, to Borrower's knowledge, are there any
contemplated improvements to the Property that may result in such special or
other assessments.

      3.1.15 ENFORCEABILITY. The Loan Documents are not subject to any right of
rescission, set-off, counterclaim or defense by Borrower, including the defense
of usury, nor would the operation of any of the terms of the Loan Documents, or
the exercise of any right thereunder, render the Loan Documents unenforceable,
and Borrower has not asserted any right of rescission, set-off, counterclaim or
defense with respect thereto.

      3.1.16 ASSIGNMENT OF LEASES. The Assignment of Leases creates a valid
assignment of, or a valid security interest in, certain rights under the Leases,
subject only to a license granted to Borrower to exercise certain rights and to
perform certain obligations of the lessor under the Leases, including the right
to operate the Property. No Person other than Lender has any interest in or
assignment of any portion of Borrower's interest in the Leases or any portion of
Borrower's interest in the Rents due and payable or to become due and payable
thereunder.

      3.1.17 INSURANCE. Borrower has obtained and has delivered to Lender
original or certified copies of all of the Policies, with all premiums prepaid
thereunder, reflecting the insurance coverages, amounts and other requirements
set forth in this Agreement. To the best of Borrower's knowledge, no claims have
been made under any of the Policies, and no Person, including Borrower, has
done, by act or omission, anything which would impair the coverage of any of the
Policies.

      3.1.18 LICENSES. To the best of Borrower's knowledge, all material permits
and approvals, including without limitation, certificates of occupancy required
by any Governmental Authority for the use, occupancy and operation of the
Property (in any material respect) in the manner in which the Property is
currently being used, occupied and operated have been obtained and are in full
force and effect.

      3.1.19 FLOOD ZONE. Except as shown on the Survey, none of the Improvements
on the Property is located in an area identified by the Federal Emergency
Management Agency as a special flood hazard area.

      3.1.20 PHYSICAL CONDITION. To the best of Borrower's knowledge and except
as disclosed in the property condition reports and other written reports
delivered to Lender prior to the Closing Date, the Property, including, without
limitation, all buildings, improvements, parking facilities, sidewalks, storm
drainage systems, roofs, plumbing systems, HVAC systems,

                                      -21-
<PAGE>

fire protection systems, electrical systems, equipment, elevators, exterior
sidings and doors, landscaping, irrigation systems and all structural
components, are in good condition, order and repair in all material respects; to
the best of Borrower's knowledge there exists no structural or other material
defects or damages in the Property, whether latent or otherwise, and Borrower
has not received notice from any insurance company or bonding company of any
defects or inadequacies in the Property, or any part thereof, which would
adversely affect the insurability of the same or cause the imposition of
extraordinary premiums or charges thereon or of any termination or threatened
termination of any policy of insurance or bond.

      3.1.21 BOUNDARIES. Except as shown on the Survey, all of the improvements
which were included in determining the appraised value of the Property lie
wholly within the boundaries and building restriction lines of the Property, and
no improvements on adjoining properties encroach upon the Property, and no
easements or other encumbrances affecting the Property encroach upon any of the
improvements, so as to affect the value or marketability of the Property in any
material respect except those which are insured against by title insurance.

      3.1.22 LEASES.

      (a) The lease between Borrower, as landlord, and Telcordia Technologies,
Inc., a Delaware corporation ("Telcordia") dated March___, 2005, as amended by
that certain Landlord's Agreement dated March___, 2005, and as may be further
amended with Lender's consent except as otherwise specifically permitted
pursuant to Section 4.1.12 hereof, (the "Telcordia Lease") is the only Lease for
the Property to which Borrower is a party. Lender acknowledges that Borrower may
enter into a "triple net" lease for the entire Property acceptable to Lender in
its reasonable discretion (an "Acceptable Replacement Lease") with another
single-user tenant acceptable to Lender in its reasonable discretion (an
"Acceptable Replacement Tenant"). Lender agrees that it will not unreasonably
withhold, condition or delay its consent or approval of any amendments to the
Telcordia Lease proposed by Borrower which are intended to preserve the
treatment of the Telcordia Lease as an operating lease under generally accepted
accounting principals.

      (b) Except as disclosed in the rent roll for Property delivered to and
approved by Lender in writing prior to the date hereof, (i) Borrower is the sole
owner of the entire lessor's interest in the Telcordia Lease; (ii) the Telcordia
Lease is valid and enforceable and in full force and effect; (iii) the Telcordia
Lease is an arms-length agreement with bona fide, independent third parties;
(iv) no party under the Telcordia Lease is in default; (v) all Rents due and
payable have been paid in full; (vi) the terms of all alterations, modifications
and amendments to the Telcordia Lease are reflected in the estoppel certificate
delivered to and approved by Lender; (vii) none of the Rents reserved in the
Leases to which Borrower is a party have been assigned or otherwise pledged or
hypothecated except to Lender; (viii) none of the Rents have been collected for
more than one (1) calendar quarter in advance (except a security deposit shall
not be deemed rent collected in advance; (ix) the premises demised under the
Telcordia Lease have been completed and the tenant under the Telcordia Lease has
accepted the same and has taken possession of the same on a rent-paying basis;
(x) there exist no offsets or defenses to the payment of any portion of the
Rents and Borrower has no monetary obligation to any tenant under the Telcordia
Lease; (xi) Borrower has received no notice from any tenant challenging the
validity or enforceability of the Telcordia Lease; (xii) there are no binding
agreements between

                                      -22-
<PAGE>

Borrower and Telcordia other than expressly set forth in the Telcordia Lease or
disclosed to Lender in writing; (xiii) other than subtenants and licensees
disclosed in writing to Lender prior to the Closing Date, no person or entity
has any possessory interest in, or right to occupy, the Property except under
and pursuant to the Telcordia Lease; (xiv) the Telcordia Lease is subordinate to
the applicable Mortgage, either pursuant to its terms or a recordable
subordination agreement; (xv) all security deposits relating to the Telcordia
Lease are reflected on the certified rent roll delivered to Lender have been
collected by Borrower; and (xvi) no brokerage commissions or finders fees are
due and payable regarding any the Telcordia Lease that have not been paid in
full.

         (c) Notwithstanding anything contained herein to the contrary, Borrower
shall not willfully withhold from Lender any information known to Borrower
regarding renewal, extension, amendment, modification, waiver of provisions of,
termination, rental reduction of, surrender of space of, or shortening of the
term of, any Lease during the term of the Loan.

         3.1.23 FILING AND RECORDING TAXES. All transfer taxes, deed stamps,
intangible taxes or other amounts in the nature of transfer taxes required to be
paid under applicable Legal Requirements in connection with the transfer of the
Property to Borrower have been paid or are being paid simultaneously herewith.
All mortgage, mortgage recording, stamp, intangible or other similar tax
required to be paid under applicable Legal Requirements in connection with the
execution, delivery, recordation, filing, registration, perfection or
enforcement of any of the Loan Documents, including, without limitation, the
Mortgage, have been paid or are being paid simultaneously herewith. All taxes
and governmental assessments due and owing in respect of the Property have been
paid, or an escrow of funds in an amount sufficient to cover such payments has
been established hereunder or are insured against by the title insurance policy
to be issued in connection with the Mortgage.

         3.1.24 SINGLE PURPOSE. Borrower hereby represents and warrants to, and
covenants with, Lender that as of the date hereof and until such time as the
Debt shall be paid in full:

         (a) Borrower does not own and will not own any asset or property other
than (i) the Property, and (ii) incidental personal property necessary for the
ownership or operation of the Property.

         (b) Borrower will not engage in any business other than the ownership,
development, repair, maintenance, management and operation of the Property and
Borrower will conduct and operate its business as presently conducted and
operated.

         (c) Borrower will not enter into any contract or agreement with any
Affiliate of Borrower, any constituent party of Borrower or any Affiliate of any
constituent party, except upon terms and conditions that are commercially
reasonable and substantially similar to those that would be available on an
arms-length basis with third parties other than any such party.

         (d) Borrower has not incurred and will not incur any Indebtedness other
than (i) the Debt, (ii) unsecured trade payables and operational debt not
evidenced by a note and in an aggregate amount not exceeding $500,000 at any one
time and (iii) Indebtedness incurred in the

                                      -23-

<PAGE>

financing of equipment and other personal property used on the Property with
annual payments not exceeding $500,000 in the aggregate; provided that any
Indebtedness incurred pursuant to subclauses (ii) and (iii) shall (x) not be
outstanding more than thirty (30) days past the due date thereof and (y) be
incurred in the ordinary course of business. No Indebtedness other than the Debt
may be secured (subordinate or pari passu) by the Property.

         (e) Borrower has not made and will not make any loans or advances to
any third party (including any Affiliate or constituent party), and shall not
acquire obligations or securities of its Affiliates.

         (f) Borrower is and will remain solvent and Borrower will pay its debts
and liabilities (including, as applicable, shared personnel and overhead
expenses) from its assets as the same shall become due.

         (g) Borrower has done or caused to be done and will do all things
necessary to observe organizational formalities applicable to Borrower and
preserve its existence, and Borrower will not, nor will Borrower permit any
constituent party to amend, modify or otherwise change the partnership
certificate, partnership agreement, articles of incorporation and bylaws,
operating agreement, trust or other organizational documents of Borrower or such
constituent party without the prior consent of Lender in any manner that (i)
violates the single purpose covenants set forth in this Section 3.1.24, or (ii)
amends, modifies or otherwise changes any provision thereof that by its terms
cannot be modified at any time when the Loan is outstanding or by its terms
cannot be modified without Lender's consent.

         (h) Borrower will maintain all of its books, records, financial
statements and bank accounts separate from those of any other person or entity.
Borrower's assets will not be listed as assets on the financial statement of any
other Person, provided, however, that Borrower's assets may be included in a
consolidated financial statement of its Affiliates provided that (i) appropriate
notation shall be made on such consolidated financial statements to indicate the
separateness of Borrower and such Affiliates and to indicate that Borrower's
assets and credit are not available to satisfy the debts and other obligations
of such Affiliates or any other Person and (ii) such assets shall be listed on
Borrower's own separate balance sheet.

         (i) Borrower will be, and at all times will hold itself out to the
public as, a legal entity separate and distinct from any other entity (including
any Affiliate of Borrower or any constituent party of Borrower), shall correct
any known misunderstanding regarding its status as a separate entity, shall
conduct business in its own name, shall not identify itself or any of its
Affiliates as a division or part of the other and shall maintain and utilize
separate stationery, invoices and checks bearing its own name.

         (j) Borrower will maintain adequate capital for the normal obligations
reasonably foreseeable in a business of its size and character and in light of
its contemplated business operations.

         (k) Neither Borrower nor any constituent party will seek or effect the
liquidation, dissolution, winding up, liquidation, consolidation or merger, in
whole or in part, of Borrower.

                                      -24-

<PAGE>

         (l) Borrower will not commingle the funds and other assets of Borrower
with those of any Affiliate or any other Person, and will hold all of its assets
in its own name.

         (m) Borrower has and will maintain its assets in such a manner that it
will not be costly or difficult to segregate, ascertain or identify its
individual assets from those of any Affiliate or constituent party or any other
Person.

         (n) Borrower will not guarantee or become obligated for the debts of
any other Person and does not and will not hold itself out to be responsible for
or have its credit available to satisfy the debts or obligations of any other
Person.

         (o) Intentionally omitted.

         (p) If Borrower is a corporation, a limited partnership or a limited
liability company (other than a single member limited liability company),
Borrower shall at all times cause there to be at least two duly appointed
members of the board of directors of Borrower reasonably satisfactory to Lender
(each, an "Independent Director") who shall not have been at the time of such
individual's appointment or at any time while serving as a director of Borrower,
and may not have been at any time during the preceding five years (i) a
stockholder, director (other than as an Independent Director), officer,
employee, partner, attorney or counsel of Borrower or any Affiliate of Borrower,
(ii) a customer, supplier or other Person who derives any of its purchases or
revenues from its activities with Borrower or any Affiliate of Borrower, (iii) a
Person or other entity controlling or under common control with any such
stockholder, partner, customer, supplier or other Person, or (iv) a member of
the immediate family of any such stockholder, director, officer, employee,
partner, customer, supplier or other Person. As used in this definition, the
term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management, policies or activities of a
Person, whether through ownership of voting securities, by contract or
otherwise. A natural person who otherwise satisfies the foregoing definition of
Independent Director except for being an analogous independent director,
independent manager or springing member of a "special purpose entity" affiliated
with the Borrower shall not be disqualified from serving as an Independent
Director if such "special purpose entity" does not own a direct or indirect
equity interest in the Borrower and if such individual is an independent
director supplied by a nationally-recognized company, or such other reputable
company reasonably acceptable to Lender, that provides professional independent
directors.

         (q) Borrower shall not cause or permit the board of directors of
Borrower to take any action which, under the terms of any certificate of
incorporation, by-laws or any voting trust agreement with respect to any common
stock or under any organizational document of Borrower, requires a vote of the
board of directors of Borrower unless at the time of such action there shall be
at least two members who are each an Independent Director.

         (r) Intentionally omitted.

         (s) If Borrower is a corporation, a limited partnership or a limited
liability company (other than a single member limited liability company),
Borrower shall conduct its business so that the factual assumptions made with
respect to Borrower in the Insolvency

                                      -25-

<PAGE>

Opinion shall be true and correct in all respects. In connection with the
foregoing, Borrower hereby covenants and agrees that it will comply with or
cause the compliance with, (i) all of the facts and factual assumptions
(regarding Borrower, Guarantor or any Affiliate of Borrower or Guarantor) set
forth in the Insolvency Opinion, (ii) all the representations, warranties and
covenants in this Section 3.1.24, and (iii) all the organizational documents of
Borrower.

         (t) Intentionally omitted,

         (u) Intentionally omitted.

         (v) Borrower shall pay the salaries of its own employees (if any) from
its own funds and maintain a sufficient number of employees (if any) in light of
its contemplated business operations.

         (w) Borrower shall compensate each of its consultants and agents from
its funds for services provided to it and pay from its own assets all
obligations of any kind incurred.

         3.1.25 TAX FILINGS. To the extent required, Borrower has filed (or has
obtained effective extensions for filing) all federal, state and local tax
returns required to be filed and have paid or made adequate provision for the
payment of all federal, state and local taxes, charges and assessments payable
by Borrower. Borrower believes that its tax returns (if any) properly reflect
the income and taxes of Borrower for the periods covered thereby, subject only
to reasonable adjustments required by the Internal Revenue Service or other
applicable tax authority upon audit.

         3.1.26 SOLVENCY. Borrower (a) has not entered into the transaction or
any Loan Document with the actual intent to hinder, delay, or defraud any
creditor and (b) received reasonably equivalent value in exchange for its
obligations under the Loan Documents. Giving effect to the Loan, the fair
saleable value of Borrower's assets exceeds and will, immediately following the
making of the Loan, exceed Borrower's total liabilities, including, without
limitation, subordinated, unliquidated, disputed and contingent liabilities. The
fair saleable value of Borrower's assets is and will, immediately following the
making of the Loan, be greater than Borrower's probable liabilities, including
the maximum amount of its contingent liabilities on its debts as such debts
become absolute and matured. Borrower's assets do not and, immediately following
the making of the Loan will not, to Borrower's knowledge, constitute
unreasonably small capital to carry out its business as conducted or as proposed
to be conducted. Borrower does not intend to, and does not believe that it will,
incur Indebtedness and liabilities (including contingent liabilities and other
commitments) beyond its ability to pay such Indebtedness and liabilities as they
mature (taking into account the timing and amounts of cash to be received by
Borrower and the amounts to be payable on or in respect of obligations of
Borrower).

         3.1.27 FEDERAL RESERVE REGULATIONS. No part of the proceeds of the Loan
will be used for the purpose of purchasing or acquiring any "margin stock"
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System or for any other purpose which would be inconsistent with such
Regulation U or any other Regulations of such Board of Governors, or for any
purposes prohibited by Legal Requirements or by the terms and conditions of this
Agreement or the other Loan Documents.

                                      -26-

<PAGE>

         3.1.28 ORGANIZATIONAL CHART. The organizational chart attached as
Schedule III hereto, relating to Borrower and certain Affiliates and other
parties, is true, complete and correct in all material respects on and as of the
date hereof.

         3.1.29 BANK HOLDING COMPANY. Borrower is not a "bank holding company"
or a direct or indirect subsidiary of a "bank holding company" as defined in the
Bank Holding Company Act of 1956, as amended, and Regulation Y thereunder of the
Board of Governors of the Federal Reserve System.

         3.1.30 NO OTHER DEBT. Borrower has not borrowed or received debt
financing (other than permitted pursuant to this Agreement) that has not been
heretofore repaid in full.

         3.1.31 INVESTMENT COMPANY ACT. Borrower is not (1) an "investment
company" or a company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended; (2) a "holding
company" or a "subsidiary company" of a "holding company" or an "affiliate" of
either a "holding company" or a "subsidiary company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended; or (3) subject to any
other federal or state law or regulation which purports to restrict or regulate
its ability to borrow money.

         3.1.32 ACCESS/UTILITIES. To the best of Borrower's knowledge, all
public utilities necessary to the continued use and enjoyment of the Property as
presently used and enjoyed are located in the public right-of-way abutting the
Property or within an easement benefiting the Property. To the best of
Borrower's knowledge, all roads necessary for the utilization of the Property
consistent in all material respects with its current purpose have been completed
and dedicated to public use and accepted by all governmental authorities or are
the subject of access easements for the benefit of the Property.

         3.1.33 NO BANKRUPTCY FILING. Borrower is not contemplating either the
filing of a petition by it under any state or federal bankruptcy or insolvency
laws or the liquidation of its assets or property, and Borrower does not have
any actual knowledge of any Person contemplating the filing of any such petition
against it.

         3.1.34 FULL AND ACCURATE DISCLOSURE. To the best of Borrower's
knowledge, no information contained in this Agreement, the other Loan Documents,
or any written statement furnished by or on behalf of Borrower pursuant to the
terms of this Agreement contains any untrue statement of a material fact or
omits to state a material fact necessary to make the statements contained herein
or therein not misleading in light of the circumstances under which they were
made. There is no fact or circumstance presently known to Borrower which has not
been disclosed to Lender and which materially adversely affects, or is
reasonably likely to materially adversely affect, the Property, Borrower or its
business, operations or condition (financial or otherwise).

         3.1.35 FOREIGN PERSON. Borrower is not a "foreign person" within the
meaning of Section 1445(f)(3) of the Code.

         3.1.36 FRAUDULENT TRANSFER Borrower (a) has not entered into the Loan
or any Loan Document with the actual intent to hinder, delay, or defraud any
creditor and (b) has

                                      -27-

<PAGE>

received reasonably equivalent value in exchange for its obligations under the
Loan Documents. The assets of Borrower do not and, immediately following the
execution and delivery of the Loan Documents will not, to Borrower's knowledge
constitute unreasonably small capital to carry out its business as conducted or
as proposed to be conducted. Borrower does not intend to, and does not believe
that it will, incur debts and liabilities (including contingent liabilities and
other commitments) beyond its ability to pay such debts as they mature (taking
into account the timing and amounts reasonably expected to be payable on or in
respect of its obligations).

         3.1.37 NO CHANGE IN FACTS OR CIRCUMSTANCES; DISCLOSURE. To the best of
Borrower's knowledge, there has been no material adverse change in any
condition, fact, circumstance or event that would make the financial statements,
rent rolls, reports, certificates or other documents submitted in connection
with the Loan inaccurate, incomplete or otherwise misleading in any material
respect or that otherwise materially and adversely affects the business
operations or the financial condition of Borrower or the Property.

         3.1.38 INTENTIONALLY OMITTED.

         3.1.39 PERFECTION OF ACCOUNTS. Borrower hereby represents and warrants
to Lender that:

         (a) This Agreement, together with the other Loan Documents, create a
valid and continuing security interest (as defined in the Uniform Commercial
Code) in the Accounts (as defined in the Cash Management Agreement) in favor of
Lender, which security interest is prior to all other Liens, other than
Permitted Encumbrances, and is enforceable as such against creditors of and
purchasers from Borrower. Other than in connection with the Loan Documents and
except for Permitted Encumbrances, Borrower has not sold or otherwise conveyed
the Accounts;

         (b) The Accounts constitute "deposit accounts" or "securities accounts"
within the meaning of the Uniform Commercial Code, as set forth in the Cash
Management Agreement;

         (c) Pursuant and subject to the terms hereof, Agent has agreed to
comply with all instructions originated by Lender, without further consent by
Borrower, directing disposition of the Accounts and all sums at any time held,
deposited or invested therein, together with any interest or other earnings
thereon, and all proceeds thereof (including proceeds of sales and other
dispositions), whether accounts, general intangibles, chattel paper, deposit
accounts, instruments, documents or securities; and

         (d) The Accounts are not in the name of any Person other than Borrower,
as pledgor, or Lender, as pledgee. Borrower has not consented to Agent's
complying with instructions with respect to the Accounts from any Person other
than Lender.

         3.1.40 NO BREACH OF FIDUCIARY DUTY. To Borrower's knowledge, no Person
currently owning a direct or indirect membership or partnership interest in
Borrower (nor any past or current affiliate of such Person), has breached any
fiduciary duty owed by such Person to any other Person now or previously owning
a direct or indirect membership or partnership interest in Borrower or any prior
owner of the Property.

                                      -28-

<PAGE>

         SECTION 3.2 SURVIVAL OF REPRESENTATIONS.

         The representations and warranties set forth in Section 3.1 shall
survive for so long as any amount remains payable to Lender under this Agreement
or any of the other Loan Documents.

         IV. BORROWER COVENANTS

         SECTION 4.1 BORROWER AFFIRMATIVE COVENANTS.

         Borrower hereby covenants and agrees with Lender that:

         4.1.1 EXISTENCE; COMPLIANCE WITH LEGAL REQUIREMENTS. Borrower shall do
or cause to be done all things necessary to preserve, renew and keep in full
force and effect its existence, and all material rights, licenses, permits and
franchises and shall comply in all material respects with all Legal Requirements
applicable to it and the Property, including, without limitation, Prescribed
Laws; provided Borrower shall have the right to contest such Legal Requirements
as provided in this Agreement.

         4.1.2 TAXES AND OTHER CHARGES. Borrower shall pay or cause to be paid
all Taxes and Other Charges now or hereafter levied or assessed or imposed
against the Property or any part thereof as the same become due and payable;
provided, however, Borrower's obligation to directly pay Taxes shall be
suspended to the extent Borrower has deposited Tax Funds sufficient to pay such
Taxes. Borrower shall furnish to Lender receipts for the payment of the Taxes
and the Other Charges prior to the date the same shall become delinquent;
provided, however, that Borrower is not required to furnish such receipts for
payment of Taxes in the event that such Taxes have been paid by Lender pursuant
to Section 6.2 hereof. Borrower shall not permit or suffer and shall promptly
discharge any lien or charge against the Property. After prior written notice to
Lender, Borrower or, if the Telcordia Lease or an Acceptable Replacement Lease
is in full force and effect, Telcordia or an Acceptable Replacement Tenant, as
applicable, at its own expense, may contest by appropriate legal proceeding,
initiated within a reasonable period of time and conducted in good faith and
with due diligence, the amount or validity or application in whole or in part of
any of the Taxes, provided that (i) no Event of Default has occurred and remains
uncured; (ii) such proceeding shall be permitted under and be conducted in
accordance with all applicable statutes, laws and ordinances; (iii) neither the
Property nor any part thereof or interest therein will be in danger of being
sold, forfeited, terminated, canceled or lost as a result of such contest or
underlying lien; (iv) Borrower shall promptly upon final determination thereof
pay the amount of any such Taxes or Other Charges, together with all costs,
interest and penalties which may be payable in connection therewith; (v) such
proceeding shall suspend the collection of Taxes or Other Charges from the
Property; and (vi) or Borrower or Telcordia or an Acceptable Replacement Tenant
shall have furnished the security as may be required in the proceeding, or as
may be reasonably requested by Lender to insure the payment of any contested
Taxes, together with all interest and penalties thereon, taking into
consideration any Tax Funds available for payment of Taxes. Lender may pay over
any such cash or other security held by Lender to the claimant entitled thereto
at any time when, in the reasonable judgment of Lender, the Property or any part
thereof or interest therein is in danger of being sold, forfeited, terminated
cancelled or lost.

                                      -29-

<PAGE>

         4.1.3 LITIGATION. Borrower shall give prompt notice to Lender of any
litigation or governmental proceedings pending or threatened against Borrower,
of which Borrower has knowledge, which might materially adversely affect the
Property or Borrower's ability to perform its obligations hereunder or under the
other Loan Documents.

         4.1.4 ACCESS TO PROPERTY. Subject to the rights of the tenants under
all Leases, and without unreasonable material interference with the operation of
the Property, Borrower shall permit agents, representatives and employees of
Lender to inspect the Property or any part thereof at reasonable hours upon
reasonable advance notice.

         4.1.5 FURTHER ASSURANCES; SUPPLEMENTAL MORTGAGE AFFIDAVITS. Borrower
shall, at Borrower's sole cost and expense:

         (a) execute and deliver to Lender such documents, instruments,
certificates, assignments and other writings, and do such other acts reasonably
necessary or desirable, to evidence, preserve and/or protect the collateral at
any time securing or intended to secure the obligations of Borrower under the
Loan Documents, as Lender may reasonably require; and

         (b) do and execute all and such further lawful and reasonable acts,
conveyances and assurances for the better and more effective carrying out of the
intents and purposes of this Agreement and the other Loan Documents, as Lender
shall reasonably require from time to time.

