Document:

EXHIBIT 10.50

                                 LOAN AGREEMENT

                          Dated as of January ___, 2000

                                     Between

                                    1350 LLC,

                                   as Borrower

                                       and

                          SECORE FINANCIAL CORPORATION,

                                    as Lender

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                                TABLE OF CONTENTS

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                                                                                                                 PAGE
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W I T N E S S E T H :.............................................................................................1

I        DEFINITIONS; PRINCIPLES OF CONSTRUCTION..................................................................1

         Section 1.1       Definitions............................................................................1

         Section 1.2       Principles of Construction............................................................19

II       THE LOAN................................................................................................19

         Section 2.1       The Loan..............................................................................19

         Section 2.2       Interest Rate.........................................................................20

         Section 2.3       Loan Payments.........................................................................23

         Section 2.4       Prepayments...........................................................................24

         Section 2.5       Exit Fee..............................................................................25

         Section 2.6       Extension of Maturity Date............................................................25

III      REPRESENTATIONS AND WARRANTIES..........................................................................26

         Section 3.1       Borrower Representations..............................................................26

         Section 3.2       Survival of Representations...........................................................34

IV       BORROWER COVENANTS......................................................................................34

         Section 4.1       Borrower Affirmative Covenants........................................................34

         Section 4.2       Borrower Negative Covenants...........................................................39

V        INSURANCE, CASUALTY AND CONDEMNATION....................................................................41

         Section 5.1       Insurance.............................................................................41

         Section 5.2       Casualty and Condemnation.............................................................44

         Section 5.3       Delivery of Net Proceeds..............................................................45

VI       RESERVE FUNDS...........................................................................................48

         Section 6.1       Tax Funds.............................................................................48

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         Section 6.2       Insurance Premium Funds...............................................................49

         Section 6.3       Capital Expenditures Funds............................................................50

         Section 6.4       Security Interest in Funds............................................................51

         Section 6.5       The Accounts; Permitted Investments; Earnings.........................................52

         Section 6.6       Cash Management.......................................................................53

VII      PROPERTY MANAGEMENT.....................................................................................54

         Section 7.1       The Management Agreement..............................................................54

         Section 7.2       Prohibition Against Termination or Modification.......................................54

         Section 7.3       Replacement of Manager................................................................54

VIII     PERMITTED TRANSFERS.....................................................................................54

         Section 8.1       Permitted Transfers of Interest in Borrower...........................................54

IX       SALE AND SECURITIZATION OF MORTGAGE.....................................................................55

         Section 9.1       Sale of Mortgage and Securitization...................................................55

         Section 9.2       Securitization Indemnification........................................................56

X        DEFAULTS................................................................................................59

         Section 10.1               Event of Default.............................................................59

         Section 10.2               Remedies.....................................................................60

         Section 10.3               Remedies Cumulative..........................................................62

XI       MISCELLANEOUS...........................................................................................62

         Section 11.1               Successors and Assigns.......................................................62

         Section 11.2               Lender's Discretion..........................................................62

         Section 11.3               Governing Law................................................................62

         Section 11.4               Modification, Waiver in Writing..............................................63

         Section 11.5               Delay Not a Waiver...........................................................63

                                                                 ii

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         Section 11.6               Notices......................................................................63

         Section 11.7               Trial by Jury................................................................64

         Section 11.8               Headings.....................................................................65

         Section 11.9               Severability.................................................................65

         Section 11.10              Preferences..................................................................65

         Section 11.11              Waiver of Notice.............................................................65

         Section 11.12              Remedies of Borrower.........................................................65

         Section 11.13              Expenses; Indemnity..........................................................66

         Section 11.14              Schedules Incorporated.......................................................67

         Section 11.15              Offsets, Counterclaims and Defenses..........................................67

         Section 11.16              No Joint Venture or Partnership; No Third Party Beneficiaries................67

         Section 11.17              Publicity....................................................................68

         Section 11.18              Waiver of Marshalling of Assets..............................................68

         Section 11.19              Waiver of Counterclaim.......................................................68

         Section 11.20              Conflict; Construction of Documents; Reliance................................68

         Section 11.21              Brokers and Financial Advisors...............................................69

         Section 11.22              Exculpation..................................................................69

         Section 11.23              Prior Agreements.............................................................71

         Section 11.24              Servicer.....................................................................71

         Section 11.25              Assignment to Successor Lender...............................................71

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                                                                iii

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SCHEDULES

Schedule 1        -        Annual Budget
Schedule 2        -        Capital Expenditures Budget
Schedule 3        -        Non-Compliance
Schedule 4        -        Leases
Schedule 4A       -        Defaulted Leases

EXHIBITS

Exhibit A         -        Form of Financial Statements
Exhibit B         -        Form of Cash Management Agreement
Exhibit C         -        Form of Letter of Instruction
Exhibit D         -        Form of Subordination Agreement

                                       iv

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                                 LOAN AGREEMENT

                  THIS LOAN AGREEMENT dated as of January ___, 2000 (as amended,
restated,  replaced,  supplemented or otherwise modified from time to time, this
"Agreement"),  between SECORE FINANCIAL CORPORATION, a Pennsylvania corporation,
having an address at 3 Bethesda  Metro  Center,  Suite 700,  Bethesda,  Maryland
20814  (together  with its  successors  and assigns,  "Lender")  and 1350 LLC, a
Delaware limited  liability  company,  having an address at 10 East 50th Street,
27th Floor, New York, New York 10022 ("Borrower").

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

                              W I T N E S S E T H :

                  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:

                  "Accounts" shall mean, collectively,  the Lockbox Account, the
         Cash Management Account, the Tax Account, the Insurance Premium Account
         and the Capital Expenditures Account.

                  "Act" shall mean the Delaware Limited Liability Company Act, 6
         Del. C. Section 18-101 et seq., as amended from time to time.

                  "Affiliate"  shall mean,  as to any Person,  any other  Person
         that, directly or indirectly,  is in control of, is controlled by or is
         under  common  control  with such Person or is a director or officer of
         such Person or of an Affiliate of such Person.

                  "Affiliate Creditor" shall mean, with respect to any Affiliate
         Loan, the Affiliate of Borrower that made such Affiliate Loan.

                  "Affiliate  Loan"  shall  mean an  unsecured  loan  made by an
         Affiliate of Borrower to Borrower.

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                  "Affiliate  Obligations"  shall  mean,  with  respect  to  any
         Affiliate  Loan, (a) the principal  amount of, and accrued  interest on
         (including,  without  limitation,  any interest which accrues after the
         commencement  of any case,  proceeding or other action  relating to the
         bankruptcy,  insolvency or reorganization of Borrower),  such Affiliate
         Loan and (b) all other  indebtedness,  obligations  and  liabilities of
         Borrower to the Affiliate  Creditor that made such  Affiliate  Loan now
         existing or hereafter  incurred or created  under or with respect to or
         in connection with such Affiliate Loan.

                  "Agent"  shall  mean  the  bank  that  is  party  to the  Cash
         Management Agreement, its permitted successors and assigns.

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

                  "Alteration  Threshold" shall mean  $3,500,000,  excluding the
         cost of any  alterations  set forth in the Annual  Budget  attached  as
         Schedule 1 hereto.

                  "Annual  Budget" shall mean the  operating and capital  budget
         for the Property  setting forth Borrower's good faith estimate of Gross
         Revenue,   Operating  Expenses,   and  Capital   Expenditures  for  the
         applicable Fiscal Year.

                  "Applicable  Interest  Rate"  shall  mean (i)  LIBOR  plus the
         Spread  with  respect to any  period  when the Loan is a LIBOR Loan and
         (ii) the Substitute Rate plus the Substitute Spread with respect to any
         period when the Loan is a Substitute Rate Loan.

                  "Approved  Annual  Budget" shall have the meaning set forth in
         Section 4.1.6(e).

                  "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.

                  "Assignment of Management  Agreement"  shall mean that certain
         Assignment of Management Agreement and Subordination of Management Fees
         dated the date hereof among Borrower,  Manager and Lender,  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.

                                       2

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                  "Borrower"  shall  have the  meaning  set  forth in the  first
         paragraph of this Agreement, together with its permitted successors and
         permitted assigns.

                  "Business  Day"  shall  mean any day  other  than a  Saturday,
         Sunday or day on which  national  banks in New  York,  New York are not
         open for business.

                  "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  Expenditures  Account"  shall have the  meaning  set
         forth in Section 6.5.1.

                  "Capital  Expenditures  Budget" shall mean the budget  annexed
         hereto as Schedule 2.

                  "Capital  Expenditures  Deposit"  shall have the  meaning  set
         forth in Section 2.6(e).

                  "Capital  Expenditures Funds" shall have the meaning set forth
         in Section 6.3.1.

                  "Capital  Expenditures Work" shall mean any labor performed or
         materials installed in connection with any Capital Expenditure.

                  "Cash Management  Account" shall have the meaning set forth in
         Section 6.6.3.

                  "Cash  Management  Agreement"  shall  mean that  certain  cash
         management agreement among Lender, Borrower and Agent relating to funds
         deposited in the Lockbox Account.

                  "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).

                  "Casualty  Retainage"  shall  have the  meaning  set  forth in
         Section 5.3.2(d).

                  "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.

                                       3

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                  "Crescent"  shall mean Crescent Real Estate  Equities  Limited
         Partnership, a Delaware limited partnership.

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

                  "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 (a) the  maximum  rate  permitted  by
         applicable law, or (b) three percent (3%) above the Applicable Interest
         Rate.

                  "Determination  Date" shall mean, with respect to any Interest
         Period,  the date that is two (2)  London  Business  Days  prior to the
         beginning of such Interest Period.

                  "Disclosure  Document"  shall  have the  meaning  set forth in
         Section 9.2(a).

                  "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 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. ss.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-1 by Standard & Poor's Ratings  Group,  P-1 by Moody's
         Investors  Service,  Inc.,  D-1 by Duff & Phelps  Credit Rating Co. and
         F-1+ by Fitch  IBCA,  Inc.  in the case of  accounts in which funds are
         held for thirty  (30) days or less or, in the case of 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,  Duff and
         S&P and "Aa2" by Moody's.

                                       4

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                  "Environmental    Indemnity"    shall   mean   that    certain
         Environmental  Indemnity Agreement dated as of the date hereof executed
         by Borrower 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).

                  "Exit  Fee"  shall  mean a  non-refundable  fee to be  paid to
         Lender as additional interest in the amount of $350,000.

                  "Extension  Period" shall mean the First  Extension  Period or
         the Second Extension Period.

                  "Extraordinary  Expense"  shall mean any operating  expense or
         capital expenditure not set forth in the Annual Budget.

                  "First Extended Maturity Date" shall mean May 1, 2001.

                  "First Extension  Period" shall mean the period commencing the
         Initial Maturity Date and ending the First Extended Maturity Date.

                  "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.

                  "Funds" shall mean, collectively, the Tax Funds, the Insurance
         Premium Funds and the Capital Expenditures Funds.

                  "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.

                                       5

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                  "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
         determined by Lender, refunds and uncollectible  accounts,  proceeds of
         casualty  insurance  and Awards (other than  business  interruption  or
         other loss of income  insurance),  and any disbursements to Borrower of
         any Funds or any other fund  established by the Loan Documents.  If any
         Lease has been  terminated by Borrower in accordance  with the terms of
         this  Agreement  and (i) a  replacement  Lease has not been executed by
         Borrower with respect to the space demised by such terminated  Lease or
         (ii) a replacement  Lease has been executed by Borrower with respect to
         the  space  demised  by such  terminated  Lease  but  rents are not yet
         payable under such replacement Lease, the rents that would otherwise be
         payable under such terminated or replacement Lease, respectively, shall
         be included in the calculation of "Gross Revenue".

                  "Guaranty"  shall mean that certain Partial  Guaranty dated as
         of the date hereof executed by Metropolitan in favor 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,  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.

                  "Independent  Director"  shall have the  meaning  set forth in
         Section 3.1.24(p).

                  "Independent  Manager"  shall  have the  meaning  set forth in
         Section 3.1.24(o).

                  "Initial Maturity Date" shall mean February 1, 2001.

                  "Insolvency  Opinion"  shall  have the  meaning  set  forth in
         Section 4.1.11.

                  "Insurance  Premium  Account" shall have the meaning set forth
         in Section 6.5.1.

                                       6

<PAGE>

                  "Insurance  Premium Funds" shall have the meaning set forth in
         Section 6.2.1.

                  "Insurance  Premiums"  shall  have the  meaning  set  forth in
         Section 5.1.1.

                  "Interest  Period"  shall  mean  (a)  initially,   the  period
         commencing  on the Closing  Date and ending on the last day of January,
         2000 and (b) for each period  thereafter,  the period commencing on the
         first  (1st) day of each  calendar  month and ending on the last day of
         such calendar month.

                  "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) to which  Borrower or any
         predecessor-in-interest  of Borrower  is a party  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, with respect to Borrower and
         the  Property,  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  have  the  meaning  set  forth  in the  first
         paragraph of this Agreement, together with its successors and assigns.

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

                  "LIBOR" shall mean, with respect to each Interest Period,  the
         rate  (expressed  as a  percentage  per annum and  rounded  upward,  if
         necessary,  to the next  nearest  1/1000  of 1%) for  deposits  in U.S.
         dollars, for a one-month period, that appears on Telerate Page 3750 (or
         the  successor  thereto) as of 11:00 a.m.,  London time, on the related
         Determination  Date. If such rate does not appear on Telerate Page 3750
         as of 11:00 a.m., London

                                       7

<PAGE>

         time, on  such  Determination  Date, LIBOR shall be the arithmetic mean
         of  the  offered  rates  (expressed  as a  percentage  per  annum)  for
         deposits  in U.S.  dollars  for a  one-month  period that appear on the
         Reuters   Screen  Libor Page as of 11:00  a.m.,  London  time,  on such
         Determination  Date,  if at least two such offered rates so appear.  If
         fewer than two such  offered  rates appear on the Reuters  Screen Libor
         Page as of 11:00 a.m.,  London time, on such Determination Date, Lender
         shall request the  principal  London Office of any four major reference
         banks in the London  interbank market reasonably selected by Lender, to
         provide such bank's  offered  quotation  (expressed as a percentage per
         annum) to prime banks  in the London  interbank  market for deposits in
         U.S. dollars for a  one-month period as of 11:00 a.m.,  London time, on
         such Determination  Date for  the then outstanding  principal amount of
         the Loan.  If at least two  such  offered  quotations  are so provided,
         LIBOR shall be the arithmetic  mean of such  quotations.  If fewer than
         two such  quotations  are so  provided,  Lender shall request any three
         major banks in New York City  reasonably selected by Lender, to provide
         such bank's rate  (expressed  as a percentage  per annum) for loans  in
         U.S.  dollars to leading  European banks for a one-month  period as  of
         approximately  11:00  a.m.,  New  York  City  time  on  the  applicable
         Determination  Date for the then  outstanding  principal  amount of the
         Loan.  If at least two such rates are so provided,  LIBOR  shall be the
         arithmetic mean of such rates.  LIBOR shall be determined  by Lender or
         its agent.

                  "LIBOR  Loan"  shall  mean the  Loan at any time in which  the
         Applicable  Interest  Rate is  calculated  at LIBOR  plus the Spread in
         accordance with the provisions of Article II hereof.

                  "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 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 Assignment of Management
         Agreement,  the  Guaranty  and  any  other  document  now or  hereafter
         executed and/or delivered in connection with the Loan.

                  "Lockbox  Account" shall have the meaning set forth in Section
         6.6.1.

                  "Lockbox  Trigger  Date"  shall have the  meaning set forth in
         Section 6.6.1.

                  "Major  Lease" shall mean any Lease  covering more than 20,000
         square feet at the Property.

                                       8

<PAGE>

                  "Management   Agreement"  shall  mean,  with  respect  to  the
         Property, that certain management agreement dated as of the date hereof
         by and between  Borrower and Manager,  pursuant to which  Manager is to
         provide management and other services with respect to the Property.

                  "Manager" shall mean Rany Management  Group, Inc. or any other
         manager approved by Lender.

                  "Maturity  Date" shall mean the  Initial  Maturity  Date,  the
         First Extended  Maturity Date or the Second Extended  Maturity Date, as
         applicable,  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.

                  "Metropolitan"   shall  mean  Metropolitan   Partners  LLC,  a
         Delaware limited liability company.

                  "Metropolitan  Operating  Partnership" shall mean Metropolitan
         Operating Partnership, L.P., a Delaware limited partnership.

                  "Monthly Insurance Premium Deposit" shall have the meaning set
         forth in Section 6.2.1.

                  "Monthly Payment Date" shall mean the first (1st) Business Day
         of every calendar month occurring during the term of the Loan.

                  "Monthly  Tax  Deposit"  shall have the  meaning  set forth in
         Section 6.1.1.

                  "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
         Consolidated,  Amended and Restated  Mortgage,  Security  Agreement and
         Fixture  Filing dated as of the date hereof,  executed and delivered by
         Borrower as security for the Loan made to Borrower and  encumbering the
         Property, as the same may be amended, restated, replaced,  supplemented
         or otherwise modified from time to time.

                                       9

<PAGE>

                  "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  officer  of
         Borrower.

                  "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,  a management fee
         equal to the greater of 3.5% of annual  rents or the actual  management
         fee  and  deposits   required  to  be  made  as  Funds,  but  excluding
         depreciation,   amortization  and  Extraordinary  Expenses;   provided,
         however,  such costs and  expenses  shall be subject to  adjustment  by
         Lender to normalize such costs and expenses.

                  "Operating   Partnership"   shall   mean   Reckson   Operating
         Partnership L.P., a Delaware limited partnership.

                  "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.

                  "Permanent Financing" shall mean any financing or loan secured
         in whole or in part by an interest  in the  Property,  the  proceeds of
         which will be used by Borrower to repay the Debt in full.

                  "Permitted  Encumbrances"  shall  mean,  with  respect  to the
         Property, 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 relating to the Property or any
         part  thereof,   (iii)  Liens,   if  any,  for  Taxes  imposed  by  any
         Governmental  Authority not yet due or  delinquent,  (iv) to the extent
         that any leases are either  approved  by Lender or do not  require  the
         approval of Lender pursuant to the terms of this  Agreement,  rights of
         tenants  under such leases as tenants only and (v) such other title and
         survey  exceptions  as Lender has approved or may approve in writing in
         Lender's  sole  discretion,  which in the  aggregate do not  materially
         adversely affect the value or use of the Property or Borrower's ability
         to repay the Loan.

                                       10

<PAGE>

                  "Permitted  Investments"  shall have the  meaning set forth in
         the Cash Management Agreement.

                  "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).

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

                  "Property"  shall  mean  each  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,  as  more  particularly  described  in the
         Granting Clauses of the Mortgage.

                  "Qualified  Transferee"  shall mean an  institutional  quality
         investor  with  appropriate  financial  wherewithal  and of good  moral
         character and good  standing,  each as determined by Lender in its sole
         discretion.

                  "Rating Agencies" shall mean each of Standard & Poor's Ratings
         Group, a division of  McGraw-Hill,  Inc.,  Moody's  Investors  Service,
         Inc.,  Duff & Phelps  Credit  Rating Co. and Fitch IBCA,  Inc.,  or any
         other  nationally-recognized  statistical  rating agency which has been
         approved by Lender.

                  "Reckson"  shall  mean  Reckson  Associates  Realty  Corp.,  a
         Maryland corporation.

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

                  "Rents" shall mean,  with respect to the Property,  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.

                  "Restoration"  shall  have the  meaning  set forth in  Section
         5.2.1.

                  "Restoration Threshold" shall mean $3,500,000.

                                       11

<PAGE>

                  "Secondary  Market  Transaction"  shall have the  meaning  set
         forth in Section 9.1(a).

                  "Second Extended Maturity Date" shall mean August 1, 2001.

                  "Second Extension Period" shall mean the period commencing the
         First Extended  Maturity Date and ending the Second  Extended  Maturity
         Date.

                  "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).

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

                  "Securitization  Date" shall mean that date which is the later
         of (a) thirty (30) days after Lender gives  Borrower  written notice of
         its intent to complete a  Securitization  and (b) the date upon which a
         preliminary   prospectus  or  offering  memorandum  is  distributed  to
         investors in connection with a proposed Securitization.

                  "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).

                  "SPC  Member"  shall  have the  meaning  set forth in  Section
         3.1.24(o).

                  "Spread" shall mean 1.65%.

                  "Springing  Event" shall have the meaning set forth in Section
         3.1.24(v).

                  "Springing Member" shall have the meaning set forth in Section
         3.1.24(v)

                  "Standard  Statement"  shall  have the  meaning  set  forth in
         Section 9.1(c).

                  "State" shall mean the State of New York.

                  "Subordinate and Junior in Right of Payment",  with respect to
         any Affiliate Loan, shall mean that:

                  (i) no part of the Affiliate  Obligations shall have any claim
         to the assets of Borrower on a parity with or prior to the claim of the
         Debt.  Unless  and  until  the Debt  shall  have  been  fully  paid and
         satisfied by payment in full in cash,  no Affiliate  Creditor  will (A)
         take, demand or receive from Borrower, and Borrower will not make, give
         or permit, directly or indirectly, by set-off, redemption,  purchase or
         in any other manner, any payment,  prepayment,

                                       12

<PAGE>

         collateral or security, or permit any payment, prepayment,  collateral,
         security  or  guarantee,  for the  whole or any  part of the  Affiliate
         Obligations,  provided,  however,  that if (x) no  Default  or Event of
         Default has occurred  under this  Agreement or any other Loan  Document
         and (y) the cash flow from the  operation of the Property is sufficient
         to make  such  payments,  then  Borrower  shall  be  permitted  to make
         payments on account of the Affiliate Obligations in an aggregate amount
         not to exceed  $3,500,000,  (B) accelerate for any reason the scheduled
         maturities  of any of  the  Affiliate  Obligations,  (C)  institute  or
         maintain any action to enforce the loan documents and other instruments
         evidencing,  representing,  securing and/or  guaranteeing the Affiliate
         Loan,  as any of  the  same  may  be  amended,  supplements,  extended,
         renewed,  restated,  replaced,  substituted or otherwise  modified from
         time to time with the prior  written  consent of Lender  (collectively,
         the "Subordinated Loan Documents"),  including, without limitation, any
         action  to  foreclose  the  Subordinated  Loan  Documents  by  judicial
         procedure or  otherwise,  (D) commence  any case,  proceeding  or other
         action under any existing or future law of any  jurisdiction,  domestic
         or  foreign,  relating to  bankruptcy,  insolvency,  reorganization  or
         relief of  debtors,  seeking to have an order for relief  entered  with
         respect to Borrower,  or seeking to  adjudicate  Borrower a bankrupt or
         insolvent,   or  seeking   reorganization,   arrangement,   adjustment,
         winding-up, liquidation,  dissolution, composition or other relief with
         respect  to  Borrower  or its  debts,  (E)  apply to any court or other
         public  body  for the  appointment  of a  receiver,  trustee,  agent or
         similar  official  for  the  Project,  (F)  exercise  any of the  other
         remedies  provided  in  the  Subordinated  Loan  Documents,  including,
         without limitation,  the right to collect and retain rents and revenues
         from the Project and the right to enter upon,  take  possession  of and
         manage the Project or (G) demand or take any  security  for all or part
         of the Affiliate Obligations.

                  (ii)  (A)  In  the  event  of any  distribution,  division  or
         application,   partial  or  complete,   voluntary  or  involuntary,  by
         operation of law or otherwise,  of all or any  substantial  part of the
         property, assets or business of Borrower or the proceeds thereof to any
         creditor  or  creditors  of Borrower  or (B) upon any  indebtedness  of
         Borrower  becoming  due  and  payable  by  reason  of any  liquidation,
         dissolution  or other  winding-up  of  Borrower  or its  business or by
         reason  of  any  sale,  receivership,   insolvency,  reorganization  or
         bankruptcy  proceedings,  assignment  for  the  benefit  of  creditors,
         arrangement  or any  proceeding  by or against  Borrower for any relief
         under any bankruptcy, reorganization or insolvency law or laws, Federal
         or state,  or any law,  Federal  or state,  relating  to the  relief of
         debtors, readjustment of indebtedness, reorganization,  composition, or
         extension, or (C) in the event that any of the Affiliate Obligations is
         declared  due  and  payable  prior  to  its  stated   maturity   (under
         circumstances  when  the  preceding  clause  (A)  or (B)  shall  not be
         applicable),  or (D) in the event that any of the Debt have become,  or
         have been  declared to be, due and  payable  (and have not been paid in
         accordance with their terms),  then and in any such event,  any payment
         or distribution of any kind or character,  whether in cash, property or
         securities  which,  but  for  the  subordination  provisions  contained
         herein,  would  otherwise be payable or  deliverable  to the  Affiliate
         Creditor upon or in respect of the Affiliate Obligations, shall instead
         be paid over or delivered to, and for the account of,  Lender,  and the
         Affiliate  Creditor shall not receive any such payment or  distribution
         or any  benefit  therefrom  unless  and until the Debt  shall have been
         fully paid and satisfied in cash.