         4.1.6 FINANCIAL REPORTING.

         (a) Borrower and any Guarantors shall keep adequate books and records
of account in accordance with GAAP, or in accordance with other methods
acceptable to Lender in its reasonable discretion, consistently applied and
furnish to Lender:

         (i) monthly, or if the Loan has been securitized or sold by Lender,
quarterly and annual certified rent rolls in the form attached hereto as
Schedule I signed and dated by Borrower, detailing the names of all tenants of
the Improvements under Leases to which Borrower is a party, the portion of
Improvements occupied by each tenant, the base rent and any other charges
payable under each Lease and the term of each Lease, including the expiration
date, the extent to which any tenant is in default under any Lease, and any
other information as is reasonably required by Lender, within thirty (30) days
after the end of each calendar month, thirty (30) days after the end of each
fiscal quarter or sixty (60) days after the close of each fiscal year of
Borrower, as applicable;

         (ii) on a monthly basis, operating statements of the Property in the
form attached as Schedule VI for the immediately preceding month (and for
previous periods if required by Lender), or if the Loan has been securitized or
sold as a whole loan by Lender, annual and, if requested by Lender, quarterly
operating statements of the Property in the form attached hereto as Schedule VI,
all of which shall be prepared and certified by Borrower in the form required by
Lender, detailing the revenues received, the expenses incurred and the net
operating income before and after debt service (principal and interest) and
major capital improvements completed by Borrower for each month and containing
appropriate year to date information, within twenty (20) days after the end of
each calendar month, thirty (30) days after

                                      -30-

<PAGE>

the end of each fiscal quarter or sixty (60) days after the close of each fiscal
year of Borrower, as applicable;

         (iii) an annual operating statement of the Property in the form
attached hereto as Schedule VI detailing the total revenues received, total
expenses incurred, total cost of all capital improvements, total debt service
and total cash flow, to be prepared and certified by Borrower in the form
required by Lender within sixty (60) days after the close of each fiscal year of
Borrower;

         (iv) quarterly and annual balance sheet in the form attached hereto as
Schedule VII and profit and loss statements of Borrower, any Guarantors in a
form reasonably acceptable to Lender, prepared and certified by the respective
Borrower and/or Guarantors within sixty (60) days after the end of each fiscal
quarter and within sixty (60) days after the end of each fiscal year, with
respect to Borrower, and within ninety (90) days (or, at any time after the Loan
is securitized, ninety (90) days) after the end of each fiscal quarter with
respect to any Guarantors; and audited financial statements prepared by an
independent certified public accountant acceptable to Lender, within one hundred
twenty (120) days after the close of each fiscal year with respect to any
Guarantor. Lender acknowledges that Borrower's and Guarantor's financial
statements may be consolidated and such consolidated financial statements shall
be acceptable; and

         (v) upon Lender's request, an annual operating budget in the form
attached hereto as Schedule IX (an "Annual Budget") presented on a monthly basis
consistent with the annual operating statement described above for the Property,
including cash flow projections for the upcoming year, and all proposed capital
replacements and improvements at least fifteen (15) days prior to the start of
each fiscal year.

         (b) Upon request from Lender, Borrower and any Guarantor shall furnish
in a timely manner to Lender:

         (i) If at any time the Property is not occupied by a single tenant user
pursuant to a triple net lease, a property management report for the Property,
showing the number of inquiries made and/or rental applications received from
tenants or prospective tenants and deposits received from tenants and any other
information reasonably requested by Lender, in reasonable detail and certified
by Borrower (or an officer, general partner, member or principal of Borrower if
Borrower is not an individual) under penalty of perjury to be true and complete,
but no more frequently than quarterly; and

         (ii) an accounting of all security deposits held in connection with any
Lease of any part of the Property, including the name and identification number
of the accounts in which such security deposits are held, the name and address
of the financial institutions in which such security deposits are held and the
name of the person to contact at such financial institution, along with any
authority or release necessary for Lender to obtain information regarding such
accounts directly from such financial institutions.

         (c) Borrower and any Guarantor shall furnish Lender with such other
additional financial or management information (including State and Federal tax
returns, if any)

                                      -31-

<PAGE>

as may, from time to time, be reasonably required by Lender in form and
substance satisfactory to Lender.

         (d) Borrower acknowledges the importance to Lender of the timely
delivery of each of the items required by this Section 4.1.6 (each, a "Required
Financial Item" and collectively, the "Required Financial Items"). In the event
Borrower fails to deliver to Lender any of the Required Financial Items within
the time frame specified herein and such failure is not cured within ten (10)
business days after notice from Lender (each such event, a "Reporting Failure"),
without limiting Lender's other rights and remedies with respect to the
occurrence of such an Event of Default, in the event of the occurrence of two or
more Reporting Failures in any twelve (12) month period, Borrower shall pay to
Lender the sum of $500.00 per occurrence for each such Reporting Failure. It
shall constitute a further Event of Default hereunder if any such payment is not
received by Lender within thirty (30) days of the date on which such payment is
due, and Lender shall be entitled to the exercise of all of its rights and
remedies provided hereunder.

         4.1.7 TITLE TO THE PROPERTY. Borrower will warrant and defend the
validity and priority of the Liens of the Mortgage and the Assignment of Leases
on the Property against the claims of all Persons whomsoever, subject only to
Permitted Encumbrances.

         4.1.8 ESTOPPEL STATEMENT.

         (a) After request by Lender, Borrower shall within ten (10) Business
Days furnish Lender with a statement, duly acknowledged and certified, stating
(i) the unpaid principal amount of the Note, (ii) the Applicable Interest Rate
of the Note, (iii) the date installments of interest and/or principal were last
paid, (iv) any offsets or defenses to the payment of the Debt, if any, and (v)
that this Agreement and the other Loan Documents have not been modified or if
modified, giving particulars of such modification.

         (b) After request by Borrower, Lender shall within ten (10) Business
Days furnish Borrower with a statement, duly acknowledged and certified, stating
(i) the unpaid principal amount of the Note, (ii) the Applicable Interest Rate
of the Note, (iii) the date installments of interest and/or principal were last
paid and (iv) whether or not Lender has sent any notice of default under the
Loan Documents which remains uncured in the opinion of Lender.

         (c) Borrower shall deliver to Lender, upon request, an estoppel
certificate from each Tenant under any Lease (provided that Borrower shall only
be required to use commercially reasonable efforts to obtain an estoppel
certificate from any Tenant); provided that such certificate may be in the form
required under such Lease; provided further that Borrower shall not be required
to deliver such certificates more frequently than two (2) times in any calendar
year.

         4.1.9 LEASES.

         (a) Borrower may enter into a proposed Lease (including the renewal or
extension of an existing Lease (a "Renewal Lease")) without the prior written
consent of Lender, provided such proposed Lease or Renewal Lease (i) provides
for rental rates and terms

                                      -32-

<PAGE>

comparable to existing local market rates and terms (taking into account the
type and quality of the tenant) as of the date such Lease is executed by
Borrower (unless, in the case of a Renewal Lease, the rent payable during such
renewal, or a formula or other method to compute such rent, is provided for in
the original Lease), (ii) is an arms-length transaction with a bona fide,
independent third party tenant, (iii) does not have a materially adverse effect
on the value of the Properties taken as a whole, (iv) is subject and subordinate
to the Mortgages and the lessee thereunder agrees to attorn to Lender, and (v)
is written on the standard form of lease approved by Lender. All proposed Leases
which do not satisfy the requirements set forth in this Section 4.1.9 shall be
subject to the prior approval of Lender and its counsel (which approval shall
not be unreasonably withheld, conditioned or delayed), at Borrower's expense.
Borrower shall promptly deliver to Lender copies of all Leases which are entered
into pursuant to this Subsection together with Borrower's certification that it
has satisfied all of the conditions of this Subsection.

         (b) Borrower (i) shall observe and perform all the obligations imposed
upon the lessor under the Leases and shall not do or permit to be done anything
to impair the value of any of the Leases as security for the Debt; (ii) upon
request, shall promptly send copies to Lender of all notices of default which
Borrower shall send or receive thereunder; (iii) shall enforce all of the
material terms, covenants and conditions contained in the Leases upon the part
of the tenant thereunder to be observed or performed, (iv) shall not collect any
of the Rents more than one (1) calendar quarter in advance (except security
deposits shall not be deemed Rents collected in advance); (v) shall not execute
any other assignment of the lessor's interest in any of the Leases or the Rents;
and (vi) shall not consent to any assignment of or subletting otherwise not
permitted under any Leases, without the prior written consent of Lender (which
consent shall not be unreasonably withheld, conditioned or delayed). Provided no
Event of Default has occurred and is continuing, Borrower may waive, amend, add
to and/or supplement any financial covenants of Telcordia contained in the
Telcorida Lease without the prior written consent of Lender.

         (c) Borrower may, without the consent of Lender, amend, modify or waive
the provisions of any Lease or terminate, reduce rents under, accept a surrender
of space under, or shorten the term of, any Lease (including any guaranty,
letter of credit or other credit support with respect thereto) provided that
such action (taking into account, in the case of a termination, reduction in
rent, surrender of space or shortening of term, the planned alternative use of
the affected space) does not have a materially adverse effect on the value of
the Property taken as a whole, and provided that such Lease, as amended,
modified or waived, is otherwise in compliance with the requirements of this
Agreement and any subordinate agreement binding upon Lender with respect to such
Lease. A termination of a Lease with a tenant who is in default beyond
applicable notice and grace periods shall not be considered an action which has
a materially adverse effect on the value of the Properties taken as a whole. Any
amendment, modification, waiver, termination, rent reduction, space surrender or
term shortening which does not satisfy the requirements set forth in this
subsection shall be subject to the prior approval of Lender and its counsel,
which approval shall not be unreasonably withheld, delayed, or conditioned, at
Borrower's expense. Borrower shall promptly deliver to Lender copies of
amendments, modifications and waivers which are entered into pursuant to this
subsection together with Borrower's certification that it has satisfied all of
the conditions of this subsection.

                                      -33-

<PAGE>

         (d) Notwithstanding anything contained herein to the contrary, Borrower
shall not, without the prior written consent of Lender, enter into, renew,
extend, amend, modify, waive any provisions of, terminate, reduce rents under,
accept a surrender of space under, or shorten the term of, any Major Lease. The
term "Major Lease" shall mean any Lease between Borrower as landlord and a
tenant which lease is (i) approved by Lender, in form and substance, in its sole
discretion using prudent business judgment, (ii) at comparable terms with the
Telcordia Lease and (iii) which demises in the aggregate more than the lesser of
(a) 200,000 rentable square feet or (b) fifteen percent (15%) of the total
rentable square feet at the Properties.

         4.1.10 ALTERATIONS. Lender's prior approval shall be required in
connection with any alterations to any Improvements (except tenant improvements
under any Lease approved by Lender or under any Lease for which approval was not
required by Lender under this Agreement) (a) that may have a material adverse
effect on Borrower's financial condition, the value of the Property or the
ongoing revenues and expenses of the Property, (b) the cost of which (including
any related alteration, improvement or replacement) is reasonably anticipated to
exceed the Alteration Threshold or (c) made after the Maturity Date if the Loan
shall not have been repaid in full, which approval may be granted or withheld in
Lender's sole discretion. If the total unpaid amounts incurred and to be
incurred with respect to such alterations to the Improvements shall at any time
exceed the Alteration Threshold, Borrower shall upon the written request of
Lender promptly deliver to Lender as security for the payment of such amounts
and as additional security for Borrower's obligations under the Loan Documents
any of the following: (i) cash, (ii) Letters of Credit (iii) U.S. Obligations,
(iv) other securities acceptable to lender, provided that Lender shall have the
right to require Rating Agency Confirmation as to the form and issuer of same,
or (v) a completion bond, provided that Lender shall have received a Rating
Agency Confirmation as to the form and issuer of same. Such security shall be in
an amount equal to the excess of the total unpaid amounts incurred and to be
incurred with respect to such alterations to the Improvements (other than such
amounts to be paid or reimbursed by Tenants under the Leases) over the
Alteration Threshold.

         4.1.11 APPROVAL OF MATERIAL AGREEMENTS. From and after the Maturity
Date, Borrower shall be required to obtain Lender's prior written approval to
any and all Material Agreements affecting the Property, which approval may be
granted or withheld in Lender's sole discretion.

         4.1.12 MATERIAL AGREEMENTS. Borrower shall (a) promptly perform and/or
observe all of the material covenants and agreements required to be performed
and observed by it under each Material Agreement to which it is a party, and do
all things necessary to preserve and to keep unimpaired its rights thereunder,
(b) promptly notify Lender in writing of the giving of or receipt by Borrower of
any notice of any default by any party under any Material Agreement of which it
is aware and (c) promptly enforce in a commercially reasonable manner the
performance and observance of all of the material covenants and agreements
required to be performed and/or observed by the other party under each Material
Agreement to which it is a party in a commercially reasonable manner.

         4.1.13 PERFORMANCE BY BORROWER. Borrower shall in a timely manner
observe, perform and fulfill each and every covenant, term and provision of each
Loan Document executed and delivered by Borrower (or shall cause such observance
performance and

                                      -34-

<PAGE>

fulfillment), and shall not enter into or otherwise suffer or permit any
amendment, waiver, supplement, termination or other modification of any Loan
Document executed and delivered by Borrower without the prior consent of Lender.

         4.1.14 COSTS OF ENFORCEMENT/REMEDYING DEFAULTS. In the event (a) that
the Mortgage is foreclosed in whole or in part or the Note or any other Loan
Document is put into the hands of an attorney for collection, suit, action or
foreclosure, (b) of the foreclosure of any Lien or Mortgage prior to or
subsequent to the Mortgage in which proceeding Lender is made a party, (c) of
the bankruptcy, insolvency, rehabilitation or other similar proceeding in
respect of Borrower or Guarantor or an assignment by Borrower or Guarantor for
the benefit of its creditors, or (d) Lender shall remedy or attempt to remedy
any Event of Default hereunder, Borrower shall be chargeable with and agrees to
pay all costs incurred by Lender as a result thereof, including costs of
collection and defense (including reasonable attorneys', experts', consultants'
and witnesses' fees and disbursements) in connection therewith and in connection
with any appellate proceeding or post-judgment action involved therein, which
shall be due and payable on demand, together with interest thereon from the date
incurred by Lender at the Default Rate, and together with all required service
or use taxes.

         4.1.15 BUSINESS AND OPERATIONS. Borrower will continue to engage in the
businesses currently conducted by it as and to the extent the same are necessary
for the ownership, leasing, operation or maintenance of the Property. Borrower
will qualify to do business and will remain in good standing under the laws of
each jurisdiction as and to the extent the same are required for the ownership
and leasing of the related Property. Borrower shall at all times cause the
Property to be maintained as an office, research and development and industrial
facility.

         SECTION 4.2 BORROWER NEGATIVE COVENANTS.

         Borrower covenants and agrees with Lender that:

         4.2.1 DUE ON SALE AND ENCUMBRANCE; TRANSFERS OF INTERESTS. Without the
prior written consent of Lender, neither Borrower nor any other Person having a
direct or indirect ownership or beneficial interest in Borrower shall sell,
convey, mortgage, grant, bargain, encumber, pledge, assign or transfer any
interest, direct or indirect, in the Borrower, the Property or any part thereof,
whether voluntarily or involuntarily, except as otherwise specifically permitted
pursuant to and in accordance with the terms and provisions hereof, of Article 6
of the Mortgage and of the other Loan Documents.

         4.2.2 LIENS. Borrower shall not create, incur, assume or suffer to
exist any Lien on any portion of the Property except for Permitted Encumbrances.

         4.2.3 DISSOLUTION. Borrower shall not (i) engage in any dissolution,
liquidation or consolidation or merger with or into any other business entity,
(ii) engage in any business activity not related to the ownership and operation
of the Property, or (iii) transfer, lease or sell, in one transaction or any
combination of transactions, all or substantially all of the property or assets
of Borrower except to the extent expressly permitted by the Loan Documents.

                                      -35-

<PAGE>

         4.2.4 CHANGE IN BUSINESS. Borrower shall not enter into any line of
business other than the ownership and operation of the Property.

         4.2.5 DEBT CANCELLATION. Borrower shall not cancel or otherwise forgive
or release any claim or debt (other than termination of Leases in accordance
herewith) owed to Borrower by any Person, except for adequate consideration and
in the ordinary course of Borrower's business.

         4.2.6 AFFILIATE TRANSACTIONS. Borrower shall not enter into, or be a
party to, any transaction with an Affiliate of Borrower or any of the partners
of Borrower except in the ordinary course of business and on terms which are
fully disclosed to Lender in advance and are no less favorable to Borrower or
such Affiliate than would be obtained in a comparable arm's-length transaction
with an unrelated third party.

         4.2.7 ZONING. Borrower shall not initiate or consent to any zoning
reclassification of any portion of the Property or seek any variance under any
existing zoning ordinance or use or permit the use of any portion of the
Property in any manner that could result in such use becoming a non-conforming
use under any zoning ordinance or any other applicable land use law, rule or
regulation, without the prior consent of Lender.

         4.2.8 ASSETS. Borrower shall not purchase or own any property other
than the Property and any property necessary or incidental for the operation of
the Property.

         4.2.9 NO JOINT ASSESSMENT. Borrower shall not suffer, permit or
initiate the joint assessment of the Property (i) with any other real property
constituting a tax lot separate from the Property, and (ii) with any portion of
the Property which may be deemed to constitute personal property, or any other
procedure whereby the lien of any taxes which may be levied against such
personal property shall be assessed or levied or charged to the Property.

         4.2.10 PRINCIPAL PLACE OF BUSINESS. Borrower shall not change its
principal place of business from the address set forth on the first page of this
Agreement without first giving Lender thirty (30) days prior notice.

         4.2.11 ERISA. (a) Borrower shall not engage in any transaction which
would cause any obligation, or action taken or to be taken, hereunder (or the
exercise by Lender of any of its rights under the Note, this Agreement or the
other Loan Documents) to be a non-exempt (under a statutory or administrative
class exemption) prohibited transaction under the Employee Retirement Income
Security Act of 1974, as amended ("ERISA").

         (b) Borrower shall deliver to Lender such certifications or other
evidence from time to time throughout the term of the Loan, as reasonably
requested by Lender, that (A) Borrower is not an "employee benefit plan" as
defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, or a
"governmental plan" within the meaning of Section 3(32) of ERISA; (B) Borrower
is not subject to any state statute regulating investments of, or fiduciary
obligations with respect to, governmental plans; and (C) one or more of the
following circumstances is true:

                                      -36-

<PAGE>

         (i) Equity interests in Borrower are publicly offered securities,
within the meaning of 29 C.F.R. Section 2510.3-101(b)(2);

         (ii) Less than twenty-five percent (25%) of each outstanding class of
equity interests in Borrower are held by "benefit plan investors" within the
meaning of 29 C.F.R. Section 2510.3-101(f)(2);or

         (iii) Borrower qualifies as an "operating company" or a "real estate
operating company" within the meaning of 29 C.F.R. Section 2510.3-101(c) or (e).

         4.2.12 MATERIAL AGREEMENTS. Borrower shall not, without Lender's prior
written consent: (a) enter into, surrender or terminate any Material Agreement
to which it is a party (unless the other party thereto is in material default
and the termination of such agreement would be commercially reasonable), (b)
increase or consent to the increase of the amount of any charges under any
Material Agreement to which it is a party, except as provided therein or on an
arms'-length basis and commercially reasonable terms; or (c) otherwise modify,
change, supplement, alter or amend, or waive or release any of its rights and
remedies under any Material Agreement to which it is a party in any material
respect, except on an arms'-length basis and commercially reasonable terms.

         V. INSURANCE, CASUALTY AND CONDEMNATION

         SECTION 5.1 INSURANCE.

         5.1.1 INSURANCE POLICIES. (a) Borrower shall obtain and maintain, or
cause to be maintained, insurance for Borrower and the Property providing at
least the following coverages:

         (i) comprehensive all risk insurance on the Improvements and the
personal property at the Property, including contingent liability from Operation
of Building Laws, Demolition Costs and Increased Cost of Construction
Endorsements, in each case (A) in an amount equal to one hundred percent (100%)
of the "Full Replacement Cost," which for purposes of this Agreement shall mean
actual replacement value (exclusive of costs of excavations, foundations,
underground utilities and footings) with a waiver of depreciation, but the
amount shall in no event be less than the outstanding principal balance of the
Loan; (B) containing an agreed amount endorsement with respect to the
Improvements and personal property at the Property waiving all co-insurance
provisions; (C) providing for no deductible in excess of Two Hundred Fifty
Thousand Dollars ($250,000) for all such insurance coverage; and (D) containing
an "Ordinance or Law Coverage" or "Enforcement" endorsement if any of the
Improvements or the use of the Property shall at any time constitute legal
non-conforming structures or uses. In addition, Borrower shall obtain: (y) if
any portion of the Improvements is currently or at any time in the future
located in a federally designated "special flood hazard area", flood hazard
insurance in an amount equal to the lesser of (1) the outstanding principal
balance of the Note or (2) the maximum amount of such insurance available under
the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of
1973 or the National Flood Insurance Reform Act of 1994, as each may be amended
or such greater amount as Lender shall reasonably require; and (z) earthquake
insurance in amounts and in form and substance

                                      -37-

<PAGE>

satisfactory to Lender in the event the Property is located in an area with a
high degree of seismic activity, provided that the insurance pursuant to clauses
(y) and (z) hereof shall be on terms consistent with the comprehensive all risk
insurance policy required under this subsection (i).

         (ii) commercial general liability insurance against claims for personal
injury, bodily injury, death or property damage occurring upon, in or about the
Property, such insurance (A) to be on the so-called "occurrence" form with a
combined limit, excluding umbrella coverage, of not less than Fifteen Million
Dollars ($15,000,000); (B) to continue at not less than the aforesaid limit
until required to be changed by Lender by reason of changed economic conditions
making such protection inadequate; and (C) to cover at least the following
hazards: (1) premises and operations; (2) products and completed operations on
an "if any" basis; (3) independent contractors; (4) blanket contractual
liability for all legal contracts; and (5) contractual liability covering the
indemnities contained in Article 9 of the Mortgage to the extent the same is
available;

         (iii) business income insurance (A) with loss payable to Lender; (B)
covering all risks required to be covered by the insurance provided for in
subsection (i) above for a period commencing at the time of loss for such length
of time as it takes to repair or replace with the exercise of due diligence and
dispatch; (C) containing an extended period of indemnity endorsement which
provides that after the physical loss to the Improvements and Personal Property
has been repaired, the continued loss of income will be insured until such
income either returns to the same level it was at prior to the loss, or the
expiration of eighteen (18) months from the date that the Property is repaired
or replaced and operations are resumed, whichever first occurs, and
notwithstanding that the policy may expire prior to the end of such period; and
(D) in an amount equal to one hundred percent (100%) of the projected gross
income from the Property for a period from the date of loss to a date (assuming
total destruction) which is twenty-four (24) months from the date that the
Property is repaired or replaced and operations are resumed. The amount of such
business income insurance shall be determined prior to the date hereof and at
least once each year thereafter based on Borrower's reasonable estimate of the
gross income from the Property for the succeeding eighteen (18) month period,
based upon the assumption that no casualty has or will occur. All proceeds
payable to Lender pursuant to this subsection shall be held by Lender and shall
be applied to the obligations secured by the Loan Documents from time to time
due and payable hereunder and under the Note; provided, however, that nothing
herein contained shall be deemed to relieve Borrower of its obligations to pay
the obligations secured by the Loan Documents on the respective dates of payment
provided for in the Note and the other Loan Documents except to the extent such
amounts are actually paid out of the proceeds of such business income insurance;

         (iv) at all times during which structural construction, repairs or
alterations are being made with respect to the Improvements, and only if the
Property coverage form does not otherwise apply, (A) owner's contingent or
protective liability insurance covering claims not covered by or under the terms
or provisions of the above mentioned commercial general liability insurance
policy; and (B) the insurance provided for in subsection (i) above written in a
so-called builder's risk completed value form (1) on a non-reporting basis, (2)
against all risks insured against pursuant to subsection (i) above, (3)
including permission to occupy the Property, and (4) with an agreed amount
endorsement waiving co-insurance provisions;

                                      -38-

<PAGE>

         (v) statutory workers' compensation insurance with respect to any work
on or about the Property;

         (vi) comprehensive boiler and machinery insurance, if applicable, in
amounts as shall be reasonably required by Lender on terms consistent with the
commercial property insurance policy required under subsection (i) above;

         (vii) umbrella liability insurance in addition to primary coverage in
an amount not less than Fifteen Million and No/100 Dollars ($15,000,000) per
occurrence on terms consistent with the commercial general liability insurance
policy required under subsection (ii) above and (viii) below;

         (viii) motor vehicle liability coverage for all owned and non-owned
vehicles, including rented and leased vehicles containing minimum limits per
occurrence, including umbrella coverage, of One Million and No/100 Dollars
($1,000,000);

         (ix) so-called "dramshop" insurance or other liability insurance
required in connection with the sale of alcoholic beverages;

         (x) intentionally omitted;

         (xi) if the commercial property and business income insurance policies
required under subsections (i) and (iii) above do not cover perils of terrorism
or acts of terrorism, Borrower shall use commercially reasonable efforts,
consistent with those of prudent owners of real estate comparable to the
Property, to maintain commercial property and business income insurance for loss
resulting from perils and acts of terrorism on terms (including amounts)
consistent with those required under subsections (i) and (iii) above. If a
Rating Agency in connection with a Securitization of the Loan or in connection
with its rating surveillance of the Securities issued pursuant to a
Securitization of the Loan would not provide or maintain a rating for any
portion of the Loan or such Securities which would otherwise be available but
for the failure to maintain such terrorism insurance, Borrower will so maintain
such insurance if obtainable from any insurer or any Governmental Authority (for
the maximum amount obtainable up to the amounts set forth in subsections (i) and
(iii) above and with deductibles no greater than those provided in subsections
(i) and (iii) above). The claims paying ability rating of the insurer shall be
consistent with the requirements of Section 5.1.2 hereof or, if no insurer of
such claims paying ability rating is then issuing such terrorism insurance, the
chosen insurer shall be the insurer which is offering such terrorism insurance
and which has a claims paying ability rating the closest to that required by
Section 5.1.2 hereof; and

         (xii) upon sixty (60) days' notice, such other reasonable insurance and
in such reasonable amounts as Lender from time to time may reasonably request
against such other insurable hazards which at the time are commonly insured
against for property similar to the Property located in or around the region in
which the Property is located.

         (b) All insurance provided for in Section 5.1.1 (a) shall be obtained
under valid and enforceable policies (collectively, the "Policies" or in the
singular, the "Policy") and, to the extent not specified above, shall be subject
to the reasonable approval of Lender as to deductibles, loss payees and
insureds. Not less than ten (10) days prior to the expiration dates of

                                      -39-

<PAGE>

the Policies theretofore furnished to Lender, certificates of insurance
evidencing the Policies accompanied by evidence satisfactory to Lender of
payment of the premiums then due thereunder (the "Insurance Premiums"), shall be
delivered by Borrower to Lender.

         (c) Any blanket insurance Policy shall specifically allocate to the
Property the amount of coverage from time to time required hereunder and shall
otherwise provide the same protection as would a separate Policy insuring only
the Property in compliance with the provisions of Section 5.1.1 (a).

         (d) All Policies of insurance provided for or contemplated by Section
5.1.1(a) shall be primary coverage and, except for the Policy referenced in
Section 5.1.1(a)(v), shall name Borrower as the insured and Lender and its
successors and/or assigns as the additional insured, as its interests may
appear, and in the case of property damage, boiler and machinery, flood,
earthquake and terrorism insurance, shall contain a so-called New York standard
non-contributing mortgagee clause in favor of Lender providing that the loss
thereunder shall be payable to Lender. Borrower shall not procure or permit any
of its constituent entities to procure any other insurance coverage which would
be on the same level of payment as the Policies or would adversely impact in any
way the ability of Lender or Borrower to collect any proceeds under any of the
Policies.

         (e) All Policies of insurance provided for in Section 5.1.1 (a), except
for the Policies referenced in Section 5.1.1(a)(v) and (a)(viii) shall contain
clauses or endorsements to the effect that:

         (i) no act or negligence of Borrower, or anyone acting for Borrower, or
of any Tenant or other occupant, or failure to comply with the provisions of any
Policy, which might otherwise result in a forfeiture of the insurance or any
part thereof, shall in any way affect the validity or enforceability of the
insurance insofar as Lender is concerned;

         (ii) the Policy shall not be canceled without at least thirty (30)
days' written notice to Lender and any other party named therein as an
additional insured and, if obtainable by Borrower using commercially reasonable
efforts, shall not be materially changed (other than to increase the coverage
provided thereby) without such a thirty (30) day notice; and

         (iii) Lender shall not be liable for any Insurance Premiums thereon or
subject to any assessments thereunder.

         (f) If at any time Lender is not in receipt of written evidence that
all insurance required hereunder is in full force and effect, Lender shall have
the right, without notice to Borrower, to take such action as Lender deems
necessary to protect its interest in the Property, including, without
limitation, the obtaining of such insurance coverage as Lender in its sole
discretion deems appropriate and all premiums incurred by Lender in connection
with such action or in obtaining such insurance and keeping it in effect shall
be paid by Borrower to Lender upon demand and until paid shall be secured by the
Mortgage and shall bear interest at the Default Rate.

         (g) In the event of foreclosure of the Mortgage or other transfer of
title to the Property in extinguishment in whole or in part of the Debt, all
right, title and interest of

                                      -40-

<PAGE>

Borrower in and to the Policies that are not blanket Policies then in force
concerning the Property and all proceeds payable thereunder shall thereupon vest
in the purchaser at such foreclosure or Lender or other transferee in the event
of such other transfer of title.

         5.1.2 INSURANCE COMPANY. The Policies shall be issued by financially
sound and responsible insurance companies authorized to do business in the state
in which the Property is located and having a claims paying ability rating of
"A" or better by S&P and Fitch and an insurance financial strength rating of
"Aa2" by Moody's. If a Securitization occurs, (i) the foregoing required
insurance company rating by a Rating Agency not rating any Securities shall be
disregarded and (ii) if the insurance company complies with the aforesaid S&P
required rating (and S&P is rating the Securities) and the other Rating Agencies
rating the Securities do not rate the insurance company, such insurance company
shall be deemed acceptable with respect to such Rating Agency not rating such
insurance company. If a Securitization occurs and S&P is not a Rating Agency,
each of the insurance companies shall have a claims paying ability rating of at
least A- by Fitch and an insurance financial strength rating of A3 by Moody's
and at least sixty-seven percent (67%) of the coverage shall be provided by
insurance companies having claims paying ability ratings of AA by Fitch and an
insurance financial strength rating of Aa2 by Moody's; provided, however, if
Fitch or Moody's shall not provide a rating for an insurance company, then an
A.M. Best rating of A(X) shall be substituted for each of the foregoing rating
requirements of Fitch or Moody's, as applicable. Notwithstanding the foregoing,
Borrower shall be permitted to maintain the Policies with insurance companies
which do not meet the foregoing requirements (an "OTHERWISE RATED INSURER"),
provided Borrower obtains a "cut-through" endorsement (that is, an endorsement
which permits recovery against the provider of such endorsement) with respect to
any Otherwise Rated Insurer from an insurance company which meets the claims
paying ability ratings required above. Moreover, if Borrower desires to maintain
insurance required hereunder from an insurance company which does not meet the
claims paying ability ratings set forth herein but the parent of such insurance
company, which owns at least fifty-one percent (51%) of such insurance company,
maintains such ratings, Borrower may use such insurance companies if approved by
the Rating Agencies (such approval may be conditioned on items required by the
Rating Agencies including a requirement that the parent guarantee the
obligations of such insurance company). Notwithstanding anything to the contrary
in this Section 5.1.2, the insurance companies carrying the insurance required
hereunder as of the date hereof (the "CURRENT INSURERS") are hereby approved by
Lender and each Current Insurer shall continue to be approved by Lender for so
long as no material adverse change occurs with respect to the financial
condition, claims paying ability or other material aspects of such Current
Insurer. Notwithstanding the foregoing, so long as (i) the Telcordia Lease an
Acceptable Replacement Lease remains in full force and effect with Telcordia or
its assignee as the tenant thereunder or an Acceptable Replacement Tenant, (ii)
Telcordia or an Acceptable Replacement Tenant is not in default under the
Telcordia Lease or an Acceptable Replacement Lease, as applicable, beyond any
applicable notice and cure periods set forth in the Telcordia Lease, and (iii)
Borrower provides Lender with original Policies or certificates of insurance
evidencing that Telcordia or an Acceptable Replacement Tenant is carrying all
insurance required under the Telcordia Lease or an Acceptable Replacement Lease,
as applicable, then the requirements of Section 5.1.1 and 5.1.2 shall be deemed
satisfied.

         SECTION 5.2 CONDEMNATION. Borrower shall promptly give Lender notice
upon Borrower becoming aware of any actual or threatened commencement of any
condemnation or

                                      -41-

<PAGE>

eminent domain proceeding and shall deliver to Lender copies of any and all
papers served in connection with such proceedings. 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), Borrower shall continue to pay the Debt at the
time and in the manner provided for its payment in the Note and in this
Agreement and the Debt shall not be reduced until any award or payment therefor
shall have been actually received and applied by Lender, after the deduction of
expenses of collection, to the reduction or discharge of the Debt. Subject to
Section 5.3 herein and the Telcordia Lease, Borrower shall cause the award or
payment made in any condemnation or eminent domain proceeding, which is payable
to Borrower, to be paid directly to Lender. Subject to Section 5.3 herein and
the Telcordia Lease, Lender shall not be limited to the interest paid on the
award by the condemning authority but shall be entitled to receive out of the
award interest at the rate or rates provided herein or in the Note. Subject to
Section 5.3 herein and the Telcordia Lease, Lender may apply any award or
payment to the reduction or discharge of the Debt whether or not then due and
payable without prepayment penalty or premium. If the Property is sold, through
foreclosure or otherwise, prior to the receipt by Lender of the award or
payment, Lender shall have the right, whether or not a deficiency judgment on
the Note (to the extent permitted in the Note or herein) shall have been sought,
recovered or denied, to receive the award or payment allocated to Borrower under
the Telcordia Lease, or a portion thereof sufficient to pay the Debt. Use of the
Net Proceeds to pay down the Debt as may be required by Lender herein will not
cause Borrower to incur either a prepayment premium or a penalty. In the event
of any conflict between the terms and conditions contained herein with respect
to the payment or settlement of any casualty or condemnation proceeds or awards
and the terms and conditions of the Telcordia Lease as of the date hereof, such
terms and conditions of the Telcordia Lease shall control.

         SECTION 5.3 RESTORATION AFTER CASUALTY/CONDEMNATION. In the event of a
casualty or a taking by eminent domain, the following provisions shall apply in
connection with the Restoration (defined below) of the Property:

         (a) If the Property shall be damaged or destroyed, in whole or in part,
by fire or other casualty, or if the Property or any portion thereof is taken by
the power of eminent domain, and such damage and/or taking exceeds the
Restoration Threshold, Borrower shall give prompt notice of such damage or
taking to Lender and, subject to Sections 17, 18 and 19 of the Telcordia Lease,
shall promptly commence or cause to be commenced and diligently prosecute or
cause to be prosecuted the completion of the repair and restoration of the
Property as nearly as possible to the condition the Property was in immediately
prior to such fire or other casualty or taking, with such alterations as may be
approved by Lender (the "Restoration"). Use of the Net Proceeds to pay down the
Debt as may be required by Lender herein will not cause Borrower to incur either
a prepayment premium or a penalty.

         (b) The term "Net Proceeds" for purposes of this Section 5.3 shall
mean: (i) the net amount of all insurance proceeds under the Policies carried
pursuant to Subsections (i), (iii), (vi) and (xi) of this Agreement as a result
of such damage or destruction, after deduction of Lender's reasonable costs and
expenses (including, but not limited to reasonable counsel fees), if any, in
collecting the same, or (ii) the net amount of all awards and payments received
by Lender with respect to a taking referenced in Section 5.2 of this Agreement,
after deduction of Lender's reasonable costs and expenses (including, but not
limited to reasonable counsel fees), if any, in

                                      -42-

<PAGE>

collecting the same, whichever the case may be. If (i) the Net Proceeds do not
exceed the Restoration Threshold; (ii) the costs of completing the Restoration
as reasonably estimated by Borrower shall be less than or equal to the Net
Proceeds (plus any additional security posted by Borrower or Telcordia for the
purpose of completing the Restoration and acceptable to Lender in its reasonable
discretion) or Telcordia shall be unconditionally obligated and, in Lender's
reasonable discretion, financially able to complete the Restoration in full,
regardless of the amount of the Net Proceeds; (iii) no Event of Default shall
have occurred and be continuing under the Note, this Agreement or any of the
other Loan Documents; (iv) the Property and the use thereof after the
Restoration will be in material compliance with, and permitted under, all
applicable zoning laws, ordinances, rules and regulations (including, without
limitation, all applicable Environmental Laws); (v) (A) in the event that the
Net Proceeds are insurance proceeds, less than twenty-five percent (25%) of the
total floor area of the Improvements has been damaged or destroyed, or rendered
unusable as a result of such fire or other casualty; or (B) in the event that
the Net Proceeds are condemnation awards, less than 25% of the Land (as defined
in the Mortgages) constituting the Property is taken, such Land that is taken is
located along the perimeter or periphery of the Property, no material portion of
the Improvements is located in such Lands, and such taking does not materially
impair access to the Property; and (vi) Lender shall be reasonably satisfied
that any operating deficits, including all scheduled payments of principal and
interest under the Note which will be incurred with respect to the Property as a
result of the occurrence of any such fire or other casualty or taking, whichever
the case may be, will be covered out of (1) the Net Proceeds, or (2) other funds
of Borrower, then the Net Proceeds will be disbursed directly to Borrower.
Notwithstanding anything to the contrary contained in this Section 5.3(b), so
long as (i) the Telcordia Lease remains in full force and effect and (ii)
Telcordia is not in default under the Telcordia Lease beyond any applicable
notice and cure periods set forth in the Telcordia Lease, then (1) subsections
(iv) and (v) of Section 5.3(b) shall be deemed not applicable and (2) Telcordia
shall be entitled to adjust and settle any claim less than the Restoration
Threshold and all settlements of claims, regardless of amount, shall be subject
to the approval of Telcordia.

         (c) If the Net Proceeds are greater than the Restoration Threshold or
Borrower is not otherwise entitled to have the Net Proceeds disbursed directly
to Borrower pursuant to Subsection 5.3(b), such Net Proceeds shall be forthwith
paid to Lender to be held by Lender in a segregated account to be made available
to Borrower for the Restoration in accordance with the provisions of this
Subsection 5.3(c).

      The Net Proceeds held by Lender pursuant to this Subsection 5.3(c) shall
be made available to Borrower for payment or reimbursement of Borrower's
expenses in connection with the Restoration, subject to the following
conditions:

         (i) no Event of Default shall have occurred and be continuing under the
Note, this Agreement or any of the other Loan Documents;

         (ii) Lender shall, within a reasonable period of time prior to request
for initial disbursement, be furnished with an estimate of the cost of the
Restoration accompanied by an independent architect's certification as to such
costs and appropriate plans and specifications for the Restoration, such plans
and specifications and cost estimates to be subject to Lender's approval, not to
be unreasonably withheld or delayed;

                                      -43-

<PAGE>

         (iii) the Net Proceeds, together with any cash or cash equivalent
deposited by Borrower with Lender, are sufficient to cover the cost of the
Restoration as such costs are certified by the independent architect or, to the
extent the Borrower does not deposit the deficiency, Borrower or Telcordia
demonstrate to Lender the ability, as determined by Lender in its reasonable
discretion, to pay the deficiency and all deficiency funds are expended prior to
the release of any of the Net Proceeds by Borrower;

         (iv) Net Proceeds are less than the then outstanding principal balance
of the Note;

         (v) (A) in the event that the Net Proceeds are insurance proceeds, less
than twenty-five percent (25%) of the total floor area of the Improvements has
been damaged or destroyed, or rendered unusable as a result of such fire or
other casualty; or (B) in the event that the Net Proceeds are condemnation
awards, less than 25% of the Land constituting the Property is taken, such Land
that is taken is located along the perimeter or periphery of the Property, no
material portion of the Improvements is located in such Lands and such taking
does not materially impair access to the Property, provided, however, that the
terms of this Section 5.3(c)(v) shall not apply so long as Telcordia is
obligated to perform the Restoration pursuant to the terms of the Telcordia
Lease;

         (vi) Lender shall be satisfied that any operating deficits, including
all scheduled payments of principal and interest under the Note which will be
incurred with respect to the Property as a result of the occurrence of any such
fire or other casualty or taking, whichever the case may be, will be covered out
of (1) the Net Proceeds, or (2) other funds of Borrower;

         (vii) Lender shall be satisfied that, upon the completion of the
Restoration, the net cash flow of the Property will be restored to a level
sufficient to cover all carrying costs and operating expenses of the Property,
including, without limitation, debt service on the Note and all required
replacement reserves, reserves for tenant improvements and leasing commissions,
if any;

         (viii) the Restoration can reasonably be completed on or before the
earliest to occur of (A) six (6) months prior to the Maturity Date (as defined
in the Note), (B) the earliest date required for such completion under the terms
of any Major Leases and (C) such time as may be required under applicable zoning
law, ordinance, rule or regulation in order to repair and restore the Property
to as nearly as possible the condition it was in immediately prior to such fire
or other casualty or to such taking, as applicable;

         (ix) the Property and the use thereof after the Restoration will be in
material compliance with, and permitted under, all applicable zoning laws,
ordinances, rules and regulations (including, without limitation, all applicable
Environmental Laws; and

         (x) each Major Lease in effect as of the date of the occurrence of such
fire or other casualty shall remain in full force and effect during and after
the completion of the Restoration without abatement of rent beyond the time
required for Restoration.

                                      -44-

<PAGE>

         (d) The Net Proceeds held by Lender until disbursed in accordance with
the provisions of this Section 5.3 shall constitute additional security for the
Debt. The Net Proceeds other than the Net Proceeds paid under the Policy
described in Subsection 5.1(a)(iv) shall be disbursed by Lender to, or as
directed by, Borrower, in an amount equal to the costs actually incurred from
time to time for work in place as part of the Restoration less customary
retainage from time to time during the course of the Restoration, not more
frequently than once per month, upon receipt of evidence satisfactory to Lender
that (A) all materials installed and work and labor performed (except to the
extent that they are to be paid for out of the requested disbursement) in
connection with the Restoration have been paid for in full, and (B) there exist
no notices of pendency, stop orders, mechanic's or materialmen's liens or
notices of intention to file same, or any other liens or encumbrances of any
nature whatsoever on the Property arising out of the Restoration which have not
either been fully bonded and discharged of record or in the alternative fully
insured to the satisfaction of Lender by the title company insuring the lien of
this Security Instrument. The Net Proceeds paid under the Policy described in
Subsection 5.3(a)(iv) shall be disbursed by Lender to pay for debt service under
the loan evidenced by the Note, to pay other expenses incurred by Borrower in
connection with the ownership and operation of the Property, and the remainder
thereof, to, or as directed by, Borrower to pay for the cost of the Restoration
in accordance with this Section 5.3(d). Final payment of all remaining Net
Proceeds shall be made after submission to Lender of all licenses, permits,
certificates of occupancy and other required approvals of governmental
authorization having jurisdiction and Casualty Consultant's (as defined below)
certification that the Restoration has been fully completed.

         (e) Subject to the rights of Telcordia under the Telcordia Lease, so
long as the Telcordia Lease remains in full force and effect, Lender shall have
the use of the plans and specifications and all permits, licenses and approvals
required or obtained in connection with the Restoration. The identity of the
contractors, subcontractors and materialmen engaged in the Restoration, as well
as the contracts under which they have been engaged, shall be subject to prior
review and acceptance by Lender and an independent consulting engineer selected
by Lender (the "Casualty Consultant"), such acceptance not to be unreasonably
withheld or delayed. All costs and expenses incurred by Lender in connection
with making the Net Proceeds available for the Restoration including, without
limitation, reasonable counsel fees and disbursements and the Casualty
Consultant's fees, shall be paid by Borrower.

         (f) If at any time the Net Proceeds or the undisbursed balance thereof
shall not, in the reasonable opinion of Lender, be sufficient to pay in full the
balance of the costs which are reasonably estimated by the Casualty Consultant
to be incurred in connection with the completion of the Restoration, Borrower
shall deposit or cause to be deposited the deficiency (the "Net Proceeds
Deficiency") with Lender before any further disbursement of the Net Proceeds
shall be made. The Net Proceeds Deficiency deposited with Lender shall be held
by Lender and shall be disbursed for costs actually incurred in connection with
the Restoration on the same conditions applicable to the disbursement of the Net
Proceeds, and until so disbursed pursuant to this Section 5.3 shall constitute
additional security for the Debt.

         (g) Except upon the occurrence and continuance of an Event of Default,
Borrower shall settle any insurance claims with respect to the Net Proceeds
which in the aggregate are less than the Restoration Threshold. Lender shall
have the right to participate in and reasonably approve any settlement for
insurance claims with respect to the Net Proceeds

                                      -45-
<PAGE>

which in the aggregate are greater than the Restoration Threshold. If an Event
of Default shall have occurred and be continuing, Borrower hereby irrevocably
empowers Lender, in the name of Borrower as its true and lawful
attorney-in-fact, to file and prosecute such claim and to collect and to make
receipt for any such payment. If the Net Proceeds are received by Borrower and
not required to be disbursed to Telcordia pursuant to the Telcordia Lease, such
Net Proceeds shall, until the completion of the related work, be held in trust
for Lender and shall be segregated from other funds of Borrower to be used to
pay for the cost of the Restoration in accordance with the terms hereof.

            (h) The excess, if any, of the Net Proceeds and the remaining
balance, if any, of the Net Proceeds Deficiency deposited with Lender after (i)
the Casualty Consultant certifies to Lender that the Restoration has been
completed in accordance with the provisions of this Section 5.3, and (ii) the
receipt by Lender of evidence satisfactory to Lender that all costs incurred in
connection with the Restoration have been paid in full and all required permits,
licenses, certificates of occupancy and other required approvals of governmental
authorities having jurisdiction have been issued, shall be remitted by Lender to
Borrower, provided no Event of Default shall have occurred and shall be
continuing under the Note, this Agreement or any of the other Loan Documents.

            (i) All Net Proceeds not required (i) to be made available for the
Restoration or (ii) to be returned to Borrower as excess Net Proceeds pursuant
to Subsection 5.3(g) shall be retained and applied by Lender toward the payment
of the Debt without penalty or prepayment premium whether or not then due and
payable in such order, priority and proportions as Lender in its discretion
shall deem proper or, at the discretion of Lender, the same shall be paid,
either in whole or in part, to Borrower. If Lender shall receive and retain Net
Proceeds, the lien of the Mortgages shall be reduced only by the amount received
and retained by Lender and actually applied by Lender in reduction of the Debt.
Lender hereby agrees that Borrower may accept any rejectable offer by Telcordia
to terminate the Telcordia Lease upon the occurrence of a Termination Event
provided that simultaneously with payment of the Termination Amount, Borrower
pays Lender, without prepayment premium or penalty, the remaining unpaid
principal balance of the Note, together with unpaid interest accrued thereon.

            VI. RESERVE FUNDS

            SECTION 6.1 REQUIRED REPAIR FUNDS

            6.1.1 DEPOSIT OF REQUIRED REPAIR FUNDS. Borrower shall perform the
repairs at the Property as set forth on Schedule II hereto (such repairs
hereinafter referred to as "Required Repairs") and shall complete each of the
Required Repairs on or before the respective deadline for each repair as set
forth on Schedule II. On the Closing Date, Borrower shall deposit with Agent the
amount set forth on such Schedule II hereto to perform the Required Repairs.
Amounts deposited pursuant to this Section 6.1.1 are referred to herein as the
"Required Repair Funds".

            6.1.2 RELEASE OF REQUIRED REPAIR FUNDS. Lender shall direct Agent to
disburse to Borrower the Required Repair Funds within five (5) business days
after satisfaction by Borrower of each of the following conditions: (a) Borrower
shall submit a request for

                                      -46-
<PAGE>

payment to Lender at least ten (10) days prior to the date on which Borrower
requests such payment be made and specifies the Required Repairs to be paid, (b)
on the date such request is received by Lender and on the date such payment is
to be made, no Event of Default shall exist and remain uncured, (c) Lender shall
have received a certificate from Borrower (i) stating that all Required Repairs
to be funded by the requested disbursement have been completed in a good and
workmanlike manner and in accordance with all applicable Legal Requirements,
such certificate to be accompanied by a copy of any license, permit or other
approval by any Governmental Authority required in connection with the Required
Repairs, (ii) identifying each Person that supplied materials or labor in
connection with the Required Repairs to be funded by the requested disbursement,
and (iii) stating that each such Person has been paid in full or will be paid in
full upon such disbursement, such certificate to be accompanied by lien waivers
or other evidence of payment satisfactory to Lender, (d) at Lender's option, a
title search for the Property indicating that the Property is free from all
liens, claims and other encumbrances not previously approved by Lender, (e) at
Lender's option, if the cost of the Required Repairs exceeds $75,000, Lender
shall have received a report satisfactory to Lender in its reasonable discretion
from an architect or engineer approved by Lender in respect of such architect or
engineer's inspection of the required repairs, and (f) Lender shall have
received such other evidence as Lender shall reasonably request that the
Required Repairs to be funded by the requested disbursement have been completed
and are paid for or will be paid upon such disbursement to Borrower. Lender
shall not be required to disburse Required Repair Funds more frequently than
once each calendar month, unless such requested disbursement is in an amount
greater than the Minimum Disbursement Amount (or a lesser amount if the total
Required Repair Funds is less than the Minimum Disbursement Amount, in which
case only one disbursement of the amount remaining in the account shall be
made).

            SECTION 6.2 TAX FUNDS.

            6.2.1 DEPOSITS OF TAX FUNDS. On the Closing Date, Borrower shall
deposit with Agent the amount of 0.00 and No/100 Dollars and, pursuant to the
Cash Management Agreement, there shall be deposited on each Monthly Payment Date
an amount equal to one- twelfth of the Taxes that Lender estimates will be
payable during the next ensuing twelve (12) months in order to accumulate
sufficient funds to pay all such Taxes at least ten (10) days prior to their
respective due dates. Amounts deposited pursuant to this Section 6.2.1 are
referred to herein as the "Tax Funds". If at any time Lender reasonably
determines that the Tax Funds will not be sufficient to pay the Taxes, Lender
shall notify Borrower of such determination and the monthly deposits for Taxes
shall be increased by the amount that Lender estimates is sufficient to make up
the deficiency at least ten (10) days prior to the respective due dates for the
Taxes; provided that if Borrower receives notice of any deficiency after the
date that is ten (10) days prior to the date that Taxes are due, Borrower will
deposit such amount within one (1) Business Day after its receipt of such
notice. Notwithstanding the foregoing, so long as no Event of Default has
occurred and is continuing and then Borrower shall not be required to make
monthly payments of Tax Funds.

            6.2.2 RELEASE OF TAX FUNDS. Lender shall have the right to apply the
Tax Funds to payments of Taxes. In making any payment relating to Taxes, Lender
may do so according to any bill, statement or estimate procured from the
appropriate public office (with respect to Taxes) without inquiry into the
accuracy of such bill, statement or estimate or into the

                                      -47-

<PAGE>

validity of any tax, assessment, sale, forfeiture, tax lien or title or claim
thereof. If the amount of the Tax Funds shall exceed the amounts due for Taxes,
Lender shall, in its sole discretion, return any excess to Borrower or credit
such excess against future payments to be made to the Tax Funds. Any Tax Funds
remaining after the Debt has been paid in full or after all Events of Default
shall have been cured shall be returned to Borrower.

            SECTION 6.3 INSURANCE FUNDS.

            6.3.1 DEPOSITS OF INSURANCE FUNDS. On the Closing Date, Borrower
shall deposit with Agent the amount of 0.00 and No/100 Dollars and, pursuant to
the Cash Management Agreement, there shall be deposited on each Monthly Payment
Date an amount equal to one-twelfth of the Insurance Premiums that Lender
estimates will be payable for the renewal of the coverage afforded by the
Policies upon the expiration thereof in order to accumulate sufficient funds to
pay all such Insurance Premiums at least thirty (30) days prior to the
expiration of the Policies. Amounts deposited pursuant to this Section 6.3.1 are
referred to herein as the "Insurance Funds". If at any time Lender reasonably
determines that the Insurance Funds will not be sufficient to pay the Insurance
Premiums, Lender shall notify Borrower of such determination and the monthly
deposits for Insurance Premiums shall be increased by the amount that Lender
estimates is sufficient to make up the deficiency at least thirty (30) days
prior to expiration of the Policies. Notwithstanding the foregoing, so long as
no Event of Default has occurred and is continuing then Borrower shall not be
required to make monthly payments of Insurance Funds.