                                       13

<PAGE>

                  "Subordination  Agreement" shall have the meaning set forth in
         Section 3.1.24(d).

                  "Substitute  Rate" shall have the meaning set forth in Section
         2.2.3(c).

                  "Substitute  Rate  Loan"  shall  mean  the Loan at any time in
         which the Applicable Interest Rate is calculated at the Substitute Rate
         plus the Substitute Spread in accordance with the provisions of Article
         II hereof.

                  "Substitute  Spread"  shall  have  the  meaning  set  forth in
         Section 2.2.3(c).

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

                  "Tax  Account"  shall  have the  meaning  set forth in Section
         6.5.1.

                  "Tax Funds" shall have the meaning set forth in Section 6.1.1.

                  "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 any part thereof.

                  "Tenant" shall mean any Person  obligated  under any Lease now
         or hereafter affecting all or any part of the Property.

                  "Title  Insurance  Policy" shall mean an ALTA mortgagee  title
         insurance policy in the form (acceptable to Lender) issued with respect
         to the Property and insuring the lien of the Mortgage  encumbering  the
         Property.

                  "UCC" or  "Uniform  Commercial  Code"  shall mean the  Uniform
         Commercial Code as in effect in the applicable State or Commonwealth in
         which the Property is located.

                  "Underwritable  Net Operating Income" shall mean the excess of
         Gross  Revenue  over  Operating  Expenses.   Lender's   calculation  of
         Underwritable  Net Operating Income  (including  determination of items
         that do not qualify as Gross  Revenue or Operating  Expenses)  shall be
         final absent manifest error.

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

                  "Updated  Information"  shall  have the  meaning  set forth in
         Section 9.1(b).

                                       14

<PAGE>

                  "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.

                  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 in the
original principal amount of $70,000,000.00.

                  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.

                  2.1.3 The Note.  The Loan shall be  evidenced  by that certain
Consolidated,  Amended  and  Restated  Note dated as of the date  hereof made by
Borrower in favor of Lender in the original  principal amount of  $70,000,000.00
(as the same may be amended,  supplemented,  restated,  increased,  extended and
consolidated, the "Note").

                  2.1.4 Use of Proceeds. Borrower shall use proceeds of the Loan
to (i) pay a portion of the acquisition  costs relating to the Property and (ii)
pay costs and expenses  incurred in connection  with the closing of the Loan, as
approved by Lender.

                  Section 2.2 Interest Rate

                  2.2.1  Applicable  Interest Rate.  Interest on the outstanding
principal  balance  of the Loan shall  accrue  from the  Closing  Date up to and
including the Maturity Date, at the Applicable Interest Rate.

                  2.2.2  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 the Applicable Interest Rate and a three hundred sixty
(360) day year by (c) the outstanding principal balance of the Loan.

                  2.2.3 Determination of Interest Rate.

                                      15

<PAGE>

                  (a) Subject to the terms and conditions of this Section 2.2.3,
the  Loan  shall  be a  LIBOR  Loan  and  Borrower  shall  pay  interest  on the
outstanding  principal  amount of the Loan at 7.43%  per  annum for the  initial
Interest  Period  ending on January  31, 2000 and LIBOR plus the Spread for each
Interest Period thereafter.  Any change in the rate of interest hereunder due to
a change in the  Applicable  Interest  Rate  shall  become  effective  as of the
opening  of  business  on the first  Business  Day on which  such  change in the
Applicable Interest Rate shall become effective. Each determination by Lender of
the  Applicable  Interest Rate shall be conclusive and binding for all purposes,
absent manifest error.

                  (b) In the event  that  Lender  shall have  determined  (which
determination  shall be  conclusive  and binding upon Borrower  absent  manifest
error)  that by reason  of  circumstances  affecting  the  interbank  eurodollar
market,  adequate and reasonable means do not exist for ascertaining LIBOR, then
Lender  shall,  by  notice  to  Borrower  ("Lender's  Notice"),   establish  the
Applicable  Interest Rate at Lender's  then  customary  spread (the  "Substitute
Spread"),  taking into account the size of the Loan and the  creditworthiness of
Borrower,  above a published  index used for variable  rate loans as  reasonably
determined by Lender (the "Substitute Rate").

                  (c) If, pursuant to the terms of this Agreement,  the Loan has
been  converted to a  Substitute  Rate Loan and Lender  shall  determine  (which
determination  shall be  conclusive  and binding upon Borrower  absent  manifest
error) that the event(s) or  circumstance(s)  which resulted in such  conversion
shall no longer be applicable, Lender shall give notice thereof to Borrower, and
the  Substitute  Rate Loan  shall  automatically  convert to a LIBOR Loan on the
effective date set forth in such notice.  Notwithstanding  any provision of this
Agreement to the contrary, in no event shall Borrower have the right to elect to
convert a LIBOR Loan to a Substitute Rate Loan.

                  (d) All payments  made by Borrower  hereunder  with respect to
the Loan  shall be made free and  clear  of,  and  without  reduction  for or on
account of, income,  stamp or other taxes,  levies,  imposts,  duties,  charges,
fees, deductions,  reserves or withholdings imposed, levied, collected, withheld
or assessed by any Governmental Authority,  which are imposed, enacted or become
effective  after the date hereof  (such  non-excluded  taxes  being  referred to
collectively as "Foreign  Taxes"),  excluding  income and franchise taxes of the
United  States of  America  or any  political  subdivision  or taxing  authority
thereof or therein (including Puerto Rico). If any Foreign Taxes are required to
be withheld from any amounts payable to Lender hereunder, the amounts so payable
to Lender shall be increased to the extent  necessary to yield to Lender  (after
payment  of all  Foreign  Taxes)  interest  or any such  other  amounts  payable
hereunder  at the  rate or in the  amounts  specified  hereunder.  Whenever  any
Foreign Tax is payable  pursuant to applicable  law by Borrower,  as promptly as
possible thereafter, Borrower shall send to Lender an original official receipt,
if available,  or certified  copy thereof  showing  payment of such Foreign Tax.
Borrower  hereby  indemnifies  Lender for any  incremental  taxes,  interest  or
penalties that may become payable by Lender which may result from any failure by
Borrower  to pay  any  such  Foreign  Tax  when  due to the  appropriate  taxing
authority or any failure by Borrower to remit to Lender the required receipts or
other required documentary evidence.

                                       16

<PAGE>

                  (e) If any  requirement of law or any change therein or in the
interpretation  or  application  thereof,  shall  hereafter make it unlawful for
Lender to make or  maintain  a LIBOR  Loan as  contemplated  hereunder,  (i) the
obligation of Lender hereunder to make a LIBOR Loan shall be cancelled forthwith
and (ii) Lender may give Borrower a Lender's  Notice,  declaring the  Applicable
Interest  Rate based upon the  Substitute  Rate in effect from time to time plus
the  Substitute  Spread.  Borrower  hereby agrees  promptly to pay Lender,  upon
demand,   any  additional   amounts  necessary  to  compensate  Lender  for  any
out-of-pocket  costs  incurred by Lender in making any  conversion in accordance
with this Agreement, including, without limitation, any interest or fees payable
by Lender to lenders of funds  obtained by it in order to make or  maintain  the
LIBOR Loan  hereunder.  Lender's notice of such costs, as certified to Borrower,
shall be conclusive absent manifest error.

                  (f) In the event that any change in any  requirement of law or
in the interpretation or application  thereof,  or compliance by Lender with any
request or directive  (whether or not having the force of law) hereafter  issued
from any central bank or other Governmental Authority:

                  (i) shall  hereafter  impose,  modify or hold  applicable  any
         reserve,  special  deposit,  compulsory  loan  or  similar  requirement
         against assets held by, or deposits or other  liabilities in or for the
         account of,  advances or loans by, or other credit  extended by, or any
         other  acquisition  of funds by,  any  office  of  Lender  which is not
         otherwise included in the determination of LIBOR hereunder;

                  (ii) shall  hereafter  have the effect of reducing the rate of
         return  on  Lender's  capital  as  a  consequence  of  its  obligations
         hereunder to a level below that which  Lender  could have  achieved but
         for such  adoption,  change or  compliance  (taking into  consideration
         Lender's  policies  with  respect  to capital  adequacy)  by any amount
         deemed by Lender to be material; or

                  (iii) shall hereafter impose on Lender any other condition and
         the result of any of the foregoing is to increase the cost to Lender of
         making,  renewing or  maintaining  loans or  extensions of credit or to
         reduce any amount receivable hereunder;

then, in any such case,  Borrower  shall promptly pay Lender,  upon demand,  any
additional  amounts  necessary to compensate  Lender for such additional cost or
reduced  amount  receivable  which Lender deems to be material as  determined by
Lender.  If Lender becomes entitled to claim any additional  amounts pursuant to
this Section  2.2.3(f),  Lender shall provide Borrower with not less than thirty
(30) days written notice  specifying in reasonable detail the event by reason of
which it has become so  entitled  and the  additional  amount  required to fully
compensate  Lender for such additional cost or reduced amount.  A certificate as
to any additional costs or amounts payable  pursuant to the foregoing  sentence,
executed  by an  authorized  signatory  of  Lender  and  submitted  by Lender to
Borrower  shall be conclusive in the absence of manifest  error.  This provision
shall survive payment of the Note and the satisfaction of all other  obligations
of Borrower under this Agreement and the Loan Documents.

                                       17

<PAGE>

                  (g)  Borrower  agrees to  indemnify  Lender and to hold Lender
harmless from any loss or expense (other than consequential or punitive damages)
which Lender  sustains or incurs as a consequence of (i) any default by Borrower
in payment of the principal of or interest on a LIBOR Loan,  including,  without
limitation,  any such loss or expense  arising  from  interest or fees  actually
payable  by Lender to  lenders of funds  obtained  by it in order to  maintain a
LIBOR Loan hereunder,  (ii) any prepayment  (whether  voluntary or mandatory) of
the LIBOR Loan on a day that (A) is not the Monthly  Payment  Date or (B) is the
Monthly  Payment Date  immediately  following the last day of an Interest Period
with respect  thereto if Borrower did not give the prior written  notice of such
prepayment required pursuant to the terms of this Agreement,  including, without
limitation,  such loss or expense arising from interest or fees actually payable
by Lender to lenders of funds obtained by it in order to maintain the LIBOR Loan
hereunder  and (iii) the  conversion  (for any reasons set forth in this Section
2.2.3)  of  the  Applicable  Interest  Rate  to the  Substitute  Rate  plus  the
Substitute  Spread  with  respect to any  portion of the  outstanding  principal
amount of the Loan then  bearing  interest  at a rate other than the  Substitute
Rate plus the  Substitute  Spread on a date other than the Monthly  Payment Date
immediately  following the last day of an Interest  Period,  including,  without
limitation, such loss or expenses arising from interest or fees actually payable
by Lender to lenders of funds  obtained  by it in order to maintain a LIBOR Loan
hereunder  (the amounts  referred to in clauses  (i),  (ii) and (iii) are herein
referred to  collectively as the "Breakage  Costs").  Whenever in this paragraph
the term "interest or fees payable by Lender to lenders of funds obtained by it"
is used and no such funds were actually  obtained  from such  lenders,  it shall
include  interest  or fees  which  would  have been  payable by Lender if it had
obtained funds from lenders in order to maintain a LIBOR Loan hereunder.  Lender
will  provide to  Borrower a statement  detailing  such  Breakage  Costs and the
calculation  thereof.  This provision  shall survive payment of the Note in full
and the  satisfaction of all other  obligations of Borrower under this Agreement
and the other Loan Documents.

                  2.2.4   Additional   Costs.   Lender  will  use   commercially
reasonable  efforts  (consistent  with  legal and  regulatory  restrictions)  to
maintain the availability of the LIBOR Loan and to avoid or reduce any increased
or additional costs payable by Borrower under Section 2.2.3 above, including, if
requested by Borrower and  available,  a transfer or assignment of the Loan to a
branch,   office  or  Affiliate  of  Lender  in  another   jurisdiction,   or  a
redesignation  of its  lending  office  with  respect  to the Loan,  in order to
maintain the availability of the LIBOR Loan or to avoid or reduce such increased
or  additional  costs;  provided,  however,  that such  transfer,  assignment or
redesignation would not (a) result in any additional costs,  expenses or risk to
Lender and (b) be  disadvantageous  in any other material respect to Lender,  as
determined by Lender in its sole discretion.

                  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

                                       18

<PAGE>

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  and not on account of the  interest due  hereunder.  All
sums paid 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 date  hereof for the period from the
Closing Date to and including January 31, 2000. Borrower shall make a payment to
Lender of interest  only  calculated  in the manner set forth herein on March 1,
2000 and on each Monthly  Payment Date  thereafter to and including the Maturity
Date.

                  2.3.2 Payments 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 the Exit Fee, and all other  amounts then due hereunder
and under the Note, the Mortgage and the other Loan Documents.

                  2.3.3 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  which  gave rise to such Event of
Default occurred without regard to any grace or cure periods contained herein.

                  2.3.4 Late Payment Charge.  If any principal,  interest or any
other sum due under the Loan  Documents  is not paid by  Borrower on the date on
which it is due, Borrower shall pay to Lender upon demand an amount equal to the
lesser of three percent (3%) 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,  interest  shall be payable at the
Applicable  Interest  Rate or the Default  Rate, as the case may be, during such
extension.

                                       19

<PAGE>

                  Section 2.4 Prepayments.

                  2.4.1 Voluntary Prepayments. Borrower shall have the right, at
its  option and upon not less than both (i)  thirty  (30) days  prior  revocable
written  notice to Lender and (ii) fifteen (15) days prior  irrevocable  written
notice to Lender,  to prepay the Debt at any time,  in whole or in part,  on any
Monthly Payment Date;  provided,  however,  that each prepayment  shall be in an
amount equal to not less than $1,000,000.

                  2.4.2 Mandatory  Prepayments.  If Lender  actually  receives a
distribution  of Net  Proceeds,  and if Lender is not  required  to and does not
actually  make  such Net  Proceeds  available  to  Borrower  for a  Restoration,
Borrower  shall,  at  Lender's  option,  as of the  Monthly  Payment  Date  next
succeeding the receipt of such Net Proceeds,  prepay the  outstanding  principal
balance of the Note in an amount equal to one hundred percent (100%) of such Net
Proceeds.

                  2.4.3 Prepayments After Securitization.  In the event that any
prepayment of the Debt is made after the  Securitization  Date on a date that is
not a Monthly  Payment Date,  Borrower shall also pay to Lender,  in addition to
any applicable Breakage Costs, all interest that would have otherwise accrued on
the Debt  through the last day of the Interest  Period in which such  prepayment
occurs.

                  Section 2.5 Exit Fee.

                  The Exit Fee shall be payable in full upon the  Maturity  Date
or such other date on which all of the  principal  of the Note  becomes  due and
payable  as set  forth in the Note or this  Agreement,  whether  at such  stated
maturity date, by declaration of acceleration or otherwise. The Exit Fee paid by
Borrower to Lender  shall be credited  against a portion of (a) any  origination
fee otherwise payable to Lender if Lender provides  Permanent  Financing and (b)
any  advisory  fee  otherwise  payable to Lender in  conjunction  with  Lender's
arrangement of a Permanent Financing.

                  Section 2.6 Extension of Maturity Date.

                  Upon and subject to fulfillment of the following conditions to
the satisfaction of Lender, Borrower shall have the right to extend the Maturity
Date of the Loan to the First Extended Maturity Date (the "First Extension") and
in the event that the First Extension has been effected, Borrower shall have the
right to extend the First Extended Maturity Date to the Second Extended Maturity
Date (the "Second Extension"):

                  (a) Prior to such extension,  Borrower shall have delivered to
Lender a written notice (the "Extension Notice") of the proposed extension on or
before a date which is between 30 and 60 days prior to: (i) with  respect to the
First  Extension,  the  Maturity  Date  and  (ii)  with  respect  to the  Second
Extension, the First Extended Maturity Date;

                                       20

<PAGE>

                  (b) Not later than the  commencement  of the relevant  renewal
period,  Borrower  shall have paid an extension fee to Lender in an amount equal
to $105,000 (the "Extension Fee");

                  (c)  The   Underwritable   Net   Operating   Income   for  the
twelve-month  period  immediately  preceding the date the  applicable  Extension
Notice is received by Lender shall be at least equal to $7,800,000;

                  (d) Any reserves  which are required to be funded  pursuant to
this Agreement shall have been fully funded;

                  (e) To the extent  Borrower  has not  previously  delivered to
Lender  satisfactory  evidence  that Borrower has made Capital  Expenditures  in
accordance   with  the  Capital   Expenditures   Budget  (the  "Actual   Capital
Expenditures") equal to at least $3,500,000,  Borrower shall either deliver such
evidence of the Actual Capital Expenditures to Lender in such amount or Borrower
shall have  funded the  difference  between  $3,500,000  and the Actual  Capital
Expenditures  that  were  made  by  Borrower  (such  difference,   the  "Capital
Expenditures Deposit") into the Capital Expenditures Account; and

                  (f) No Event of Default shall have occurred and be continuing,
either as of (i) the date the  Extension  Notice is  delivered  or (ii) the date
upon which the Extension Period is to otherwise commence.

                  Each  Extension  Notice shall be  accompanied  by an Officer's
Certificate of Borrower (A) stating that, as of the date of such request, to the
best of Borrower's knowledge,  no Default has occurred and is continuing and (B)
specifying the Underwritable Net Operating Income for the immediately  preceding
twelve-month  period.  Lender shall  calculate the  Underwritable  Net Operating
Income  within  thirty (30) days after  Lender's  receipt  from  Borrower of the
Extension  Notice,  and shall  notify  Borrower  thereof.  If Borrower  does not
properly  exercise its  extension  options as set forth in this Section 2.6, the
Debt shall be due and payable in full on the Initial  Maturity Date or the First
Extended  Maturity Date, as applicable.  Notwithstanding  anything herein to the
contrary,  if Borrower  notifies  Lender in writing that it intends to repay the
Loan as of any  Maturity  Date,  no  Extension  Fee shall be due and  payable by
Borrower  so long as Borrower  actually  pays the Debt in full within 15 days of
such specified Maturity Date.

                       III REPRESENTATIONS AND WARRANTIES

                  Section 3.1 Borrower Representations.

                  Borrower represents and warrants that:

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<PAGE>

                  3.1.1  Organization.   Borrower  is  duly  organized,  validly
existing and in good  standing  with full power and  authority to own its assets
and conduct its business,  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 by it, and has the power and authority to execute,
deliver and perform under this Agreement and all the  transactions  contemplated
hereby.

                  3.1.2   Organization.   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 the Property),  in each
case which  would  materially  and  adversely  affect the ability of Borrower to
carry out the transactions contemplated by this Agreement.

                  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.

                  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  might  have  consequences  that  would
materially and adversely affect the condition (financial or other) or operations
of Borrower or its properties or might have  consequences  that would materially
and 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.

                                       22

<PAGE>

                  3.1.7 Title. Borrower has good, marketable and insurable title
in fee simple to the real  property  comprising  part of the  Property  and good
title to the  balance of the  Property,  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.

                  3.1.8 No Plan  Assets.  Borrower is not an  "employee  benefit
plan," as  defined in Section  3(3) of ERISA,  subject to Title I of ERISA,  and
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.  In
addition,  (i)  Borrower  is not a  "governmental  plan"  within the  meaning of
Section 3(32) of ERISA and (ii) transactions by or with Borrower are not subject
to state  statutes  regulating  investment  of, and fiduciary  obligations  with
respect to, governmental plans.

                  3.1.9  Compliance.  Except as set forth on Schedule 3 attached
hereto, to Borrower's  knowledge,  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. Except
as set forth on Schedule 3 attached hereto, to Borrower's knowledge, Borrower is
not in default or violation of any order, writ, injunction,  decree or demand of
any Governmental  Authority,  the violation of which might materially  adversely
affect the condition (financial or otherwise) or business of Borrower.  Borrower
has not committed any act which may 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, including,
without  limitation,  the  statements  of cash  flow and  income  and  operating
expense,  that have been  delivered  to Lender in respect of the Property (i) is
fairly stated in all material respects, (ii) accurately represents 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.

                  3.1.11 Condemnation.  To Borrower's knowledge, no Condemnation
or other proceeding has been commenced or is contemplated with respect to all or
any portion of the Property or for the relocation of roadways  providing  access
to the Property.

                  3.1.12 Utilities and Public Access. 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.

                                       23

<PAGE>

                  3.1.13  Separate Lots. The Property is comprised of one (1) or
more parcels  which  constitutes  a separate  tax lot and does not  constitute a
portion of any other tax lot not a part of the Property.

                  3.1.14  Assessments.  To  Borrower's  knowledge,  there are no
pending or proposed  special or other  assessments  for public  improvements  or
otherwise affecting the Property, nor 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,  setoff, 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,  setoff,
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 such Leases,  including
the right to operate the Property.  No Person other than Lender has any interest
in or  assignment  of  Borrower's  interest  in the Leases or any portion of the
Rents due and payable or to become due and payable thereunder.

                  3.1.17 Insurance.  Each building or other improvement  located
on the Property is insured by a fire and extended perils insurance policy, in an
amount not less than the replacement cost thereof;  the Property is also covered
by business interruption insurance and comprehensive general liability insurance
in amounts generally required by institutional  lenders for similar  properties;
all  premiums  on such  insurance  policies  required  to be paid as of the date
hereof have been paid;  such  insurance  policies  require  prior  notice to the
insured of termination or cancellation, and no such notice has been received.

                  3.1.18 Licenses. All permits and approvals,  including without
limitation, certificates of occupancy required by any Governmental Authority for
the use,  occupancy  and  operation  of the  Property 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.  None of the  Improvements  on the Property
are 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,  the  Property,   including,   without  limitation,   all  buildings,
improvements,  parking  facilities,  sidewalks,  storm drainage systems,  roofs,
plumbing systems,  HVAC systems,  fire protection  systems,  electrical systems,
equipment,  elevators,  exterior  sidings  and  doors,  landscaping,  irrigation
systems and all structural components, is in good condition, order and repair in
all material  respects;  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  materially
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.

                                       24

<PAGE>

                  3.1.21  Boundaries.  Except  as set  forth on the  Survey,  to
Borrower's  knowledge,  all of the Improvements 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  except  those  which are  insured
against by title insurance.

                  3.1.22 Leases.  To Borrower's  knowledge,  the Property is not
subject to any Leases  other than the Leases  described  in  Schedule 4 attached
hereto and made a part hereof. To Borrower's  knowledge,  except as set forth on
Schedule 4A attached  hereto,  the Leases  identified  on Schedule 4 are in full
force and effect and there are no defaults  thereunder by either party.  No Rent
(including  security  deposits) has been paid more than one (1) month in advance
of its due date.  All work to be performed by Borrower under each Lease has been
performed as required and has been accepted by the  applicable  tenant,  and any
payments,  free rent,  partial rent, rebate of rent or other payments,  credits,
allowances  or  abatements  required  to be given by  Borrower to any tenant has
already been received by such tenant.

                  3.1.23  Taxes.  All transfer  taxes,  deed stamps,  intangible
taxes or other  amounts in the nature of  transfer  taxes  required to have been
paid under applicable Legal  Requirements in connection with the transfer of the
Property to Borrower have been paid. All mortgage,  mortgage  recording,  stamp,
intangible  or other  similar tax  required  to have been 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.  All taxes and
governmental assessments due and owing in respect of 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,  management  and  operation of the Property and Borrower will conduct
and operate its business as presently conducted and operated.

                                       25

<PAGE>

                  (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
intrinsically fair and substantially similar to those that would be available on
an  arms-length  basis with third parties  other than any such party;  provided,
however,  that that  certain  Management  Agreement  dated as of the date hereof
between Borrower and Manager is hereby approved by Lender.

                  (d)   Borrower  has  not  incurred  and  will  not  incur  any
Indebtedness,  secured or unsecured,  direct or indirect, absolute or contingent
(including  guaranteeing any obligation) other than (i) the Debt, (ii) unsecured
trade  payables  not more than sixty (60) days past due incurred in the ordinary
course of business in an aggregate amount not exceeding  $1,000,000 exclusive of
any amount that Borrower is disputing in good faith and (iii)  Affiliate  Loans,
provided,  however,  notwithstanding the foregoing,  that (x) all such Affiliate
Loans shall at all times be  Subordinate  and Junior in Right of Payment and the
Affiliate  Creditor  which makes such  Affiliate  Loan  executes  and delivers a
subordination  agreement to Lender in substantially the form attached as Exhibit
D hereto (the "Subordination  Agreement"),  (y) outside counsel to the Affiliate
Creditor  which makes such  Affiliate  Loan  executes  and delivers to Lender an
opinion  letter   satisfactory  to  Lender  regarding  the  due   authorization,
execution,  delivery and enforceability of such Subordination  Agreement and (z)
the sum of all amounts referenced in clauses (i), (ii) and (iii) above shall not
exceed 75% of the  Borrower's  actual cash cost of acquiring  the  Property.  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 any third party  (including any
Affiliate or constituent party).