            6.3.2 RELEASE OF INSURANCE FUNDS. Lender shall have the right to
apply the Insurance Funds to payment of Insurance Premiums. In making any
payment relating to Insurance Premiums, Lender may do so according to any bill,
statement or estimate procured from the insurer or its agent, without inquiry
into the accuracy of such bill, statement or estimate. If the amount of the
Insurance Funds shall exceed the amounts due for Insurance Premiums, Lender
shall, in its sole discretion, return any excess to Borrower or credit such
excess against future payments to be made to the Insurance Funds. Any Insurance
Funds remaining after the Debt has been paid in full or after all Events of
Default shall have been cured shall be returned to Borrower.

            SECTION 6.4 CAPITAL EXPENDITURE FUNDS.

            6.4.1 DEPOSITS OF CAPITAL EXPENDITURE FUNDS. Borrower shall deposit
with Lender on each Monthly Payment Date an amount equal to $0.00 for annual
Capital Expenditures approved by Lender, which approval shall not be
unreasonably withheld or delayed. Amounts deposited pursuant to this Section
6.4.1 are referred to herein as the "Capital Expenditure Funds". Lender may
reassess its estimate of the amount necessary for capital expenditures from time
to time and, and may require Borrower to increase the monthly deposits required
pursuant to this Section 6.4.1 during the continuance of an Event of Default
upon thirty (30) days notice to Borrower if Lender determines in its reasonable
discretion that an increase is necessary to maintain proper operation of the
Property. Any Capital Expenditure Funds remaining after the Debt has been paid
in full or after all Events of Default shall have been cured shall be returned
to Borrower.

                                      -48-

<PAGE>

            6.4.2 RELEASE OF CAPITAL EXPENDITURE FUNDS. (a) Lender shall direct
Agent to disburse Capital Expenditure Funds only for Capital Expenditures.

            (b) Lender shall direct Agent to disburse to Borrower the Capital
Expenditure Funds within five (5) business days after satisfaction by Borrower
of each of the following conditions: (i) Borrower shall submit a request for
payment to Lender at least ten (10) days prior to the date on which Borrower
requests such payment be made and specifies the Capital Expenditures to be paid,
(ii) on the date such request is received by Lender and on the date such payment
is to be made, no Event of Default shall exist and remain uncured, (iii) Lender
shall have received a certificate from Borrower (A) stating that the items to be
funded by the requested disbursement are Capital Expenditures, (B) stating that
all Capital Expenditures at the Property to be funded by the requested
disbursement have been completed in a good and workmanlike manner and in
accordance with all applicable Legal Requirements, such certificate to be
accompanied by a copy of any license, permit or other approval required by any
Governmental Authority in connection with the Capital Expenditures, (C)
identifying each Person that supplied materials or labor in connection with the
Capital Expenditures to be funded by the requested disbursement, and (D) stating
that each such Person has been paid in full or will be paid in full upon such
disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment satisfactory to Lender, (iv) at Lender's option, a title
search for the Property indicating that the Property is free from all Liens,
claims and other encumbrances not previously approved by Lender, and (v) at
Lender's option, if the cost of any individual Capital Expenditure exceeds
$75,000, Lender shall have received a report satisfactory to Lender in its
reasonable discretion from an architect or engineer approved by Lender in
respect of such architect or engineer's inspection of the required repairs, and
(vi) Lender shall have received such other evidence as Lender shall reasonably
request that the Capital Expenditures at the Property to be funded by the
requested disbursement have been completed and are paid for or will be paid upon
such disbursement to Borrower. Lender shall not be required to disburse Capital
Expenditure Funds more frequently than once each calendar month, unless such
requested disbursement is in an amount greater than the Minimum Disbursement
Amount (or a lesser amount if the total amount of Capital Expenditure Funds is
less than the Minimum Disbursement Amount, in which case only one disbursement
of the amount remaining in the account shall be made).

            (c) Nothing in this Section 6.4.2 shall (i) make Lender responsible
for making or completing the Capital Expenditures Work; (ii) require Lender to
expend funds in addition to the Capital Expenditure Funds to complete any
Capital Expenditures Work; (iii) obligate Lender to proceed with the Capital
Expenditures Work; or (iv) obligate Lender to demand from Borrower additional
sums to complete any Capital Expenditures Work.

            (d) Borrower shall permit Lender and Lender's agents and
representatives (including, without limitation, Lender's engineer, architect, or
inspector) or third parties to enter onto the Property during normal business
hours (subject to the rights of Tenants under their Leases), upon reasonable
advance notice to Borrower, to inspect the progress of any Capital Expenditures
Work and all materials being used in connection therewith and to examine all
plans and shop drawings relating to such Capital Expenditures Work. Borrower
shall cause all contractors and subcontractors to cooperate with Lender or
Lender's representatives or such other Persons described above in connection
with inspections described in this Section 6.4.2(d).

                                      -49-

<PAGE>

            (e) If a disbursement will exceed $75,000, Lender may require an
inspection of the Property at Borrower's expense prior to making a disbursement
of Capital Expenditure Funds in order to verify completion of the Capital
Expenditures Work for which reimbursement is sought. Lender may require that
such inspection be conducted by an appropriate independent qualified
professional selected by Lender and may require a certificate of completion by
an independent qualified professional architect acceptable to Lender prior to
the disbursement of Capital Expenditure Funds. Borrower shall pay the expense of
the inspection as required hereunder, whether such inspection is conducted by
Lender or by an independent qualified professional architect.

            (f) In addition to any insurance required under the Loan Documents,
Borrower shall provide or cause to be provided workmen's compensation insurance,
builder's risk, and public liability insurance and other insurance to the extent
required under applicable law in connection with Capital Expenditures Work. All
such policies shall be in form and amount reasonably satisfactory to Lender.

            SECTION 6.5 ROLLOVER FUNDS.

            6.5.1 DEPOSITS OF ROLLOVER FUNDS. Borrower shall deposit with Lender
on each Monthly Payment Date the sum of $0.00, for tenant improvements and
leasing commissions that may be incurred following the date hereof. Amounts
deposited pursuant to this Section 6.5.1 are referred to herein as the "Rollover
Funds".

            6.5.2 RELEASE OF ROLLOVER FUNDS. Lender shall direct Agent to
disburse to Borrower the Rollover Funds within 5 business days after
satisfaction by Borrower of each of the following conditions: (i) Borrower shall
submit a request for payment to Lender at least ten (10) days prior to the date
on which Borrower requests such payment be made and specifies the tenant
improvement costs and leasing commissions to be paid, (ii) on the date such
request is received by Lender and on the date such payment is to be made, no
Event of Default shall exist and remain uncured, (iii) Lender shall have
reviewed and approved the Lease in respect of which Borrower is obligated to pay
or reimburse certain tenant improvement costs and leasing commissions, (iv)
Lender shall have received and approved a budget for tenant improvement costs
and a schedule of leasing commissions payments and the requested disbursement
will be used to pay all or a portion of such costs and payments, (v) Lender
shall have received a certificate from Borrower (A) stating that all tenant
improvements at the Property to be funded by the requested disbursement have
been completed in good and workmanlike manner and in accordance with all
applicable federal, state and local laws, rules and regulations, such
certificate to be accompanied by a copy of any license, permit or other approval
by any Governmental Authority required in connection with such tenant
improvements, (B) identifying each Person that supplied materials or labor in
connection with the tenant improvements to be funded by the requested
disbursement, and (C) stating that each such Person has been paid in full or
will be paid in full upon such disbursement, such certificate to be accompanied
by lien waivers or other evidence of payment satisfactory to Lender, (vi) at
Lender's option, a title search for the Property indicating that the Property is
free from all Liens, claims and other encumbrances not previously approved by
Lender, and (vii) Lender shall have received such other evidence as Lender shall
reasonably request that the tenant improvements at the Property to be funded by
the requested disbursement have been completed and are paid for or will be paid
upon such disbursement to

                                      -50-

<PAGE>

Borrower. Lender shall not be required to disburse Rollover Funds more
frequently than once each calendar month, unless such requested disbursement is
in an amount greater than the Minimum Disbursement Amount (or a lesser amount if
the total amount of Rollover Funds is less than the Minimum Disbursement Amount,
in which case only one disbursement of the amount remaining in the account shall
be made).

            SECTION 6.6 INTENTIONALLY OMITTED.

            SECTION 6.7 APPLICATION OF RESERVE FUNDS.

            Upon the occurrence of an Event of Default, Lender, at its option,
may withdraw the Reserve Funds and apply the Reserve Funds to the items for
which the Reserve Funds were established or to payment of the Debt in such
order, proportion and priority as Lender may determine in its sole discretion.
Lender's right to withdraw and apply the Reserve Funds shall be in addition to
all other rights and remedies provided to Lender under the Loan Documents.

            SECTION 6.8 SECURITY INTEREST IN RESERVE FUNDS.

            6.8.1 GRANT OF SECURITY INTEREST. Borrower shall be the owner of the
Reserve Funds. Borrower hereby pledges, assigns and grants a security interest
to Lender, as security for payment of the Debt and the performance of all other
terms, conditions and covenants of the Loan Documents on Borrower's part to be
paid and performed, in all of Borrower's right, title and interest in and to the
Reserve Funds. The Reserve Funds shall be under the sole dominion and control of
Lender.

            6.8.2 INCOME TAXES. Borrower shall report on its federal, state and
local income tax returns all interest or income accrued on the Reserve Funds.

            6.8.3 PROHIBITION AGAINST FURTHER ENCUMBRANCE. Borrower shall not,
without the prior consent of Lender, further pledge, assign or grant any
security interest in the Reserve Funds or permit any lien or encumbrance to
attach thereto, or any levy to be made thereon, or any UCC-1 Financing
Statements, except those naming Lender as the secured party, to be filed with
respect thereto.

            VII. MANAGEMENT

            The management of the Property shall be by: (a) Borrower or an
entity affiliated with Borrower approved by Lender in its reasonable discretion
for so long as Borrower or said affiliated entity is managing the Property in a
manner comparable to similar properties; or (b) a professional property
management company approved by Lender in its reasonable discretion; or (c) for
so long as the Telcordia Lease or an Acceptable Replacement Lease is in full
force and effect, by Telcordia or such Acceptable Replacement Tenant. Such
management by an affiliated entity or a professional property management company
shall be pursuant to a written agreement approved by Lender in its reasonable
discretion. In no event shall any manager be removed or replaced or the terms of
any management agreement modified or amended without the prior written consent
of Lender, which consent shall not be unreasonably withheld, conditioned or
delayed. In the event of default hereunder or under any management contract then
in effect,

                                      -51-

<PAGE>

which default is not cured within any applicable grace or cure period, Lender
shall have the right to immediately terminate, or to direct Borrower to
immediately terminate, such management contract and to retain, or to direct
Borrower to retain, a new management agent approved by Lender. All Rents
generated by or derived from the Property shall first be utilized solely for
current expenses directly attributable to the ownership and operation of the
Property, including, without limitation, current expenses relating to Borrower's
liabilities and obligations with respect to the Note, this Agreement and the
other Loan Documents, and none of the Rents generated by or derived from the
Property shall be diverted by Borrower and utilized for any other purpose unless
all such current expenses attributable to the ownership and operation of the
Property have been fully paid and satisfied.

            VIII. DUE ON SALE/ENCUMBRANCE

      SECTION 8.1 LENDER RELIANCE. Borrower acknowledges that Lender has
examined and relied on the experience of Borrower and its officers, directors,
general partners, members, principals and (if Borrower is a trust) beneficial
owners, as applicable, in owning and operating properties such as the Property
in agreeing to make the Loan, and will continue to rely on Borrower's ownership
of the Property as a means of maintaining the value of the Property as security
for repayment of the Debt and the performance of the Other Obligations. Borrower
acknowledges that Lender has a valid interest in maintaining the value of the
Property so as to ensure that, should Borrower default in the repayment of the
Debt or the performance of the Other Obligations, Lender can recover the Debt by
a sale of the Property.

      SECTION 8.2 NO SALE/ENCUMBRANCE. Borrower agrees that Borrower shall not,
without the prior written consent of Lender, sell, convey, mortgage, grant,
bargain, encumber, pledge, assign, or otherwise transfer the Property or any
part thereof or any interest therein or any direct or indirect interest in
Borrower or permit the Property or any part thereof or any interest therein or
any direct or indirect interest in Borrower to be sold, conveyed, mortgaged,
granted, bargained, encumbered, pledged, assigned, or otherwise transferred,
other than pursuant to Leases of space in the Improvements to tenants in
accordance with the provisions of Section 4.1.9 hereof.

      SECTION 8.3 SALE/ENCUMBRANCE DEFINED.

            (a) A sale, conveyance, mortgage, grant, bargain, encumbrance,
pledge, assignment, or transfer within the meaning of this Article 8 shall be
deemed to include, but not be limited to, (a) an installment sales agreement
wherein Borrower agrees to sell the Property or any part thereof for a price to
be paid in installments; (b) an agreement by Borrower leasing all or a
substantial part of the Property for other than actual occupancy by a space
tenant thereunder or a sale, assignment or other transfer of, or the grant of a
security interest in, Borrower's right, title and interest in and to any Leases
or any Rents; (c) if Borrower, any Guarantor, or any general or limited partner
or member of Borrower or any Guarantor is a corporation, any merger,
consolidation or voluntary or involuntary sale, conveyance, transfer or pledge
of such corporation's stock (or the stock of any corporation directly or
indirectly controlling such corporation by operation of law or otherwise) or the
creation or issuance of new stock in one or a series of transactions by which an
aggregate of more than 10% of such corporation's stock shall be vested in a
party or parties who are not now stockholders; (d) if Borrower or any Guarantor
or

                                      -52-

<PAGE>

any general or limited partner or member of Borrower or any Guarantor is a
limited or general partnership or joint venture, the change, removal or
resignation of a general partner or the transfer or pledge of the partnership
interest of any general partner or any profits or proceeds relating to such
partnership interest or the voluntary or involuntary sale, conveyance, transfer
or pledge of limited partnership interests (or the limited partnership interests
of any limited partnership directly or indirectly controlling such limited
partnership by operation of law or otherwise); and (e) if Borrower or any
Guarantor or any general or limited partner or member of Borrower or any
Guarantor is a limited liability company, the change, removal or resignation of
a managing member (or if no managing member, any member or non-member manager)
or the transfer of the membership interest of a managing member (or if no
managing member, any member) or any profits or proceeds relating to such
membership interest or the voluntary or involuntary sale, conveyance, transfer
or pledge of membership interests (or the membership interests of any limited
liability company directly or indirectly controlling such limited liability
company by operation of law or otherwise).

            (b) Notwithstanding the foregoing, so long as the Guarantor is
Corporate Property Associates 12 Incorporated, Corporate Property Associates 14
Incorporated, Corporate Property Associates 15 Incorporated or an Affiliate (as
defined in Section 6.5(b) hereof) (each, a "GUARANTOR"), the provisions of
clauses (c), (d) and (e) in Section 8.3(a) above shall not apply to the
Guarantor or any interest holder therein. Notwithstanding anything in this
Agreement to the contrary, (i) the transfer of any direct or indirect interests
in Borrower shall be permitted without the consent of Lender and without
requiring receipt by Lender of confirmation in writing from the Rating Agencies
that rate the Securities to the effect that such transfer will not result in a
qualification, downgrade or withdrawal of any rating initially assigned or then
currently assigned or to be assigned to the Securities, as applicable (and no
fee or charge shall be required to be paid to Lender or any Rating Agency on
account of any such transfer), so long as following such transfer, Carey Asset
Management Corp. and/or any Affiliate responsible for the management and/or
control of the Property and/or Borrower remains in legal, beneficial and actual
control and management of the Property and/or Borrower, (ii) any involuntary
transfer caused by the death of Borrower or any general partner, shareholder,
joint venturer, member or beneficial owner of a trust shall not be an Event of
Default under this Agreement so long as Borrower is reconstituted, if required,
following such death and so long as those persons responsible for the control
and/or management of the Property and/or Borrower remain unchanged as a result
of such death, or any replacement control and/or management is approved in
writing by Lender in each instance, (iii) gifts for estate planning purposes of
any individual's interests in Borrower or in any of Borrower's general partners,
members or joint venturers to the spouse or any lineal descendant of such
individual, or to a trust for the benefit of any one or more of such individual,
spouse or lineal descendant, shall not be an Event of Default under this Loan
Agreement so long as Borrower is reconstituted, if required, following such gift
and so long as those persons responsible for the control and/or management of
the Property and/or Borrower remain unchanged following such gift, or any
replacement control and/or management is approved in writing by Lender in each
instance, (iv) the transfer of stock of any general partner, shareholder, joint
venturer, member or beneficial owner of a trust stock in Borrower or any of its
principals, including, without limitation, any Guarantor or any Indemnitor, from
time to time on a recognized public exchange shall be freely transferable
without the consent of Lender and without requiring receipt by Lender of
confirmation in writing from the Rating Agencies that rate the Securities to the
effect that such transfer will not result in a qualification, downgrade or

                                      -53-

<PAGE>

withdrawal of any rating initially assigned or then currently assigned or to be
assigned to the Securities, as applicable (and no fee or charge shall be
required to be paid to Lender or any Rating Agency on account of any such
transfer), and (v) the transfer of any direct or indirect interest of any
general partner, shareholder, joint venturer, member or beneficial owner of a
trust stock in Borrower or any of its principals, including, without limitation,
any Guarantor or any Indemnitor, shall be permitted from time to time to any
Affiliate without the consent of Lender and without requiring receipt by Lender
of confirmation in writing from the Rating Agencies that rate the Securities or
Participations to the effect that such transfer will not result in a
qualification, downgrade or withdrawal of any rating initially assigned or then
currently assigned or to be assigned to the Securities or Participations, as
applicable (and no fee or charge shall be required to be paid to Lender or any
Rating Agency on account of any such transfer), so long as following such
transfer, Carey Asset Management Corp. and/or any Affiliate responsible for the
management and/or control of the Property and/or Borrower remains in legal,
beneficial and actual control and management of the Property and/or Borrower. By
way of clarification, transfers of any direct or indirect ownership interests in
Borrower or in any partner, shareholder or member of Borrower by Corporate
Property Associates 16-Global Incorporated pursuant to a merger, consolidation,
sale or any other transfer shall be permitted with or to any Affiliate without
restriction and without the prior consent of Lender and without requiring
receipt by Lender of confirmation in writing from the Rating Agencies that rate
the Securities or Participations to the effect that such transfer will not
result in a qualification, downgrade or withdrawal of any rating initially
assigned or then currently assigned or to be assigned to the Securities or
Participations, as applicable (and no fee or charge shall be required to be paid
to Lender or any Rating Agency on account of any such transfer).

            (c) If, in connection with a transfer permitted or consented to by
Lender pursuant to this Section 8.3, an Affiliate assumes the obligations of any
Guarantor or any Indemnitor and such Affiliate has a net worth of at least
$25,000,000 and shall execute, without any cost or expense to Lender, a new
guaranty or indemnity agreement in form and substance substantially similar to
the Environmental Indemnity and the Guaranty, then Lender shall release such
Guarantor or Indemnitor from all obligations first arising under the
Environmental Indemnity and the Guaranty after the closing of such transfer.

      SECTION 8.4 LENDER'S RIGHTS. Lender reserves the right to condition the
consent required hereunder upon a modification of the terms hereof and on
assumption of the Note, this Security Instrument and the other Loan Documents as
so modified by the proposed transferee, payment of a transfer fee equal to one
percent (1%) of the then outstanding principal balance of the Note, and all of
Lender's expenses incurred in connection with such transfer, the approval by a
Rating Agency of the proposed transferee, the proposed transferee's continued
compliance with the covenants set forth in this Security Instrument, including,
without limitation, the covenants in Section 3.1.24 of this Agreement or
Lender's standard single purpose entity provisions for a loan of this size, or
such other conditions as Lender shall determine in its sole discretion to be in
the interest of Lender. All of Lender's expenses incurred shall be payable by
Borrower whether or not Lender consents to the transfer. Lender shall not be
required to demonstrate any actual impairment of its security or any increased
risk of default hereunder in order to declare the Debt immediately due and
payable upon Borrower's sale, conveyance, mortgage, grant, bargain, encumbrance,
pledge, assignment, or transfer of the Property without Lender's consent. This
provision shall apply to every sale, conveyance, mortgage, grant,

                                      -54-

<PAGE>

bargain, encumbrance, pledge, assignment, or transfer of the Property regardless
of whether voluntary or not, or whether or not Lender has consented to any
previous sale, conveyance, mortgage, grant, bargain, encumbrance, pledge,
assignment, or transfer of the Property.

      SECTION 8.5 PERMITTED ONE TIME TRANSFER.

            8.5.1 (a) Notwithstanding the foregoing provisions of this Section,
Lender shall not unreasonably withhold consent to the simultaneous sale,
conveyance or transfer of the Property in its entirety on one occasion (a,
"Sale") after the first anniversary of the first day of the first calendar month
after the date hereof (or the date hereof if dated the first day of a calendar
month) and with respect to such Sale, Lender shall not require a modification of
the material economic terms hereof (other than a corresponding increase in
Borrower's deposits into the Escrow Fund with respect to Taxes in the event such
Sale results in an increase in the real property tax assessment by the
applicable taxing authority), to any person or entity provided that each of the
following terms and conditions are satisfied:

                  (a) no default after the expiration of notice or grace periods
            is then continuing hereunder, under the Note, the Security
            Instrument or under any of the other Loan Documents;

                  (b) Borrower gives Lender written notice of the terms of such
            prospective Sale not less than thirty (30) days before the date on
            which such Sale is scheduled to close and, concurrently therewith,
            gives Lender all such information concerning the proposed transferee
            of the Property (hereinafter, "BUYER") as Lender would reasonably
            require in evaluating an initial extension of credit to a borrower
            and pays to Lender a non-refundable application fee in the amount of
            $2,500.00. Lender shall have the right to approve or disapprove the
            proposed Buyer, such approval not to be unreasonably withheld or
            delayed. In determining whether to give or withhold its approval of
            the proposed Buyer, Lender shall consider the Buyer's experience and
            track record in owning and operating facilities similar to the
            Property, the Buyer's financial strength, the Buyer's general
            business standing and the Buyer's relationships and experience with
            contractors, vendors, tenants, lenders and other business entities;
            provided, however, that, notwithstanding Lender's agreement to
            consider the foregoing factors in determining whether to give or
            withhold such approval, such approval shall be given or withheld
            based on what Lender determines to be commercially reasonable and,
            if given, may be given subject to such conditions as Lender may deem
            reasonably appropriate;

                  (c) Borrower pays Lender, concurrently with the closing of
            such Sale, a non-refundable assumption fee in an amount equal to all
            out-of-pocket costs and expenses, including, without limitation,
            reasonable attorneys' fees, incurred by Lender in connection with
            the Sale plus an amount equal to one percent (1.0%) of the then
            outstanding principal balance of the Note. Borrower also pays,
            concurrently with the closing of such Sale, all costs and expenses
            of all third parties and Rating Agencies in connection with the
            Sale;

                                      -55-

<PAGE>

                  (d) Buyer assumes and agrees to pay the indebtedness secured
            hereby as and when due subject to the provisions of Article 11.22
            hereof and, prior to or concurrently with the closing of such Sale,
            the Buyer executes, without any cost or expense to Lender, such
            documents and agreements as Lender shall reasonably require to
            evidence and effectuate said assumption;

                  (e) Borrower and the Buyer execute, without any cost or
            expense to Lender, new financing statements or financing statement
            amendments and any additional documents reasonably requested by
            Lender;

                  (f) Borrower delivers to Lender, without any cost or expense
            to Lender, such endorsements to Lender's title insurance policy,
            hazard insurance endorsements or certificates and other similar
            materials as Lender may reasonably deem necessary at the time of the
            Sale, all in form and substance reasonably satisfactory to Lender,
            including, without limitation, an endorsement or endorsements to
            Lender's title insurance policy insuring the lien of this Security
            Instrument insuring that fee simple title to the Property is vested
            in the Buyer;

                  (g) Buyer shall furnish, if the Buyer is a corporation,
            partnership or other entity, all appropriate papers evidencing the
            Buyer's capacity and good standing, and the qualification of the
            signers to execute the assumption of the indebtedness secured
            hereby, which papers shall include certified copies of all documents
            relating to the organization and formation of the Buyer and of the
            entities, if any, which are partners or members of the Buyer. The
            Buyer and such constituent partners, members or shareholders of
            Buyer (as the case may be), as Lender shall require, shall be single
            purpose, "bankruptcy remote" entities which satisfy the requirements
            of Section 3.1.24 of this Agreement and the requirements of the
            Rating Agencies, and whose formation documents shall be approved by
            counsel to Lender. An individual recommended by the Buyer and
            approved by Lender shall serve as an independent director of the
            Buyer (if the Buyer is a corporation) or the Buyer's corporate
            general partner or an independent member of, in Lender's discretion,
            manager, of Buyer if the Buyer is a limited liability company. The
            consent of such independent director shall be required for, among
            other things, any merger, consolidation, dissolution, bankruptcy or
            insolvency of the Buyer.