                  (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) Each of  Borrower  and SPC Member has done or caused to be
done and will do all things necessary to observe limited  liability  company and
other  organizational  formalities and preserve its existence,  and Borrower and
SPC Member  will not,  nor will  Borrower or SPC Member  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,  SPC Member or
such constituent party without the prior written consent of Lender.

                  (h)  Borrower  will  maintain  all  of  its  books,   records,
financial statements and bank accounts separate from those of its Affiliates and
any constituent party and Borrower will file its own tax returns. Borrower shall
maintain its books, records, resolutions and agreements as official records.

                                       26

<PAGE>

                  (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 a  separate  telephone  number and  separate  stationery,  invoices  and
checks.

                  (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) None of Borrower, SPC Member or any constituent party will
seek  or  effect  the  liquidation,   dissolution,   winding  up,   liquidation,
consolidation or merger, in whole or in part, of Borrower.

                  (l) Borrower  will not commingle the funds and other assets of
Borrower with those of any Affiliate or  constituent  party 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  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) Borrower shall have as its sole member a Delaware  limited
liability company (the "SPC Member") which is a single purpose entity whose sole
asset is its  interest  in  Borrower  (which  interest  shall  not be less  than
one-hundred percent (100%) of the ownership interest in Borrower).  Borrower and
SPC  Member  shall each have as an  independent  manager  (each an  "Independent
Manager") a Delaware  corporation  which is a single  purpose  entity whose sole
asset is its interest in the Borrower;  each of such Independent  Managers shall
be different  corporate  entities.  Each  Independent  Manager will at all times
comply,  and will cause  Borrower  and SPC  Member to  comply,  with each of the
representations, warranties and covenants contained in this Section 3.1.24 as if
such  representation,  warranty or covenant was made directly by the Independent
Managers and the SPC Member. As used in this subsection 3.1.24, the term "single
purpose  entity"  shall mean an entity whose  organizational  documents  contain
restrictions  on its  activities  and impose  requirements  intended to preserve
separateness  that are  substantially  similar to those of Borrower and provide,
inter  alia,  that  it:  (a)  is  organized  for  a  limited  purpose;  (b)  has
restrictions  on  its  ability  to  incur  indebtedness,   dissolve,  liquidate,
consolidate, merge and/or sell assets; (c) may not file voluntarily a bankruptcy
petition  without the consent of independent  managers or independent  directors
and  (d)  shall  conduct  itself  in  accordance   with  certain   "separateness
covenants",  including,  but not  limited  to,  the  maintenance  of its  books,
records, bank accounts, and assets separate from those of any other Person.

                                       27

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                  (p)  Borrower and SPC Member shall at all times cause there to
be at least  two duly  appointed  members  of the  board of  directors  (each an
"Independent  Director") of the Independent Managers of Borrower and SPC Member,
respectively,  reasonably  satisfactory to Lender who shall not have been at the
time of such  individual's  appointment,  will not be while  serving and may not
have  been at any time  during  the  preceding  five  years  (i) a  stockholder,
director  (other  than  an  Independent  Director),  manager,  member,  officer,
employee,  partner,  attorney or counsel of such corporation,  Borrower, the SPC
Member,  or any  Affiliate  of any of them,  (ii) a customer,  supplier or other
Person who derives any of its  purchases or revenues  from its  activities  with
such  corporation,  Borrower,  the SPC Member or any  Affiliate  of any of them,
other than fees  received in its capacity as an  Independent  Director,  (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;  provided,  however,  that this
paragraph (p) shall apply only from and after the  Securitization  Date. 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.

                  (q)  Borrower  and SPC  Member  shall not cause or permit  the
board of  directors  of the  Independent  Manager  of  Borrower  or SPC  Member,
respectively,  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,  requires a vote of the board of directors of the Independent  Manager of
Borrower  or SPC Member,  as the case may be,  unless at the time of such action
there  shall be at least two members who are  Independent  Directors;  provided,
however, that this paragraph (q) shall apply only after the Securitization Date.

                  (r) Borrower and its  Independent  Manager  shall  conduct its
business so that the assumptions made with respect to Borrower in any Insolvency
Opinion  delivered in connection  with any  Securitization  of the Loan shall be
true and correct in all respects;  provided,  however,  that this  paragraph (r)
shall only apply after the Securitization Date.

                  (s)  Borrower  will  permit only duly  authorized  officers of
Borrower to have access to its bank accounts.

                  (t) Borrower  shall pay the salaries of its own  employees and
maintain a sufficient number of employees in light of its contemplated  business
operations.

                  (u) 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.  Upon the withdrawal or the disassociation
of the Independent  Manager of either  Borrower or SPC Member,  Borrower and SPC
Member,  as the  case may be,  shall  immediately  appoint  a new  member  whose
articles of incorporation are substantially  similar to those of the Independent
Manager  and,  in the event a  non-consolidation  opinion  has been  provided to
Lender,  Borrower  shall deliver a new  non-consolidation  opinion to the Rating
Agency or Rating Agencies, as applicable, with respect to the new single purpose
entity and its equity owners.

                                       28

<PAGE>

                  (v)  Borrower  and SPC Member  shall each have at all times at
least two persons who shall  automatically  become  members having a 0% economic
interest in Borrower and SPC Member,  respectively (each, a "Springing Member"),
simultaneously  upon the  occurrence  of any event  which  would  cause the sole
member of  Borrower  or SPC  Member to cease to be a member of  Borrower  or SPC
Member,  as the case may be (a  "Springing  Event");  provided  that if a single
purpose entity serves as a Springing Member,  only one Springing Member shall be
required.  Upon the  occurrence  of a Springing  Event,  Borrower and SPC Member
shall be continued without dissolution and each Springing Member shall,  without
any action of any person or entity, automatically become a member of Borrower or
SPC Member, as the case may be, having a 0% economic interest in Borrower or SPC
Member,  as the case may be, and the personal  representative(s)  (as defined in
the Act) of each member shall  automatically  become an  unadmitted  assignee of
each member  respectively,  being entitled thereby only to the  distributions to
which such member was entitled  pursuant to the operating  agreement of Borrower
or SPC Member,  as the case may be, and any other right  conferred  thereupon by
the Act.  Pursuant to Section 18-301 of the Act, each Springing Member shall not
be required to make any capital  contributions to Borrower or SPC Member, as the
case may be, and shall not  receive any limited  liability  company  interest in
Borrower or SPC Member,  as the case may be. Prior to its  admission to Borrower
or SPC Member, as the case may be, as a member of Borrower or SPC Member, as the
case may be, pursuant to this subparagraph (v), each Springing Member shall have
no  interest  (economic  or  otherwise)  and is not a member of  Borrower or SPC
Member.  1350 Corp.,  a Delaware  corporation,  shall be the  initial  Springing
Member of Borrower,  and 1350 Mezzanine Corp., a Delaware corporation,  shall be
the initial Springing Member of SPC Member;  provided however, that such initial
Springing  Members  shall not be admitted as a member of Borrower or SPC Member,
as the case may be, until a Springing Event shall have occurred. Upon the death,
resignation,  dissolution  or other event that  causes a Springing  Member to be
unable to fulfill its obligations  under the operating  agreement of Borrower or
SPC  Member,  as the case may be, or, if admitted as a member of Borrower or SPC
Member, it shall cease to be a member of Borrower or SPC Member, as the case may
be, a new  Springing  Member  shall be  appointed  and sign an  amendment to the
operating agreement of Borrower or SPC Member, as the case may be, acknowledging
such an appointment. The Bankruptcy (as defined in Sections 18-101(1) and 18-304
of the Act) of any member or  Springing  Member  shall not cause such  member or
Springing Member to cease to be a member of Borrower or SPC Member,  as the case
may be, and upon the  occurrence  of such an event,  the business of Borrower or
SPC Member, as the case may be, shall continue without dissolution.

                  3.1.25 Capitalization.  At Closing,  members of Borrower shall
have contributed to Borrower not less than $55,000,000 in capital contributions.

                                       29

<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,  rights,  licenses,  permits and franchises
and comply with all Legal Requirements applicable to it and the Property.

                  4.1.2 Taxes and Other  Charges.  Borrower  shall pay 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.  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 other than the Permitted  Encumbrances.  After prior
notice to Lender, Borrower, at its own expense, may contest by appropriate legal
proceeding,  conducted  in good  faith  and with due  diligence,  the  amount or
validity of any Taxes or Other Charges,  provided that either (a) such contested
Taxes or Other Charges have been paid in full or (b) (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) the Property or any part thereof or interest therein will not be in danger
of being sold,  forfeited,  terminated,  canceled or lost;  (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) Borrower shall
deposit with Lender cash,  or other  security as may be  reasonably  approved by
Lender,  in an amount  equal to one hundred  twenty-five  percent  (125%) of the
unpaid  contested  amount,  to insure  the  payment  of any such  Taxes or Other
Charges,  together with all interest and penalties thereon.  Lender may pay over
any such cash or other security held by Lender to the claimant  entitled thereto
at any time when, in the judgment of Lender, the entitlement of such claimant is
established.

                  4.1.3 Litigation.  Borrower shall give prompt notice to Lender
of any litigation or governmental  proceedings  pending or threatened in writing
against  Borrower which, if adversely  determined,  would  materially  adversely
affect the Property or Borrower's  ability to perform its obligations  hereunder
or under the other Loan Documents.

                                       30

<PAGE>

                  4.1.4 Access to Property. Subject to the rights of the tenants
under the Leases, 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 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  shall  keep  and
maintain or will cause to be kept and  maintained  proper and accurate books and
records, in accordance with GAAP,  reflecting the financial affairs of Borrower.
Lender shall have the right from time to time during normal  business hours upon
reasonable notice to Borrower to examine such books and records at the office of
Borrower  or other  Person  maintaining  such books and records and to make such
copies or extracts thereof as Lender shall desire.

                  (b) Borrower shall furnish Lender annually, within ninety (90)
days  following  the end of each Fiscal  Year of  Borrower,  a complete  copy of
Borrower's annual financial  statements  audited by a "Big Five" accounting firm
or other independent  certified public accountant  acceptable to Lender prepared
in accordance  with GAAP covering the Property for such financial  statements to
include  statements  of income and  expense and cash flow for  Borrower  and the
Property  and a balance  sheet for  Borrower.  Such  statements  shall set forth
Underwritable Net Operating Income, Gross Revenue and Operating Expenses for the
Property.  Borrower's  annual  financial  statements  shall be  accompanied by a
certificate  executed by an officer of Borrower  (without  personal  recourse to
such officer)  stating that such annual  financial  statement  fairly states the
financial  condition and the results of operations of Borrower and the Property.
Together with Borrower's annual financial statements,  Borrower shall furnish to
Lender an Officer's Certificate certifying as of the date thereof whether to the
best of  Borrower's  knowledge  there  exists  an  event or  circumstance  which
constitutes a Default or Event of Default by Borrower  under the Loan  Documents
and if such Default or Event of Default exists,  the nature thereof,  the period
of time it has existed and the action then being taken to remedy the same.

                  (c) So long as the Loan is outstanding,  Borrower will furnish
Lender on or before  the  forty-fifth  (45th)  day after the end of each  fiscal
quarter (based on Borrower's  Fiscal Year), the following items,  accompanied by
certificate  from an officer of  Borrower  (without  personal  recourse  to such
officer),  certifying  that such items are fairly stated and fairly  present the
financial  condition and results of the  operations of Borrower and the Property
in accordance with GAAP as applicable:

                                       31

<PAGE>

                  (i)  quarterly  and  year-to-date  statements  of  income  and
         expense and cash flow  prepared  for such  quarter  with respect to the
         Property, with a balance sheet for such quarter for Borrower; and

                  (ii) a current rent roll for the Property.

                  (d) Borrower will furnish Lender on or before the thirty-fifth
(35th) day after the end of each calendar month, statements substantially in the
form of those attached as Exhibit A hereto, accompanied by a certificate from an
officer of Borrower (without personal recourse to such officer), certifying that
such items fairly state the financial condition and results of the operations of
Borrower and the Property in a manner consistent with GAAP, as applicable.

                  (e) Borrower will promptly furnish Lender copies of any notice
received from a tenant under a Lease  threatening  non-payment  of rent or other
default,  alleging  or  acknowledging  a  default  by  landlord,   requesting  a
termination  of a Lease or a  material  modification  of any Lease or  notifying
Borrower of the  exercise or  non-exercise  of any option  provided  for in such
tenant's  Lease,  or any  other  similar  material  correspondence  received  by
Borrower from tenants during the subject month.

                  (f)  Borrower  shall  submit the  Annual  Budget to Lender not
later than  thirty  (30) days prior to the  commencement  of each  Fiscal  Year.
Lender shall have no right to approve the Annual Budget.

                  (g) Borrower shall furnish to Lender, within ten (10) Business
Days after request (or as soon thereafter as may be reasonably  possible),  such
further  detailed  information with respect to the operation of the Property and
the financial affairs of Borrower as may be reasonably requested by Lender.

                  4.1.7 Title to the Property.  Borrower will warrant and defend
the validity and  priority of the Lien 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 five (5) 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.  After request by Borrower,  Lender shall within five (5) Business
Days furnish Borrower with a statement, duly acknowledged and certified, stating
(i) the  unpaid  principal  amount of the Note;  (ii) the date  installments  of
interest and/or principal were last paid; (iii) the Applicable  Interest Rate of
the Note;  and (iv) that this  Agreement and the other Loan  Documents  have not
been modified or if modified, giving particulars of such modification.

                                       32

<PAGE>

                  (b)  Borrower  shall use  reasonable  efforts  to  deliver  to
Lender, upon request,  an estoppel  certificate from each tenant under any Lease
which requires  tenant to provide such  certificate  to Borrower;  provided that
such  certificate  shall be in the form  required  under  such  Lease;  provided
further that Borrower  shall not be required to deliver such  certificates  more
than one (1) time hereunder.

                  4.1.9   Leases.   (a)  All  Major  Leases  and  all  renewals,
amendments  and  modifications  thereof  executed after the date hereof shall be
subject to Lender's prior  approval,  not to be  unreasonably  withheld,  to the
extent such Major Leases or renewals,  amendments or  modifications  thereof are
not at market rates and on market terms.

                  (b)  Borrower  may  terminate  or accept a surrender of one or
more Leases  demising up to 100,000  square feet on an aggregate  basis  without
Lender's approval.  Borrower shall not terminate or accept a surrender of Leases
demising more than 100,000  square feet on an aggregate  basis without  Lender's
prior approval,  not to be unreasonably  withheld;  provided,  however, that the
termination or surrender of any Lease  demising space to The Hearst  Corporation
shall neither require  Lender's  approval nor be included in such 100,000 square
foot aggregate amount so long as Borrower has executed a replacement  Lease with
another  tenant  with  respect  to  such  terminated  or  surrendered  space  in
accordance with subparagraph (a) above. Each request by Borrower for approval of
any  termination  or surrender  of any Lease shall be made by written  notice to
Lender and must  include a statement in bold face type that if Lender shall fail
to approve or disapprove such  termination or surrender within ten (10) Business
Days after  receipt by Lender of such  request,  such  termination  or surrender
shall be deemed to have been approved. If Lender fails to respond to such notice
within such ten (10) day  period,  Borrower  shall  deliver a second copy of the
original  notice to Lender  via  overnight  courier  which  copy shall be marked
"Second  Notice."  Lender shall approve or disapprove  any such  termination  or
surrender  within five (5) Business  Days after receipt by Lender of such Second
Notice.  If Lender shall fail to disapprove of any such termination or surrender
within  such five (5) day period,  time being of the  essence,  Lender  shall be
conclusively deemed to have approved such termination or surrender.

                  (c)  Borrower  (i) shall  observe and perform the  obligations
imposed upon the lessor under the Leases in a  commercially  reasonable  manner;
(ii) shall enforce the terms,  covenants and conditions  contained in the Leases
upon  the  part of the  lessee  thereunder  to be  observed  or  performed  in a
commercially  reasonable manner,  provided,  however, that Borrower shall comply
with the  provisions of paragraph (b) above;  (iii) shall not collect any of the
rents more than one (1) month in advance  (other than  security  deposits);  and
(iv) shall not execute any assignment of lessor's  interest in the Leases or the
Rents (except as contemplated by the Loan Documents).

                                       33

<PAGE>

                  (d) Upon request,  Borrower shall furnish Lender with executed
copies of all Leases.

                  (e) Upon request  from  Borrower,  Lender shall  provide (i) a
subordination, nondisturbance and attornment agreement on Lender's standard form
to each lessee  under any Lease  executed in  accordance  with the terms of this
Agreement  after the date  hereof  and which  demises at least  12,500  rentable
square feet of space in the  Property and (ii) a  subordination,  nondisturbance
and attornment  agreement to each lessee under any Lease existing as of the date
hereof to the extent such Lease requires the delivery of such an agreement.

                  4.1.10  Alterations.   Lender's  prior  approval  (not  to  be
unreasonably  withheld)  shall be required in connection with any alterations to
any  Improvements on the Property (a) that may have a material adverse effect on
Borrower's financial  condition,  the value of the Property or the Underwritable
Net Operating Income or (b) the cost of which (including any related alteration,
improvement or replacement)  is reasonably  anticipated to exceed the Alteration
Threshold;  provided,  however,  that no consent shall be required in respect of
any tenant improvement work required to be performed by Borrower under any Major
Lease  approved by Lender or under any other Lease not  requiring the consent of
Lender pursuant to the terms of this Loan Agreement. If the total unpaid amounts
with respect to  alterations  to the  Improvements  shall at any time exceed the
Alteration Threshold,  Borrower shall 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) U.S.
Obligations,  (iii) other  securities  acceptable  to Lender,  provided that the
applicable Rating Agencies have confirmed in writing that the form and issuer of
same  will  not,  in  and  of  itself,  result  in a  downgrade,  withdrawal  or
qualification  of the then  current  ratings  assigned  in  connection  with any
Securitization,  or (iv) a  completion  bond,  the form and  issuer of which the
Rating Agencies have confirmed in writing will not, in and of itself,  result in
a downgrade, withdrawal or qualification of the then current ratings assigned in
connection with any Securitization. Such security shall be in an amount equal to
the  excess of the total  unpaid  amounts  with  respect to  alterations  to the
Improvements  on the Property  (other than such amounts to be paid or reimbursed
by tenants under the Leases) over the Alteration Threshold.

                  4.1.11  Securitization  Date  Deliveries.  On  or  before  the
Securitization  Date,  Borrower shall deliver to Lender (i) a  non-consolidation
opinion  letter  in form  and  substance  satisfactory  to  Lender  in its  sole
discretion (the "Insolvency  Opinion") and (ii) evidence  satisfactory to Lender
that the  Accounts  have been opened and the  required  deposits  have been made
therein in  accordance  with the  provisions  of  Section VI of this  Agreement.
Borrower  shall  cooperate  with  Lender  to  obtain a FIRREA  appraisal  of the
Property on or before the Securitization Date; provided,  however, that Borrower
shall not be required to pay for any such appraisal.

                  Section 4.2 Borrower Negative Covenants.

                                       34

<PAGE>

                  Borrower covenants and agrees with Lender that:

                  4.2.1 Operation of the Property.  Borrower shall not terminate
the  Management  Agreement  or  otherwise  replace the Manager or enter into any
other management agreement with respect to the Property; provided, however, that
the Manager  may assign the  Management  Agreement  without  modification  to an
Affiliate  of Manager or Borrower so long as such  Affiliate  (i) assumes all of
Manager's rights and obligations  under the Management  Agreement in writing and
(ii) executes and delivers to Lender a Replacement Assignment (as defined in the
Assignment of Management Agreement).

                  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,  (iii) transfer,  lease or sell, in one
transaction or any combination of transactions,  all or substantially all of the
properties or assets of Borrower except to the extent expressly permitted by the
Loan Documents,  or (iv) cause, permit or suffer the SPC Member to (A) dissolve,
wind up or liquidate or take any action,  or omit to take an action, as a result
of which the SPC Member would be  dissolved,  wound up or liquidated in whole or
in  part,  or  (B)  amend,   modify,  waive  or  terminate  the  certificate  of
incorporation or bylaws of the SPC Member,  in each case,  without obtaining the
prior written consent of Lender or Lender's designee, which consent shall not be
unreasonably withheld so long as such action or inaction does not cause Borrower
or the SPC Member, as applicable, to violate the terms of Section 3.1.24 of this
Agreement.

                  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
members of Borrower  except (i) in the ordinary  course of business and on terms
which 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 or (ii)
as otherwise approved by Lender.

                  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
nonconforming  use under any zoning  ordinance or any other  applicable land use
law,  rule or  regulation,  without  the  prior  consent  of  Lender,  not to be
unreasonably withheld.

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<PAGE>

                  4.2.8  Assets.   Borrower   shall  not  purchase  or  own  any
properties other than 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 set forth on the first page of this  Agreement
without first giving Lender ten (10) Business Days prior notice.

                  4.2.11  ERISA.  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").

                  (a) Borrower further covenants and agrees to deliver to Lender
such  certifications  or other evidence from time to time throughout the term of
the Loan,  as requested by Lender in its sole  discretion,  that (A) Borrower is
not and does not maintain 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(3) of ERISA;  (B)  Borrower  is not  subject to state
statutes  regulating  investments  and  fiduciary  obligations  with  respect to
governmental plans; and (C) one or more of the following circumstances is true:

                  (i)  Equity   interests  in  Borrower  are  publicly   offered
         securities, within the meaning of 29 C.F.R.ss.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.ss.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.
         ss.2510.3-101(c) or (e).

                  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:

                                       36

<PAGE>

                  (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
         Ten  Thousand  and  No/100  Dollars  ($10,000)  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; provided, however, Borrower shall be permitted a deductible of
         $50,000 for  insurance  covering  damage to boilers and  machinery.  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 require;  and (z)
         earthquake insurance in amounts and in form and substance  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 of not less than One
         Million and No/100  Dollars  ($1,000,000);  (B) to continue at not less
         than the  aforesaid  limit  until  required  to be changed by Lender in
         writing 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 all insured contracts  contained in Section 32 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;  and (C) in an amount  sufficient
         to satisfactorily  address the recovery period identified below,  until
         the  earlier of (x) the date that such  income  returns to the level it
         was at prior to the loss and (y) the  expiration  of twelve (12) months
         from the date of loss, plus an extended period of indemnity of not less
         than 180 days,  which extended  period of indemnity  shall not commence
         until the property is fully repaired and/or  replaced,  notwithstanding
         that

                                       37

<PAGE>

         the  policy  may  expire  prior  to the end of such period.  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  twenty-four  (24) month  period.  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;

                  (v) workers' compensation,  subject to the statutory limits of
         the state in which the Property is located,  and  employer's  liability
         insurance  with a limit of at least Five  Hundred  Thousand  and No/100
         Dollars ($500,000) per accident and per disease per employee,  and Five
         Hundred Thousand and No/100 Dollars ($500,000) for disease aggregate in
         respect  of any work or  operations  on or about  the  Property,  or in
         connection with the Property or its operation (if applicable);

                  (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 Fifty  Million  and No/100  Dollars
         ($50,000,000)  per occurrence on terms  consistent  with the commercial
         general  liability  insurance  policy  required under  subsection  (ii)
         above;

                  (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 Fifty
         Million and No/100 Dollars ($50,000,000); and

                  (ix)  upon  sixty  (60)  days'  written  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.

                                       38

<PAGE>

                  (b)  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 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 the  Policies  theretofore  furnished to
Lender,  certificates  of  insurance  evidencing  the  Policies  accompanied  by
evidence  satisfactory  to Lender of payment of the premiums 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), 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 and earthquake  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.

                  (e) All Policies of insurance provided for in Section 5.1.1(a)
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 materially changed (other than to
         increase the coverage  provided  thereby) or canceled  without at least
         thirty  (30) days' prior  written  notice to Lender and any other party
         named therein as an additional insured;  provided,  however,  that with
         respect to  non-payment  of premium by  Borrower,  Lender and any other
         party named therein as an additional insured shall receive no less than
         ten (10) days' prior written 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,  with 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

                                       39

<PAGE>

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 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 "AA" or  better  by the  Rating  Agencies  (each,  an "AA  Company").
Notwithstanding  the  foregoing,  Borrower  shall be  permitted  to maintain its
Policy with American  Protection  Insurance Company  ("American") for so long as
American  maintains  its current  claims  paying  ability  rating.  In the event
American is downgraded from its current claims paying ability  rating,  Borrower
shall replace American with an AA Company.

                  Section 5.2 Casualty and Condemnation.