                  (h) Buyer shall assume the obligations of Borrower under any
            management agreements pertaining to the Property or assign to Lender
            as additional security any new management agreement entered into in
            connection with such Sale;

                  (i) Buyer shall furnish an opinion of counsel reasonably
            satisfactory to Lender and its counsel (A) that the Buyer's
            formation documents provide for the matters described in
            subparagraph (vii) above, (B) that the assumption of the
            indebtedness evidenced hereby has been duly authorized, executed and
            delivered, and that the Note, this Agreement, the Security
            Instrument, the assumption agreement and the other Loan Documents
            are valid, binding and enforceable

                                      -56-

<PAGE>

            against the Buyer in accordance with their terms, subject to general
            principles of equity and other customary qualifications, (C) that
            the Buyer and any entity which is a controlling stockholder, member
            or general partner of Buyer, have been duly organized, and are in
            existence and good standing, (D) if required by Lender, that the
            assets of the Buyer will not be consolidated with the assets of any
            other entity having an interest in, or affiliation with, the Buyer,
            in the event of bankruptcy or insolvency of any such entity, and (E)
            with respect to such other matters as Lender may reasonably request;

                  (j) Lender shall have received confirmation in writing from
            the Rating Agencies that rate the Securities or Participations (as
            defined in Article 9 of the Loan Agreement) to the effect that the
            Sale will not result in a qualification, downgrade or withdrawal of
            any rating initially assigned or then currently assigned or to be
            assigned to the Securities or Participations, as applicable;

                  (k) An affiliate of Buyer with a net worth (as determined by
            Lender) of not less than Twenty Five Million Dollars ($25,000,000)
            shall have assumed, from and after the date of such Sale, all of the
            obligations of Guarantor under the Environmental Indemnity and the
            Guaranty pursuant to such documents and agreements as Lender shall
            reasonably require to evidence and effectuate such assumption and
            thereafter Guarantor shall be released from all liabilities and
            obligations under the Environmental indemnity and the Guaranty
            arising from matters first occurring from and after the date of such
            Sale; and

                  (l) Borrower's obligations under the contract of sale pursuant
            to which the Sale is proposed to occur shall expressly be subject to
            the satisfaction of the terms and conditions of this Section 8.5.

            8.5.2 Notwithstanding the foregoing provision of this Section,
Borrower shall be permitted, after the first anniversary of the first day of the
first calendar month after the date hereof (or the date hereof if dated the
first day of a calendar month), to transfer or convey on up to two (2) occasions
all or a part of its interests in all of the Individual Properties to any
Affiliate (hereinafter defined) whose key principal's (the "KEY PRINCIPAL") net
worth as determined by Lender shall be not less than Twenty Five Million Dollars
($25,000,0000) without the approval or consent of Lender, any Rating Agency or
any investors in the Loan and without payment of the one percent (1%) transfer
fee and no additional fee shall be required to paid to any Rating Agency or
Investor on account of such transfer (but with payment of all out-of-pocket
expenses, including without limitation, reasonable attorney's fees, incurred by
Lender in connection with the transfer and all costs and expenses of all third
parties and Rating Agencies in connection with the Sale) so long as the terms
and conditions set forth in Sections 8.5.1(a), (d), (e), (f), (g), (h), (i) and
(j) are satisfied. Borrower shall, not less than thirty (30) days before any
such transfer, deliver to Lender written notice of such transfer which notice
shall (i) describe the proposed transfer in reasonable detail, (ii) include
evidence reasonably satisfactory to Lender that the proposed transferee is an
Affiliate of Borrower and that such Key Principal has a net worth of not less
than Twenty Five Million Dollars ($25,000,000), and (iii) include evidence
reasonably satisfactory to Lender that the applicable provisions of Section 8.5
hereof have been satisfied. In connection with any such transfer to an
Affiliate, Key Principal shall assume, from and after the

                                      -57-

<PAGE>

date of such transfer, all of the obligations of Guarantor under the
Environmental Indemnity and the Guaranty pursuant to such documents and
agreements as Lender shall reasonably require to evidence and effectuate such
assumption and thereafter Guarantor shall be released from all liabilities and
obligations under the Environmental Indemnity and the Guaranty arising from
matters first occurring from and after the date of such transfer. As used
herein, the term "AFFILIATE" shall mean an entity which controls, is controlled
by or is under common control with Borrower, Corporate Property Associates 12
Incorporated, Corporate Property Associates 14 Incorporated, Corporate Property
Associates 15 Incorporated, CPA Acquisitions Incorporated, Guarantor or W.P.
Carey & Co. LLC.

      8.5.3 In the event of a transfer pursuant to this Article 8.5, any
successor guarantor whose ownership interests are publicly held and which is
approved by Lender, or deemed approved by Lender pursuant to Section 8.5(b),
shall have the benefit of Section 8.3(b) and 8.3(c), as may be amended based on
the affiliates of said successor guarantor.

            IX. SALE AND SECURITIZATION OF MORTGAGE

            SECTION 9.1 SALE OF MORTGAGE AND SECURITIZATION.

            (a) Lender shall have the right (i) to sell or otherwise transfer
the Loan or any portion thereof as a whole loan, (ii) to sell participation
interests in the Loan or (iii) to securitize the Loan or any portion thereof in
a single asset securitization or a pooled loan securitization. (The transaction
referred to in clauses (i), (ii) and (iii) shall hereinafter be referred to
collectively as "Secondary Market Transactions" and the transactions referred to
in clause (iii) shall hereinafter be referred to as a "Securitization". Any
certificates, notes or other securities issued in connection with a
Securitization are hereinafter referred to as "Securities").

            (b) If requested by Lender, Borrower shall, at no expense to
Borrower (except to the extent otherwise made the obligation of Borrower
pursuant to a separate provision of this Agreement and/or the other Loan
Documents), assist Lender in satisfying the market standards to which Lender
customarily adheres or which may be reasonably required in the marketplace or by
the Rating Agencies in connection with any Secondary Market Transactions,
including, without limitation, to:

            (i) (A) provide updated financial and other information with respect
to the Property, the business operated at the Property, Borrower, and (B)
provide updated budgets relating to the Property;

            (ii) provide opinions of counsel, which may be relied upon by
Lender, the Rating Agencies and their respective counsel, agents and
representatives, as to non-consolidation, fraudulent conveyance, and true sale
or any other opinion customary in Secondary Market Transactions or required by
the Rating Agencies with respect to the Property and Borrower and Affiliates,
which counsel and opinions shall be satisfactory to Lender and the Rating
Agencies;

                                      -58-

<PAGE>

            (iii) provide updated, as of the closing date of the Secondary
Market Transaction, representations and warranties made in the Loan Documents
and such additional representations and warranties as the Rating Agencies may
reasonably require; and

            (iv) execute amendments to the Loan Documents reasonably requested
by Lender; provided, however, that Borrower shall not be required to modify or
amend any Loan Document if such modification or amendment would (A) change the
interest rate, the stated maturity or the amortization of principal as set forth
herein or in the Note, or (B) modify or amend any other material economic term
of the Loan.

            (c) If requested by Lender, Borrower shall provide Lender with the
following financial statements (it being understood that Lender shall request
(i) full financial statements if it anticipates that the principal amount of the
Loan at the time of Securitization equals or exceeds 20% of the aggregate
principal amount of all mortgage loans included in the Securitization and (ii)
summaries of such financial statements if the principal amount of the Loan at
any such time equals or exceeds 10% of such aggregate principal amount):

            (i) As of the Closing Date, a balance sheet with respect to the
Property, meeting the requirements of Section 210.3-01 of Regulation S-X of the
Securities Act and statements of income and statements of cash flows with
respect to the Property, meeting the requirements of Section 210.3-02 of
Regulation S-X, provided that such balance sheet need not be audited, and, to
the extent that such balance sheet is more than 135 days old as of the Closing
Date, interim financial statements of the Property meeting the requirements of
Section 210.3-01 and 210.3-02 of Regulation S-X (all of such financial
statements, collectively, the "Standard Statements"); provided, however, that if
the Property would be deemed to constitute a business and not real estate under
Regulation S-X that has been acquired by Borrower from an unaffiliated third
party, as to which the other conditions set forth in Section 210.3-05 of
Regulation S-X for provision of financial statements in accordance with such
Section have been met, at Lender's election in lieu of or in addition to the
Standard Statements otherwise required by this Section 9.1(c)(i), Borrower shall
instead provide the financial statements required by such Section 210.3-05 of
Regulation S-X ("Acquired Property Statements").

            (ii) Not later than 30 days after the end of each fiscal quarter
following the Closing Date, a balance sheet of the Property as of the end of
such fiscal quarter, meeting the requirements of Section 210.3-01 of Regulation
S-X, provided that such balance sheet need not be audited, and statements of
income and statements of cash flows of the Property for the period commencing on
the day following the last day of the most recent Fiscal Year and ending on the
date of such balance sheet and for the corresponding period of the most recent
Fiscal Year, meeting the requirements of Section 210.3-02 of Regulation S-X
(provided, that if for such corresponding period of the most recent Fiscal Year
Acquired Property Statements were permitted to be provided hereunder pursuant to
paragraph (i) above, Borrower shall instead provide Acquired Property Statements
for such corresponding period). If requested by Lender, Borrower shall also
provide "summarized financial information," as defined in Section 210.1-02(bb)
of Regulation S-X, with respect to such quarterly financial statements.

            (iii) Not later than 90 days after the end of each Fiscal Year
following the Closing Date, a balance sheet of the Property as of the end of
such Fiscal Year, meeting the

                                      -59-

<PAGE>

requirements of Section 210.3-01 of Regulation S-X, provided that such balance
sheet need not be audited, and statements of income and statements of cash flows
of the Property for such Fiscal Year, meeting the requirements of Section
210.3-02 of Regulation S-X provided that such statements need not be audited. If
requested by Lender, Borrower shall provide summarized financial information
with respect to such annual financial statements.

            (iv) Upon 20 Business Days after notice from Lender in connection
with the Securitization of this Loan, such additional financial statements, such
that, as of the date (each a "Disclosure Document Date") of each Disclosure
Document, Borrower shall have provided Lender with all financial statements as
described in paragraph (i) above; provided that the Fiscal Year and interim
periods for which such financial statements shall be provided shall be
determined as of such Disclosure Document Date, provided that such statements
need not be audited.

            (v) In the event Lender determines, in connection with a
Securitization, that the financial statements required in order to comply with
Regulation S-X or Legal Requirements are other than as provided herein, then
notwithstanding the provisions of this Section, Lender may request, and Borrower
shall promptly provide, such combination of Acquired Property Statements and/or
Standard Statements as may be necessary for such compliance.

            (vi) Any other or additional financial statements, or financial,
statistical or operating information, as shall be required pursuant to
Regulation S-X (provided that such statements and information need not be
audited) or other Legal Requirements in connection with any Disclosure Document
or any filing under or pursuant to the Exchange Act in connection with or
relating to a Securitization (hereinafter an "Exchange Act Filing") or as shall
otherwise be reasonably requested by Lender to meet disclosure, rating agency or
marketing requirements.

All financial statements provided by Borrower pursuant to this Section 9.1 (c)
shall be prepared in accordance with GAAP, and shall meet the requirements of
Regulation S-X (provided that such statements need not be audited) and other
applicable Legal Requirements. All financial statements of Guarantor relating to
a Fiscal Year shall be audited by the independent accountants in accordance with
generally accepted auditing standards, Regulation S-X and all other applicable
Legal Requirements, shall be accompanied by the manually executed report of the
independent accountants thereon, which report shall meet the requirements of
Regulation S-X and all other applicable Legal Requirements, and shall be further
accompanied by a manually executed written consent of the independent
accountants, in form and substance acceptable to Lender, to the inclusion of
such financial statements in any Disclosure Document and any Exchange Act Filing
and to the use of the name of such independent accountants and the reference to
such independent accountants as "experts" in any Disclosure Document and
Exchange Act Filing, all of which shall be provided at the same time as the
related financial statements are required to be provided. All other financial
statements shall be certified by the chief financial officer of Borrower, which
certification shall state that such financial statements meet the requirements
set forth in the first sentence of this paragraph.

                                      -60-

<PAGE>

            SECTION 9.2 SECURITIZATION INDEMNIFICATION.

            (a) Borrower agrees that information provided to Lender by Borrower
and its agents, counsel and representatives may be included in disclosure
documents in connection with the Securitization, including, without limitation,
an offering circular, a prospectus, prospectus supplement, private placement
memorandum or other offering document (each, an "Disclosure Document") and may
also be included in filings with the Securities and Exchange Commission pursuant
to the Securities Act of 1933, as amended (the "Securities Act"), or the
Securities and Exchange Act of 1934, as amended (the "Exchange Act"), and may be
made available to investors or prospective investors in the Securities, the
Rating Agencies, and service providers relating to the Securitization.

            (b) Borrower shall provide in connection with each of (i) a
preliminary and a final private placement memorandum or (ii) a preliminary and
final prospectus or prospectus supplement, as applicable, an agreement (A)
certifying that Borrower has examined all relevant portions of such Disclosure
Documents specified by Lender and that to Borrower's knowledge each such
Disclosure Document, as it relates to Borrower, Borrower Affiliates and the
Property does not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in the
light of the circumstances under which they were made, not misleading, (B)
indemnifying Lender (and for purposes of this Section 9.2, Lender hereunder
shall include its officers and directors), the Affiliate of Morgan Stanley & Co.
("Morgan Stanley") that has filed the registration statement relating to the
Securitization (the "Registration Statement"), each of its directors, each of
its officers who have signed the Registration Statement and each Person that
controls the Affiliate within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (collectively, the "Morgan Stanley Group") , and
Morgan Stanley, and any other placement agent or underwriter with respect to the
Securitization, each of their respective directors and each Person who controls
Morgan Stanley or any other placement agent or underwriter within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act
(collectively, the "Underwriter Group") for any losses, claims, damages or
liabilities (collectively, the "Liabilities") to which Lender, the Morgan
Stanley Group or the Underwriter Group may become subject insofar as the
Liabilities arise out of or are based upon any untrue statement of any material
fact contained in such sections or arise out of or are based upon the omission
to state therein a material fact related to Borrower required to be stated in
such sections or necessary in order to make the statements in such sections, in
light of the circumstances under which they were made, not misleading and (C)
agreeing to reimburse Lender, the Morgan Stanley Group and/or the Underwriter
Group for any reasonable legal or other expenses reasonably incurred by Lender,
the Morgan Stanley Group and the Underwriter Group in connection with
investigating or defending the Liabilities; provided, however, that Borrower
will be liable in any such case under clauses (B) or (C) above only to the
extent that any such loss claim, damage or liability arises out of or is based
upon any such untrue statement or omission made therein in reliance upon and in
conformity with information furnished to Lender by or on behalf of Borrower in
connection with the preparation of the Disclosure Document or in connection with
the underwriting or closing of the Loan, including, without limitation,
financial statements of Borrower, operating statements and rent rolls with
respect to the Property. This indemnity agreement will be in addition to any
liability which Borrower may otherwise have.

                                      -61-

<PAGE>

            (c) In connection with Exchange Act Filings, Borrower shall (i)
indemnify Lender, the Morgan Stanley Group and the Underwriter Group for
Liabilities to which Lender, the Morgan Stanley Group or the Underwriter Group
may become subject insofar as the Liabilities arise out of or are based upon the
omission or alleged omission to state in the Disclosure Document a material fact
required to be stated in the Disclosure Document in order to make the statements
in the Disclosure Document, in light of the circumstances under which they were
made, not misleading and (ii) reimburse Lender, the Morgan Stanley Group or the
Underwriter Group for any legal or other expenses reasonably incurred by Lender,
the Morgan Stanley Group or the Underwriter Group in connection with defending
or investigating the Liabilities. Notwithstanding anything to the contrary in
this Section 9.2, Borrower shall not be liable under any provision of this
Section 9.2 to the extent that any Liabilities arise from or relate to
omissions, errors or untrue statements which Borrower identified in writing to
Lender or the Underwriter Group and remain uncorrected or as to which Lender or
Underwriter Group had actual knowledge of such omission, error or untrue
statement, or which arise as a result of Lender's gross negligence or willful
misconduct.

            (d) Promptly after receipt by an indemnified party under this
Section 9.2 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9.2, notify the indemnifying party in writing of the
commencement thereof, but the omission to so notify the indemnifying party will
not relieve the indemnifying party from any liability which the indemnifying
party may have to any indemnified party hereunder except to the extent (that
failure to notify causes prejudice to the indemnifying party. In the event that
any action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled, jointly with any other indemnifying party, to participate therein and,
to the extent that it (or they) may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel satisfactory to
such indemnified party. After notice from the indemnifying party to such
indemnified party under this Section 9.2, such indemnified party shall pay for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there are any legal defenses available to
it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal defenses
and to otherwise participate in the defense of such action on behalf of such
indemnified party at the cost of the indemnifying party. The indemnifying party
shall not be liable for the expenses of more than one separate counsel unless an
indemnified party shall have reasonably concluded that there may be legal
defenses available to it that are different from or additional to those
available to another indemnified party.

            (e) Intentionally omitted.

            (f) The liabilities and obligations of both Borrower and Lender
under this Section 9.2 shall survive the termination of this Agreement and the
satisfaction and discharge of the Debt.

                                      -62-

<PAGE>

            SECTION 9.3 INTENTIONALLY OMITTED.

            X. DEFAULTS

            SECTION 10.1 EVENT OF DEFAULT.

            (a) Each of the following events shall constitute an event of
default hereunder (an "Event of Default"):

            (i) if (A) any monthly installment of principal and/or interest due
under the Note or any amount required to be deposited into the Reserve Funds or
the payment due on the Maturity Date is not paid when due or (B) any other
portion of the Debt is not paid when due and such non-payment referred to under
this clause (B) continues for five (5) days following notice to Borrower that
the same is due and payable;

            (ii) if any of the Taxes or Other Charges required to be paid by
Borrower pursuant to the terms hereof are not paid prior to delinquency, penalty
or other accrual of default interest for any reason other than a failure by
Lender to pay the such Taxes or Other Charges to the extent such amounts have
been deposited with Lender;

            (iii) if the Policies are not kept in full force and effect for any
reason other than a failure by Lender to pay the premiums for such Policies to
the extent such amounts have been deposited with Lender, or if the Policies are
not delivered to Lender within ten (10) Business Days of Lender's request;

            (iv) if Borrower breaches or permits or suffers a breach of
Article 6 of the Mortgage;

            (v) if any representation or warranty made by Borrower herein or in
any other Loan Document, or in any report, certificate, financial statement or
other instrument, agreement or document furnished to Lender by or on behalf of
Borrower shall have been false or misleading in any material respect as of the
date the representation or warranty was made and such false or misleading
representation or warranty continues to be material;

            (vi) if Borrower or Guarantor shall make an assignment for the
benefit of creditors;

            (vii) if a receiver, liquidator or trustee shall be appointed for
Borrower or Guarantor or if Borrower or Guarantor shall be adjudicated a
bankrupt or insolvent, or if any petition for bankruptcy, reorganization or
arrangement pursuant to federal bankruptcy law, or any similar federal or state
law, shall be filed by or against, consented to, or taken any action indicating
acquiescence in by, Borrower or Guarantor, or if any proceeding for the
dissolution or liquidation of Borrower or Guarantor shall be instituted;
provided, however, if such appointment, adjudication, petition or proceeding was
involuntary and not consented to by Borrower or Guarantor, upon the same not
being discharged, stayed or dismissed within 90 days;

                                      -63-

<PAGE>

            (viii) if the Property becomes subject to any mechanic's,
materialman's or other Lien other than a Lien for local real estate taxes and
assessments not then due and payable and the Lien shall remain undischarged of
record (by payment, bonding or otherwise) for a period of 60 days after Borrower
receives notice of such Lien;

            (ix) if Borrower attempts to assign its rights under this Agreement
or any of the other Loan Documents or any interest herein or therein in
contravention of the Loan Documents;

            (x) if any of the factual assumptions contained in the Insolvency
Opinion, or in any other non-consolidation opinion delivered to Lender in
connection with the Loan, or in any other non-consolidation delivered subsequent
to the closing of the Loan, is or shall become untrue in any material respect;

            (xi) if Borrower breaches any representation, warranty or covenant
contained in Section 3.1.24 hereof;

            (xii) If Borrower fails to comply with the covenants as to
Prescribed Laws set forth in Section 4.1.1 hereof;

            (xiii) if Borrower breaches any of the negative covenants contained
in Section 4.2.12 hereof or acts or neglects to act in such a manner as to be
considered a default under the Operating Agreements.

            (xiv) if Guarantor breaches in any material respect any covenant,
warranty or representation contained in the Guaranty;

            (xv) if Borrower shall continue to be in Default under any of the
other terms, covenants or conditions of this Agreement not specified in
subsections (i) to (xiv) above, for ten (10) days after notice to Borrower from
Lender, in the case of any Default which can be cured by the payment of a sum of
money, or for thirty (30) days after notice from Lender in the case of any other
Default; provided, however, that if such non-monetary Default is susceptible of
cure but cannot reasonably be cured within such 30-day period and provided
further that Borrower shall have commenced to cure such Default within such
30-day period and thereafter diligently and expeditiously proceeds to cure the
same, such 30-day period shall be extended for such time as is reasonably
necessary for Borrower in the exercise of due diligence to cure such Default,
such additional period not to exceed 105 days; or

            (xvi) if there shall be default under any of the other Loan
Documents beyond any applicable cure periods contained in such Loan Documents,
whether as to Borrower or the Property, or if any other such event shall occur
or condition shall exist, if the effect of such event or condition is to
accelerate the maturity of any portion of the Debt or to permit Lender to
accelerate the maturity of all or any portion of the Debt.

            (b) Upon the occurrence of an Event of Default (other than an Event
of Default described in clauses (vi), (vii) or (viii) above) and at any time
thereafter Lender may, in addition to any other rights or remedies available to
it pursuant to this Agreement and the other Loan Documents or at law or in
equity, take such action, without notice or demand, that Lender deems

                                      -64-

<PAGE>

advisable to protect and enforce its rights against Borrower and in and to the
Property, including, without limitation, declaring the Debt to be immediately
due and payable, and Lender may enforce or avail itself of any or all rights or
remedies provided in the Loan Documents against Borrower and the Property,
including, without limitation, all rights or remedies available at law or in
equity; and upon any Event of Default described in clauses (vi), (vii) or (viii)
above, the Debt and all other obligations of Borrower hereunder and under the
other Loan Documents shall immediately and automatically become due and payable,
without notice or demand, and Borrower hereby expressly waives any such notice
or demand, anything contained herein or in any other Loan Document to the
contrary notwithstanding.

            SECTION 10.2 REMEDIES.

            (a) During the continuance of an Event of Default, all or any one or
more of the rights, powers, privileges and other remedies available to Lender
against Borrower under this Agreement or any of the other Loan Documents
executed and delivered by, or applicable to, Borrower or at law or in equity may
be exercised by Lender at any time and from time to time, whether or not all or
any of the Debt shall be declared due and payable, and whether or not Lender
shall have commenced any foreclosure proceeding or other action for the
enforcement of its rights and remedies under any of the Loan Documents with
respect to the Property. Any such actions taken by Lender shall be cumulative
and concurrent and may be pursued independently, singly, successively, together
or otherwise, at such time and in such order as Lender may determine in its sole
discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Lender permitted by law,
equity or contract or as set forth herein or in the other Loan Documents.
Without limiting the generality of the foregoing, if an Event of Default is
continuing (i) Lender is not subject to any "one action" or "election of
remedies" law or rule, and (ii) all liens and other rights, remedies or
privileges provided to Lender shall remain in full force and effect until Lender
has exhausted all of its remedies against the Property and the Mortgage has been
foreclosed, sold and/or otherwise realized upon in satisfaction of the Debt or
the Debt has been paid in full.

            (b) Lender shall have the right from time to time to partially
foreclose the Mortgage in any manner and for any amounts secured by the Mortgage
then due and payable as determined by Lender in its sole discretion including,
without limitation, the following circumstances: (i) in the event Borrower
defaults beyond any applicable grace period in the payment of one or more
scheduled payments of principal and interest, Lender may foreclose the Mortgage
to recover such delinquent payments, or (ii) in the event Lender elects to
accelerate less than the entire outstanding principal balance of the Loan,
Lender may foreclose the Mortgage to recover so much of the principal balance of
the Loan as Lender may accelerate and such other sums secured by the Mortgage as
Lender may elect. Notwithstanding one or more partial foreclosures, the Property
shall remain subject to the Mortgage to secure payment of sums secured by the
Mortgage and not previously recovered.

            (c) Lender shall have the right from time to time to sever the Note
and the other Loan Documents into one or more separate notes, mortgages and
other security documents (the "Severed Loan Documents") in such denominations as
Lender shall determine in its sole discretion for purposes of evidencing and
enforcing its rights and remedies provided hereunder. Borrower shall execute and
deliver to Lender from time to time, promptly after the request of

                                      -65-

<PAGE>

Lender, a severance agreement and such other documents as Lender shall request
in order to effect the severance described in the preceding sentence, all in
form and substance reasonably satisfactory to Lender. Borrower hereby absolutely
and irrevocably appoints Lender as its true and lawful attorney, coupled with an
interest, in its name and stead to make and execute all documents necessary or
desirable to effect the aforesaid severance, Borrower ratifying all that its
said attorney shall do by virtue thereof; provided, however, Lender shall not
make or execute any such documents under such power until three (3) business
days after notice has been given to Borrower by Lender of Lender's intent to
exercise its rights under such power. The Severed Loan Documents shall not
contain any representations, warranties or covenants not contained in the Loan
Documents and any such representations and warranties contained in the Severed
Loan Documents will be given by Borrower only as of the Closing Date.

            (d) Any amounts recovered from the Property or any other collateral
for the Loan during the continuance of an Event of Default may be applied by
Lender toward the payment of any interest and/or principal of the Loan and/or
any other amounts due under the Loan Documents in such order, priority and
proportions as Lender in its sole discretion shall determine.

            SECTION 10.3 RIGHT TO CURE DEFAULTS.

            Lender may, but without any obligation to do so and without notice
to or demand on Borrower and without releasing Borrower from any obligation
hereunder or being deemed to have cured any Event of Default hereunder, make, do
or perform any obligation of Borrower hereunder in such manner and to such
extent as Lender may deem necessary. Lender is authorized to enter upon the
Property for such purposes, or appear in, defend, or bring any action or
proceeding to protect its interest in the Property for such purposes, and the
cost and expense thereof (including reasonable attorneys' fees to the extent
permitted by law), with interest as provided in this Section 10.3, shall
constitute a portion of the Debt and shall be due and payable to Lender upon
demand. All such costs and expenses incurred by Lender in remedying such Event
of Default or such failed payment or act or in appearing in, defending, or
bringing any action or proceeding shall bear interest at the Default Rate, for
the period after such cost or expense was incurred into the date of payment to
Lender. All such costs and expenses incurred by Lender together with interest
thereon calculated at the Default Rate shall be deemed to constitute a portion
of the Debt and be secured by the liens, claims and security interests provided
to Lender under the Loan Documents and shall be immediately due and payable upon
demand by Lender therefore.

            SECTION 10.4 REMEDIES CUMULATIVE.