                  5.2.1  Casualty.  If the  Property  shall  sustain a Casualty,
Borrower shall give prompt notice of such Casualty to Lender and shall (or shall
cause the tenants to) promptly  commence and diligently  prosecute to completion
the  repair  and  restoration  of the  Property  as  nearly as  possible  to the
condition   the  Property  was  in   immediately   prior  to  such  Casualty  (a
"Restoration")  and otherwise in accordance with Section 5.3. Borrower shall pay
all  costs  of such  Restoration  whether  or not  such  costs  are  covered  by
insurance.  Lender may, but shall not be obligated to, make proof of loss if not
made promptly by Borrower.

                  5.2.2  Condemnation.  Borrower shall give Lender prompt notice
of any  actual  or  threatened  in  writing  Condemnation  by  any  Governmental
Authority of all or any part of the Property and shall  deliver to Lender a copy
of any and all papers served in  connection  with such  proceedings.  Lender may
participate  in any such  proceedings,  and  Borrower  shall  from  time to time
deliver  to  Lender  all   instruments   requested  by  Lender  to  permit  such
participation.  Borrower  shall, at its expense,  diligently  prosecute any such
proceedings,  and shall  consult with Lender,  its  attorneys  and experts,  and
cooperate  with them in the  carrying  on or  defense  of any such  proceedings.
Notwithstanding any Condemnation or the payment of any Award by any Governmental
Authority, 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.  If the Property or
any portion thereof is taken by any Governmental  Authority,  Borrower shall (or
shall cause the tenants to)  promptly  commence  and  diligently  prosecute  the
Restoration of the Property and otherwise  comply with the provisions of Section
5.3. If the Property is sold,  through  foreclosure  or otherwise,  prior to the
receipt by Lender of the Award,  Lender  shall have the right,  whether or not a
deficiency judgment on the Note shall have been sought,  recovered or denied, to
receive the Award, or a portion thereof sufficient to pay the Debt.

                                       40

<PAGE>

                  Section 5.3 Delivery of Net Proceeds.

                  5.3.1  Minor  Casualty  or  Condemnation.  If  a  Casualty  or
Condemnation  has occurred to the  Property  and the Net Proceeds  shall be less
than the Restoration Threshold and the costs of completing the Restoration shall
be less than the Restoration  Threshold,  and provided no Event of Default shall
have occurred and remain  uncured,  the Net Proceeds will be disbursed by Lender
to Borrower. Promptly after receipt of the Net Proceeds, Borrower shall commence
and  satisfactorily  complete with due diligence the  Restoration  in accordance
with the terms of this Agreement.

                  5.3.2  Major  Casualty or  Condemnation.  (a) If a Casualty or
Condemnation  has  occurred to the Property and the Net Proceeds are equal to or
greater  than  the  Restoration   Threshold  or  the  costs  of  completing  the
Restoration is equal to or greater than the Restoration Threshold,  Lender shall
make the Net Proceeds  available for the Restoration,  provided that each of the
following conditions are met:

                  (i) no Event of Default shall have occurred and be continuing;

                  (ii) (A) in the event the Net Proceeds are insurance proceeds,
         less than  twenty-five  percent  (25%) of the total  floor  area of the
         Improvements at the Property has been materially damaged,  destroyed or
         rendered  unusable as a result of such Casualty or (B) in the event the
         Net Proceeds are an Award,  less than twenty-five  percent (25%) of the
         land constituting the Property is taken, and such land is located along
         the  perimeter  or  periphery  of the  Property,  and no portion of the
         Improvements is the subject of the Condemnation;

                  (iii)  Leases  requiring  payment  of  annual  rent  equal  to
         seventy-five  percent (75%) of the Gross  Revenue  received by Borrower
         during the twelve (12) month period immediately  preceding the Casualty
         or  Condemnation  and all Major  Leases  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,
         notwithstanding the occurrence of such Casualty or Condemnation.

                  (iv)  Borrower  shall  commence  the  Restoration  as  soon as
         reasonably   practicable  and  shall  diligently  pursue  the  same  to
         satisfactory completion;

                  (v) Lender shall be  reasonably  satisfied  that any operating
         deficits and all payments of principal and interest under the Note will
         be paid during the period  required  for  Restoration  from (A) the Net
         Proceeds, or (B) other funds of Borrower (which funds may include funds
         available  to  Borrower  under any line of credit  to the  extent  that
         Lender is  provided  with a  written  agreement  in form and  substance
         satisfactory to Lender from parties  approved by Lender that such funds
         will be reserved for  Borrower and made  available to Borrower for such
         purpose);

                                       41

<PAGE>

                  (vi) Lender shall be satisfied  that the  Restoration  will be
         completed on or before the earliest to occur of (A) the Maturity  Date,
         (B) such time as may be required under applicable Legal Requirements in
         order to repair and restore the  Property  to the  condition  it was in
         immediately  prior to such  Casualty  or to as nearly as  possible  the
         condition  it  was  in  immediately  prior  to  such  Condemnation,  as
         applicable or (C) the expiration of the insurance  coverage referred to
         in Section 5.1.1(a)(iii) (as such insurance coverage may be extended);

                  (vii) the Property and the use thereof  after the  Restoration
         will be in compliance  with and permitted  under all  applicable  Legal
         Requirements;

                  (viii) the Restoration shall be done and completed by Borrower
         in an  expeditious  and  diligent  fashion and in  compliance  with all
         applicable Legal Requirements; and

                  (ix) such Casualty or  Condemnation,  as applicable,  does not
         result  in  the  loss  of  access  to  the   Property  or  the  related
         Improvements.

                  (b) The Net Proceeds shall be paid directly to Lender and held
by Lender in an interest-bearing account and, until disbursed in accordance with
the provisions of this Section 5.3.2, shall constitute  additional  security for
the Debt.  The Net Proceeds  shall be disbursed by Lender to, or as directed by,
Borrower from time to time during the course of the Restoration, upon receipt of
(i) evidence  satisfactory to Lender that all  requirements set forth in Section
5.3.2(a) have been  satisfied,  (ii) a  certificate  from an officer of Borrower
certifying that 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 in full and  (iii)  evidence
satisfactory  to Lender that there exist no notices of  pendency,  stop  orders,
mechanic's or  materialman'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 to the  satisfaction
of Lender and  discharged of record or in the  alternative  fully insured to the
satisfaction of Lender by the title company issuing the Title Insurance Policy.

                  (c) All plans and  specifications  required in connection with
the  Restoration  shall  be  subject  to  prior  approval  by  Lender  and by an
independent  architect selected by Borrower which shall be reasonably acceptable
to  Lender  (the  "Casualty  Consultant").  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 approval by
Lender  and the  Casualty  Consultant.  All  out-of-pocket  costs  and  expenses
actually incurred by Lender in connection with recovering, holding and advancing
the Net Proceeds for the Restoration including,  without limitation,  reasonable
attorneys'  fees  and  disbursements  and the  Casualty  Consultant's  fees  and
disbursements, shall be paid by Borrower.

                                       42

<PAGE>

                  (d)  In  no  event   shall   Lender  be   obligated   to  make
disbursements  of the Net  Proceeds  in excess  of an amount  equal to the costs
actually  incurred  from  time  to  time  for  work  in  place  as  part  of the
Restoration,  as  certified  by  the  Casualty  Consultant,  less  the  Casualty
Retainage.  The term  "Casualty  Retainage"  shall  mean an amount  equal to ten
percent  (10%) of the costs  actually  incurred for work in place as part of the
Restoration, as certified by the Casualty Consultant,  until the Restoration has
been completed; provided, however, that upon completion of 50% of the work to be
performed by any contractor  (as such  percentage of completion is determined by
the Casualty  Consultant),  Lender shall,  upon the written request of Borrower,
reduce the Casualty  Retainage with respect to future advances allocable to such
contractor to five percent (5%). The Casualty  Retainage shall in no event,  and
notwithstanding  anything  to the  contrary  set  forth  above  in this  Section
5.3.2(d),  be  less  than  the  amount  actually  held  back  by  Borrower  from
contractors,  subcontractors  and materialmen  engaged in the  Restoration.  The
Casualty Retainage shall not be released until the Casualty Consultant certifies
to  Lender  that the  Restoration  has been  completed  in  accordance  with the
provisions  of this Section  5.3.2(d) and that all  approvals  necessary for the
re-occupancy  and use of the Property have been  obtained  from all  appropriate
Governmental  Authorities,  and Lender receives evidence  satisfactory to Lender
that the costs of the Restoration have been paid in full or will be paid in full
out of the Casualty Retainage;  provided,  however, that Lender will release the
portion of the Casualty  Retainage  being held with  respect to any  contractor,
subcontractor  or  materialman  engaged in the  Restoration  as of the date upon
which  the  Casualty  Consultant   certifies  to  Lender  that  the  contractor,
subcontractor  or  materialman  has  satisfactorily  completed  all work and has
supplied all materials in accordance  with the  provisions of the  contractor's,
subcontractor's  or  materialman's  contract,  the contractor,  subcontractor or
materialman  delivers  the lien  waivers and  evidence of payment in full of all
sums due to the  contractor,  subcontractor  or materialman as may be reasonably
requested by Lender or by the title company issuing the Title Insurance  Policy,
and Lender  receives an endorsement to the Title  Insurance  Policy insuring the
continued  priority of the lien of the related  Mortgage and evidence of payment
of any premium payable for such endorsement.  If required by Lender, the release
of any such  portion of the Casualty  Retainage  shall be approved by the surety
company,  if any, which has issued a payment or performance bond with respect to
the contractor, subcontractor or materialman.

                  (e) Lender shall not be obligated to make disbursements of the
Net Proceeds more frequently than once every calendar month.

                  (f) If at any time the Net Proceeds or the undisbursed balance
thereof  shall not, in the opinion of Lender in  consultation  with the Casualty
Consultant,  be  sufficient  to pay in full the  balance of the costs  which are
estimated  by the  Casualty  Consultant  to be incurred in  connection  with the
completion of the  Restoration,  Borrower shall deposit 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 5.3.2 shall constitute  additional security for the Debt. Borrower shall
have the option of securing payment of the Net Proceeds Deficiency by delivering
to Lender a letter of credit (in lieu of cash) issued by a financial institution
and pursuant to a letter of credit acceptable to Lender in its sole discretion.

                                       43

<PAGE>

                  (g) The excess,  if any, of the Net Proceeds and the remaining
balance, if any, of the Net Proceeds Deficiency deposited with Lender (including
all interest accrued thereon, if any) after the Casualty Consultant certifies to
Lender that the Restoration has been completed in accordance with the provisions
of this  Section  5.3.2,  and the  receipt  by  Lender  of  evidence  reasonably
satisfactory   to  Lender  that  all  costs  incurred  in  connection  with  the
Restoration  have been paid in full,  shall be remitted  by Lender to  Borrower,
provided no Event of Default shall have  occurred and shall be continuing  under
any of the Loan Documents.

                  (h) 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 Section  5.3.2(g) may be retained  and applied by Lender  toward the
payment of the Debt whether or not then due and payable in such order,  priority
and proportions as Lender in its sole discretion  shall deem proper,  or, at the
discretion  of  Lender,  the same may be paid,  either  in whole or in part,  to
Borrower for such purposes as Lender shall designate.

                  VI RESERVE FUNDS

                  Section 6.1 Tax Funds.

                  6.1.1  Deposits  of Tax Funds.  Borrower  shall  deposit  with
Lender an amount which,  together with Monthly Tax Deposits (as defined  below),
will be  sufficient  to pay Lender's  reasonable  estimate of Taxes at least ten
(10) days prior to the next due date (the "Initial Tax Deposit") on a date which
is no later than the  Securitization  Date.  Thereafter,  Borrower shall deposit
with Lender on the Monthly  Payment Date an amount (the  "Monthly Tax  Deposit")
equal to  one-twelfth  of the Taxes that  Lender  reasonably  estimates  will be
payable during the next ensuing  twelve (12) months in order to accumulate  with
Lender  sufficient  funds to pay all such  Taxes at least ten (10) days prior to
their  respective  due  dates  (the  Initial  Tax  Deposit,  together  with such
additional  Monthly Tax Deposits,  shall  hereinafter be referred to as the "Tax
Funds").  If at  any  time  after  the  Securitization  Date  Lender  reasonably
determines  that the Tax Funds will not be sufficient  to pay the Taxes,  Lender
shall notify  Borrower of such  determination  and Borrower  shall  increase its
monthly  payments to Lender by the amount that Lender  reasonably  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 two (2) Business Days after
its receipt of such notice.

                  6.1.2 Release of Tax Funds.  Lender shall timely 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 validity of

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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
(including all interest  accrued  thereon,  if any) remaining after the Debt has
been  paid in full  shall be  returned  to  Borrower.  If (a) the Tax  Funds are
available to Lender to make a payment of Taxes when due and (b) Borrower  incurs
late fees due to Lender's failure to make such payment of Taxes when due, Lender
shall reimburse Borrower for any such late fees incurred by Borrower.

                  6.1.3  Application  of Tax Funds.  Upon the  occurrence  of an
Event of Default, Lender, at its option, may withdraw all the Tax Funds from the
Tax  Account  and may apply the Tax Funds  either to the  payment of Taxes 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 Tax
Funds shall be in addition to all other rights and  remedies  provided to Lender
under the Loan Documents.

                  Section 6.2 Insurance Premium Funds.

                  6.2.1  Deposits of Insurance  Premium  Funds.  Borrower  shall
deposit with Lender an amount  which,  together with Monthly  Insurance  Premium
Deposits (as defined  below),  will be  sufficient  to pay  Lender's  reasonable
estimate of Insurance Premiums at least ten (10) days prior to the next due date
(the "Initial  Insurance  Premium Deposit") on a date which is no later than the
Securitization  Date.  Thereafter,  Borrower  shall  deposit with Lender on each
Monthly Payment Date an amount (the "Monthly  Insurance  Premium Deposit") equal
to one-twelfth of the Insurance  Premiums that Lender reasonably  estimates will
be payable for the renewal of the  coverage  afforded by the  Policies  upon the
expiration  thereof in order to accumulate with Lender  sufficient  funds to pay
all such Insurance Premiums at least thirty (30) days prior to the expiration of
the Policies (the Initial Insurance Premium Deposit,  together with such Monthly
Insurance Premium  Deposits,  shall hereinafter be referred to as the "Insurance
Premium Funds").  If at any time after the Securitization Date Lender reasonably
determines  that the  Insurance  Premium Funds will not be sufficient to pay the
Insurance  Premiums,  Lender shall  notify  Borrower of such  determination  and
Borrower shall increase its monthly payments to Lender by the amount that Lender
reasonably  estimates is  sufficient  to make up the  deficiency at least thirty
(30) days prior to expiration of the Policies.

                  6.2.2 Release of Insurance Premium Funds.  Lender shall timely
apply the Insurance  Premium 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 Premium 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  Premium Funds.
Any Insurance  Premium Funds (including all interest  accrued  thereon,  if any)
remaining  after the Debt has been paid in full shall be  promptly  returned  to
Borrower.  If (a) the Insurance  Premium Funds are available to Lender to make a
payment of Insurance  Premiums when due and (b) Borrower incurs late fees due to
Lender's  failure to make such payment of Insurance  Premiums  when due,  Lender
shall reimburse Borrower for any such late fees incurred by Borrower.

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<PAGE>

                  6.2.3   Application  of  Insurance  Premium  Funds.  Upon  the
occurrence  of an Event of  Default,  Lender  at its  option  may  withdraw  the
Insurance  Premium  Funds from the Insurance  Premium  Account and may apply the
Insurance  Premium Funds to the payment of Insurance  Premiums or to the payment
of the Debt in such order,  proportion and priority as Lender shall determine in
its sole discretion.  Lender's right to withdraw and apply the Insurance Premium
Funds shall be in addition to all other rights and  remedies  provided to Lender
under the Loan Documents.

                  Section 6.3 Capital Expenditures Funds.

                  6.3.1  Deposits  of Capital  Expenditures  Funds.  If required
pursuant  to  Section  2.6,  Borrower  shall  deposit  with  Lender on the First
Extension Date an amount equal to the Capital  Expenditures Deposit (such amount
so  deposited  shall  hereinafter  be referred to as the  "Capital  Expenditures
Funds").

                  6.3.2  Release  of Capital  Expenditure  Funds.  Lender  shall
disburse Capital  Expenditure  Funds only for the costs of those items listed on
the Capital Expenditures Budget annexed hereto.

                  (a) Lender shall disburse to Borrower the Capital Expenditures
Funds upon  satisfaction  by Borrower of each of the following  conditions:  (i)
Borrower shall submit a written  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  set  forth  on the  Capital
Expenditures  Budget, (B) stating that all Capital  Expenditures at the Property
which have been funded by all prior  disbursements  have been  completed in 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 such Capital
Expenditures  and (C) stating that each Person that supplied  materials or labor
in  connection  with the Capital  Expenditures  performed  at the Property to be
funded by the requested  disbursement has been or will be paid in full upon such
disbursement,  such  certificate  to be  accompanied  by lien  waivers  or other
evidence of payment reasonably  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 the Capital  Expenditures  exceeds $100,000,
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

                                       46

<PAGE>

Lender shall reasonably request that the Capital Expenditures at the Property to
be funded by the requested  disbursement  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 or with respect
to the Property unless such requested  disbursement is in an amount greater than
$25,000 (or a lesser amount if the total amount of Capital  Expenditure Funds is
less than $25,000,  in which case only one  disbursement of the amount remaining
in the account shall be made).

                  (b)  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 Expenditures 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.

                  (c)  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) 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).

                  (d) If a disbursement will exceed $100,000, 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.

                  (e) 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.

                  (f) Any Capital  Expenditure  Funds  (including  all  interest
accrued thereon, if any) remaining after the Debt has been paid in full shall be
returned to Borrower.

                  6.3.3  Application  of  Capital  Expenditure  Funds.  Upon the
occurrence  of an Event of Default,  Lender,  at its option,  may  withdraw  the
Capital  Expenditure Funds from the

                                       47

<PAGE>

Capital  Expenditures  Account  and  apply  the  Capital  Expenditure  Funds  to
completion  of the Capital  Expenditures  Work 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 Capital  Expenditure  Funds shall be in
addition to all other  rights and  remedies  provided  to Lender  under the Loan
Documents.

                  Section 6.4 Security Interest in Funds.

                  6.4.1 Grant of Security Interest.  Borrower shall be the owner
of each of the 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 Funds. Each of the Funds shall be under the sole dominion and control
of Lender.

                  6.4.2  Income  Taxes.  Borrower  shall  report on its federal,
state and local income tax returns all interest or income accrued on the Funds.

                  6.4.3 Prohibition Against Further Encumbrance.  Borrower shall
not,  without the prior consent of Lender,  further pledge,  assign or grant any
security  interest  in the 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.

                  Section 6.5 The Accounts; Permitted Investments; Earnings.

                  6.5.1 The Accounts.  Borrower  shall open with Agent  separate
accounts for each of the Tax Funds (the "Tax Account") and the Insurance Premium
Funds  (the  "Insurance   Premium   Account")  and,   simultaneously   with  the
commencement  of the First  Extension  Period,  if  applicable,  for the Capital
Expenditure Funds (the "Capital Expenditures Account"),  each on a date which is
no later than the  Securitization  Date.  The Tax Funds shall be held in the Tax
Account.  The Insurance  Premium  Funds shall be held in the  Insurance  Premium
Account.   The  Capital   Expenditures  Funds  shall  be  held  in  the  Capital
Expenditures  Account.  At Lender's option, each of the Accounts shall be opened
in Lender's name or in Servicer's  name. Each of the Accounts shall (i) be under
the sole dominion and control of Lender and (ii) be opened and  maintained as an
Eligible Account.

                  6.5.2 Permitted Investments.  Lender shall invest any balances
in the Accounts in Permitted  Investments  as instructed  by Borrower,  provided
that (i) if Borrower  fails to so instruct  Lender,  or upon the  occurrence and
continuation  of an Event of  Default,  Lender  may  invest  and  reinvest  such
balances  in  Permitted  Investments  as  Lender  shall  determine  in its  sole
discretion,  (ii) the maturities of the Permitted  Investments on deposit in the
Accounts shall be selected and  coordinated to become due not later than one day
before  any  disbursements  from  the  Accounts  must be  made,  (iii)  all such
Permitted  Investments  shall  be held  in the  name of and be  under  the  sole
dominion and control of Lender and subject at all times to the terms hereof, and

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<PAGE>

(iv) no Permitted Investment shall be made unless Lender shall have and continue
to have a perfected  first priority Lien in such Permitted  Investment  securing
the obligations of Borrower hereunder and under the other Loan Documents and all
filings and other  actions  necessary to ensure the  validity,  perfection,  and
first  priority  of such  Lien  shall  have been  taken.  Lender  shall  have no
liability for any loss investments of funds in the Accounts that are invested in
Permitted  Investments and no such loss shall affect  Borrower's  obligations to
make the deposits  required  under  Sections  6.1, 6.2, 6.3, 6.4 and 6.5 hereof.
Borrower  shall  report on its  federal,  state and local income tax reports any
interest or income accrued on funds in the Accounts.

                  6.5.3 Earnings on Account Collateral;  Monthly Statements. All
interest  or other  income  (whether  by  virtue  of  Permitted  Investments  or
otherwise)  accruing  on funds in the  Accounts  shall,  in each  case,  be held
therein as part of such  Account.  All risk of loss in  respect of the  Accounts
shall be borne by Borrower. Lender shall provide to Borrower a monthly statement
of  account   showing   deposits  into  and   disbursements   (or  transfers  or
reallocations, as the case may be) from each of the Accounts.

                  Section 6.6 Cash Management.

                  6.6.1 Lockbox Account. Within thirty (30) days after receiving
written  notice of the  occurrence of an Event of Default (the "Lockbox  Trigger
Date"),  Borrower shall open an account (the "Lockbox  Account") with Agent. The
Lockbox  Account  shall be in  Lender's  name,  or at  Lender's  option,  in the
Servicer's  name.  The  Lockbox  Account  shall be under the sole  dominion  and
control of Lender.  The  Lockbox  Account  will be opened and  maintained  as an
Eligible  Account.  Borrower  shall  pledge,  assign and grant a  first-priority
security interest in all of Borrower's  right,  title and interest in and to the
Lockbox  Account  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,  on a date which is no later than
the Lockbox Trigger Date. Each of the Funds shall be under the sole dominion and
control of Lender.

                  6.6.2 Cash Management Agreement. Borrower shall provide Lender
with an original copy of the Cash  Management  Agreement,  substantially  in the
form  attached as Exhibit B hereto and otherwise  satisfactory  to Lender in its
sole  discretion,  executed by Borrower  and Agent,  on a date which is no later
than the Lockbox Trigger Date.

                  6.6.3  Deposits  into  Lockbox  Account.  From and  after  the
Lockbox  Trigger Date,  Borrower  shall cause all Tenants at the Property to pay
Rent  directly  into the Lockbox  Account on or before the date such Rent is due
under  the  terms  of the  applicable  Lease.  Borrower  shall  send  a  notice,
substantially in the form of Exhibit C hereto,  on a date which is no later than
the Lockbox  Trigger Date to all Tenants at the Property  directing  them to pay
all Rent into the Lockbox  Account.  All sums deposited into the Lockbox Account
shall be swept daily into the Cash  Management  Account  established by Borrower
with Agent on a date which is no later than the Lockbox  Trigger Date (the "Cash
Management  Account"),  to be held and  administered in accordance with the Cash
Management Agreement.  The Cash Management

                                       49

<PAGE>

Account shall be in Lender's  name,  or at Lender's  option,  in the  Servicer's
name. The Cash  Management  Account shall be under the sole dominion and control
of Lender.  The Cash  Management  Account  will be opened and  maintained  as an
Eligible  Account.  Borrower  shall  pledge,  assign and grant a  first-priority
security interest in all of Borrower's  right,  title and interest in and to the
Cash Management  Account 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,  on a date which is no later than
the Lockbox  Trigger  Date.  None of the Lockbox  Account,  the Cash  Management
Account or the Cash  Management  Agreement  shall  alter or  diminish in any way
Borrower's  obligation to make timely  payment and deposits to all sums required
to be paid or deposited under any Loan Document.

                  VII PROPERTY MANAGEMENT

                  Section 7.1 The Management Agreement.

                  Borrower  shall  cause  Manager  to  manage  the  Property  in
accordance with the Management Agreement.  Borrower shall (i) diligently perform
and  observe  all of the  terms,  covenants  and  conditions  of the  Management
Agreement on the part of Borrower to be performed  and  observed  (ii)  promptly
notify  Lender of any  notice to  Borrower  of any  default by  Borrower  in the
performance  or observance  of any of the terms,  covenants or conditions of the
Management  Agreement on the part of Borrower to be performed and  observed.  If
Borrower  shall default in the  performance  or observance of any material term,
covenant or condition of the Management  Agreement on the part of Borrower to be
performed or observed,  then, without limiting Lender's other rights or remedies
under  this  Agreement  or the other  Loan  Documents,  and  without  waiving or
releasing Borrower from any of its obligations hereunder or under the Management
Agreement, Lender shall have the right, but shall be under no obligation, to pay
any sums and to perform any act as may be  appropriate to cause all the material
terms,  covenants  and  conditions  of the  Management  Agreement on the part of
Borrower to be performed or observed.

                  Section 7.2 Prohibition Against Termination or Modification.

                  Subject to the  Assignment of Management  Agreement,  Borrower
shall not (a) surrender the Management Agreement,  (b) consent to the assignment
by the Manager of its interest under the Management Agreement,  (c) terminate or
cancel the Management  Agreement,  (d) materially  modify,  change,  supplement,
alter or amend the Management  Agreement,  (e) change,  replace or terminate the
Manager or (f) enter into a new management  agreement;  provided,  however, that
the Management  Agreement may be assigned without  material  modification by the
Manager to an  Affiliate  of Manager or Borrower so long as such  Affiliate  (i)
assumes all of Manager's rights and obligations  under the Management  Agreement
in writing and (ii) executes and delivers to Lender a Replacement Assignment (as
defined in the Assignment of Management Agreement).

                                       50

<PAGE>

                  Section 7.3 Replacement of Manager.

                  Lender shall have the right to require Borrower to replace the
Manager  with a Person  chosen by  Borrower  and  approved  by  Lender  upon the
occurrence of any one or more of the following events: (i) at any time following
the  occurrence of an Event of Default  and/or (ii) at any time that the Manager
has engaged in (x) gross negligence, (y) fraud or (z) willful misconduct.

                  VIII PERMITTED TRANSFERS

                  Section 8.1 Permitted Transfers of Interest in Borrower.

                  (a) Notwithstanding anything to the contrary contained in this
Agreement or in Section 7 of the Mortgage,  but subject to Section 8.1(b) below,
without the consent of Lender:

                  (i) up to an aggregate of 70% of the  membership  interests in
         Metropolitan  may be transferred upon not less than ten (10) days prior
         notice to Lender,  provided  that (i) each  transferee  is a  Qualified
         Transferee,  (ii) after giving effect to such  transfer,  the Operating
         Partnership  shall  continue  to control  the  day-to-day  and  overall
         management and operation of  Metropolitan  and  Metropolitan  Operating
         Partnership  and (iii) Lender shall promptly be provided with copies of
         all documents and instruments evidencing such transfer;

                  (ii) up to an aggregate of 70% of the membership  interests in
         the SPC  Member  may be  transferred  upon not less  than ten (10) days
         prior  notice  to  Lender,  provided  that  (i)  each  transferee  is a
         Qualified  Transferee,  (ii)  after  giving  effect  to such  transfer,
         Metropolitan  shall  continue  to control  the  day-to-day  and overall
         management  and  operation  of the SPC  Member and  Borrower  and (iii)
         Lender  shall  promptly be provided  with copies of all  documents  and
         instruments evidencing such transfer;

                  (iii) shares of common or preferred  stock of Reckson shall be
         freely transferable;

                  (iv)   limited   partnership   interests   in  the   Operating
         Partnership shall be freely transferable; and

                  (v) Crescent's preferred equity interest in Metropolitan shall
         be freely transferable.

                  (b) In addition to the foregoing, with respect to any transfer
otherwise  permitted by Section  8.1(a)  above,  if, after giving effect to such
transfer and all prior  transfers,  more than 49% in the aggregate of the direct
and indirect  interests in Borrower are owned by any Person that owned less than
a 49% direct or indirect interest in Borrower as of the Securitization Date, the
confirmation  in writing by the  applicable  Rating  Agencies  that the proposed
transfer  will not, in and of itself,  result in a downgrade,  qualification  or
withdrawal  of the  initial,  or, if higher,  then current  ratings  assigned in
connection  with  any  Securitization  shall  be a  condition  precedent  to the
implementation of such transfer.

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<PAGE>

                  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 as a whole loan, (ii) to sell  participation  interests in the
Loan to any entity other than to a publicly traded real estate  investment trust
of which the majority of its assets are office properties or (iii) to securitize
the Loan 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 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 Securitization, 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 the Manager and (B) provide  updated  budgets  relating to
         the Property (the "Updated Information"),  together, if customary, with
         appropriate  verification of the Updated Information through letters of
         auditors acceptable to Lender and the Rating Agencies;

                  (ii) (A) provide the Insolvency  Opinion and (B) cooperate (at
         de minimis cost and expense to Borrower)  with Lender in obtaining  any
         other  opinions  of counsel,  which may be relied  upon by Lender,  the
         Rating   Agencies   and   their   respective   counsel,    agents   and
         representatives,  as to fraudulent  conveyance,  true sale or any other
         opinion customary in Securitizations or required by the Rating Agencies
         with respect to the Property, Borrower and/or its Affiliates;

                  (iii)  provide  updated,   as  of  the  closing  date  of  the
         Securitization,   representations  and  warranties  made  in  the  Loan
         Documents and such  additional  representations  and  warranties as the
         Rating Agencies may require; and

                  (iv) execute  amendments to the Loan  Documents and Borrower's
         organizational  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  term  of  the  Loan  (including,   without  limitation,   the
         provisions of Article VIII above.

                  (c) If  requested by Lender,  Borrower  shall  cooperate  with
Lender in obtaining a FIRREA  appraisal of the Property in  connection  with any
Secondary Market Transaction,  provided that Borrower is not required to pay for
any such appraisal.

                                       52

<PAGE>

                  Section 9.2 Securitization Indemnification.

                  (a) Borrower  understands 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, a "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  agrees to 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 such  Disclosure  Documents  specified by
Lender  and that each such  Disclosure  Document,  as it  relates  to  Borrower,
Borrower  Affiliates,  the Property,  Manager and all other aspects of the Loan,
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 Dean Witter & 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,  each of its  directors  and each  Person who  controls  Morgan
Stanley 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  or  alleged
untrue statement of any material fact contained in such sections or arise out of
or are based upon the omission or alleged  omission to state  therein a material
fact  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 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, rent rolls,
appraisals,  market studies,  environmental site assessment reports and property
condition reports with respect to the Property. This indemnity agreement will be
in addition to any liability which Borrower may otherwise have.

                                       53

<PAGE>

                  (c) In  connection  with any filing  under or  pursuant to the
Exchange Act in connection with or relating to a Securitization,  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.

                  (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) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 9.2(b) or
(c) is for any reason held to be  unenforceable  as to an  indemnified  party in
respect of any  losses,  claims,  damages or  liabilities  (or action in respect
thereof)  referred  to therein  which would  otherwise  be  indemnifiable  under
Section  9.2(b) or (c), the  indemnifying  party shall  contribute to the amount
paid or payable by

                                       54

<PAGE>

the indemnified party as a result of such losses, claims, damages or liabilities
(or action in respect  thereof);  provided,  however,  that no Person  guilty of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) shall be entitled to  contribution  from any Person who was not
guilty  of such  fraudulent  misrepresentation.  In  determining  the  amount of
contribution to which the respective parties are entitled, the following factors
shall be considered:  (i) Morgan Stanley's and Borrower's relative knowledge and
access to information  concerning the matter with respect to which the claim was
asserted; (ii) the opportunity to correct and prevent any statement or omission;
and (iii) any other equitable  considerations  appropriate in the circumstances.
Lender and Borrower hereby agree that it would not be equitable if the amount of
such contribution were determined by pro rata or per capita allocation.

                  (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.

                  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 any portion of the Debt is not paid when due; provided,
         however,  that until the Securitization  Date has occurred,  failure to
         pay interest with respect to the Loan on any Monthly Payment Date shall
         not  constitute an Event of Default  unless such failure shall continue
         for two (2)  Business  Days after  written  notice to  Borrower of such
         failure;

                  (ii) if any of the  Taxes or Other  Charges  are not paid when
         due; provided, however, that it shall not be an Event of Default if (A)
         Borrower is  depositing  Tax Funds with Lender in  accordance  with the
         terms of this Agreement,  (B) such Tax Funds are available to Lender to
         make any  payment of Taxes  when due and (C)  Lender  fails to make any
         payment of Taxes when due;

                  (iii) if the Policies are not kept in full force and effect;

                  (iv) if Borrower or SPC Member  breaches or permits or suffers
         a breach of Section 3.1.24 hereof or Section 7 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 shall have been false or misleading  in any material  respect as
         of the date the representation or warranty was made;

                  (vi) if Borrower or SPC Member  shall make an  assignment  for
         the benefit of creditors;

                                       55

<PAGE>

                  (vii) if a receiver,  liquidator or trustee shall be appointed
         for Borrower or Metropolitan  or if Borrower or  Metropolitan  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 acquiesced in by, Borrower or Metropolitan,  or if any
         proceeding   for  the   dissolution   or  liquidation  of  Borrower  or
         Metropolitan   shall  be  instituted;   provided,   however,   if  such
         appointment,  adjudication,  petition or proceeding was involuntary and
         not consented to by Borrower or Metropolitan,  as applicable,  upon the
         same not being discharged, stayed or dismissed within thirty (30) days;

                  (viii) 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;

                  (ix) if any of the  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;

                  (x) 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 (ix) above, for seven (7) Business 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  nonmonetary  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 180 days; or

                  (xi) if there  shall be a default  under any of the other Loan
         Documents  beyond  any  applicable  cure  periods   contained  in  such
         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
advisable to protect and enforce its rights  against  Borrower and in and to all
or any portion of 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

                                       56

<PAGE>

the Loan Documents against Borrower and any portion of 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) Upon the occurrence 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,  Borrower  agrees that 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) With respect to Borrower and the Property, Lender may seek
satisfaction  out  of  the  Property  or  any  part  thereof,  in  its  absolute
discretion,  in respect of the Debt.  In  addition,  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 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

                                       57

<PAGE>

(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 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) days after  notice has been given to
Borrower by Lender of Lender's  intent to exercise  its rights under such power.
Except as may be  required  in  connection  with a  securitization  pursuant  to
Section 9.1 hereof,  (i)  Borrower  shall not be  obligated  to pay any costs or
expenses  incurred in connection with the preparation,  execution,  recording or
filing of the Severed Loan Documents,  and (ii) 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  after 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 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 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.

                                       58

<PAGE>

                  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
(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.

                  THIS  AGREEMENT  SHALL IN ALL  RESPECTS  BE  GOVERNED  BY, AND
CONSTRUED  IN  ACCORDANCE  WITH,  THE LAW OF THE  STATE OF NEW  YORK,  INCLUDING
SECTION 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT EXCLUDING,
TO THE EXTENT  PERMITTED  BY LAW,  ALL OTHER  CHOICE OF LAW AND  CONFLICT OF LAW
RULES. 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.  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.

                  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.

                                       59

<PAGE>

                  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.

                  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  three (3) days after the date such  Notice is mailed or on the date of
sending by telefax or  delivery by hand or the next  Business  Day if sent by an
overnight commercial courier addressed to the parties as follows:

<TABLE>
<CAPTION>

              <S>                    <C>
              If to Lender:          Morgan Stanley Mortgage Capital Inc.
                                     1585 Broadway - 38th Floor
                                     New York, New York 10036
                                     Attention:  James Flaum & Kevin Swartz
                                     Facsimile No. (212) 761-0524

              with a copy to:        Simpson Thacher & Bartlett
                                     425 Lexington Avenue
                                     New York, New York 10017
                                     Attention:  Gregory J. Ressa, Esq.
                                     Facsimile No. (212) 455-2502

              If to Borrower:        Reckson Associates Realty Corp.
                                     10 East 50th Street - 27th Floor
                                     New York, New York 10022
                                     Attention:  Philip M. Waterman III and Jason Barnett, Esq.
                                     Facsimile No. (212) 715-6535

              with a copy to:        Fried, Frank, Harris, Shriver & Jacobson
                                     One New York Plaza
                                     New York, New York 10004
                                     Attention:  Joshua Mermelstein, Esq.
                                     Facsimile No. (212) 859-4000
</TABLE>

                                       60

<PAGE>

                  Section 11.7 Trial by Jury.

                  BORROWER  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 IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE
AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE  ACCRUE.
LENDER IS HEREBY  AUTHORIZED TO FILE A COPY OF THIS  PARAGRAPH IN ANY PROCEEDING
AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY BORROWER.

                  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.

                  Except as otherwise  explicitly  set forth in this  Agreement,
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.  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.

                                       61

<PAGE>

                  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,
Borrower  agrees  that  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.  The parties hereto
agree  that any  action or  proceeding  to  determine  whether  Lender has acted
reasonably shall be determined by an action seeking declaratory judgment.

                  Section 11.13 Expenses; Indemnity.

                  (a) Borrower covenants and agrees to pay or, if Borrower fails
to pay, to reimburse Lender upon receipt of written 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 (as to third party  claims,  to the
extent  that  Borrower  has not  promptly  undertaken  to defend such claims and
diligently  prosecuted  such  defense  in a manner and with  counsel  reasonably
satisfactory  to  Lender)  or the  prosecuting  or  defending  of any  action or
proceeding  or other  litigation,  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

                                       62

<PAGE>

connection  with any  refinancing or  restructuring  of the credit  arrangements
provided  under this Agreement in the nature of a "workout" 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  from the  Lockbox
Account.

                  (b) Borrower shall indemnify,  defend and hold harmless Lender
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  Lender  in  connection   with  any
investigative,  administrative or judicial  proceeding  commenced or threatened,
whether or not Lender shall be designated a party thereto),  that may be imposed
on, incurred by, or asserted against Lender 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 Lender  hereunder  to the  extent  that such
Indemnified Liabilities arise from the gross negligence,  illegal acts, fraud or
willful  misconduct of Lender.  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 law
to the payment  and  satisfaction  of all  Indemnified  Liabilities  incurred by
Lender.

                  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 which is not an Affiliate of Lender 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;  provided,  however,  that an Affiliate of Lender
shall not be deemed to include any  transferee  of  Lender's  interest in and to
this Agreement and the other Loan Documents in connection with a Securitization.

                                       63

<PAGE>

                  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 nothing  contained in this Agreement or the other Loan
Documents  shall be deemed to confer upon anyone  other than Lender 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.

                  Except as required by law,  all news  releases,  publicity  or
advertising, in each case, initiated 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, not to be unreasonably  withheld or delayed. If Lender shall
fail to disapprove any written  request  regarding a news release,  publicity or
advertising  within three (3) Business Days of Lender's receipt of such request,
Lender  shall  be  conclusively  deemed  to have  approved  such  news  release,
publicity or advertising.

                  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,  or to a sale in  inverse  order of  alienation  in the  event of
foreclosure  of the Mortgage,  and agrees not to 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.

                                      64

<PAGE>

                  Section 11.19 Waiver of Counterclaim.

                  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.

                  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.  Lender 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.  Borrower hereby agrees to indemnify, defend and
hold Lender harmless from and against any and all claims, liabilities, 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 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,  (i)  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  shall be
sought against any of the members of Borrower or any direct or indirect partner,
shareholder,  member, manager, owner, officer,  director, trustee or employee in
or of Borrower (collectively, the "Exculpated Parties") or Borrower, except that
Lender may

                                       65

<PAGE>

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,  (ii) 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, agrees that
it shall not sue for, seek or demand any deficiency judgment against Borrower or
any 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 and (iii) none of the Exculpated  Parties shall have any personal
liability in any respect for the Loan or the  obligations of Borrower  contained
in the 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 or any guaranty
made in connection with the Loan (including,  without limitation,  the Guaranty)
or any of the rights and remedies of Lender  thereunder,  or be taken to prevent
recourse against any guarantor  (including,  without  limitation,  Metropolitan)
under  any  guaranty  made in  connection  with  the  Loan  (including,  without
limitation,  the  Guaranty);  (d)  impair  the right of  Lender  to  obtain  the
appointment  of a receiver;  (e) impair the  enforcement  of the  Assignment  of
Leases;  (f)  constitute  a  prohibition  against  Lender  to seek a  deficiency
judgment  against Borrower in order to fully realize the security granted by the
Mortgage or to commence any other appropriate  action or proceeding in order for
Lender to exercise its remedies against the Property; or (g) 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  attorneys'
fees and costs reasonably  incurred) arising out of or in connection with any of
the following:

                  (i) fraud or intentional  misrepresentation by Borrower or any
         guarantor in connection with the Loan;

                  (ii) the gross negligence or willful misconduct of Borrower;

                  (iii) the breach of any representation,  warranty, covenant or
         indemnification  provision  in the  Environmental  Indemnity  or in the
         Mortgage  concerning   environmental  laws,  hazardous  substances  and
         asbestos  and any  indemnification  of Lender with  respect  thereto in
         either document;

                  (iv) the removal or  disposal  of any portion of the  Property
         after an Event of Default  without  replacing  the same with an item or
         items of comparable value;

                  (v) the  misapplication  or  conversion by Borrower of (A) any
         insurance proceeds paid by reason of any loss, damage or destruction to
         the Property,  (B) any Awards or other  amounts  received in connection
         with the  Condemnation of all or a portion of the Property,  or (C) any
         Rents following an Event of Default;

                                       66

<PAGE>

                  (vi)  failure to pay charges for labor or  materials  or other
         charges that can create liens on any portion of the Property;

                  (vii) any  security  deposits,  advance  deposits or any other
         deposits collected with respect to the Property which are not delivered
         to Lender upon a foreclosure of the Property or action in lieu thereof,
         except  to the  extent  any such  security  deposits  were  applied  in
         accordance  with the terms and conditions of any of the Leases prior to
         the  occurrence  of the  Event  of  Default  that  gave  rise  to  such
         foreclosure or action in lieu thereof;

                  (viii)  Borrower's  indemnification  of  Lender  set  forth in
         Section 9.2 hereof;

                  (ix) failure to maintain Borrower's status as a single purpose
         entity; and

                  (x) failure to permit  on-site  inspections  of the  Property,
         failure to provide  financial  information  or failure to appoint a new
         property  manager upon the request of Lender after an Event of Default,
         each as required by, and in accordance  with,  the terms and provisions
         of, this Agreement and the Mortgage,  if such condition  shall continue
         for five (5) Business Days after notice thereof.

                  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:  (i) Borrower fails to obtain
Lender's prior written consent to any  subordinate  financing or other voluntary
lien  encumbering the Property;  or (ii) Borrower fails to obtain Lender's prior
written  consent to any assignment,  transfer,  or conveyance of the Property or
any interest therein as required by the Mortgage or this Agreement.

                  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,  including,  without  limitation,  the Letter
dated October 26, 1999 (as amended)  between  Borrower and Morgan  Stanley,  are
superseded by the terms of this Agreement and the other Loan Documents.

                                       67

<PAGE>

                  Section 11.24 Servicer.

                  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.

                  Section 11.25 Assignment to Successor Lender.

                  Lender  shall,  upon (i)  payment in full of the Debt and (ii)
the  written  request of  Borrower,  assign the  Mortgage  and the Note  without
recourse,  representation  or warranty of any kind to an assignee  designated by
Borrower;   provided,   however,  that  Borrower  shall  pay  all  third  party,
out-of-pocket  costs  or  expenses  incurred  by  Lender  (including  reasonable
attorney's fees of outside counsel) in connection with such assignment.

                                       68

<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:

                                 SECORE FINANCIAL CORPORATION, a
                                 Pennsylvania corporation

                                 By:
                                     --------------------------------
                                 Name:
                                 Title:

                                 BORROWER:

                                 1350 LLC, a Delaware limited liability company

                                 By:   1350 Mezzanine LLC, a Delaware limited
                                       liability company

                                       By:  Metropolitan Operating Partnership,
                                            L.P., a Delaware limited partnership

                                            By: Metropolitan Partners LLC, a
                                                Delaware limited liability
                                                company

                                                By:
                                                   -----------------------------
                                                   Name:
                                                   Title:

                                       69

<PAGE>

                                   SCHEDULE 1

                                  ANNUAL BUDGET

        Loan Year         Item    Estimated Cost    Total Annual Amount
        ---------         ----    --------------    -------------------

<PAGE>

                                   SCHEDULE 2

                           CAPITAL EXPENDITURES BUDGET

        Loan Year         Item    Estimated Cost    Total Annual Amount
        ---------         ----    --------------    -------------------

<PAGE>

                                   SCHEDULE 3

                                 NON-COMPLIANCE

                                      NONE

<PAGE>

                                   SCHEDULE 4

                                     LEASES

<PAGE>

                                   SCHEDULE 4A

                                DEFAULTED LEASES

<PAGE>

                                    EXHIBIT A

                          FORM OF FINANCIAL STATEMENTS

<PAGE>

                                    EXHIBIT B

                        FORM OF CASH MANAGEMENT AGREEMENT

<PAGE>

                                    EXHIBIT C

                              LETTER OF INSTRUCTION

                             ------------ ---, -----

[Tenants under Leases]

                  Re:      Lease dated ________ between _______________,
                           as Landlord, and _______________, as Tenant,
                           concerning premises known as ________________

Ladies and Gentlemen:
                  This  letter   shall   constitute   notice  to  you  that  the
undersigned  has  granted a security  interest  in the  captioned  lease and all
rents, additional rent and all other monetary obligations to landlord thereunder
(collectively,  "Rent")  in favor of  Secore  Financial  Corporation,  as lender
("Lender"),  to secure certain of the undersigned's  obligations to Lender.  The
undersigned hereby irrevocably instructs and authorizes you to disregard any and
all  previous  notices  sent to you in  connection  with Rent and  hereafter  to
deliver by wire transfer of immediately available funds all Rent as follows:

                           Account No. ______________
                           [Bank with Operating Account]
                           [Bank's Address]
                           Attention: _________________
                           ABA# ____________________
                  You hereby agree that you have no right of offset  against the
Rent and shall not  exercise or attempt to exercise  any such right  against the
Rent.

<PAGE>

                  The  instructions set forth herein are irrevocable and are not
subject to modification in any manner, except that Secore Financial Corporation,
under  that  certain  Consolidated,  Amended  and  Restated  Mortgage,  Security
Agreement and Fixture Filing,  dated as of the date hereof, from the undersigned
in favor of Lender,  or any successor  lender so  identified  by Lender,  may by
written notice to you rescind the instructions contained herein.

                                   Sincerely,
                                   1350 LLC
                                   By:
                                       -----------------------------
                                   Name:
                                   Title:

                  ACKNOWLEDGMENT AND AGREEMENT
                  The undersigned  acknowledges  notice of the security interest
of Lender and hereby confirms that the undersigned has received no notice of any
other pledge or  assignment  of the Rent and will honor the above  instructions.
All payments made by the  undersigned to Lender shall be made  irrespective  of,
and without deduction for, any counterclaim, defense, recoupment or setoff.

                                   [Tenant]
                                   By:
                                       -----------------------------
                                   Name:
                                   Title:

                  Dated as of: __________ ___, _____EXHIBIT 10.51

                      AGREEMENT OF SPREADER, CONSOLIDATION

                               AND MODIFICATION OF

                         MORTGAGE AND SECURITY AGREEMENT
                               [Fee and Leasehold]

                (with UCC Financing Statement for Fixture Filing)

             METROPOLITAN 810 7TH AVE, LLC AND 100 WALL COMPANY LLC,
                                   Mortgagor,

                               having an office at
                         10 East 50th Street--27th Floor
                            New York, New York 10022

                                       to

                        MONUMENTAL LIFE INSURANCE COMPANY
                             a Maryland corporation,
                                   Mortgagee,

                                having an address
                       c/o AEGON USA Realty Advisors, Inc.
                            4333 Edgewood Road, N.E.
                          Cedar Rapids, Iowa 52499-5443

<PAGE>

                      AGREEMENT OF SPREADER, CONSOLIDATION

                               AND MODIFICATION OF

                         MORTGAGE AND SECURITY AGREEMENT

                               [FEE AND LEASEHOLD]
                (WITH UCC FINANCING STATEMENT FOR FIXTURE FILING)

THIS  AGREEMENT  OF SPREADER,  CONSOLIDATION  AND  MODIFICATION  OF MORTGAGE AND
SECURITY  AGREEMENT  is made and  given  as of the  ________  day of July,  1999
between  METROPOLITAN 810 7TH AVE, LLC, a limited  liability  company  organized
under  Delaware  law  ("810"),  and 100 Wall  Company  LLC, a limited  liability
company  organized under Delaware law ("100"),  each of whose principal place of
business  is  10  East  50th  Street--27th  Floor,  New  York,  New  York  10022
(collectively,  810 and 100 are hereinafter referred to as the "Mortgagor"), and
MONUMENTAL LIFE INSURANCE COMPANY,  a Maryland  corporation having an office c/o
AEGON USA Realty Advisors,  Inc., 4333 Edgewood Road,  N.E., Cedar Rapids,  Iowa
52499-5223  ("Mortgagee").  The  definitions of  capitalized  terms used in this
Mortgage may be found either in Section 2 below, or through the cross-references
provided in that Section.