            The rights, powers and remedies of Lender under this Agreement shall
be cumulative and not exclusive of any other right, power or remedy which Lender
may have against Borrower pursuant to this Agreement or the other Loan
Documents, or existing at law or in equity or otherwise. Lender's rights, powers
and remedies may be pursued singly, concurrently or otherwise, at such time and
in such order as Lender may determine in Lender's sole discretion. No delay or
omission to exercise any remedy, right or power accruing upon an Event of
Default shall impair any such remedy, right or power or shall be construed as a
waiver thereof, but any such remedy, right or power may be exercised from time
to time and as often as

                                      -66-

<PAGE>

may be deemed expedient. A waiver of one Default or Event of Default with
respect to Borrower shall not be construed to be a waiver of any subsequent
Default or Event of Default by Borrower or to impair any remedy, right or power
consequent thereon.

            XI. MISCELLANEOUS

            SECTION 11.1 SUCCESSORS AND ASSIGNS.

            All covenants, promises and agreements in this Agreement, by or on
behalf of Borrower, shall inure to the benefit of the legal representatives,
successors and assigns of Lender.

            SECTION 11.2 LENDER'S DISCRETION.

            Whenever pursuant to this Agreement Lender exercises any right given
to it to approve or disapprove, or any arrangement or term is to be satisfactory
to Lender, the decision of Lender to approve or disapprove or to decide whether
arrangements or terms are satisfactory or not satisfactory shall, absent
manifest error, except as is otherwise specifically herein provided, be in the
sole discretion of Lender and shall be final and conclusive. Prior to a
Securitization, whenever pursuant to this Agreement the Rating Agencies are
given any right to approve or disapprove, or any arrangement or term is to be
satisfactory to the Rating Agencies, the decision of Lender to approve or
disapprove or to decide whether arrangements or terms are satisfactory or not
satisfactory, based upon Lender's determination of Rating Agency criteria, shall
be substituted therefore.

            SECTION 11.3 GOVERNING LAW.

            (A) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE
BY LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF
THE NOTE DELIVERED PURSUANT HERETO 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 EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING,
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, THIS AGREEMENT 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 SUCH STATE (WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED
STATES OF AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION,
PERFECTION, AND ENFORCEMENT OF THE LIEN AND SECURITY INTEREST CREATED PURSUANT
HERETO AND PURSUANT TO THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND
CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROPERTY IS LOCATED, IT
BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE,
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE

                                      -67-
<PAGE>

CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE
OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY
LAW, BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT
THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT AND THE NOTE, AND
THIS AGREEMENT AND THE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW.

      (B) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER
ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY AT LENDER'S OPTION BE
INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW
YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND
BORROWER WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE
AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER
HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT,
ACTION OR PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND APPOINT:

                        TELC (NJ) QRS 16-30, INC.
                        C/O W.P. CAREY CO. LLC
                        50 ROCKEFELLER PLAZA
                        SECOND FLOOR
                        NEW YORK, NEW YORK 10020
                        ATTENTION: DIRECTOR, ASSET MANAGEMENT

                        WITH A COPY TO:

                        REED SMITH LLP
                        2500 ONE LIBERTY PLACE
                        PHILADELPHIA, PA 19103
                        ATTENTION: CHAIRMAN, REAL ESTATE DEPARTMENT

AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF
PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE
MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN
EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH SUIT,
ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER (I) SHALL GIVE PROMPT
NOTICE TO LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II)
MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE

                                      -68-

<PAGE>

AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT
AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF
PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED
AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT
LEAVING A SUCCESSOR.

            SECTION 11.4 MODIFICATION, WAIVER IN WRITING.

            No modification, amendment, extension, discharge, termination or
waiver of any provision of this Agreement or of any other Loan Document, nor
consent to any departure by Borrower therefrom, shall in any event be effective
unless the same shall be in a writing signed by the party against whom
enforcement is sought, and then such waiver or consent shall be effective only
in the specific instance, and for the purpose, for which given. Except as
otherwise expressly provided herein, no notice to, or demand on Borrower, shall
entitle Borrower to any other or future notice or demand in the same, similar or
other circumstances.

            SECTION 11.5 DELAY NOT A WAIVER.

            Neither any failure nor any delay on the part of Lender in insisting
upon strict performance of any term, condition, covenant or agreement, or
exercising any right, power, remedy or privilege hereunder, or under any other
Loan Document, shall operate as or constitute a waiver thereof, nor shall a
single or partial exercise thereof preclude any other future exercise, or the
exercise of any other right, power, remedy or privilege. In particular, and not
by way of limitation, by accepting payment after the due date of any amount
payable under this Agreement or any other Loan Document, Lender shall not be
deemed to have waived any right either to require prompt payment when due of all
other amounts due under this Agreement or the other Loan Documents, or to
declare a default for failure to effect prompt payment of any such other amount.
Lender shall have the right to waive or reduce any time periods that Lender is
entitled to under the Loan Documents in its sole and absolute discretion.

            SECTION 11.6 NOTICES.

            All notices, demands, requests, consents, approvals or other
communications (any of the foregoing, a "Notice") required, permitted, or
desired to be given hereunder shall be in writing sent by telefax (with answer
back acknowledged) or by registered or certified mail, postage prepaid, return
receipt requested, or delivered by hand or reputable overnight courier addressed
to the party to be so notified at its address hereinafter set forth, or to such
other address as such party may hereafter specify in accordance with the
provisions of this Section 11.6. Any Notice shall be deemed to have been
received: (a) three (3) days after the date such Notice is mailed, (b) on the
date of sending by telefax if sent during business hours on a Business Day
(otherwise on the next Business Day), (c) on the date of delivery by hand if
delivered during business hours on a Business Day (otherwise on the next
Business Day), and (d) on the next Business Day if sent by an overnight
commercial courier, in each case addressed to the parties as follows:

                                      -69-

<PAGE>

            If to Lender:           Morgan Stanley Mortgage Capital Inc.
                                    1221 Avenue of the Americas, 27th Floor
                                    New York, New York 10020
                                    Attention: Stephen Holmes
                                    Facsimile No. (212) 762-9495

            with a copy to:         Morgan Stanley Mortgage Capital Inc.
                                    c/o ARCap Servicing, Inc.,
                                    5605 N. MacArthur Boulevard
                                    Suite 950, LB 26
                                    Irving, Texas 75038

            with a copy to:         Paul, Hastings, Janofsky & Walker LLP
                                    515 S. Flower Street, 25th Floor
                                    Los Angeles, California 90071
                                    Attention: Margaret Frick Bertisch, Esq.
                                    Facsimile No.(213) 627-0705

            If to Borrower:         TELC (NJ) QRS 16-30, INC.
                                    c/o W.P. Carey & Co LLC
                                    50 Rockefeller Plaza
                                    Second Floor
                                    New York, NY 10020
                                    Attention: Director, Asset Management
                                    Facsimile No.: (212) 492-8922

            with a copy to:         Reed Smith LLP
                                    2500 One Liberty Place
                                    Philadelphia, PA 19103
                                    Attention: Chairman, Real Estate Department
                                    Facsimile No.: (215) 851-1420

            SECTION 11.7 TRIAL BY JURY.

            BORROWER AND LENDER EACH 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 THE 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 BORROWER AND LENDER, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. EACH PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF
THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

                                      -70-

<PAGE>

            SECTION 11.8 HEADINGS.

            The Article and/or Section headings and the Table of Contents in
this Agreement are included herein for convenience of reference only and shall
not constitute a part of this Agreement for any other purpose.

            SECTION 11.9 SEVERABILITY.

            Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.

            SECTION 11.10 PREFERENCES.

            Lender shall have the continuing and exclusive right to apply or
reverse and reapply any and all payments by Borrower to any portion of the
obligations of Borrower hereunder consistent with the terms and provisions
hereof and the other Loan Documents. To the extent Borrower makes a payment or
payments to Lender, which payment or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds received, the obligations hereunder or
part thereof intended to be satisfied shall be revived and continue in full
force and effect, as if such payment or proceeds had not been received by
Lender.

            SECTION 11.11 WAIVER OF NOTICE.

            Borrower shall not be entitled to any notices of any nature
whatsoever from Lender except with respect to matters for which this Agreement
or the other Loan Documents specifically and expressly provide for the giving of
notice by Lender to Borrower and except with respect to matters for which
Borrower is not, pursuant to applicable Legal Requirements, permitted to waive
the giving of notice. Borrower hereby expressly waives the right to receive any
notice from Lender with respect to any matter for which this Agreement or the
other Loan Documents do not specifically and expressly provide for the giving of
notice by Lender to Borrower.

            SECTION 11.12 REMEDIES OF BORROWER.

            In the event that a claim or adjudication is made that Lender or its
agents have acted unreasonably or unreasonably delayed acting in any case where,
by law or under this Agreement or the other Loan Documents, Lender or such
agent, as the case may be, has an obligation to act reasonably or promptly,
neither Lender nor its agents shall be liable for any monetary damages, and
Borrower's sole remedy shall be limited to commencing an action seeking
injunctive relief or declaratory judgment. Any action or proceeding to determine
whether Lender has acted reasonably shall be determined by an action seeking
declaratory judgment.

                                      -71-

<PAGE>

            SECTION 11.13 EXPENSES; INDEMNITY.

            (a) Except as expressly provided herein, Borrower shall pay or, if
Borrower fails to pay, reimburse Lender upon receipt of notice from Lender, for
all reasonable costs and expenses (including reasonable attorneys' fees and
disbursements) incurred by Lender in connection with (i) Borrower's ongoing
performance of and compliance with Borrower's agreements and covenants contained
in this Agreement and the other Loan Documents on its part to be performed or
complied with after the Closing Date, including, without limitation, confirming
compliance with environmental and insurance requirements; (ii) Lender's ongoing
performance of and compliance with all agreements and covenants contained in
this Agreement and the other Loan Documents on its part to be performed or
complied with after the Closing Date; (iii) the negotiation, preparation,
execution, delivery and administration of any consents, amendments, waivers or
other modifications to this Agreement and the other Loan Documents and any other
documents or matters requested by Borrower; (iv) the filing and recording fees
and expenses, title insurance and reasonable fees and expenses of counsel for
providing to Lender all required legal opinions, and other similar expenses
incurred, in creating and perfecting the Liens in favor of Lender pursuant to
this Agreement and the other Loan Documents; (v) enforcing or preserving any
rights, in response to third party claims or the prosecuting or defending of any
action or proceeding or other litigation or otherwise, in each case against,
under or affecting Borrower, this Agreement, the other Loan Documents, the
Property, or any other security given for the Loan; and (vi) enforcing any
obligations of or collecting any payments due from Borrower under this
Agreement, the other Loan Documents or with respect to the Property or in
connection with any "special servicing" of the Loan or any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a "work-out" or of any insolvency or bankruptcy proceedings; provided,
however, that Borrower shall not be liable for the payment of any such costs and
expenses to the extent the same arise by reason of the gross negligence, illegal
acts, fraud or willful misconduct of Lender. Any costs due and payable to Lender
may be paid to Lender pursuant to the Cash Management Agreement.

            (b) Borrower shall indemnify, defend and hold harmless Lender and
its officers, directors, agents, employees (and the successors and assigns of
the foregoing) (the "Lender Indemnitees") from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, expenses and disbursements of any kind or nature whatsoever
(including, without limitation, the reasonable fees and disbursements of counsel
for the Lender Indemnitees in connection with any investigative, administrative
or judicial proceeding commenced or threatened, whether or not the Lender
Indemnitees shall be designated a party thereto), that may be imposed on,
incurred by, or asserted against the Lender Indemnitees in any manner relating
to or arising out of (i) any breach by Borrower of its obligations under, or any
material misrepresentation by Borrower contained in, this Agreement or the other
Loan Documents, or (ii) the use or intended use of the proceeds of the Loan
(collectively, the "Indemnified Liabilities"); provided, however, that Borrower
shall not have any obligation to the Lender Indemnitees hereunder to the extent
that such Indemnified Liabilities arise from the gross negligence, illegal acts,
fraud or willful misconduct of the Lender Indemnitees. To the extent that the
undertaking to indemnify, defend and hold harmless set forth in the preceding
sentence may be unenforceable because it violates any law or public policy,
Borrower shall pay the maximum portion that it is permitted to pay and satisfy
under applicable

                                      -72-

<PAGE>

law to the payment and satisfaction of all Indemnified Liabilities incurred by
the Lender Indemnitees.

            SECTION 11.14 SCHEDULES INCORPORATED.

            The Schedules annexed hereto are hereby incorporated herein as a
part of this Agreement with the same effect as if set forth in the body hereof.

            SECTION 11.15 OFFSETS, COUNTERCLAIMS AND DEFENSES.

            Any assignee of Lender's interest in and to this Agreement and the
other Loan Documents shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to such documents which Borrower
may otherwise have against any assignor of such documents, and no such unrelated
counterclaim or defense shall be interposed or asserted by Borrower in any
action or proceeding brought by any such assignee upon such documents and any
such right to interpose or assert any such unrelated offset, counterclaim or
defense in any such action or proceeding is hereby expressly waived by Borrower.

            SECTION 11.16 NO JOINT VENTURE OR PARTNERSHIP; NO THIRD PARTY
                          BENEFICIARIES.

            (a) Borrower and Lender intend that the relationships created
hereunder and under the other Loan Documents be solely that of borrower and
lender. Nothing herein or therein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between Borrower
and Lender nor to grant Lender any interest in the Property other than that of
mortgagee, beneficiary or lender.

            (b) This Agreement and the other Loan Documents are solely for the
benefit of Lender and Borrower and nothing contained in this Agreement or the
other Loan Documents shall be deemed to confer upon anyone other than Lender and
Borrower any right to insist upon or to enforce the performance or observance of
any of the obligations contained herein or therein. All conditions to the
obligations of Lender to make the Loan hereunder are imposed solely and
exclusively for the benefit of Lender and no other Person shall have standing to
require satisfaction of such conditions in accordance with their terms or be
entitled to assume that Lender will refuse to make the Loan in the absence of
strict compliance with any or all thereof and no other Person shall under any
circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender's sole
discretion, Lender deems it advisable or desirable to do so.

            SECTION 11.17 PUBLICITY.

            All news releases, publicity or advertising by Borrower or its
Affiliates through any media intended to reach the general public which refers
to the Loan Documents or the financing evidenced by the Loan Documents, to
Lender, Morgan Stanley Mortgage Capital Inc., or any of their Affiliates shall
be subject to the prior approval of Lender.

                                      -73-

<PAGE>

            SECTION 11.18 WAIVER OF MARSHALLING OF ASSETS.

            To the fullest extent permitted by law, Borrower, for itself and its
successors and assigns, waives all rights to a marshalling of the assets of
Borrower, Borrower's partners and others with interests in Borrower, and of the
Property, and shall not assert any right under any laws pertaining to the
marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters
whatsoever to defeat, reduce or affect the right of Lender under the Loan
Documents to a sale of the Property for the collection of the Debt without any
prior or different resort for collection or of the right of Lender to the
payment of the Debt out of the net proceeds of the Property in preference to
every other claimant whatsoever.

            SECTION 11.19 WAIVER OF OFFSETS/DEFENSES/COUNTERCLAIMS.

            Borrower hereby waives the right to assert a counterclaim, other
than a compulsory counterclaim, in any action or proceeding brought against it
by Lender or its agents or otherwise to offset any obligations to make the
payments required by the Loan Documents. No failure by Lender to perform any of
its obligations hereunder shall be a valid defense to, or result in any offset
against, any payments which Borrower is obligated to make under any of the Loan
Documents.

            SECTION 11.20 CONFLICT; CONSTRUCTION OF DOCUMENTS; RELIANCE.

            In the event of any conflict between the provisions of this
Agreement and any of the other Loan Documents, the provisions of this Agreement
shall control. The parties hereto acknowledge that they were represented by
competent counsel in connection with the negotiation, drafting and execution of
the Loan Documents and that such Loan Documents shall not be subject to the
principle of construing their meaning against the party which drafted same.
Borrower acknowledges that, with respect to the Loan, Borrower shall rely solely
on its own judgment and advisors in entering into the Loan without relying in
any manner on any statements, representations or recommendations of Lender or
any parent, subsidiary or Affiliate of Lender. Lender shall not be subject to
any limitation whatsoever in the exercise of any rights or remedies available to
it under any of the Loan Documents or any other agreements or instruments which
govern the Loan by virtue of the ownership by it or any parent, subsidiary or
Affiliate of Lender of any equity interest any of them may acquire in Borrower,
and Borrower hereby irrevocably waives the right to raise any defense or take
any action on the basis of the foregoing with respect to Lender's exercise of
any such rights or remedies. Borrower acknowledges that Lender engages in the
business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.

            SECTION 11.21 BROKERS AND FINANCIAL ADVISORS.

            Borrower hereby represents that it has dealt with no financial
advisors, brokers, underwriters, placement agents, agents or finders in
connection with the transactions contemplated by this Agreement with the
exception of Ridgefield Financial. Borrower shall indemnify, defend and hold
Lender harmless from and against any and all claims, liabilities,

                                      -74-

<PAGE>

costs and expenses of any kind (including Lender's attorneys' fees and expenses)
in any way relating to or arising from a claim by any Person that such Person
acted on behalf of Borrower or Lender in connection with the transactions
contemplated herein. The provisions of this Section 11.21 shall survive the
expiration and termination of this Agreement and the payment of the Debt.

            SECTION 11.22 EXCULPATION.

            Subject to the qualifications below, Lender shall not enforce the
liability and obligation of Borrower to perform and observe the obligations
contained in the Note, this Agreement, the Mortgage or the other Loan Documents
by any action or proceeding wherein a money judgment or any deficiency judgment
or other judgment establishing personal liability shall be sought against
Borrower or any principal, director, officer, employee, beneficiary,
shareholder, partner, member, trustee, agent, or affiliate of Borrower or any
legal representatives, successors or assigns of any of the foregoing
(collectively, the "Exculpated Parties"), except that Lender may bring a
foreclosure action, an action for specific performance or any other appropriate
action or proceeding to enable Lender to enforce and realize upon its interest
under the Note, this Agreement, the Mortgage and the other Loan Documents, or in
the Property, the Rents, or any other collateral given to Lender pursuant to the
Loan Documents; provided, however, that, except as specifically provided herein,
any judgment in any such action or proceeding shall be enforceable against
Borrower only to the extent of Borrower's interest in the Property, in the Rents
and in any other collateral given to Lender, and Lender, by accepting the Note,
this Agreement, the Mortgage and the other Loan Documents, shall not sue for,
seek or demand any deficiency judgment against Borrower or any of the Exculpated
Parties, in any such action or proceeding under or by reason of or under or in
connection with the Note, this Agreement, the Mortgage or the other Loan
Documents. The provisions of this Section shall not, however, (a) constitute a
waiver, release or impairment of any obligation evidenced or secured by any of
the Loan Documents; (b) impair the right of Lender to name Borrower as a party
defendant in any action or suit for foreclosure and sale under the Mortgage; (c)
affect the validity or enforceability of any indemnity, guaranty or similar
instrument made in connection with the Loan or any of the rights and remedies of
Lender thereunder; (d) impair the right of Lender to obtain the appointment of a
receiver; (e) impair the enforcement of the Assignment of Leases; (f) impair the
right of Lender to enforce the provisions of Section 2 of the Environmental
Indemnity; (g) impair the right of Lender to obtain a deficiency judgment or
other judgment on the Note against Borrower if necessary in order to obtain any
insurance proceeds or condemnation awards to which Lender would otherwise be
entitled to under this Agreement, provided that Lender shall only enforce such
judgment to the extent of the insurance proceeds and/or condemnation awards; or
(h) constitute a waiver of the right of Lender to enforce the liability and
obligation of Borrower, by money judgment or otherwise, to the extent of any
loss, damage, cost, expense, liability, claim or other obligation incurred by
Lender (including reasonable attorneys' fees and costs reasonably incurred)
arising out of or in connection with the following:

            (i) fraud or intentional misrepresentation by Borrower or any of the
Exculpated Parties in connection with the Loan;

                                      -75-

<PAGE>

            (ii) Borrower's misapplication or misappropriation or conversion of
Rents or security deposits received by Borrower in advance or after the
occurrence of and during the continuance of an Event of Default;

            (iii) the misapplication or the misappropriation of insurance
proceeds or condemnation awards;

            (iv) intentionally omitted;

            (v) Borrower's breach of, or failure to comply with, the
representations, warranties and covenants contained in Section 4.1.9 of this
Agreement; and

            (vi) Any amendment, modification or waiver of any provisions of the
Telcordia Lease, except as specifically permitted pursuant to Section 4.1.9
hereof, or any termination thereof by Borrower or by Telcordia with the consent
or acquiescence of Borrower, except as otherwise specifically permitted pursuant
to the terms of the Telcordia Lease, this Agreement or the other Loan Documents
and except for the rejection of the Telcordia Lease by Telcordia or its trustee
in a bankruptcy proceeding.

            Notwithstanding anything to the contrary in this Agreement, the Note
or any of the Loan Documents, (A) Lender shall not be deemed to have waived any
right which Lender may have under Section 506(a), 506(b), 1111(b) or any other
provisions of the Bankruptcy Code to file a claim for the full amount of the
Debt or to require that all collateral shall continue to secure all of the Debt
owing to Lender in accordance with the Loan Documents, and (B) the Debt shall be
fully recourse to Borrower in the event that: (i) Borrower fails to obtain
Lender's prior consent to any assignment, transfer, or conveyance of the
Property or any interest therein as required by the Mortgage or this Agreement;
or (ii) if the Property or Borrower or Guarantor shall become an asset in or be
involved in (a) a voluntary bankruptcy or insolvency proceeding or (b) an
involuntary bankruptcy or insolvency proceeding (other than one filed by or on
behalf of Lender) which is not dismissed within ninety (90) days of filing.

            SECTION 11.23 PRIOR AGREEMENTS.

            This Agreement and the other Loan Documents contain the entire
agreement of the parties hereto and thereto in respect of the transactions
contemplated hereby and thereby, and all prior agreements among or between such
parties, whether oral or written are superseded by the terms of this Agreement
and the other Loan Documents.

            SECTION 11.24 SERVICER.

            (a) At the option of Lender, the Loan may be serviced by a servicer
(the "Servicer") selected by Lender and Lender may delegate all or any portion
of its responsibilities under this Agreement and the other Loan Documents to the
Servicer pursuant to a servicing agreement (the "Servicing Agreement") between
Lender and Servicer. At closing, Borrower shall be responsible for any
reasonable set-up fees or any other initial costs relating to or arising under
the Servicing Agreement; provided, however, that Borrower shall not be
responsible for payment of the monthly servicing fee due to the Servicer under
the Servicing Agreement. Servicer shall, however, be entitled to reimbursement
of costs and expenses as and to the same

                                      -76-

<PAGE>

extent (but without duplication) as Lender is entitled thereto under the
applicable provisions of this Agreement and the other Loan Documents.

            (b) Upon notice thereof from Lender, Servicer shall have the right
to exercise all rights of Lender and enforce all obligations of Borrower
pursuant to the provisions of this Agreement, the Note and the other Loan
Documents.

            (c) Provided Borrower shall have been given notice of Servicer's
address by Lender, Borrower shall deliver to Servicer duplicate originals of all
notices and other instruments which Borrower may or shall be required to deliver
to Lender pursuant to this Agreement, the Note and the other Loan Documents (and
no delivery of such notices or other instruments by Borrower shall be of any
force or effect unless delivered to Lender and Servicer as provided above).

            SECTION 11.25 JOINT AND SEVERAL LIABILITY.

            If more than one Person has executed this Agreement as "Borrower,"
the representations, covenants, warranties and obligations of all such Persons
hereunder shall be joint and several.

            SECTION 11.26 CREATION OF SECURITY INTEREST.

            Notwithstanding any other provision set forth in this Agreement, the
Note, the Mortgage or any of the other Loan Documents, Lender may at any time
create a security interest in all or any portion of its rights under this
Agreement, the Note, the Mortgage and any other Loan Document (including,
without limitation, the advances owing to it) in favor of any Federal Reserve
Bank in accordance with Regulation A of the Board of Governors of the Federal
Reserve System.

            SECTION 11.27 ASSIGNMENTS AND PARTICIPATIONS.

            (a) The Lender may, at no cost to Borrower, assign to one or more
Persons all or a portion of its rights and obligations under this Loan
Agreement.

            (b) Upon such execution and delivery, from and after the effective
date specified in such Assignment and Acceptance, the assignee thereunder shall
be a party hereto and have the rights and obligations of Lender hereunder.

            (c) Lender may, at no cost to Borrower, sell participations to one
or more Persons in or to all or a portion of its rights and obligations under
this Loan Agreement; provided, however, that (i) Lender's obligations under this
Loan Agreement shall remain unchanged, (ii) Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(ii) Lender shall remain the holder of any Note for all purposes of this Loan
Agreement and (iv) Borrower shall continue to deal solely and directly with
Lender in connection with Lender's rights and obligations under and in respect
of this Loan Agreement and the other Loan Documents.

                                      -77-

<PAGE>

            (d) Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 11.27, disclose
to the assignee or participant or proposed assignee or participant, as the case
may be, any information relating to Borrower or any of its Affiliates or to any
aspect of the Loan that has been furnished to the Lender by or on behalf of the
Borrower or any of its Affiliates.

            SECTION 11.28 SET-OFF. In addition to any rights and remedies of
Lender provided by this Loan Agreement and by law, the Lender shall have the
right, without prior notice to Borrower, any such notice being expressly waived
by Borrower to the extent permitted by applicable law, upon any amount becoming
due and payable by Borrower hereunder (whether at the stated maturity, by
acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by Lender or any Affiliate
thereof to or for the credit or the account of Borrower. Lender agrees promptly
to notify Borrower after any such set-off and application made by Lender;
provided that the failure to give such notice shall not affect the validity of
such set-off and application.

            SECTION 11.29 PARTIAL RELEASE - EXPANSION PARCELS.