RECITALS

         WHEREAS,   Mortgagor  is  the  fee  owner  of  the  Real  Property  (as
         hereinafter defined) and Mortgagee is, by assignment or otherwise,  the
         owner and  holder  of  certain  mortgages  covering  the fee  estate of
         Mortgagor  in the Real  Property,  as more  particularly  described  in
         Exhibit  A  annexed  hereto  and   incorporated   herein  by  reference
         (hereinafter referred to as the "Existing Mortgages") and of the notes,
         bonds or other obligations secured thereby (hereinafter  referred to as
         the "Existing Notes");

         WHEREAS,  there is now owing on the  Existing  Notes  and the  Existing
         Mortgages the unpaid principal sum of $125,000,000.00 and interest; and

         WHEREAS,  Mortgagor and Mortgagee have agreed in the manner hereinafter
         set forth (a) to spread the Existing Mortgages and the respective liens
         thereof over those  portions of the Property (as  hereinafter  defined)
         not already  covered  thereby,  (b) to  consolidate  and coordinate the
         respective liens of the Existing  Mortgages,  as spread, (c) to combine
         and  coordinate  the Existing  Notes and the principal  sums  evidenced
         thereby,  and (d) to modify and  restate the time and manner of payment
         and the terms and  provisions  of the  Existing  Notes and the Existing
         Mortgages;

         WHEREAS,  it is a material  inducement  to Mortgagee  that  Mortgagor's
         obligations to pay the  Indebtedness (as herein defined) and to perform

<PAGE>

         and  observe all of the  provisions  of the Loan  Documents  (as herein
         defined) be secured by, among other things, the Existing Mortgages,  as
         spread, consolidated, modified and restated by this Mortgage.

         WHEREAS, Mortgagor and Mortgagee intend these recitals to be a material
         part of this Agreement.

         NOW THEREFORE,  in pursuance of said agreement and in  consideration of
         One Dollar  ($1.00) and other  valuable  consideration  the receipt and
         sufficiency of which are hereby acknowledges,  the parties hereto agree
         as follows:

         A. The Existing  Mortgages and the respective  liens thereof are hereby
         spread over those portions of the Property (as hereinafter defined) not
         already  covered  thereby,  which  Property  includes all of the right,
         title  interest  and  estate of  Mortgagor,  now  owned,  or  hereafter
         acquired,  in and to the  following  property,  rights,  interests  and
         estates  (such  property,  rights,  interests  and estates being herein
         before and hereinafter collectively referred to as the "Property"): all
         of  Mortgagor's  existing  and  after  acquired  interests  in the Real
         Property,  the Leases, the Rents, the Assigned  Accounts,  the Assigned
         Rights,  the  Condemnation  Proceeds,  the  Insurance  Proceeds and the
         Bankruptcy Rights.

         B.  The  liens of the  Existing  Mortgages  as so  spread,  are  hereby
         consolidated  and  coordinated  so that together  they shall  hereafter
         constitute  in law  but one  mortgage,  a  single  lien,  covering  the
         Property and securing the repayment of the Indebtedness, any increases,
         modifications,  renewals or  extensions  of the  Indebtedness,  and any
         substitutions  for the  Indebtedness,  as well  as the  performance  of
         Mortgagor's other  Obligations,  and in consideration of the sum of ten
         dollars  ($10.00)  and other  valuable  consideration,  the receipt and
         sufficiency of which are  acknowledged,  Mortgagor  mortgages,  grants,
         bargains, sells, warrants, conveys, alienates,  releases, assigns, sets
         over and  confirms  to  Mortgagee  and to its  successors  and  assigns
         forever,  with power of sale,  all of  Mortgagor's  existing  and after
         acquired  interests in the Real Property,  the Leases,  the Rents,  the
         Assigned Accounts,  the Assigned Rights, the Condemnation Proceeds, the
         Insurance Proceeds and the Bankruptcy Rights and the proceeds of all of
         the  foregoing,  and grants to  Mortgagee  a security  interest  in the
         Personal Property and the proceeds of all of the foregoing.

         C. The Existing Mortgages,  as so spread , consolidated and coordinated
         and as modified,  amended, restated, ratified and confirmed pursuant to
         the provisions of this  Agreement  shall  hereinafter  be  collectively
         referred to as the "Mortgage".

         Mortgagor  shall promptly cause this Agreement to be filed,  registered
         or recorded in such manner and in such places as may be required by any
         present or future  law in order to publish  notice and fully to protect
         the lien

                                       2
<PAGE>

         of the  Mortgage  upon the  Property.  Mortgagor  will pay all  filing,
         registration  and  recording  fees,  and all  expenses  incident to the
         preparation,  execution and acknowledgement of this Agreement,  and all
         Federal,   state,   county  and  municipal  taxes,   duties,   imposts,
         assessments  and  charges  arising  out of or in  connection  with  the
         filing,  registration,   recording,  execution  and  delivery  of  this
         Agreement  and Mortgagor  shall hold  harmless and indemnify  Mortgagee
         against any liability  incurred by reason of the  imposition of any tax
         on the  issuance,  making,  filing,  registration  or recording of this
         Agreement.

         Mortgagor represents,  warrants and covenants that there are no present
         offsets,  counterclaims  or  defenses  against the  Indebtedness,  this
         Agreement,  the  Mortgage  or the  Note  and  that  Mortgagor  (and the
         undersigned  representative  of  Mortgagor,  if any)  has  full  power,
         authority  and legal right to execute  this  Agreement  and to keep and
         observe all of the terms of this  Agreement on  Mortgagor's  part to be
         observed or performed.

         This  Agreement  may not be modified,  amended,  changed or  terminated
         orally, but only by an agreement in writing signed by the party against
         whom  the  enforcement  of  any  modification,   amendment,  change  or
         termination is sought.

         This  Agreement  shall  be  binding  upon an inure  to the  benefit  of
         Mortgagor and Mortgagee and their respective successors and assigns.

         This Agreement may be executed in any number of duplicate originals and
         each such duplicate  original shall be deemed to constitute but one and
         the same instrument.

         If any term, covenant,  or condition of this Agreement shall be held to
         be invalid,  illegal or  unenforceable  in any respect,  this Agreement
         shall be construed without such provision.

         This  Agreement  shall be governed by and construed in accordance  with
         the laws of the State of New York  without  regard to any choice of law
         principles which, but for this provision, would require the application
         of the law of another jurisdiction.

         D. The terms,  covenants and  provisions  of the Existing  Mortgages as
         herein modified, amended and restated are hereby ratified and confirmed
         in all respects by Mortgagor and the terms, covenants and provisions of
         the  Existing  Mortgages  are  modified,  amended and  restated so that
         henceforth, the terms, covenants and provisions of this Agreement shall
         supercede the terms, covenants and provisions of the Existing Mortgages
         and the terms, covenants and provisions of the Existing Mortgages shall
         read the same as the following numbered Articles:

                                       3
<PAGE>

1.       DEFINED TERMS

         "Absolute  Assignment  of Leases  and  Rents"  means the Loan  Document
         bearing this heading.

         "Appurtenant  Easements"  means, to the extent of Mortgagor's  existing
         and  future   interests,   the  declarations,   easements,   covenants,
         restrictions and agreements,  if any, currently appurtenant to the Real
         Property.

         "Assigned  Accounts"  means all rights of  Mortgagor  to the present or
         future payment of money, if the amounts to be paid relate to the use or
         operation  of the  Real  Property,  from any  construction  on the Real
         Property,  or from the deposit of any such amounts with banks,  savings
         and loan institutions, brokerage firms or other financial institutions,
         title insurance  companies or agencies,  or courts,  including property
         management  accounts  (whether  held in the name of  Mortgagor  or of a
         property manager),  accounts receivable,  reserves,  deferred payments,
         escrow funds,  disputed Rents,  refunds  (including tax,  insurance and
         utility rebates,  credits or refunds),  earnest money or sales contract
         deposits,   chattel  paper,   securities   entitlements,   instruments,
         documents,  notes,  drafts and letters of credit (other than letters of
         credit in favor of Mortgagee).

         "Assigned  Rights" means all of Mortgagor's  rights (whether  presently
         existing  or arising in the  future)  under all  contracts,  claims and
         licenses  that relate to the Real  Property  and may benefit its owner,
         including air rights,  mineral  rights,  water rights,  claims  against
         third  parties for damages to the Property,  franchises,  construction,
         roof and equipment  guarantees and  warranties,  building  licenses and
         permits, development permits, licenses and applications (whether or not
         yet approved or issued) management contracts, service contracts, leases
         of Fixtures  or of Personal  Property,  and all of  Mortgagor's  right,
         title and  interest  (whether  presently  existing  or  arising  in the
         future) in and to unearned  insurance  premiums,  any greater estate in
         the Real Property,  trade names, property management files, trademarks,
         trade styles, service marks, copyrights,  accounting books and records,
         site plans, surveys,  blueprints,  and construction drawings, plans and
         specifications,  and the  work  product  of  architects,  environmental
         consultants,  property tax consultants,  engineers, and any other third
         party contractors whose services benefit the Real Property.

         "Bankruptcy Rights" means all of Mortgagor's rights and remedies at any
         time arising under or pursuant toss.365(h) of the U.S. Bankruptcy Code,
         11 U.S.C.ss.365(h)  including,  without limitation,  all of Mortgagor's
         rights to remain in possession of the Property thereunder.

         "Business  Day" means any day when state and federal banks are open for
         business in Cedar Rapids, Iowa.

                                       4
<PAGE>

         "Carveout  Guaranty and  Indemnity"  means that certain  "Guaranty  and
         Indemnity  Agreement" entered into by the Carveout Obligors on the date
         of this Mortgage.

         "Carveout Obligations" means those obligations described in Section 19.

         "Carveout Obligors" means Metropolitan  Partners,  LLC and Metropolitan
         Operating  Partnership,  L.P..  Any other person who expressly  assumes
         liability for the Carveout  Obligations  in writing  during the term of
         the Loan  shall  become  a  "Carveout  Obligor"  for  purposes  of this
         Mortgage.

         "Carveouts"  means those matters from which  Carveout  Obligations  may
         arise, which are described in Section 19.

         "Code" means the Uniform Commercial Code, as in effect in New York.

         "Condemnation  Proceeds"  means  all money or other  property  that has
         been,  or is in the  future,  awarded  or agreed to be paid or given in
         connection  with any taking by eminent domain of all or any part of the
         Real  Property  (including a taking  through the vacation of any street
         dedication  or  through  a change  of grade of such a  street),  either
         permanent or temporary,  or in connection  with any purchase in lieu of
         such a taking, or as a part of any related settlement.

         "Default" means any of the acts, omissions,  or circumstances specified
         in Section 8 below.

         "Default  Rate" means the rate of interest  specified  as the  "Default
         Rate" in the Note.

         "Designated  Amount" means, with respect to the Real Property described
         on Exhibit B-1  $87,209,000.00,  and with respect to the Real  Property
         described on Exhibit B-2, $37,791,000.00.

         "Environmental  Indemnity  Agreement"  means the Loan Document  bearing
         that heading.

         "Environmental  Laws"  means all  present  and future  laws,  statutes,
         ordinances, rules, regulations,  orders, guidelines,  rulings, decrees,
         notices and determinations of any Governmental Authority pertaining to:
         (A) the protection of health  against  environmental  hazards;  (B) the
         protection of the environment from contamination by any substance which
         may  have  any  adverse  health  effect  on  humans,  livestock,  fish,
         wildlife,  or plant  life,  or which  may  disturb  an  ecosystem;  (C)
         underground   storage  tank   regulation   or  removal;   (D)  wildlife
         conservation;  (E) protection or regulation of natural  resources;  (F)
         soil  conservation;  (G)  wetlands;  (H)  management,   regulation  and
         disposal of solid and hazardous wastes; (I) radioactive materials;  (J)
         biologically  hazardous  materials;  (K)  indoor air  quality;  (L) the
         manufacture,    possession,   presence,   use,   generation,

                                       5
<PAGE>

         storage,  transportation,   treatment,  release,  emission,  discharge,
         disposal,  abatement,  cleanup, removal, remediation or handling of any
         Hazardous Substances. "Environmental Laws" include, without limitation,
         the Comprehensive Environmental Response,  Compensation,  and Liability
         Act, as amended by the Superfund  Amendments and Reauthorization Act of
         1986, 42 U.S.C.ss.9601 et seq., the Resource  Conservation and Recovery
         Act, 42 U.S.C.ss.6901 et seq., the Federal Water Pollution Control Act,
         as amended by the Clean Water Act, 33  U.S.C.ss.1251 et seq., the Clean
         Air Act, 42 U.S.C.ss.7401 et seq., the Toxic Substances Control Act, 15
         U.S.C.ss.2601 et seq., all similar state statutes and local ordinances,
         and all regulations  promulgated  under any of those statutes,  and all
         administrative and judicial actions respecting such legislation, all as
         amended from time to time.

         "ESA"  means the  written  environmental  site  assessment  of the Real
         Property obtained under the terms of the Commitment.

         "Escrow  Expenses"  means those  expenses  in respect of real  property
         taxes,  general and special  assessments,  and ground rent  (including,
         without  limitation,  rent  payable  pursuant  to the Air Rights  Lease
         (after  deduction  of any rent  payments  due for the  period  from the
         Mortgagor's   subtenant  of  such  Air  Rights  Lease   pursuant  to  a
         corresponding  sublease thereof)) that Mortgagee elects to pay directly
         from the Escrow Fund using monies accumulated through the collection of
         Monthly Escrow Payments.

         "Escrow  Fund" means the  accounting  entry  maintained on the books of
         Mortgagee as funds  available for the payment of Escrow  Expenses under
         the terms of this Mortgage.

         "Financing  Statements"  means the Uniform  Commercial  Code  financing
         statements  filed  to  perfect  the  security  interests  securing  the
         Indebtedness, as amended or extended from time to time.

         "Fixtures"  means,  to the extent of  Mortgagor's  existing  and future
         interests,  all  materials,  supplies,  equipment,  apparatus and other
         items  now or  hereafter  attached  to or  installed  on the  Land  and
         Improvements  in a manner that causes them to become fixtures under the
         law of New York,  including  all  built-in  or  attached  furniture  or
         appliances,   elevators,   escalators,  heating,  ventilating  and  air
         conditioning  system components,  emergency  electrical  generators and
         related fuel storage or delivery  systems,  septic  system  components,
         storm   windows,   doors,   electrical   equipment,   plumbing,   water
         conditioning,  lighting,  cleaning,  snow removal,  lawn,  landscaping,
         irrigation,  security, incinerating,  firefighting,  sprinkler or other
         fire  safety  equipment,  bridge  cranes or other  installed  materials
         handling  equipment,   satellite  dishes  or  other   telecommunication
         equipment,  built-in  video  conferencing  equipment,  sound systems or
         other audiovisual  equipment,  cable television  distribution systems ,
         and  artwork  and  artistic  or  decorative  installations  at the Real
         Property  on the

                                       6
<PAGE>

         date hereof and any such items  which are  hereafter  installed  at the
         Real  Property in such manner as to  constitute  a fixture  pursuant to
         applicable  law.  Fixtures  do  not  include  trade  fixtures,   office
         furniture and office equipment owned by tenants or such items which are
         neither  necessary  nor  desirable  for the  operation  of the Land and
         Improvements as income-producing commercial real estate.

         "Governmental  Authority  " means any  political  entity with the legal
         authority to impose any  requirement  on the  Property,  including  the
         governments  of the  United  States,  the State of New  York,  New York
         County, the City of New York, and any other entity with jurisdiction to
         decide,   regulate,  or  affect  the  ownership,   construction,   use,
         occupancy,  possession,  operation,  maintenance,  alteration,  repair,
         demolition  or  reconstruction  of any  portion  or element of the Real
         Property.

         "Hazardous  Substance"  means, with respect to the Property or any part
         thereof,  any  substance  the  release of or the  exposure  to which is
         prohibited,  limited or  regulated by any  Environmental  Law, or which
         poses a hazard to human  health  because  of its  toxicity,  including,
         without  limitation:  (A) any "oil," as defined  by the  Federal  Water
         Pollution Control Act and regulations promulgated thereunder (including
         crude  oil or any  fraction  of  crude  oil)  and (B)  any  radioactive
         substance. However, the term "Hazardous Substance" includes neither (A)
         a substance used in the cleaning and  maintenance of the Real Property,
         if the quantity and manner of its use are  customary,  prudent,  and do
         not violate  applicable law, nor (B) automotive motor oil in immaterial
         quantities,  if leaked  from  vehicles  in the  ordinary  course of the
         operation  of the Real  Property  and  cleaned  up in  accordance  with
         reasonable property management procedures and in a manner that violates
         no applicable law.

         "Impositions"  means all real and personal  property taxes;  general or
         special assessments;  ground rent (including,  without limitation, rent
         payable  pursuant to the Air Rights Leases);  water,  sewer,  and vault
         charges;  common area charges;  owners'  association dues or fees; fees
         for any easement,  license or agreement  maintained  for the benefit of
         the Property;  and any and all other taxes,  levies, user fees, claims,
         charges and  assessments  whatsoever  that at any time may be assessed,
         levied or imposed on the Property or upon its ownership, use, occupancy
         or  enjoyment,  and  any  related  costs,  interest  or  penalties.  In
         addition,  "Impositions"  include all  documentary,  stamp or recording
         taxes or  intangible  personal  property  taxes  that may become due in
         connection  with the  Indebtedness,  or that are  imposed on any of the
         Loan Documents.

         "Improvements"  means, to the extent of Mortgagor's existing and future
         interest,  all buildings and improvements of any kind erected or placed
         on the Land now or in the future, including the Fixtures, together with
         all   appurtenant    rights,    privileges,    easements,    tenements,
         hereditaments, titles, reversions, remainders and other interests.

                                       7
<PAGE>

         "Indebtedness"  means all sums that are owed or become due  pursuant to
         the  terms  of the  Note,  this  Mortgage,  or any  of the  other  Loan
         Documents  or any other  writing by or between  the  Mortgagor  and the
         Mortgagee relating to the Loan, including scheduled principal payments,
         scheduled interest payments, default interest, late charges, prepayment
         premiums,   accelerated  or  matured  principal   balances,   advances,
         collection costs (including  reasonable  attorneys'  fees),  reasonable
         attorneys'  fees and costs in enforcing  or  protecting  the Note,  the
         Mortgage, or any of the other Loan Documents in any probate, bankruptcy
         or  other  proceeding,  receivership  costs  and  all  other  financial
         obligations  of  Mortgagor   incurred  in  connection   with  the  Loan
         transaction  and  owed to  Lender  pursuant  to the  terms  of the Loan
         Documents  or  any  other  writing  by or  between  the  Mortgagor  and
         Mortgagee relating to the Loan, except for sums that are owed or become
         due, or any particular person's  liabilities or obligations,  under any
         Loan  Document  which  expressly   states  that  it  or  such  person's
         liabilities are unsecured by this Mortgage.

         "Insurance  Premiums"  means all premiums or other charges  required to
         maintain in force any and all  insurance  policies  that this  Mortgage
         requires that Mortgagor maintain.

         "Insurance  Proceeds"  means  all  proceeds  of  all  insurance  now or
         hereafter  carried  by or  payable  to  Mortgagor  with  respect to the
         Property,  or the  interruption  of rents or  income  derived  from the
         Property,  all unearned  insurance  premiums and all related  claims or
         demands.

         "Key  Lease"  means  any Lease of a portion  of the  Improvements  that
         covers more than 20% of the net leasable  area of the  Improvements  or
         generates  more  than  20% of  the  gross  rental  income  of the  Real
         Property,  together  with any  future  "Key  Leases"  as defined in the
         Absolute Assignment of Leases and Rents.

         "Land" means those certain tracts of land located in New York City, New
         York,  which are described on the attached Exhibit B, together with all
         appurtenances,  including all Mortgagor's  right, title and interest to
         and in the air  space  above  the  Land  and  all  alley,  party  wall,
         drainage,  sewer, mineral,  water, oil and gas, vault and other rights,
         estates,   titles,   interests,   privileges,   easements,   tenements,
         hereditaments,  titles,  royalties,  reversions,  remainders  and other
         interests.

         "Leases"   means  all   leases,   subleases,   licenses,   concessions,
         extensions, renewals and other agreements (whether written or oral, and
         whether  presently  effective  or made  in the  future)  through  which
         Mortgagor  grants any  possessory  interest  in and to, or any right to
         occupy or use,  all or any part of the Real  Property,  and any related
         guaranties.

         "Legal  Control" means the control  exercised by a general partner of a
         limited  partnership,  provided  the general  partner is not  removable
         except

                                       8
<PAGE>

         for cause, by the sole managing member of a limited liability  company,
         or by the holder of the majority of the common stock of a corporation.

         Legal  Requirements"  means all  laws,  statutes,  rules,  regulations,
         ordinances,  judicial  decisions,  administrative  decisions,  building
         permits,  development  permits,  certificates  of  occupancy,  or other
         requirements of any Governmental Authority.

         "Loan  Documents"  means all  documents  now or  hereafter  executed by
         Borrower and/or its affiliates,  or any Carveout Obligor or Obligor, or
         any agent of Borrower,  including any property manager,  which: creates
         or evidences the  indebtedness  and/or any sums due under the Note, the
         Mortgage,  the Absolute Assignment of Leases and Rents  ("Assignment"),
         the Agreement  Regarding  Letter of Credit or any indemnity or guaranty
         relating  to the  Loan;  secures  the  Note  and/or  any  sums  payable
         thereunder or in respect of the Loan or the  obligations of Borrower or
         any Carveout  Obligor or Obligor  pursuant to the Loan,  in whole or in
         part;  creates or evidences any guaranty or indemnification in favor of
         Lender in connection with the Loan;  creates or evidences any agreement
         between  Borrower,  any  Carveout  Obligor  or any  Obligor  and Lender
         relating to the Loan or the Real Property or any portion  thereof;  all
         other documents executed by any such party(ies) and delivered to Lender
         pursuant to the terms of the Note, the Mortgage,  the  Assignment,  the
         Post Closing Agreement, or the Agreement Regarding Letter of Credit; or
         any indemnity or guaranty relating to the Loan; and all  modifications,
         extensions, renewals or replacements of the foregoing.

         "Monthly  Escrow  Payment"  means  the  sum of the  Monthly  Imposition
         Requirement and the Monthly Reserve Requirement.

         "Monthly Imposition Requirement" means one-twelfth of the annual amount
         that Mortgagee reasonably estimates (based on available historical data
         and,  if future  Escrow  Expenses  are as yet  undeterminable,  on a 5%
         annual inflation  factor) will be required to permit the timely payment
         by Mortgagee of those Escrow Expenses that Mortgagee elects,  from time
         to time, to pay from the Escrow Fund.

         "Monthly  Reserve  Requirement"  means the monthly payment amount which
         Mortgagee estimates will, over the subsequent twelve months,  result in
         the  accumulation  of a surplus in the Escrow Fund equal to the Monthly
         Imposition Requirement.

         "Net Worth  Requirement" means the least of (i) the aggregate net worth
         of the Carveout  Obligors at the time of origination of the Loan,  (ii)
         the principal  balance of the Loan at the time of  determination of the
         Net  Worth  Requirement,  and  (iii)  the  aggregate  net  worth of the
         Carveout  Obligors  immediately  before the  occurrence  of the Default
         which  is  the  occasion  for  the   determination  of  the  Net  Worth
         Requirement.

                                       9
<PAGE>

         "Note" means the consolidated,  amended and restated secured promissory
         note  made by  Mortgagor  today to  evidence  the  Indebtedness  in the
         original  principal  amount  of  $125,000,000.00,   together  with  all
         extensions, renewals and modifications.

         "Notice"  means a notice given in  accordance  with the  provisions  of
         Subsection 22.12.

         "Obligations"  means all of the  obligations  required to be  performed
         under the  terms and  conditions  of any of the Loan  Documents  by any
         Obligor,  except  for  obligations  that  are  expressly  stated  to be
         unsecured under the terms of another Loan Document.

         "Obligor" means Mortgagor,  any Carveout Obligor,  or any other natural
         person,  trust or business  organization that is expressly liable under
         the Loan Documents for the payment of any portion of the  Indebtedness,
         or the performance of any other obligation, under any circumstances. As
         of the date hereof,  there are no Obligors other than Mortgagor and the
         Carveout Obligors.

         "Permitted Encumbrances" means the encumbrances or other matters listed
         on Exhibit C.

         "Permitted Transfer" means a transfer specifically described in Section
         12 as permitted.