            (a) Provided no Event of Default shall have occurred and remain
uncured and provided Borrower desires to transfer one or more Expansion Parcels
or ground lease the Ground Lease Parcel for the development of office,
residential, industrial and/or research and development facilities compatible
with the use and operation of the Property, Borrower shall have the right from
time to time prior to the Maturity Date to obtain a release of the lien of the
Mortgage (and related Loan Documents) as to an Expansion Parcels (a "Partial
Release") or ground lease the Ground Lease Parcel (a "Ground Lease") upon
satisfaction of the following conditions precedent:

            (i) Borrower shall provide Lender not less than thirty (30) days
notice (or a shorter period of time if permitted by Lender in its sole
discretion) specifying the date (the "Expansion Date") on which the Partial
Release or Ground Lease, as applicable, is to occur provided, however, that
Borrower may postpone the Expansion Date from time to time as long as the
extended date is at least 5 Business Days after Notice of such extension;

            (ii) Lender shall have received an Officer's Certificate (A) as to
the proposed use of the Expansion Parcel or Ground Lease Parcel, as applicable,
its compatibility with the use of the Property and its effects on the operation
and use of the remainder of the Property and (B) indicating the Gross Revenue
and Operating Expenses for the Property both immediately before and immediately
after the Partial Release or Ground Lease after taking into account the proposed
use of the Expansion Parcel or Ground Lease Parcel, as applicable, and its
effects on income and expense at the Property, together with evidence in support
of such conclusions;

            (iii) In the case of a Partial Release, if required by Lender,
Borrower shall deliver to Lender an opinion of counsel for Borrower that is
standard in commercial lending transactions and subject only to customary
qualifications, assumptions and exceptions opining,

                                      -78-

<PAGE>

among other things, that if a Securitization of any portion of the Loan has
occurred, the REMIC Trust formed pursuant to such Securitization will not fail
to maintain its status as a "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code as a result of the partial release pursuant
to this Section 11.29;

            (iv) Borrower shall have delivered to Lender evidence that Borrower
has complied with all requirements of and obtained all approvals required under
any Leases and the Operating Agreements applicable to the Partial Release or
Ground Lease, as applicable, and that such Partial Release or Ground Lease does
not violate any of the provisions of the Leases and the Operating Agreements
including, without limitation, provisions relating to the availability of
parking at the Property provided, however, that an Officer's Certificate to that
effect shall be sufficient evidence of such compliance and obtaining of such
approvals as to Leases which are not Major Leases;

            (v) In the case of a Partial Release, Borrower shall have delivered
to Lender (A) at Borrower's option, (x) an endorsement to the Title Insurance
Policy, (y) an opinion of counsel (from counsel reasonably acceptable to Lender)
or (z) a certificate of an architect or engineer (from an architect or engineer
reasonably acceptable to Lender and licensed to practice in the State)
indicating that the Expansion Parcel has been legally subdivided for zoning lot
purposes from the remainder of the Property pursuant to a zoning lot subdivision
in accordance with applicable law, (B) at Borrower's option, (x) an endorsement
to the Title Insurance Policy, (y) an opinion of counsel (from counsel
reasonably acceptable to Lender) or (z) a certificate of an architect (from an
architect reasonably acceptable to Lender and licensed to practice in the State)
indicating that the balance of the Property separately conforms to and is in
material compliance with all applicable Legal Requirements and constitutes a
separate tax lot(s), (C) a certificate from an architect or engineer licensed to
practice in the State and reasonably acceptable to Lender to the effect that the
Expansion Parcel is not necessary for the uses of the remainder of the Property,
including, without limitation, for support, access, driveways, parking,
utilities, drainage flows or any other purpose, (after giving effect to any
easements therefor reserved over the Expansion Parcel for the benefit of the
remainder of the Property) and (D) an Officer's Certificate with supporting
documentation indicating that either (y) sufficient parking remains on the
remainder of the Property to comply with all Leases of such remainder and with
all Operating Agreements and which is adequate for the proper use and enjoyment
of the balance of the Property or (z) reservations of parking (in favor of such
remainder) in the Expansion Parcel are sufficient (when added to parking
otherwise available to the remainder) to comply with all Leases of such
remainder and with all Operating Agreements and which are adequate for the
proper use and enjoyment of the remainder of the Property;

            (vi) In the case of a Partial Release, Borrower shall have delivered
a copy of any reciprocal easement agreement to be executed on or prior to the
Expansion Date which will provide for any of the reservations required by
Section 11.29(a)(v) and which will otherwise conform to the other requirements
of Section 11.29(a)(v) and may contain cross-easements for the benefit of the
Expansion Parcel and the remainder of the Property in respect of access,
driveways, parking, utilities, drainage flows, storm and sanitary sewers, and
other customary purposes. Such reciprocal easement agreement will contain only
those provisions which (x) are necessary or desirable to accommodate the
proposed development described in this Section 11.29, (y) are consistent with
Borrower's obligations under the Loan Documents and (z) would

                                      -79-

<PAGE>

be acceptable to a prudent lender subordinating its mortgage to such an
reciprocal easement agreement;

            (vii) Borrower shall have delivered a certificate from an architect
or engineer (licensed to practice in the State and reasonably acceptable to
Lender) to the effect that any improvements proposed to be built on the
Expansion Parcel or Ground Lease Parcel, as applicable, will not adversely
affect the ability to operate and maintain the remainder of the Property (after
giving effect to any easements reserved or granted for the benefit of such
remainder or the Expansion Parcel) and will not result in a loss any rentable
square feet on the remainder of the Property;

            (viii) The Debt Service Coverage Ratio for the Loan, after taking
into account any improvement which is proposed to be built on the Expansion
Parcel or the Ground Lease Parcel, as applicable, and its effect on income and
expenses at the Property, will not be less than the Debt Service Coverage Ratio
for the Loan as of the date immediately preceding the release and Borrower shall
deliver an Officer's Certificate certifying thereto and showing the calculations
with respect thereto;

            (ix) In the case of a Ground Lease, Borrower shall have delivered to
Lender an architect's certificate certifying that the plans and drawings for the
improvements to be built on the Expansion Parcel or Ground Lease Parcel, as
applicable, and the improvements to be constructed pursuant thereto will comply
with all Legal Requirements;

            (x) Lender shall have received an appraisal of the Property dated no
more than sixty (60) days prior to the proposed Expansion Date by an appraiser
reasonably acceptable to the Rating Agencies, indicating an appraised value of
the Property after the Partial Release (i.e. the value of the Property exclusive
of the Expansion Parcel) or Ground Lease, as applicable, both before and after
construction of improvements to be built on the Expansion Parcel or Ground Lease
Parcel, as applicable, equal to or greater than the value of the Property prior
to such Partial Release (exclusive of the value of the Expansion Parcel) or
Ground Lease;

            (xi) In the case of a Ground Lease, Borrower shall have delivered to
Lender, additional security for Borrower's obligations under the Loan Documents,
a Letter of Credit in the amount of the appraised value of the Ground Lease
Parcel as of the date of the appraisal;

            (xii) In the case of a Partial Release, Borrower shall have
delivered a metes and bounds description of the Expansion Parcel and a survey of
the Expansion Parcel and the remainder of the Property which would be standard
in commercial lending transactions and which contains no material deviation from
the Expansion Parcel identified on Schedule VIII;

            (xiii) In the case of a Ground Lease, Borrower shall have delivered
a description of the Ground Lease Parcel that is satisfactory to Lender;

            (xiv) In the case of a Partial Release, Borrower shall have
delivered to Lender on the date of the release an endorsement to the policy or
policies of title insurance insuring the Mortgage reflecting the release and (A)
insuring Lender's interest in any easements created in connection with the
Release, (B) extending the effective date of the policy or policies to the
effective date of the release, and (C) confirming no change in the priority of
the Mortgage on the

                                      -80-

<PAGE>

remainder of the Property or in the amount of the insurance or the coverage
under the policy or policies;

            (xv) Borrower shall deliver to Lender an Officer's Certificate
certifying that the requirements set forth in this Section 11.29 have been
satisfied; and

            (xvi) Borrower shall pay all out-of-pocket costs and expenses of
Lender incurred in connection with the Partial Release or Ground Lease, as
applicable, including Lender's reasonably attorneys' fees and expenses.

            (xvii) In the case of a Ground Lease, (A) the request for such
ground lease shall be accompanied by, at Borrower's option, (1) an endorsement
to the Title Insurance Policy, (2) an opinion of counsel (from counsel
reasonably acceptable to Lender) or (3) an architect's or surveyor's certificate
from an architect or surveyor reasonably acceptable to Lender and licensed in
the State in which the Property is located, stating that a subdivision is not
required in order for the remainder of the Property to comply with Legal
Requirements after the commencement of the ground lease, (B) Borrower shall
deliver evidence to Lender indicating that either (1) financing is available
from a reliable funding source to fund the cost of the improvements to be
constructed on the Ground Lease Parcel or (2) the tenant has sufficient
financial wherewithal to pay for the cost of construction of such improvements,
(D) such ground lease shall be approved by Lender and shall contain the
following provisions: (1) the Ground Lease Parcel shall not be used for any
purpose other than that which is compatible with the current use of the
Property, (2) the ground lease shall require that the tenant be responsible for
construction of improvements (however, Borrower, as the landlord thereunder, may
be responsible for construction of the improvements provided that Borrower
complies with the provisions of Section 4.1.10), all allocable taxes and all
insurance, maintenance, utility, repair and other similar obligations with
respect to the tenant's improvements, (3) the tenant shall be required to
restore the demised premises in the case of casualty and condemnation to a safe
and habitable condition and/or to remove any damaged structures or debris
therefrom so as to leave the demised premises in a safe condition, and (4) the
tenant shall discharge (unless the same have been bonded or otherwise secured to
Lender's satisfaction) within thirty (30) days any mechanic's Lien filed against
the demised premises by reason of the acts of the tenant or Persons claiming by,
through or under the tenant. Such ground lease may permit the tenant to procure
mortgage financing secured by the leasehold estate created thereby and such
ground lease will contain no provisions which are inconsistent with Borrower's
obligations under the Loan Documents or which would be unacceptable to a prudent
lender subordinating its mortgage to same (including any provisions which are
materially detrimental to the interests of such lender).

            (xviii) If Borrower is unable to legally subdivide the Expansion
Parcel from the remainder of Property, if Borrower desires to enter into a
ground lease in lieu of conveying title to the Expansion Parcel, Borrower shall
have the right to ground lease the Expansion Parcel to a Person other than
Borrower in lieu of such conveyance and Lender shall subordinate the Lien of the
Mortgage and the other Loan Documents to such lease, provided Borrower complies
with all of the conditions set forth in Section 11.29 to the extent applicable
to a Ground Lease.

            (b) If Borrower has elected to release the Expansion Parcel and the
requirements of this Section 11.29 have been satisfied, the Expansion Parcel
shall be released

                                      -81-

<PAGE>

from the Lien of the Mortgage (and related Loan Documents), any reciprocal
easement agreement approved by Lender may be executed and Lender shall consent
and subordinate the Lien of the Mortgage thereto. In connection with the release
of the Lien, Borrower shall submit to Lender, not less than 10 days prior to the
Expansion Date (or such shorter time as is acceptable to Lender in its sole
discretion), a release of Lien (and related Loan Documents) for execution by
Lender and a consent and subordination to any reciprocal easement agreement
approved by Lender for execution by Lender. Such release and consent and
subordination shall be in a form appropriate in the jurisdiction in which the
Property is located and shall contain standard provisions protecting the rights
of a releasing lender. In addition, Borrower shall provide all other
documentation Lender reasonably requires to be delivered by Borrower in
connection with such release, together with an Officer's Certificate certifying
that such documentation (i) is in compliance with all Legal Requirements, and
(ii) will effect such release in accordance with the terms of this Agreement.
Borrower shall pay all costs, taxes and expenses associated with the release of
the Lien of the Mortgage, including Lender's reasonable attorneys' fees.
Borrower shall cause title to the Expansion Parcel so released from the Lien of
the Mortgage to be transferred to and held by a Person other than Borrower.

            SECTION 11.30 COMPONENT NOTES.

            Lender, without in any way limiting Lender's other rights hereunder,
in its sole and absolute discretion, shall have the right at any time to require
Borrower to execute and deliver "component" notes (including senior and junior
notes), which notes may be paid in such order of priority as may be designated
by Lender, provided that (i) the aggregate principal amount of such "component"
notes shall equal the outstanding principal balance of the Loan immediately
prior to the creation of such "component" notes, (ii) the weighted average
interest rate of all such "component" notes shall on the date created equal the
interest rate which was applicable to the Loan immediately prior to the creation
of such "component" notes, (iii) the debt service payments on all such
"component" notes shall on the date created equal the debt service payment which
was due under the Loan immediately prior to the creation of such component notes
and (iv) the other terms and provisions of each of the "component" notes shall
be identical in substance and substantially similar in form to the Loan
Documents. Borrower, no cost or expense to Lender or Borrower (other than its
own costs and expenses in connection with the review, execution and delivery of
the component notes), shall cooperate with all reasonable requests of Lender in
order to establish the "component" notes and shall execute and deliver such
documents as shall reasonably be required by Lender and any Rating Agency in
connection therewith, all in form and substance reasonably satisfactory to
Lender and any Rating Agency, including, without limitation, the severance of
security documents if requested. In the event Borrower fails to execute and
deliver such documents to Lender within 10 Business Days following written
request by Lender, Borrower hereby absolutely and irrevocably appoints Lender as
its true and lawful attorney, coupled with an interest, in its name and stead to
make and execute all documents necessary or desirable to effect such
transactions, Borrower ratifying all that such attorney shall do by virtue
thereof.

            It shall be an Event of Default under this Agreement, the Note, the
Mortgage and the other Loan Documents if Borrower fails to comply with any of
the terms, covenants or conditions of this Section 11.30 after expiration of ten
(10) Business Days after written notice thereof.

                                      -82-

<PAGE>

                         [NO FURTHER TEXT ON THIS PAGE]

                                      -83-

<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Loan
Agreement to be duly executed by their duly authorized representatives, all as
of the day and year first above written.

                                    LENDER:

                                    MORGAN STANLEY MORTGAGE
                                    CAPITAL INC, a New York corporation

                                    By:/s/ CYNTHIA DEUTSCH
                                       ------------------------------
                                       Name: CYNTHIA DEUTSCH
                                       Title: an authorized signatory

                                    BORROWER:

                                    TELC (NJ) QRS 16-30, INC.,
                                    a Delaware corporation

                                    By:
                                       -----------------------------
                                       Name:
                                       Title:

<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Loan
Agreement to be duly executed by their duly authorized representatives, all as
of the day and year first above written.

                                    LENDER:

                                    MORGAN STANLEY MORTGAGE
                                    CAPITAL INC, a New York corporation

                                    By:
                                       ------------------------------
                                       Name:
                                       Title:

                                    BORROWER:

                                    TELC (NJ) QRS 16-30, INC.,
                                    a Delaware corporation

                                    By:/s/ Jason Fox
                                       ---------------------------
                                       Name: Jason Fox
                                       Title: Vice President

<PAGE>

                                                                      SCHEDULE I

                                   RENT ROLL

<PAGE>

                                                                     SCHEDULE II
                                REQUIRED REPAIRS

<TABLE>
<CAPTION>
PROPERTY           REQUIRED REPAIR            DEADLINE            DEPOSIT AMOUNT
--------           ---------------            --------            --------------
<S>                <C>                        <C>                 <C>
</TABLE>

<PAGE>

                                                                    SCHEDULE III

                              ORGANIZATIONAL CHART

<PAGE>

                            TELC (NJ) QRS 16-30, INC.

                              CORPORATE STRUCTURE

                                  [FLOW CHART]
<PAGE>

--------------------------------------------------------------------------------
             SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
--------------------------------------------------------------------------------

                                                          MSMC Loan No. 05-19219

                      MORGAN STANLEY MORTGAGE CAPITAL INC.,
                             a New York corporation
                                    (Lender)

                                       and

                         TELCORDIA TECHNOLOGIES, INC.,
                             a Delaware corporation
                                    (Tenant)

                                       and

                           TECL (NJ) QRS 16-30, INC.,
                             a Delaware corporation
                                   (Landlord)

                               _____________,2005

                        PREPARED BY AND UPON
                        RECORDATION RETURN TO:

                        Paul, Hastings, Janofsky & Walker LLP
                        515 South Flower Street, Twenty-Fifth Floor
                        Los Angeles, CA 90071-2228
                        Attention: Steven A. Fein, Esq.

<PAGE>

                                Property Location

                   1 Telcordia Drive (formerly 444 Hoes Lane)
          City of Piscataway, County of Middlesex, State of New Jersey

                                       -2-

<PAGE>

             SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT

      THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (the
"Agreement") is made as of ______________________, 2005 by and among MORGAN
STANLEY MORTGAGE CAPITAL, INC., a New York corporation, having an address at c/o
ArCap Servicing, Inc., 5605 North MacArthur Boulevard, Suite 950, Irving, Dallas
County, Texas 75038, ("Lender"). TELCORDIA TECHNOLOGIES, INC., a Delaware
corporation, having an address at 1 Telcordia Drive, Piscataway, New Jersey
08854 ("Tenant"), and TELC (NJ) QRS 16-30, INC., a Delaware corporation, having
an address at c/o W.P. Carey & Co., LLC, 50 Rockefeller Plaza, Second Floor, New
York, New York 10020 ("Landlord").

                                    RECITALS:

         A. Lender is the present owner and holder of that certain Mortgage (the
"Security Instrument") dated as of __________________, 2005, given by Landlord
to Lender which encumbers the fee simple absolute estates of Landlord in certain
premises described in Exhibit A attached hereto (the "Property") and which,
among other security instruments, secures the payment of certain indebtedness
owed by Landlord to Lender evidenced by a certain promissory note dated
________________, 2005, given by Landlord to Lender (the "Note");

         B. Tenant is the holder of a leasehold estate in the Property under and
pursuant to the provisions of a certain lease dated _______________, 2005
between Landlord, as landlord and Tenant, as tenant (as may be amended from
time to time, the "Lease"); and

         C. Tenant has agreed to subordinate the Lease to the Security
Instrument and to the lien thereof and Lender has agreed to grant
non-disturbance to Tenant under the Lease on the terms and conditions
hereinafter set forth.

                                   AGREEMENT:

     For good and valuable consideration, Tenant, Lender and Landlord agree as
follows:

         1. Subordination. The Lease and all of the terms, covenants and
provisions thereof and all rights, remedies and options of Tenant thereunder are
and shall at all times continue to be subject and subordinate in all respects to
the terms, covenants and provisions of the Security Instrument, as of the date
hereof, and to the lien thereof, including without limitation, all renewals,
increases, modifications, spreaders, consolidations, replacements and
extensions thereof and to all sums secured thereby and advances made
thereunder with the same force and effect as if the Security Instrument had
been executed, delivered and recorded prior to the execution and delivery of the
Lease.

         2. Non-Disturbance. If any action or proceeding is commenced by Lender
for the foreclosure of the Security Instrument or the sale of the Property,
neither Tenant nor any senior secured lender, subordinate senior lender,
purchase money equipment lender or equipment lessor of Tenant that is a party
with Landlord to any consent, waiver or agreement pursuant to Section 32 of the
Lease (hereinafter "Tenant's Lender") shall be named as a party to such action
or proceeding unless such joinder shall be required by law, provided, however,
such joinder shall

                                       -3-

<PAGE>

not result in the termination of the Lease or disturb or interfere with Tenant's
possession or use of the premises demised thereunder or any of Tenant's other
rights under the Lease or any rights of Tenant's Lender (including, without
limitation, Tenant's current senior secured lenders pursuant to the terms of
that certain Landlord's Waiver and Agreement the "(Landlord's Waiver and
Agreement") dated as of the date of the Lease among Tenant, Landlord and
JP Morgan Chase Bank, N.A., as agent for Tenant's current senior secured
lenders), except as specifically set forth elsewhere in this Agreement, and the
sale of the Property in any such action or proceeding and the exercise by Lender
of any of its other rights under the Note or the Security Instrument shall be
made subject to all rights of Tenant under the Lease and any rights of any
Tenant's Lenders (including, without limitation Tenant's current senior secured
lenders under the Landlord's Waiver and Agreement), provided that at the time of
the commencement of any such action or proceeding or at the time of any such
sale or exercise of any such other rights, an Event of Default, as defined in
the Lease, by Tenant shall not have occurred and be continuing and Landlord
shall not have terminated the Lease. The immediately preceding sentence shall in
no way be deemed a waiver of Lender's rights to enforce any remedy against
Tenant under the Lease, as Landlord, pursuant to the terms of the Lease in the
event that Lender becomes the owner of the Property by reason of the foreclosure
of the Security Instrument or the acceptance of a deed or assignment in lieu of
foreclosure or otherwise.

         3. Attornment. If Lender or any other subsequent purchaser of the
Property shall become the owner of the Property by reason of the foreclosure of
the Security Instrument or the acceptance of a deed or assignment in lieu of
foreclosure or by reason of any other enforcement of the Security Instrument
(Lender or such other purchaser being hereinafter referred as "Purchaser"), and
the conditions set forth in Section 2 above have been met at the time Purchaser
becomes owner of the Property, the Lease shall not be terminated or affected
thereby but shall continue in full force and effect as a direct lease between
Purchaser and Tenant upon all of the terms, covenants and conditions set forth
in the Lease and in that event, Tenant agrees to attorn to Purchaser and
Purchaser by virtue of such acquisition of the Property shall be deemed to have
agreed to accept such attornment, provided, however, that Purchaser shall not be
(a) liable for the failure of any prior landlord (any such prior landlord,
including Landlord and any successor landlord, being hereinafter referred to as
a "Prior Landlord") to perform any of its obligations under the Lease which have
accrued prior to the date on which Purchaser shall become the owner of the
Property, provided that the foregoing shall not limit Purchaser's obligations
under the Lease to correct any conditions of a continuing nature that (i)
existed as of the date Purchaser shall become the owner of the Property and (ii)
violate Purchaser's obligations as Landlord under the Lease; provided further,
however, that Purchaser shall have received written notice of such omissions,
conditions or violations and has had a reasonable opportunity to cure the same,
all subject to the terms and conditions of the Lease; (b) subject to any
offsets, defenses, abatements or counterclaims which shall have accrued in favor
of Tenant against any Prior Landlord prior to the date upon which Purchaser
shall become the owner of the Property in connection with a default by any Prior
Landlord thereunder, (c) bound by any payment of Basic Rent which Tenant may
have paid more than one (1) quarter in advance to any Prior Landlord unless (i)
such sums are actually received by Purchaser or (ii) such prepayment shall have
been expressly approved of by Purchaser (this subsection (c) shall not apply to
prepaid Basic Rent paid in accordance with the Lease) (d) bound by any agreement
terminating or amending or modifying the Basic Rent, term, commencement date or
other material term of the Lease, or any voluntary surrender of the Property,
made without Lender's prior written consent to the extent such consent is
required

                                       -4-
<PAGE>

under the Security Instrument, Note or the other related loan documents or (e)
to the extent such consent is required under the Security Instrument, the Note
or other related loan documents, bound by any assignment of the Lease or
sublease of the Property, or any portion thereof, made prior to the time
Purchaser succeeded to Landlord's interest other than any existing today
(including, without limitation, the sublease to Science Applications
International Corporation for approximately 1,000 square feet on a
month-to-month basis, the rooftop licenses to SkyTel Corp., New York SMSA
Limited Partnership, MCImetro Access Transmission Services, LLC, Sprint Spectrum
L.P. and Nextel of New York Inc. and the license to Toshiba America Research,
Inc. for approximately 2,855 square feet) if pursuant to the provisions of the
Lease. Alternatively, upon the written request of Lender or its successors or
assigns, Tenant shall enter into a new lease of the Premises with Lender or such
successor or assign, at Lender's or such successor or assign's cost and expense,
for the then remaining term of the Lease, upon the same terms and conditions as
contained in the Lease (as the same may be amended or modified as mutually
agreed to by Tenant and Purchaser).

         4. Right of First Refusal. In the event that Lender or any other
subsequent purchaser of the Property shall become the owner of the Property by
reason of the foreclosure of the Security Instrument or the acceptance of a deed
or assignment in lieu of foreclosure or by reason of any other enforcement of
the Security Instrument, such event shall not trigger any right of first refusal
that Tenant has under the Lease.

         5. Notice to Tenant. After written notice is given to Tenant by
Lender that the Landlord is in default under the Note and the Security
Instrument and that the rentals under the Lease should be paid to Lender
pursuant to the terms of the assignment of leases and rents executed and
delivered by Landlord to Lender in connection therewith, Tenant shall (but
subject at all times to compliance with applicable law) thereafter pay to
Lender or as directed by the Lender in writing, all rentals and all other
monies due or to become due to Landlord under the Lease and Landlord hereby
expressly authorizes Tenant to make such payments to Lender and hereby
releases and discharges Tenant from any liability to Landlord on account of
any such payments.

         6. Lender's Consent. Tenant shall not, without obtaining the prior
written consent of Lender, but only to the extent such consent is required
pursuant to the Security Instrument, Note or other related loan documents, (a)
enter into any agreement amending, modifying or terminating the Basic Rent,
term, commencement date other material term of the Lease, (b) prepay any of the
Basic Rent due under the Lease for more than one (1) quarter in advance of the
due dates thereof, other than the prepaid Basic Rent paid in accordance with the
Lease, (c) voluntarily surrender the Property or terminate the Lease without
cause or shorten the term thereof other than pursuant to the provisions of the
Lease, or (d) assign the Lease or sublet the Property or any part thereof other
than pursuant to the provisions of the Lease; and any such amendment,
modification, termination, prepayment, voluntarily surrender, assignment or
subletting, without Lender's prior consent, except as otherwise permitted by
this Section 6, shall not be binding upon Lender. As to the Landlord, the terms
and restrictions contained in Security Instrument shall control to the extent
there is any conflict between the Security Instrument and this Agreement.