         "Personal  Property" means, to the full extent of Mortgagor's  existing
         and future interests therein, (A) all materials,  appliances, equipment
         or items located at the Real Property now or in the future and that may
         be incorporated in the Real Property through construction,  attachment,
         or  installation,  and that are used,  or are capable of being used, in
         the operation of the Real Property as commercial real estate, including
         (i)  appliances,  equipment  or items  required  under  any lease to be
         provided by Mortgagor to any tenant,  (ii)  materials or equipment  for
         use in the maintenance,  alteration,  landscaping or repair of the Real
         Property,  including  snow  removal,  lawn,  landscaping,   irrigation,
         security,   incineration,  and  hazardous  waste  storage,  monitoring,
         testing,   containment  or  abatement  supplies  and  equipment,  (iii)
         electrical  lights and  fixtures  (whether or not  permanently  wired),
         backup generators and related fuel storage and delivery  systems,  (iv)
         rugs, carpeting, office furnishings, decorations, window treatments and
         equipment located in any on-site leasing office,  located in any lobby,
         hall or other common area,  or used in connection  with any  "executive
         suites" operation,  (v) vehicles used to transport  prospective tenants
         or to  maintain  or  operate  the Real  Property,  (vi)  components  of
         heating,  ventilation  and air  conditioning  systems  and air  quality
         testing  equipment,  (vii)  spare  or  detached  parts  for  elevators,
         escalators  or other  mechanical  systems,  (viii) all site or building
         plans and specifications,  construction  records,  and architectural or
         engineering  drawings  relating  to the Real  Property,  (ix)

                                       10
<PAGE>

         sewer or  septic  system  components,  (x)  water  wells,  whether  for
         purposes  of water  supply or  groundwater  testing or  sampling,  (xi)
         components   of  plumbing  and  water   conditioning   systems,   (xii)
         firefighting,  sprinkler or other fire safety equipment, (xiii) central
         telephone    switches,    antennae,    satellite    dishes   or   other
         telecommunication  equipment,  and (xiv) video conferencing  equipment,
         audio equipment and cable television  distribution systems; and (B) the
         Assigned Rights, the Assigned Accounts,  the Condemnation Proceeds, and
         the  Insurance  Proceeds,  to the extent  that they  comprise  personal
         property subject to the Code.

         "Property" means the Real Property,  the Personal Property, the Leases,
         the Rents, the Assigned Rights, the Assigned Accounts, the Condemnation
         Proceeds and the Insurance Proceeds.

         "Real Property" means the Land, the Improvements, the Fixtures, and all
         of Mortgagor's  right,  title and interest to all  appurtenant  rights,
         privileges,  tenements,  hereditaments,  easements,  or other interests
         that run with the Land, including any Appurtenant  Easements,  benefits
         of  railroad  sidings,  drainage  rights,  sewer  rights  and rights of
         ingress and egress,  and all of Mortgagor's  right,  title and interest
         pursuant  to any ground  leases or lease of air  rights or  development
         rights relating to or benefiting the Land, the Improvements or the use,
         maintenance or operation thereof, including,  without limitation, those
         certain  leases  identified on Exhibit F annexed hereto and made a part
         hereof (such  leases,  as the same may be amended,  renewed,  extended,
         supplemented   and/or   modified,   each  an  "Air  Rights  Lease"  and
         collectively referred to herein as the "Air Rights Leases"),  including
         , without  limitation,  all any and all reversions or remainders in and
         to  the  Mortgagor's  interest  in  the  premises  so  leased  and  all
         extensions  modifications,  replacements,  and  renewals  thereof,  the
         privileges and rights of Mortgagor  under the Air Rights Leases and all
         credits,  deposits,  and options (including any rights of first refusal
         or options to purchase or renew) set forth in the Air Rights Leases.

         "Rents" means all rents, income, receipts, issues and profits and other
         benefits  paid or payable for using,  leasing,  licensing,  possessing,
         operating from or in, residing in, selling, mining, extracting minerals
         from,  or  otherwise  enjoying  the Real  Property,  whether  presently
         existing  or  arising  in the  future,  to which  Mortgagor  may now or
         hereafter  become entitled or may demand or claim,  including  security
         deposits,  amounts  drawn  under  letters  of  credit  securing  tenant
         obligations,   minimum  rents,   additional  rents,  parking  revenues,
         deficiency rents,  termination  payments,  space contraction  payments,
         liquidated damages following default under a Lease, premiums payable by
         tenants upon their exercise of cancellation  privileges,  proceeds from
         lease  guarantees,  proceeds  payable  under any  policy  of  insurance
         covering  loss  of  rents  resulting  from  untenantability  caused  by
         destruction  or damage to the Real  Property,  all rights and claims of
         any kind which  Mortgagor  has or may in the future  have  against  the
         tenants under the Leases, lease guarantors,  or any subtenants or other

                                       11
<PAGE>

         occupants  of the Real  Property,  all proceeds of any sale of the Real
         Property in violation of the Loan  Documents,  any future award granted
         Mortgagor  in  any  court  proceeding   involving  any  tenant  in  any
         bankruptcy,  insolvency, or reorganization  proceedings in any state or
         federal  court,  and any and all payments made by any tenant in lieu of
         rent.

2.       TITLE

         Mortgagor  represents  to and  covenants  with  Mortgagee  and with its
         successors  and assigns  that, at the point in time of the grant of the
         lien  created by this  Mortgage,  Mortgagor  is well seized of good and
         indefeasible  estate  to the  Real  Property,  in fee  simple  absolute
         (except with  respect to the interest of Mortgagor  pursuant to the Air
         Rights Leases, in which Mortgagor has a leasehold interest), subject to
         no lien or  encumbrance  except  the  Permitted  Encumbrances.  The Air
         Rights Leases are in full force and effect,  and, to the best knowledge
         of Mortgagor,  there are no defaults under the Air Rights Leases and no
         event has occurred  thereunder  which,  after the giving of notice,  or
         passage of time,  or both,  would  constitute  a default  under the Air
         Rights  Leases.  Mortgagor  has  good  and  merchantable  title  to the
         Personal  Property,  and has the  incontestable  right to grant a first
         priority security interest in the Personal Property, free of any rights
         of lessors or of sellers  under  conditional  sales  contracts or other
         financing  arrangements.  Mortgagor  warrants  this estate and title to
         Mortgagee and to its successors and assigns forever, against all lawful
         claims and demands of all persons.  Mortgagor shall maintain  mortgagee
         title insurance from a solvent  carrier,  covering the Real Property in
         an  amount  at least  equal to the  amount  of the  Indebtedness.  This
         Mortgage is and shall remain a valid and enforceable  first lien on the
         Real Property, and if the validity or enforceability of this first lien
         is attacked or called into  question,  Mortgagor  shall  diligently and
         continuously defend it through appropriate proceedings.  Should it fail
         to do so,  Mortgagee may at Mortgagor's  expense take all necessary and
         proper  action,  including the  engagement  and  compensation  of legal
         counsel,  the prosecution or defense of litigation,  and the compromise
         or discharge of claims.  Mortgagor  shall  defend,  indemnify  and hold
         Mortgagee  harmless in any suit or  proceeding  brought to challenge or
         attack the validity,  enforceability or priority of the lien granted by
         this Mortgage.  If a prior  construction,  mechanics' or  materialmen's
         lien on the Real  Property  arises by operation  of statute  during any
         construction  or repair of the  Improvements,  Mortgagor  shall  either
         cause the lien to be  discharged by paying when due any amounts owed to
         such persons, or shall comply with Section 10 of this Mortgage.

3.       REPRESENTATIONS AND WARRANTIES

         Mortgagor  (i)  represents  to  Mortgagee,  and to its  successors  and
         assigns,  that the following statements are true as of the date of this
         Mortgage,  and

                                       12

<PAGE>

         (ii)  warrants and covenants to Mortgagee,  and to its  successors  and
         assigns,  that the  following  statements  shall remain true during the
         term of the Loan:

         3.1.     FORMATION AND EXISTENCE

                  Each Mortgagor is a limited  liability company duly formed and
                  validly existing under the laws of Delaware, is duly qualified
                  to do business in and is in good standing  under,  the laws of
                  New York,  and has obtained all licenses and permits and filed
                  all statements of fictitious name and registrations  necessary
                  for the lawful operation of its business.

         3.2.     POWER AND AUTHORITY

                  Mortgagor  has  full  power  and  authority  to  carry  on its
                  business  as  presently  conducted,  to own the  Property,  to
                  execute  and deliver  the Loan  Documents,  and to perform its
                  obligations under them.

         3.3.     DUE AUTHORIZATION

                  The Loan transaction and the performance of all of Mortgagor's
                  obligations under the Loan Documents have been duly authorized
                  by all requisite  limited  liability  company  action and each
                  individual  executing any Loan Document on behalf of Mortgagor
                  has been duly authorized to do so.

         3.4.     NO DEFAULT OR VIOLATIONS

                  The execution and performance of Mortgagor's obligations under
                  the Loan  Documents  will not  result  in any  breach  of,  or
                  constitute a default under, any contract,  agreement, document
                  or other  instrument to which Mortgagor is a party or by which
                  Mortgagor  may be bound or  affected,  and do not and will not
                  violate or contravene  any law to which  Mortgagor is subject;
                  nor do any such other instruments impose any obligations which
                  prohibit or limit in any material  respect the  performance by
                  Mortgagor of its covenants and  agreements  hereunder or which
                  are in direct  conflict with the  covenants and  agreements of
                  Mortgagor hereunder.

         3.5.     NO FURTHER APPROVALS OR ACTIONS REQUIRED

                  No approval by,  authorization of, or filing with any federal,
                  state or municipal or other governmental commission,  board or
                  agency  or  other  governmental   authority  is  necessary  in
                  connection with the  authorization,  execution and delivery of
                  the Loan Documents by Mortgagor.

                                       13
<PAGE>

         3.6.     DUE EXECUTION AND DELIVERY

                  Each of the Loan  Documents to which  Mortgagor is a party has
                  been duly executed and delivered on behalf of Mortgagor.

         3.7.     LEGAL, VALID, BINDING AND ENFORCEABLE

                  Each of the  Loan  Documents  to  which  Mortgagor  is a party
                  constitutes  the  legal,   valid  and  binding  obligation  of
                  Mortgagor,  enforceable  against  Mortgagor in accordance with
                  its terms, except to the extent that its enforceability may be
                  limited  by  bankruptcy,  insolvency,  fraudulent  conveyance,
                  reorganization,  moratorium  or  similar  laws  affecting  the
                  enforceability of creditors' rights generally, or by equitable
                  principles of general  application  (whether  considered in an
                  action at law or in equity).

         3.8.     ACCURATE FINANCIAL INFORMATION

                  All financial  information furnished by Mortgagor to Mortgagee
                  in  connection  with  the  application  for the  Loan is true,
                  correct and  complete in all  material  respects  and does not
                  omit to state any fact or  circumstance  necessary to make the
                  statements  in them  not  misleading,  and  there  has been no
                  material   adverse  change  in  the  financial   condition  of
                  Mortgagor since the date of such financial information.

         3.9.     COMPLIANCE WITH LEGAL REQUIREMENTS

                  All  governmental  approvals  and  licenses  required  for the
                  conduct of Mortgagor's  business and for the  maintenance  and
                  operation of the Real Property in compliance  with  applicable
                  law are in full force and  effect,  and the Real  Property  is
                  currently   being  operated  in  compliance   with  the  Legal
                  Requirements in all material respects.

         3.10.    CONTRACTS AND FRANCHISES

                  All contracts and franchises  necessary for the conduct of the
                  Mortgagor's  business  and  for  the  operation  of  the  Real
                  Property in accordance  with good  commercial  practice are in
                  force.

                                       14
<PAGE>

         3.11.    NO CONDEMNATION PROCEEDING

                  The  Mortgagor  has no knowledge  of any  present,  pending or
                  threatened condemnation proceeding or award affecting the Real
                  Property.

         3.12.    NO CASUALTY

                  No damage to the Real  Property by any fire or other  casualty
                  has occurred and remains unrepaired.

         3.13.    COMPLETE LOTS AND TAX PARCELS

                  The Land is  comprised  exclusively  of tax  parcels  that are
                  entirely included within the Land (except, with respect to 100
                  Wall Street, that portion of the Real Property which is a part
                  of Lot 17),  and, if the Land is  subdivided,  of  subdivision
                  lots that are entirely included within the Land.

         3.14.    YEAR 2000 PREPARATION

                  The Mortgagor has taken  commercially  reasonable  measures to
                  insure that any computer  systems used in the operation of the
                  Real  Property  have  been  evaluated  in order  to  determine
                  whether,  during the year 2000, they will continue to function
                  properly,   and  has  remediated  any  potential  problems  by
                  modifying  such systems to update them in order to ensure that
                  they  will  function   properly   during  the  year  2000  and
                  thereafter.

         3.15.    COMMERCIAL PROPERTY

                  The Real  Property  is  commercial,  and the Loan has not been
                  made for personal, family or household purposes.

         3.16.    Reserved

         3.17.    STATUS OF CERTAIN TITLE MATTERS

                  To  Mortgagor's  actual  knowledge,  each  of the  Appurtenant
                  Easements,    reciprocal   easement   agreements,    operating
                  agreements,  declarations, and restrictive covenants described
                  in Exhibit C to this  Mortgage  (a) is valid and in full force
                  and effect,  (b) has not been amended or supplemented,  except
                  by means of  instruments  listed in Exhibit C, (c) requires no
                  approval   regarding  the  Improvements   that  has  not  been
                  obtained,  (d) is free of  defaults or alleged  defaults,  (e)
                  except as expressly  provided  therein,  does not give rise to
                  any lien against the Real  Property,  or any right to assert a
                  valid notice or claim of such a lien, (f) does not provide for
                  any  assessment  against the Real  Property  that has not been
                  paid in full,  and (g) has not

                                       15
<PAGE>

                  been  violated  by the  owner of the Real  Property  or by any
                  tenant of the Real Property.

         3.18.    IMPROVEMENTS NOT COMPRISED OF SIX OR FEWER RESIDENTIAL UNITS

                  Mortgagor  represents  that this  Mortgage  does not  encumber
                  property principally improved or to be improved by one or more
                  structures  containing  in the  aggregate  not  more  than six
                  residential dwelling units.

4.       COVENANTS

         4.1.     PAYMENT AND PERFORMANCE

                  Mortgagor  shall pay the  Indebtedness  and perform all of its
                  other  obligations  under the Loan Documents,  as and when the
                  Loan Documents require such payment and performance.

         4.2.     PAYMENT OF IMPOSITIONS

                  The Mortgagor  shall pay the Impositions on or before the last
                  day on which they may be paid without penalty or interest, and
                  shall,  within  thirty  days,  furnish  Mortgagee  with a paid
                  receipt  or a  cancelled  check as  evidence  of  payment.  If
                  Mortgagee does not receive such evidence, Mortgagee may secure
                  it directly. If it does so, Mortgagee will charge Mortgagor an
                  administrative  fee of $250  per  property  for  securing  the
                  evidence of payment. The payment of this fee shall be a demand
                  obligation of the Mortgagor  under the terms of this Mortgage.
                  The Mortgagor may meet the  requirements of this Subsection by
                  remitting the Monthly  Escrow  Payments when due, by providing
                  Notice  to  Mortgagee  of  any  new  Imposition  or  increased
                  Imposition  unknown  to  Mortgagee  promptly  after  Mortgagor
                  obtains  knowledge of same, and by paying to Mortgagee  within
                  ten (10)  Business  Days after  demand any amount  required to
                  increase  the Escrow  Fund to an amount  sufficient  to permit
                  Mortgagee to pay all Impositions from the Escrow Fund on time.
                  If  Mortgagor  wishes to contest the  validity or amount of an
                  Imposition,  it may do so by complying with Section 10. If any
                  new Legal  Requirement  (other than a general tax on income or
                  on interest  payments) taxes the Mortgage so that the yield on
                  the Indebtedness would be reduced,  and Mortgagor may lawfully
                  pay the tax or reimburse Mortgagee for its payment,  Mortgagor
                  shall do so.

         4.3.     MAINTENANCE OF THE REAL PROPERTY

                  Mortgagor  shall not  commit  or permit  any waste of the Real
                  Property  as a  physical  or  economic  asset,  and  agrees to
                  maintain   in  good   repair   the   Improvements,   including
                  structures,   roofs,

                                       16
<PAGE>

                  mechanical  systems,   parking  lots  or  garages,  and  other
                  components of the Real Property that are necessary for the use
                  of the Real Property, or which Mortgagor as landlord under any
                  Lease is required  to maintain  for the benefit of any tenant.
                  In  its  performance  of  this  obligation,   Mortgagor  shall
                  promptly  and in a  good  and  workmanlike  manner  repair  or
                  restore, as required under Subsection 4.8, any elements of the
                  Improvements  that are  damaged or  destroyed.  The  Mortgagor
                  shall also replace roofs,  parking lots,  mechanical  systems,
                  and other  elements  of the  Improvements  requiring  periodic
                  replacement.  The Mortgagor shall carry out such  replacements
                  no less  frequently  than  would any  commercially  reasonable
                  owner.  Except  in  connection  with (x) the  construction  of
                  tenant improvements pursuant to Leases made in accordance with
                  the  requirements  of the  Absolute  Assignment  of Leases and
                  Rents, and (y) other alterations or improvements undertaken by
                  Borrower in the ordinary  course of business  which (i) do not
                  adversely affect the structural  integrity of the Improvements
                  or any portion thereof,  (ii) are performed in accordance with
                  all  applicable  requirements  of  this  Mortgage,  including,
                  without   limitation,   compliance   with   applicable   Legal
                  Requirements, and (iii) if made in space leaseable to tenants,
                  will not  result  in the  space  in  question  being  rendered
                  unusable by general office,  retail tenant or storage tenants,
                  as the case may be, (or with  respect only to the garage space
                  at the  property  known  as 810  Seventh  Avenue,  by a garage
                  tenant),  Notice of which shall be given to Mortgagee prior to
                  the commencement of such alteration or improvement,  Mortgagor
                  shall not,  without the prior  written  consent of  Mortgagee,
                  demolish,  reconfigure,  or materially alter the Improvements,
                  but Mortgagee  agrees that any request for its consent to such
                  an  action  shall be deemed  given if  Mortgagee  declines  to
                  respond  within  fifteen  (15)  Business  Days to any  written
                  request for such a consent,  if the request is  accompanied by
                  all  materials  reasonably  required  to permit  Mortgagee  to
                  analyze the proposed action.

         4.4.     USE OF THE REAL PROPERTY

                  The  Mortgagor  shall cause the Real  Property to be used as a
                  commercial property for office,  ground floor retail and, with
                  respect  to 810,  parking  garage  purposes,  and for no other
                  purpose.

         4.5.     LEGAL REQUIREMENTS

                  The  Mortgagor  shall  comply  with  all  Legal   Requirements
                  relating to the Real Property at all times.

                                       17
<PAGE>

         4.6.     COVENANTS REGARDING CERTAIN TITLE MATTERS

                  Mortgagor  shall promptly pay,  perform and observe all of its
                  obligations  under  the  Appurtenant   Easements,   reciprocal
                  easement agreements,  operating agreements,  declarations, and
                  restrictive  covenants  Exhibit C, shall not modify or consent
                  to the  termination  of any of them without the prior  written
                  consent of the  Mortgagee,  shall promptly  furnish  Mortgagee
                  with  copies of all notices of default  under them,  and shall
                  cause all covenants and  conditions  under them and benefiting
                  the Real Property to be fully performed and observed.

         4.7.     INDEPENDENCE OF THE REAL PROPERTY

                  Subject to the Air Rights Leases, the Mortgagor shall maintain
                  the  independence  of the Real  Property  from  other land and
                  improvements  not included  within or located on the Land.  In
                  fulfilling  this  covenant,  Mortgagor  shall neither take any
                  action  which  would make it  necessary  to own or control any
                  property  other  than the Real  Property  in order to meet the
                  obligations  of the landlord  under any Lease,  or in order to
                  comply with the Legal Requirements,  nor take any action which
                  would cause any land or  improvements  other than the Land and
                  the  Improvements,  and the  land  subject  to the Air  Rights
                  Leases,  to rely upon the Land or the  Improvements  for those
                  purposes,  nor impair the integrity of the Land as one or more
                  complete subdivided lots and tax parcels.

         4.8.     REBUILDING   UPON  CASUALTY  AND   REMEDIATION  OF  EFFECT  OF
                  CONDEMNATION

                  If a casualty  occurs,  Mortgagor  shall repair or rebuild the
                  Improvements.  If any portion of the Real Property is taken by
                  power of eminent domain, Mortgagor shall remedy the effects of
                  the taking.  Any such repair,  reconstruction  or  remediation
                  shall be  effected  with the  intended  purpose  of  restoring
                  promptly the Real  Property's  value and potential to generate
                  income  in  proportion  to  the  amount  of  the  Indebtedness
                  remaining  after any  application  of  Insurance  Proceeds  or
                  Condemnation Proceeds to the Indebtedness, and Mortgagor shall
                  act in a  commercially  reasonable  manner in performing  such
                  repair,  reconstruction  or  remediation,  consistent with the
                  other applicable  provisions of this Mortgage,  in its efforts
                  to achieve such purpose.

         4.9.     PERFORMANCE OF LANDLORD OBLIGATIONS

                  Mortgagor  shall perform its material  obligations as landlord
                  under the Leases,  and shall neither take any action, nor fail
                  to  take  any  action,  if the  action  or  failure  would  be
                  inconsistent  with the commercially  reasonable  management of
                  the Real  Property for the purpose of enhancing  its long-term
                  performance   and  value.

                                       18
<PAGE>

                  Mortgagor  shall not,  without  Mortgagee's  written  consent,
                  extend, modify, declare a default under,  terminate,  or enter
                  into any Lease of the Real Property, except in compliance with
                  the Absolute Assignment of Leases and Rents.

         4.10.    FINANCIAL REPORTS AND OPERATING STATEMENTS

                  (a)      Maintenance of Books and Records

                           During the term of the Loan, Mortgagor shall maintain
                           complete  and  accurate  accounting  and  operational
                           records,  including  copies of all  Leases  and other
                           written  contracts  relating  to the  Real  Property,
                           copies of all tax statements, and evidence to support
                           the   payment   of  all   material   property-related
                           expenses.

                  (b)      Delivery   of    Financial    and    Property-Related
                           Information

                           Within  120  days of the  end of  each of its  fiscal
                           years,  or, so long as Mortgagor shall be required to
                           make  filings with the U.S.  Securities  and Exchange
                           Commission  ("SEC"),  which  individually  or  on  an
                           aggregated   basis  with   affiliated   entities   of
                           Mortgagor,   substantially   contain  the   following
                           financial  information or any portion  thereof,  such
                           longer  period  which is permitted by the SEC to make
                           corresponding  public filings  pursuant to applicable
                           law up to, but not in excess of, an additional ninety
                           (90) days (and in no event  beyond  the date on which
                           such  filings  are  actually  made to the  SEC),  the
                           Mortgagor  shall  deliver to Mortgagee  (A) copies of
                           the financial  statements of the Mortgagor  including
                           balance  sheets  and  earnings   statements,   (B)  a
                           complete and  accurate  operating  statement  for the
                           Real  Property,  and (C) a complete rent roll, all in
                           form reasonably  satisfactory  to the Mortgagee.  The
                           rent roll must be  certified  by the  Mortgagor to be
                           true and correct and must include each tenant's name,
                           premises,  square footage, rent (including percentage
                           rent  and  the  basis  for  its  calculation),  lease
                           expiration  date,  renewal options and related rental
                           rates, delinquencies, vacancies, and the existence of
                           any  unsatisfied  landlord  obligations in respect of
                           tenant improvements or other leasing costs.

                  (c)      Effect of Failure to Deliver  Financial  and Property
                           Reports

                           If no  Default  exists,  and the  Mortgagor  fails to
                           provide the financial and property  reports  required
                           under  this  Section  within 120 days of the close of
                           any  fiscal  year  (or  such  longer   period  as  is
                           permitted pursuant to Section 4.10(b)), the Mortgagee
                           will   provide  a  Notice  of  this   failure  and  a
                           thirty-day  opportunity to cure. All monthly payments
                           of principal

                                       19
<PAGE>

                           and  interest  under the Note that  become  due after
                           this cure  period has  elapsed but before the reports
                           are received by the Mortgagee  must be accompanied by
                           a fee of .000834 times the  principal  balance of the
                           Loan  at  the   beginning  of  the  previous   month,
                           regardless  of whether the Notice has  asserted  that
                           the  failure   constitutes   a  Default   under  this
                           Mortgage. This fee is to compensate the Mortgagee for
                           (A) the increased risk resulting from the Mortgagee's
                           inability  to  monitor  and  service  the Loan  using
                           up-to-date  information and (B) the reduced value and
                           liquidity of the Loan as a financial asset.

                  (d)      Certification of Information

                           The financial and operating statements provided under
                           this  Subsection  need not,  as an initial  matter be
                           certified   by  an   independent   certified   public
                           accountant as having been prepared in accordance with
                           generally     accepted     accounting     principles,
                           consistently  applied,  or, in the case of  financial
                           statements prepared on a cash or income tax basis, or
                           of operating statements, as not materially misleading
                           based  on  an  audit  conducted  in  accordance  with
                           generally accepted auditing standards.  The Mortgagor
                           shall,  however certify that such  statements  fairly
                           present  in  all  material   respects  the  financial
                           condition of the Mortgagor,  and Mortgagee  expressly
                           reserves the right to require such a certification by
                           an  independent  certified  public  accountant  if  a
                           Default  exists or if Mortgagee has reason to believe
                           that any previously  provided  financial or operating
                           statement is misleading in any material respect.