                                       -5-

<PAGE>

         7. Notice to Lender and Right to Cure.  Tenant shall  notify  Lender if
Tenant  becomes  aware of any  default by  Landlord  under the Lease and  agrees
that,  notwithstanding any provisions of the Lease to the contrary, no notice of
cancellation  thereof or of an abatement  associated  with such default shall be
effective  unless  Lender shall have received  notice of default  giving rise to
such  cancellation or abatement and (i) in the case of any such default that can
be cured by the  payment of money,  until  thirty  (30) days shall have  elapsed
following  the  giving  of such  notice  or (ii) in the case of any  other  such
default,  forty-five  (45) days,  except for a default  which cannot be cured in
such a period of time,  in which case Lender shall have a reasonable  period for
remedying  such default  following  the giving of such notice and  following the
time when Lender shall have become  entitled  under the Security  Instrument  to
remedy the same,  including such time as may be necessary to acquire  possession
of the Property if possession is necessary to effect such cure, provided Lender,
with reasonable diligence, shall (a) pursue such remedies as are available to it
under the Security  Instrument  so as to be able to remedy the default,  and (b)
thereafter  shall have  commenced  and continued to remedy such default or cause
the same to be remedied, but in no event shall such period of time exceed ninety
(90) days.  Notwithstanding  the  foregoing,  Lender shall have no obligation to
cure any such default by Landlord under the Lease.

         8. Notices. All notices or other written communications hereunder shall
be deemed to have been properly given (i) upon delivery,  if delivered in person
or by facsimile  transmission with receipt acknowledged by the recipient thereof
and  confirmed by telephone  by sender,  (ii) one (1) Business Day  (hereinafter
defined) after having been  deposited for overnight  delivery with any reputable
overnight  courier  service,  or (iii) three (3) Business Days after having been
deposited in any post office or mail depository regularly maintained by the U.S.
Postal Service and sent registered or certified mail,  postage  prepaid,  return
receipt requested, addressed as follows:

If to Tenant:           Telcordia  Technologies, Inc.
                        1 Telcordia Drive
                        Piscataway, New Jersey 08854
                        Attention: Chief Financial Officer

With a Copy To:         Willkie Farr & Gallagher LLP
                        787 Seventh  Avenue
                        New York, New York 10019
                        Attention: Steven J. Gartner, Esq.

If to Lender:           Morgan Stanley Mortgage  Capital,  Inc.
                        1221 Avenue of the Americas, 27th Floor
                        New York, New York 10020
                        Attention: Steven Holmes
                        Facsimile No.: (212) 762-9495

With a Copy To:         Morgan Stanley Mortgage Capital Inc.
                        ArCap Servicing, Inc.
                        5605 N. MacArthur Boulevard, Suite 950
                        Irving, Texas 75038

                                       -6-

<PAGE>

With a Copy To:         Paul, Hastings, Janofsky & Walker LLP
                        515 S. Flower Street, 25th Floor
                        Los Angeles,  California  90071
                        Attention:  Margaret Frick Bertisch, Esq.
                        Facsimile No.: (213) 996-3301

If to Landlord:         TELC (NJ) QRS 16-30,  Inc.
                        c/o W.P.  Carey & Co., LLC
                        50 Rockefeller  Plaza,  Second Floor
                        New York, New York 10020
                        Attention: Director, Asset Management

With a Copy  To:        Reed  Smith  LLP
                        2500 One  Liberty  Place
                        Philadelphia, Pennsylvania 19103
                        Attention: Chairman, Real Estate Department

or addressed as such party may from time to time designate by written notice to
the other parties. For purposes of this Section 7, the term "Business  Day"
shall mean a day on which commercial banks are not authorized or required by law
to close in the state or commonwealth where the Property is located. Either
party by notice to the other may designate additional or different addresses for
subsequent notices or communications.

         9. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of Lender, Tenant and Purchaser and their  respective
successors and assigns.

         10. Governing Law. This Agreement shall be deemed to be a contract
entered into pursuant to the laws of the State or Commonwealth where the
Property is located and shall in all respects be governed, construed, applied
and enforced in accordance with the laws of the State or Commonwealth where the
Property is located.

         11. Miscellaneous. This Agreement may not be modified in any manner or
terminated except by an instrument in writing executed by the parties hereto. If
any term, covenant or condition of this Agreement is held to be invalid, illegal
or unenforceable in any respect, this Agreement shall be construed without such
provision. This Agreement may be executed in any number of duplicate originals
and each duplicate original shall be deemed to be an original. This Agreement
may be executed in several counterparts, each of which counterparts shall be
deemed an original instrument and all of which together shall constitute a
single Agreement. 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.

         12. Joint and Several Liability. If Tenant consists of more than one
person, the obligations and liabilities of each such person hereunder shall be
joint and several.

         13. Definitions. The term "Lender" as used herein shall include the
successors and assigns of Lender as holder of the Security Instrument or the
acceptance of a deed or assignment in lieu of foreclosure or otherwise. The term
"Landlord" as used herein shall mean

                                       -7-
<PAGE>

and include the present landlord under the Lease and such landlord's successors
in interest under the Lease, but shall not mean or include Lender unless and
until Lender has succeeded to the interest of Landlord under the Lease. The term
"Property" as used herein shall mean the Property, the improvements now or
hereafter located thereon and the estates therein encumbered by the Security
Instrument. The term "Tenant" as used herein shall mean and include the present
tenant under the Lease and such tenant's successors in interest.

         14. Further Acts. The parties hereto will do, execute, acknowledge and
deliver such further acts and assurances as any other party shall, from time to
time, reasonably require, for the better assuring and confirming the rights
granted by the terms of this Agreement or for carrying out the intention or
facilitating the performance of the terms of this Agreement or for filing,
registering or recording this Agreement provided that any such further agreement
or assurance shall be consistent with the terms of the Lease and this Agreement.

         15. Limitations on Purchaser's Liability. In no event shall the
Purchaser, nor any heir, legal representative, successor, or assignee of the
Purchaser have any personal liability for the obligations of Landlord under the
Lease and should the Purchaser succeed to the interests of the Landlord under
the Lease, Tenant shall look only to the estate and property of any such
Purchaser in the Property for the satisfaction of Tenant's remedies for the
collection of a judgment (or other judicial process) requiring the payment of
money in the event of any default by any Purchaser as landlord under the Lease,
and no other property or assets of any Purchaser shall be subject to levy,
execution or other enforcement procedure for the satisfaction of Tenant's
remedies under or with respect to the Lease; provided, however, that the Tenant
may exercise any other right or remedy provided thereby or by law in the event
of any failure by Landlord to perform any such obligation. The parties hereby
agree that Lender, upon becoming the owner of the Property, or any Purchaser of
the Property, shall be liable for any prepaid Basic Rent less any amounts that
have been applied theretofore in accordance with the terms of the Lease on the
date of such foreclosure or acceptance of deed in lieu. The parties further
acknowledge that pursuant to the terms of the Lease, in the event the Lease is
terminated prior to the expiration of the Lease due to an Event of Default under
the Lease (as defined therein) any prepaid Basic Rent or any interest thereon
and any prepaid Basic Rent shall be applied in accordance with the terms of the
Lease.

         16. Estoppel Certificate. Tenant, shall, from time to time, within
twenty (20) days after request by Lender, execute, acknowledge and deliver to
Lender a statement by Tenant certifying (a) that the Lease is unmodified and in
full force and effect (except as otherwise specified), (b) the amounts of fixed
rent, additional rent, percentage rent or other sums, if any, which are payable
in respect of the Lease and the commencement date and expiration date of the
Lease, (c) the dates to which the fixed rent, additional rent, and other sums
which are payable in respect to the Lease have been paid, (d) that, to the
knowledge of the signer of such certificate and except as otherwise specified,
no default by Landlord exists under the Lease, and (e) except as otherwise
specified, there are no proceedings pending or, to the knowledge of the signer,
threatened, against Tenant before or by any court or administrative agency
which, if adversely decided, would materially and adversely affect the financial
condition and operations of Tenant. Tenant also shall include in any such
statement such other information concerning the Lease as Lender may reasonably
request. Any such statements by Tenant may be relied upon by Lender and its
successors and assigns. Any estoppel certificate under this provision shall
state the title

                                      -8-

<PAGE>

of the signatory thereto and that such person is duly authorized to execute
and deliver same on behalf of Tenant. In no event shall any person signing any
such statement be personally liable thereunder.

                         [NO FURTHER TEXT ON THIS PAGE]

                                      -9-

<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement to
be duly executed by their duly authorized representatives, all as of the day and
year first above written.

                                        LENDER:

                                        MORGAN STANLEY MORTGAGE
                                        CAPITAL INC, a New York corporation

                                        By: /s/ Cynthia Deutsch
                                           -------------------------------
                                        Name: CYNTHIA DEUTSCH
                                        Title: an authorized signatory

                                        BORROWER:

                                        TELC (NJ) QRS 16-30, INC.,
                                        a Delaware corporation

                                        By:_______________________________
                                           Name:
                                           Title:
<PAGE>

      IN WITNESS WHEREOF, Lender, Tenant and Landlord have duly executed this
Agreement as of the date first above written.

                                        LENDER:

                                        MORGAN STANLEY MORTGAGE CAPITAL,
                                        INC., a New York corporation

                                        By:____________________________________
                                        Name:__________________________________
                                        Title:_________________________________

                                        TENANT:

                                        TELCORDIA TECHNOLOGIES, INC.,
                                        a Delaware corporation

                                        By: /s/ Joseph Giordano
                                           ------------------------------------
                                        Name: Joseph Giordano
                                        Title: Corporate Vice President and
                                               Deputy General Counsel

                                        LANDLORD:

                                        TELC (NJ) QRS 16-30, INC.,
                                        a Delaware corporation

                                        By: /s/ Jason Fox
                                           ------------------------------------
                                        Name: Jason Fox
                                        Its: VP

                                      -10-

<PAGE>

STATE OF ____________________

COUNTY OF ___________________

This instrument was  acknowledged  before me on the _____ day  of__________,  20
______________________ by ____________________ the __________________ of
_________, a _________________, the ____________________________  of
___________, a ________, on behalf of said corporation.

___________________________________
Notary Public in and for
the State of_________

___________________________________
<Printed Name of Notary>

My commission expires: ______________

STATE OF _________________

COUNTY OF  ______________

This  instrument  was  acknowledged  before me on the 11 day of  March _____,
2005 by Joseph Giordano the Corporate  Vice President & Deputy General Counsel
Telcordia Technologies Inc., a Delaware Corporation, on behalf of said
corporation.

ROBERT  KOONIN
Notary  Public,  State of New York
No.  01KO6113974
Qualified In Rookland County
Certificate Filed In New York County
Commission Expires Aug. 9, 2006

/s/ Robert Koonin
----------------------------------
Notary Public in and for
the State of NY

___________________________________
<Printed Name of Notary>

My commission expires: ___________

<PAGE>

STATE OF New York

COUNTY OF New York

This instrument was acknowledged before me on the 14th day of March____, 2005 by
Jason Fox the Vice President of TELC (NJ) QRS 16-30 INC., a Delaware
Corporation, on behalf of said corporation.

 /s/ Kelly Costello                                     KELLY M. COSTELLO
------------------------                      Notary Public, State of New York
Notary Public in and for                               No. 01CO6111240
the State of NY                                 Qualified in New York County
                                               Commission Expires June 7, 2008
/s/ Kelly Costello
------------------------
<Printed Name of Notary>

My commission expires: 6/7/08

<PAGE>

                                    EXHIBIT A

                         LEGAL DESCRIPTIONS OF PROPERTY

<PAGE>

                                    EXHIBIT A
                              PROPERTY DESCRIPTION

ALL THAT CERTAIN PLOT, PIECE OR PARCEL OF LAND, WITH THE BUILDING AND
IMPROVEMENTS THEREON ERECTED, SITUATE, LYING AND BEING IN the Township of
Piscataway, COUNTY of Middlesex, STATE OF NEW JERSEY, BOUNDED AND DESCRIBED AS
FOLLOWS:

PARCEL ONE - BLOCK 591, LOT 2.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency, thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet; thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet; thence

                                        1

<PAGE>

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 34
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds East and a chord distance of 820.56 feet to a
            point of tangency, thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to the POINT of BEGINNING.

The above described being known as a description of Block 591, Lots 2.01, said
Lot being shown on the Piscataway Township Tax Map Sheet 51, also bring shown on
a plat entitled "Reverse Subdivision Plan" prepared by Donald H. Stires
Associates, 43 West High Street, Somerville, New Jersey dated May 26, 1999.

PARCEL ONE - BLOCK 591, LOT 2.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency; thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

                                       2
<PAGE>

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet; thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet; thence

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 54
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds Bast and a chord distance of 820.56 feet to a
            point of tangency; thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to a point of curvature; thence

      22.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 5052.02 feet, a length along the arc of 60.70
            feet, a bearing along the chord of South 12 degrees 38 minutes 34
            seconds East and a chord distance of 60.70 feet to the Point of
            BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:
            Commonly known as: 1 Telcordia Drive / 444 Hoes Lane, Piscataway,
            New Jersey Block 591, Lot 2.01 - Tax Map of the Township of
            Piscataway

                                       3
<PAGE>

PARCEL TWO - BLOCK 501.1, LOT 6.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 25
            minutes 40 seconds East, a distance of 20.89 feet; thence

      2.    South 70 degrees 22 minutes 20 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 25 minutes 40 seconds East, a distance of 250.00
            feet; thence

      4.    North 70 degrees 22 minutes 20 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 25 minutes 40 seconds East, a
            distance of 536.53 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 528.81
            feet, a bearing along the chord of South 22 degrees 06 minutes 50
            seconds East and a chord distance of 528.69 feet to a point of
            tangency, thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet; thence

      10.   North 00 degrees 42 minutes 10 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525.75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 09 minutes 55 seconds East and a chord distance of
            172.87 feet to a point of tangency; thence

      12.   North 19 degrees 37 minutes 40 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 4036 feet, a bearing along the chord of
            North 58 degrees 10 minutes 06 seconds West and a chord distance of
            37.38 feet to a point on a non-tangent curve in the southerly
            sideline of Knightsbridge Road; thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 42

                                       4
<PAGE>

            minutes 26 seconds East and a chord distance of 99.31 feet to a
            point of tangency; thence

      15.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 25 minutes 40
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 01 minutes 40 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above described being known as a Consolidated description of Block 501.1,
Lots 6,9.01 and 10, said Lots being shown on the Piscataway Township Tax Map
Sheet 44C, also being shown on a plat entitled "Reverse Subdivision Plan"
prepared by Donald H. Stires Associates, 43 West High Street, Somerville, New
Jersey, dated May 26, 1999.

PARCEL TWO - BLOCK 501.1, LOT 6.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 49
            minutes 32 seconds East, a distance of 20.89 feet; thence

      2.    South 69 degrees 58 minutes 28 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 49 minutes 32 seconds East, a distance of 250.00
            feet; thence

      4.    North 69 degrees 58 minutes 28 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 49 minutes 32 seconds East, a
            distance of 535.73 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 537.85
            feet, a bearing along the chord of South 22 degrees 30 minutes 27
            seconds East and a chord distance of 537.71 feet to a point of
            tangency; thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

                                       5
<PAGE>

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet, thence

      10.   North 01 degrees 06 minutes 02 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525,75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 33 minutes 47 seconds West and a chord distance of
            172.87 feet to a point of tangency, thence

      12.   North 20 degrees 01 minutes 32 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 40.36 feet, a bearing along the chord of
            North 58 degrees 33 minutes 57 seconds West and a chord distance of
            37.38 feet to a point on a non-tangent curve in the southerly
            sideline of Knightsbridge Road; thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 18 minutes 34 seconds East and a
            chord distance of 99.31 feet to a point of tangency; thence

      15.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 49 minutes 31
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 25 minutes 32 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:
Commonly known as:    50 Knightsbridge Road
                      Piscataway, New Jersey
                      Block 501.01, Lot 6.01 - Tax Map of the Township of
                      Piscataway

                                       6
<PAGE>

                                    EXHIBIT A

                               LEGAL DESCRIPTION

<PAGE>

                                    EXHIBIT A

                          Legal Description of Property

ALL THAT CERTAIN PLOT, PIECE OR PARCEL OF LAND, WITH THE BUILDING AND
IMPROVEMENTS THEREON ERECTED, SITUATE, LYING AND BEING IN THE TOWNSHIP OF
PISCATAWAY, COUNTY OF MIDDLESEX, STATE OF NEW JERSEY, BOUNDED AND DESCRIBED AS
FOLLOWS:

PARCEL ONE - BLOCK 591, LOT 2.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency; thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet; thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

<PAGE>

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet; thence

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 34
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds East and a chord distance of 820.56 feet to a
            point of tangency; thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to the POINT of BEGINNING.

The above described being known as a description of Block 591, Lots 2.01, said
Lot being shown on the Piscataway Township Tax Map Sheet 51, also being shown on
a plat entitled "Reverse Subdivision Plan" prepared by Donald H. Stires
Associates, 43 West High Street, Somerville, New Jersey dated May 26, 1999.

                                      -2-
<PAGE>

PARCEL ONE - BLOCK 591, LOT 2.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the westerly sideline of Hoes Lane, variable
width Right-of-Way, with the northerly sideline of Skiles Avenue, 66 foot
Right-of-Way, and from said point running; thence

      1.    Along the said northerly sideline of Skiles Avenue on a curve to the
            right said curve having a radius of 20.00 feet, a length along the
            arc of 28.17 feet, a bearing along the chord of South 27 degrees 22
            minutes 04 seconds West, and a chord distance of 25.90 feet to a
            point of tangency; thence

      2.    Continuing along said northerly sideline, South 67 degrees 43
            minutes 22 seconds West, a distance of 473.88 feet; thence

      3.    North 22 degrees 16 minutes 39 seconds West, a distance of 250.00
            feet; thence

      4.    South 67 degrees 43 minutes 21 seconds West, a distance of 280.00
            feet; thence

      5.    South 22 degrees 16 minutes 39 seconds East, a distance of 250.00
            feet to the said northerly sideline of Skiles Avenue; thence

      6.    Along said sideline, South 67 degrees 43 minutes 22 seconds West, a
            distance of 292.29 feet; thence

      7.    South 67 degrees 53 minutes 22 seconds West, a distance of 787.50
            feet; thence

      8.    North 20 degrees 10 minutes 39 seconds West, a distance of 414.90
            feet, thence

      9.    North 43 degrees 04 minutes 48 seconds West, a distance of 328.55
            feet; thence

      10.   North 13 degrees 38 minutes 03 seconds West, a distance of 435.20
            feet; thence

      11.   North 12 degrees 16 minutes 28 seconds West, a distance of 278.51
            feet; thence

      12.   North 12 degrees 11 minutes 18 seconds West, a distance of 626.96
            feet; thence

      13.   North 18 degrees 37 minutes 49 seconds West, a distance of 62.60
            feet; thence

      14.   North 65 degrees 49 minutes 40 seconds East, a distance of 97.25
            feet; thence

      15.   North 70 degrees 47 minutes 05 seconds East, a distance of 465.73
            feet: thence

      16.   North 70 degrees 37 minutes 52 seconds East, a distance of 664.05
            feet; thence

                                      -3-
<PAGE>

      17.   North 70 degrees 38 minutes 36 seconds East, a distance of 524.76
            feet to a concrete monument in the westerly sideline of Hoes Lane;
            thence

      18.   Along said sideline, South 24 degrees 17 minutes 54 seconds East, a
            distance of 526.99 feet to a point of curvature; thence

      19.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 6052.00 feet, a length along the arc of 422.51
            feet, a bearing along the chord of South 26 degrees 17 minutes 54
            seconds East, and a chord distance of 422.42 feet to a point of
            reverse curvature; thence

      20.   Continuing along the said sideline on a curve to the right said
            curve having a radius of 2948.00 feet, a length along the arc of
            823.24 feet, a bearing along the chord of South 20 degrees 17
            minutes 54 seconds East and a chord distance of 820.56 feet to a
            point of tangency; thence

      21.   South 12 degrees 17 minutes 54 seconds East, a distance of 184.28
            feet to a point of curvature; thence

      22.   Continuing along the said sideline on a curve to the left said curve
            having a radius of 5052.02 feet, a length along the arc of 60.70
            feet, a bearing along the chord of South 12 degrees 38 minutes 34
            seconds East and a chord distance of 60.70 feet to the Point of
            BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:
     Commonly known as:   1 Telcordia Drive / 444 Hoes Lane, Piscataway,
                          New Jersey Block 591, Lot 2.01 - Tax Map of the
                          Township of Piscataway

                                      -4-
<PAGE>

PARCEL TWO - BLOCK 501.1, LOT 6.01 - RECORD DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 25
            minutes 40 seconds East, a distance of 20.89 feet; thence

      2.    South 70 degrees 22 minutes 20 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 25 minutes 40 seconds East, a distance of 250.00
            feet; thence

      4.    North 70 degrees 22 minutes 20 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 25 minutes 40 seconds East, a
            distance of 536.53 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 528.81
            feet, a bearing along the chord of South 22 degrees 06 minutes 50
            seconds East and a chord distance of 528.69 feet to a point of
            tangency; thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet; thence

      10.   North 00 degrees 42 minutes 10 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525.75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 09 minutes 55 seconds East and a chord distance of
            172.87 feet to a point of tangency; thence

      12.   North 19 degrees 37 minutes 40 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 40.36 feet, a bearing along the chord of
            North 58 degrees 10 minutes

                                      -5-
<PAGE>

            06 seconds West and a chord distance of 37.38 feet to a point on a
            non-tangent curve in the southerly sideline of Knightsbridge Road;
            thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 42 minutes 26 seconds East and a
            chord distance of 99.31 feet to a point of tangency; thence

      15.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 25 minutes 40
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 70 degrees 22 minutes 20
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 01 minutes 40 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above described being known as a Consolidated description of Block 501,1,
Lots 6,9.01 and 10, said Lots being shown on the Piscataway Township Tax Map
Sheet 44C, also being shown on a plat entitled "Reverse Subdivision Plan"
prepared by Donald H. Stires Associates, 43 West High Street, Somerville, New
Jersey, dated May 26, 1999.

                                      -6-
<PAGE>

PARCEL TWO - BLOCK 501.1, LOT 6.01 - SURVEY DESCRIPTION

All that certain lot, tract or parcel of land and premise situate, lying and
being in the Township of Piscataway, County of Middlesex and State of New
Jersey, being more particularly described as follows:

BEGINNING at the intersection of the southerly sideline of Knightsbridge Road,
with the westerly sideline of Hoes Lane, variable width Right-of-Way, and from
said point; running; thence

      1.    Along the said westerly sideline of Hoes Lane, South 26 degrees 49
            minutes 32 seconds East, a distance of 20.89 feet; thence

      2.    South 69 degrees 58 minutes 28 seconds West, a distance of 234.83
            feet; thence

      3.    South 26 degrees 49 minutes 32 seconds East, a distance of 250.00
            feet; thence

      4.    North 69 degrees 58 minutes 28 seconds East, a distance of 234.84
            feet to the said westerly sideline of Hoes Lane; thence

      5.    Along said sideline, South 26 degrees 49 minutes 32 seconds East, a
            distance of 535.73 feet to a point on a non-tangent curve; thence

      6.    Continuing along said sideline on a curve to the left said curve
            having a radius of 6934.54 feet, a length along the arc of 537.85
            feet, a bearing along the chord of South 22 degrees 30 minutes 27
            seconds East and a chord distance of 537.71 feet to a point of
            tangency; thence

      7.    Continuing along said sideline, South 24 degrees 17 minutes 54
            seconds East, a distance of 46.89 feet to a concrete monument;
            thence

      8.    South 70 degrees 38 minutes 36 seconds West, a distance of 524.76
            feet; thence

      9.    South 70 degrees 37 minutes 52 seconds West, a distance of 664.05
            feet; thence

      10.   North 01 degrees 06 minutes 02 seconds West, a distance of 984.92
            feet to a point of curvature; thence

      11.   Along a curve to the left said curve having a radius of 525.75 feet,
            a length along the arc of 173.66 feet, a bearing along the chord of
            North 10 degrees 33 minutes 47 seconds West and a chord distance of
            172.87 feet to a point of tangency; thence

      12.   North 20 degrees 01 minutes 32 seconds West, a distance of 278.70
            feet to a point of curvature; thence

      13.   Along a curve to the left said curve having a radius of 30.00 feet,
            a length along the arc of 40.36 feet, a bearing along the chord of
            North 58 degrees 33 minutes

                                      -7-

<PAGE>

            57 seconds West and a chord distance of 37.38 feet to a point on a
            non-tangent curve in the southerly sideline of Knightsbridge Road;
            thence

      14.   Along said sideline on a curve to the left said curve having a
            radius of 656.91 feet, a length along the arc of 99.40, a bearing
            along the chord of North 74 degrees 18 minutes 34 seconds East and a
            chord distance of 99.31 feet to a point of tangency; thence

      15.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 343.84 feet; thence

      16.   Continuing along said sideline, South 26 degrees 49 minutes 31
            seconds East, a distance of 5.04 feet; thence

      17.   Continuing along said sideline, North 69 degrees 58 minutes 28
            seconds East, a distance of 268.62 feet to a point of curvature;
            thence

      18.   Along said sideline on a curve to the right said curve having a
            radius of 30.00 feet, a length along the arc of 43.56 feet, a
            bearing along the chord of South 68 degrees 25 minutes 32 seconds
            East and a chord distance of 39.84 feet to the Point of BEGINNING.

The above description is drawn in accordance with a Survey prepared by Richard
C. Mathews, PLS of Stires Associates, PA, dated January 10, 2005, last revised
January 24, 2005.

For Information Only:
     Commonly known as:      50 Knightsbridge Road
                             Piscataway, New Jersey
                             Block 501.01, Lot 6.01 - Tax Map of the Township of
                             Piscataway

                                      -8-
<PAGE>

                                                                      SCHEDULE V

                              GROUND LEASE PARCEL

<PAGE>

                                  [MASTER PLAN]

<PAGE>

                                                                   SCHEDULE VI-A

                          MONTHLY OPERATING STATEMENT

<PAGE>

                                                                   SCHEDULE VI-B

                         QUARTERLY OPERATING STATEMENT

<PAGE>

                                                                   SCHEDULE VI-C

                           ANNUAL OPERATING STATEMENT

<PAGE>

                                                                    SCHEDULE VII

                                 BALANCE SHEET

<PAGE>

                                                                   SCHEDULE VIII

                                EXPANSION PARCEL

<PAGE>

                                Release Parcel A

                                  [MASTER PLAN]

<PAGE>
                                Release Parcel B

                                  [MASTER PLAN]

<PAGE>

                                                                     SCHEDULE IX

                                 ANNUAL BUDGET

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