         4.11.    ESTOPPEL STATEMENTS

                  (a)      Upon  request  by  the  Mortgagee,  Mortgagor  shall,
                           within  ten  (10)  Business  Days  of  Notice  of the
                           request,  furnish  to  Mortgagee  or to  whom  it may
                           direct, a written statement  acknowledging the amount
                           of  the  Indebtedness  and  disclosing   whether  any
                           offsets or defenses  exist against the  Indebtedness.
                           Thereafter,   Mortgagor   shall  be   estopped   from
                           asserting  any other  offsets or defenses  alleged to
                           have arisen as of the date of the statement.

                  (b)      Upon request by Mortgagor,  Mortgagee  shall,  within
                           ten (10)  Business  Days of  Notice  of the  request,
                           furnish  to  Mortgagor  a written  statement  setting
                           forth  the  amount  of  the  principal  of  the  Loan
                           outstanding  as of the  date of such  statement,  the
                           date to which interest has been paid, and the amount,
                           if any,  claimed to be unpaid upon the  Mortgage  for
                           principal and interest.

                                       20
<PAGE>

         4.12.    PROHIBITION ON CERTAIN DISTRIBUTIONS

                  If  Default  exists  under  Subsection  8.2  or  under  any of
                  Subparagraphs  (b), (c),  (d), (e) or (f) of  Subsection  8.4,
                  Mortgagor shall not pay any dividend or make any  partnership,
                  trust or other distribution, and shall not make any payment or
                  transfer any  property in order to purchase,  redeem or retire
                  any interest in its beneficial interests or ownership.

         4.13.    USE OF LOAN PROCEEDS

                  The  Loan  proceeds   shall  be  used  solely  for  commercial
                  purposes.

         4.14.    LIEN LAW COVENANT

                  Mortgagor shall receive the advances  secured by this Mortgage
                  and shall hold the right to receive  such  advances as a trust
                  fund in  accordance  with the  provisions of Section 13 of the
                  New York Lien Law.

         4.15.    PROHIBITION ON CUTOFF NOTICES

                  Mortgagor  shall  not issue any  Notice  to  Mortgagee  to the
                  effect that liens on the Real  Property  after the date of the
                  Notice will enjoy priority over the lien of the Mortgage.

5.       INSURANCE REQUIREMENTS

         At all times until the  Indebtedness  is paid in full,  Mortgagor shall
         maintain  insurance   coverage  and  administer   insurance  claims  in
         compliance with this Section.

         5.1.     REQUIRED COVERAGES

                  (a)      All Risk/Open Perils Special Form Property

                           The Mortgagor shall maintain  coverage of 100% of the
                           replacement  cost of all  insurable  elements  of the
                           Real Property and of all tangible Personal  Property.
                           If a  coinsurance  clause  is in  effect,  an  agreed
                           amount endorsement is required. Blanket policies must
                           include limits by property  location.  Coverage shall
                           extend  to the  Real  Property  and  to all  tangible
                           Personal Property.

                  (b)      Broad Form Boiler and Machinery

                           If any boilers are other  machinery  is located on or
                           about the Real  Property,  Mortgagor  shall  maintain
                           broad form boiler and machinery coverage, including a
                           form of business income coverage.

                                       21
<PAGE>

                  (c)      Flood

                           If the Real  Property  is located in a special  flood
                           hazard  area  according  to the  most  current  flood
                           insurance  rate map issued by the  Federal  Emergency
                           Management   Agency   and  if  flood   insurance   is
                           available,  Mortgagor  shall maintain flood insurance
                           coverage of all  insurable  elements of Real Property
                           and of all tangible Personal Property.

                  (d)      Business Interruption

                           The  Mortgagor  shall  maintain  a form  of  business
                           income  coverage  in the  amount of 80% of one year's
                           business income from the Property.  Blanket  policies
                           must include limits by property location.

                  (e)      Comprehensive/General Liability

                           The Mortgagor  shall  maintain  comprehensive/general
                           liability  coverage  (which  may  be in the  form  of
                           umbrella/excess    liability    insurance)   with   a
                           $1,000,000 combined single limit per occurrence and a
                           minimum aggregate limit of $2,000,000.

                  (f)      Liquor Liability

                           The  Mortgagor   shall  maintain   liquor   liability
                           coverage,  if applicable law may impose  liability on
                           those selling, serving, or giving alcoholic beverages
                           to others and if such beverages will be sold,  served
                           or given on the Real Property by Mortgagor.

                  (g)      Elective Coverages

                           Mortgagee    may   require    additional    coverages
                           appropriate  to the property type and site  location.
                           Additional  coverages  may include  earthquake,  mine
                           subsidence, sinkhole, personal property, supplemental
                           liability,  or coverages  of other  property-specific
                           risks.

         5.2.     HOW MORTGAGEE SHOULD BE NAMED

                  On all property  policies and  coverages  (including  coverage
                  against loss of business  income),  Mortgagee must be named as
                  "first  mortgagee" under a standard  mortgage  clause.  On all
                  liability  policies and coverages,  Mortgagee must be named as
                  an  "additional  insured."  Mortgagee  should be  referred  to
                  verbatim as follows:  "[Name of Mortgagee] and its successors,
                  assigns,  and  affiliates;  as their interest may appear;  c/o
                  AEGON USA Realty  Advisors,  Inc.;  Mortgage Loan Dept.;  4333
                  Edgewood Rd., NE; Cedar Rapids, Iowa 52499-5443."

                                       22
<PAGE>

         5.3.     RATING

                  Each insurance  carrier must be rated A, Class X, or better by
                  Best's Rating  Service,  without regard to its parent's or any
                  reinsurer's rating.

         5.4.     DEDUCTIBLE

                  The  maximum  deductible  on all  coverages  and  policies  is
                  $25,000.

         5.5.     NOTICES, CHANGES AND RENEWALS

                  All  policies  must  require  the  insurance  carrier  to give
                  Mortgagee a minimum of thirty (30) days notice in the event of
                  cancellation  or   non-renewal.   Mortgagor  shall  report  to
                  Mortgagee  immediately  any vacancy,  change of title,  tenant
                  occupancy or use, physical damage,  additional improvements or
                  other factors affecting any insurance contract. An original or
                  certified copy of each policy is required upon renewal.  If no
                  such copy is available,  Mortgagee  will accept a binder for a
                  period not to exceed 90 days.  All  binders,  certificates  of
                  insurance,  and original or certified  copies of policies must
                  name  Mortgagee  as a  named  insured,  or  as  an  additional
                  insured,  must  include the  complete  and  accurate  property
                  address and must bear the  original  signature  of the issuing
                  insurance agent.

         5.6.     UNEARNED PREMIUMS

                  If  this  Mortgage  is   foreclosed,   Mortgagee  may  at  its
                  discretion cancel any of the insurance policies required under
                  this   Section  and  apply  any   unearned   premiums  to  the
                  Indebtedness.

         5.7.     FORCED PLACEMENT

                  If  Mortgagor  fails to comply with the  requirements  of this
                  Section,  the Mortgagee  may, at its  discretion,  procure any
                  required insurance.  Any premiums paid for such insurance,  or
                  the allocable portion of any premium paid by Mortgagee under a
                  blanket  policy  for  such   insurance,   shall  be  a  demand
                  obligation  under this  Mortgage,  and any  unearned  premiums
                  under such  insurance  shall comprise  Insurance  Proceeds and
                  therefore a portion of the Property.

6.       INSURANCE AND CONDEMNATION PROCEEDS

         6.1.     PROVISIONS OF APPROVED KEY LEASE TO GOVERN

                  The Mortgagee  agrees to permit the use of Insurance  Proceeds
                  and Condemnation  Proceeds  consistently with the terms of the
                  Key

                                       23
<PAGE>

                  Lease,  if  Mortgagor  is  obligated  under  the Key  Lease to
                  rebuild  the  Improvements  or  to  remedy  the  effect  of  a
                  condemnation,  if Mortgagee may hold the Insurance Proceeds or
                  Condemnation  Proceeds and  condition  their  disbursement  as
                  described  in Section 6.4, and if the tenant under the related
                  Key Lease  confirms  to the  Mortgagee  in writing  that it is
                  committed to pay full rent  following  the  completion  of the
                  reconstruction  or  remediation.  The remaining  provisions of
                  this  Section   shall  apply  to  the  extent  that  they  are
                  consistent with the terms of the approved Key Lease.

         6.2.     ADJUSTMENT OF INSURANCE  CLAIMS AND COMPROMISE OF CONDEMNATION
                  AWARDS

                  The Mortgagor may settle any insurance  claim or  condemnation
                  proceeding  if the effect of the casualty or the  condemnation
                  may be remediated for $1,000,000 or less (unless the Mortgagor
                  exercises  its  option  to  obtain a  release  of Parcel 2, as
                  hereinafter provided, in which event, thereafter,  $500,000.00
                  or less). If a greater sum is required,  the Mortgagor may not
                  settle  any  such  claim or  proceeding  without  the  advance
                  written  consent of the Mortgagee and,  provided there is then
                  no Default  hereunder or under the other Loan Documents,  such
                  consent shall not be  unreasonably  withheld,  conditioned  or
                  delayed. If a Default exists, the Mortgagor may not settle any
                  insurance claim or condemnation proceeding without the advance
                  written consent of the Mortgagee.

         6.3.     DIRECT PAYMENT TO THE MORTGAGEE OF PROCEEDS

                              If the Insurance  Proceeds  received in connection
                  with a  casualty  or the  Condemnation  Proceeds  received  in
                  respect  of  a  condemnation  exceed  $1,000,000  (unless  the
                  Mortgagor  exercises  its option to obtain a release of Parcel
                  2, as hereinafter  provided,  in which event,  thereafter,  in
                  excess of  $500,000.00),  or if there is a Default,  then such
                  proceeds shall be paid directly to the Mortgagee to be applied
                  in  accordance   with  the  provisions  of  Section  6.4.  The
                  Mortgagee  shall  have the right to endorse  instruments  that
                  evidence proceeds which it is entitled to receive directly.

         6.4.     AVAILABILITY TO THE MORTGAGOR OF PROCEEDS

                  The  Mortgagor  shall  have  the  right  to use the  Insurance
                  Proceeds   or  the   Condemnation   Proceeds  to  rebuild  the
                  Improvements  following a casualty, or to remedy the effect on
                  the Real Property of any condemnation,  if the amount received
                  is less than five percent (5%) of the principal balance of the
                  Note, provided (a) no condition of Default then exists, (b) no
                  nonmonetary default shall have occurred and, following Notice,
                  remained uncured beyond

                                       24
<PAGE>

                  the  applicable  cure period and (c) the proceeds  received by
                  the Mortgagee,  together with any additional  funds  deposited
                  with the Mortgagee by the Mortgagor,  are then sufficient,  in
                  the  Mortgagee's   reasonable   discretion,   to  restore  the
                  Improvements  to their  condition  before the casualty,  or to
                  remedy the effect on the Real  Property  of the  condemnation.
                  The Mortgagee may condition disbursements on approval of plans
                  and  specifications,  a minimum  disbursement  requirement  of
                  disbursements  not  more  than  once in each  calendar  month,
                  submittal of certificates  of occupancy and other  appropriate
                  evidence of completion,  updating of the Mortgagee's mortgagee
                  title   insurance   coverage   to  insure   the   absence   of
                  construction,  mechanics' or materialmen's liens, disbursement
                  on a  percentage  of  completion  basis  with  a  ten  percent
                  holdback on all  disbursements  pending final completion (on a
                  trade by trade  basis),  and other  customary  safeguards  for
                  construction lenders. All transactional expenses shall be paid
                  by the  Mortgagor.  If the  amount  received  in  respect of a
                  casualty or  condemnation  equals or exceeds five percent (5%)
                  of the principal  balance of the Note, then such proceeds may,
                  at the  Mortgagor's  option,  be used to  rebuild or to remedy
                  subject  to all of the  provisions  and  procedures  described
                  above, but only if the Loan-to-Value  ratio of the Property on
                  completion will be 65% or less, as determined by Mortgagee, in
                  its   discretion.   If   Mortgagee's   determination   of  the
                  Loan-to-Value  ratio of the Property on  completion is greater
                  than 65%, and  Mortgagor  disagrees  with such  determination,
                  Mortgagor  may,  by  Notice  to  Mortgagee,  require  that the
                  procedure  for the  appraisal of the Real Property at the time
                  of  origination  be  repeated  in order to arrive at a binding
                  determination  of market value.  The independent fee appraisal
                  shall be at the Mortgagor's  expense,  and Mortgagor shall pay
                  to the Mortgagee an administrative fee of $2,500 in connection
                  with its review.  The Mortgagee may require that the Mortgagor
                  deposit  $10,000  with the  Mortgagee  as  security  for these
                  expenses  or may pay the fee  appraiser's  and  administrative
                  fees from the proceeds at its sole  discretion.  If necessary,
                  the  Mortgagor  shall make a prepayment  of the Loan,  without
                  premium, sufficient to achieve this Loan-to-Value ratio.

                  Unless  the  Mortgagor  has the  right  to use  the  Insurance
                  Proceeds  or the  Condemnation  Proceeds  under the  foregoing
                  paragraph,  the  Mortgagee  may,  in  its  sole  and  absolute
                  discretion,  either apply them to the Loan balance or disburse
                  them for the  purposes  of repair  and  reconstruction,  or to
                  remedy the effects of the condemnation.  No prepayment premium
                  will be  charged on  amounts  applied to reduce the  principal
                  balance of the Loan.

                                       25
<PAGE>

7.       ESCROW FUND

                  The  Mortgagor  shall pay the  Monthly  Escrow  Payment on the
                  first day of every month,  commencing  with the month in which
                  the first  regular  payment of principal  and interest is due.
                  Any Monthly Escrow Payment received after the tenth day of the
                  month in which it is due shall be subject to a late  charge of
                  five  percent  (5%) , which shall not be applied to the Escrow
                  Fund.  Mortgagee  shall hold  Monthly  Escrow  Payments  in an
                  interest-bearing  fund  from  which  Mortgagee  will  pay on a
                  timely  basis  those  Escrow   Expenses  that   Mortgagee  has
                  anticipated  will become payable on a regular basis during the
                  Loan's   term,   and  on  which   Mortgagee   has   based  its
                  determination  of the Monthly  Imposition  Requirement and the
                  Monthly   Reserve   Requirement.   The  Escrow  Fund  will  be
                  maintained  as an  accounting  entry  in  Mortgagee's  general
                  account,  where it may be commingled  with  Mortgagee's  other
                  funds. The Escrow Fund shall bear interest, which shall become
                  part  of the  Escrow  Fund.  The  interest  rate  will  be the
                  passbook rate of interest at a bank in Cedar  Rapids,  Iowa at
                  the  end of the  interest  accrual  period.  Interest  will be
                  compounded  Quarterly  based on the average  monthly  balance.
                  Mortgagee may reanalyze  the  projected  Escrow  Expenses from
                  time to time and shall  advise  Mortgagor of any change in the
                  amount of the Monthly Escrow Payment based upon any reasonably
                  anticipated   change  to  the   Escrow   Expenses.   Upon  the
                  foreclosure of this  Mortgage,  the delivery of a deed in lieu
                  of foreclosure, or the payoff of the Loan, the Mortgagee shall
                  apply  amounts  in the  Escrow  Fund,  net of  accrued  Escrow
                  Expenses,  to the  Indebtedness.  Mortgagee  shall  remit  any
                  amounts in excess of the Indebtedness to Mortgagor.

8.       DEFAULT

         8.1.     EXISTENCE OF DEFAULT

                  A Default shall exist  immediately  upon the occurrence of any
                  of  the  acts,   omissions  or   circumstances   specified  in
                  Subsection  8.2 or in Subsection  8.4. Upon the  occurrence of
                  any of the  acts,  omissions  or  circumstances  specified  in
                  Subsection  8.3,  Mortgagee  may  deliver  written  Notice  to
                  Mortgagor  of the  existence  of  such  an  act,  omission  or
                  circumstance,  and that such an act,  omission or circumstance
                  shall constitute a Default under the Loan Documents unless the
                  Mortgagor  promptly  initiates an effort to cure the potential
                  Default,  pursues the cure  diligently and  continuously,  and
                  succeeds in effecting  the cure within 120 days of its receipt
                  of Notice.  An  additional  period of 120 days is  afforded in
                  cases  where  construction  or  repair  is  needed to cure the
                  potential default, and the cure cannot be completed within the
                  first  120-day  cure  period.  During  the  cure  period,  the
                  Mortgagor has the obligation to

                                       26
<PAGE>

                  provide on demand satisfactory  documentation of its effort to
                  cure,  and, upon  completion,  evidence that the cure has been
                  achieved.

         8.2.     MONETARY DEFAULTS

                  A monetary default shall exist upon any of the following:

                  (a)      Monthly Principal and Interest Payments

                           The  Mortgagor's  failure  to pay,  or to cause to be
                           paid,  any regular  monthly  payment of principal and
                           interest  under  the  Note  or any  required  Monthly
                           Escrow  Payment  on or  before  the  tenth day of the
                           month in which it is due.

                  (b)      Matured Indebtedness

                           The  Mortgagor's  failure  to pay,  or to cause to be
                           paid,  the  Indebtedness  when  the Loan  matures  by
                           acceleration  under Section 14, because of a transfer
                           or encumbrance under Section 11, or by lapse of time.

                  (c)      Demand Obligations

                           The  Mortgagor`s  failure  to pay,  or to cause to be
                           paid,  within three (3) Business Days of  Mortgagee's
                           demand (such demand and time period being in addition
                           to any other  demand or period for  payment,  if any,
                           expressly  provided for elsewhere in this  Mortgage),
                           any other  amount due under this  Mortgage  or any of
                           the other Loan Documents.

         8.3.     CURABLE NONMONETARY DEFAULT

                  A curable  nonmonetary  default  shall  exist  upon any of the
                  following  (and such  events  shall  not be a  Default  unless
                  Mortgagor  shall fail to cure the same  within the  applicable
                  notice and grace period set forth in Section 8.1):

                  (a)      Entry of a Material Judgment

                           The entry of any  judgment  against any  Mortgagor or
                           any other Obligor, if the judgment may materially and
                           adversely  affect the value,  use or operation of the
                           Real Property of such Mortgagor.

                  (b)      Failure of Warranty

                           Any representation  made in Section 3 or warranted in
                           any  other  Loan  Document  shall  become  untrue  or
                           misleading  in  any  material  respect  (except  with
                           respect to Sections 3.11 or 3.12,  provided Mortgagor
                           shall  promptly give notice of the occurrence of same
                           to Mortgagee  and,  with respect to

                                       27
<PAGE>

                           Section  3.17,  to  the  extent  within   Mortgagor's
                           control to
                           prevent or avoid such occurrence).

                  (c)      Other Defaults

                           The  Mortgagor's  failure to observe  any  promise or
                           covenant made in this Mortgage, if the failure is not
                           described in Subsection  8.2, in  Subsection  8.4, or
                           elsewhere in this Subsection 8.3. Default under other
                           Loan  Documents,  or the  existence of a "Default" as
                           defined in any Loan Document, unless the "Default" is
                           monetary   in  nature  or  is   expressly   described
                           elsewhere in this Mortgage.

                  (d)      Mortgagor  shall  default  under any Air Rights Lease
                           and  such  default  shall  not be  cured  within  the
                           applicable  time  period set forth in Section 8.1 or,
                           notwithstanding  the provisions of Section 8.1 to the
                           contrary,  if the Air Rights  Lease  shall  provide a
                           shorter  notice  and/or cure period,  if such default
                           shall not be cured at least  five (5)  Business  Days
                           prior to the  expiration  of any such  notice  and/or
                           cure period provided thereunder.

         8.4.     INCURABLE NONMONETARY DEFAULT

                  An incurable  nonmonetary  default shall exist upon any of the
                  following:

                  (a)      Material Untruth or Misrepresentation

                           Mortgagee's discovery that any representation made by
                           any  Mortgagor  or by any other  Obligor  in any Loan
                           Document  in  connection  with the Loan was untrue or
                           misleading in any material respect at the time it was
                           made.

                  (b)      Due on Sale or Encumbrance

                           The occurrence of any sale,  conveyance,  transfer or
                           vesting  that  would  result  in  the  Loan  becoming
                           immediately  due and  payable at  Mortgagee's  option
                           under Section 11.

                  (c)      Voluntary Bankruptcy Filing

                           The  filing  by  any   Mortgagor  of  a  petition  in
                           bankruptcy  or for relief  from  creditors  under any
                           present or future law that affords general protection
                           from creditors.

                  (d)      Involuntary Bankruptcy or Similar Filing

                           Any  Mortgagor  or any other  Obligor  (other  than a
                           Carveout Obligor) becomes the subject of any petition
                           or  action  seeking  to  adjudicate  it  bankrupt  or
                           insolvent,   or  seeking  liquidation,   winding  up,
                           reorganization,  arrangement, adjustment, protection,
                           relief,  or  composition of it or its debts

                                       28
<PAGE>

                           under any law relating to  bankruptcy,  insolvency or
                           reorganization  or  relief,  or that may  result in a
                           composition of its debts,  provide for the marshaling
                           of any  Mortgagor's  or such other  Obligor's  (other
                           than   a   Carveout   Obligor's)   assets   for   the
                           satisfaction   of  any   Mortgagor's  or  such  other
                           Obligor's (other than a Carveout Obligor's) debts, or
                           result  in  the   judicially   ordered  sale  of  any
                           Mortgagor's  or such other  Obligor's  (other  than a
                           Carveout   Obligor's)   assets  for  the  purpose  of
                           satisfying  its  obligations  to creditors,  unless a
                           motion for the  dismissal  of the  petition  or other
                           action is filed and results in its  dismissal  within
                           ninety  days of the filing of the  petition  or other
                           action.

                  (e)      Insolvency

                           The failure of any  Mortgagor or of any other Obligor
                           (other than a Carveout Obligor)  generally to pay its
                           debts as they become due, its admission in writing to
                           an inability  so to pay its debts,  the making by any
                           Mortgagor or of other Obligor  (other than a Carveout
                           Obligor) of a general  assignment  for the benefit of
                           creditors,  or  a  judicial  determination  that  any
                           Mortgagor or any other Obligor (other than a Carveout
                           Obligor) is insolvent.

                  (f)      Receivership

                           The  appointment  of a  receiver  or  trustee to take
                           possession of any of the assets of any Mortgagor.

                  (g)      Levy or Attachment

                           The taking or seizure of any material  portion of the
                           Property under levy of execution or attachment.

                  (h)      Lien

                           The filing  against  any of the Real  Property of any
                           lien or claim of lien for the  performance of work or
                           the  supply  of  materials,  or  the  filing  of  any
                           federal,   state  or  local  tax  lien   against  any
                           Mortgagor or any other Obligor, or against any of the
                           Real Property, unless the Mortgagor promptly complies
                           with Section 10 of this Mortgage.

                  (i)      Death, Dissolution or Liquidation

                           The  dissolution or liquidation of any Mortgagor,  or
                           the   cessation  of  its  legal   existence   (unless
                           resulting in a Permitted Transfer).

                                       29
<PAGE>

                  (j)      Events Affecting Carveout Obligors

                           The filing by any  Carveout  Obligor of a petition in
                           bankruptcy  or for relief  from  creditors  under any
                           present or future law that affords general protection
                           from creditors;  the filing by any other person of an
                           involuntary   petition  in  bankruptcy   against  any
                           Carveout  Obligor or the  filing of any other  action
                           that may result in a  composition  of debts,  provide
                           for the marshaling of assets for the  satisfaction of
                           such  Carveout  Obligor's  debts,  or  result  in the
                           judicially  ordered sale of assets for the purpose of
                           satisfying  obligations to creditors (unless a motion
                           for the  dismissal of the petition or other action is
                           filed and results in its dismissal within ninety days
                           of the filing of the petition or other  action);  the
                           dissolution or  liquidation  of any Carveout  Obligor
                           that is not a natural person, or the cessation of its
                           legal existence; or the death of any Carveout Obligor
                           who is a natural person(unless the event described in
                           this Paragraph (j) results in a Permitted  Transfer),
                           and unless,  following any such event,  any remaining
                           Carveout  Obligor  or  Obligors  have the  direct  or
                           indirect  power to exercise  management  control over
                           the Real  Property and have an aggregate net worth at
                           least equal to the Net Worth  Requirement,  or unless
                           any  remaining  Carveout  Obligor (or the executor of
                           the  estate  of  any   deceased   Carveout   Obligor)
                           diligently and  continuously  pursues the replacement
                           of the subject Carveout Obligor, and succeeds, within
                           180 days of such an event,  in causing another person
                           to assume the  obligations  of the  subject  Carveout
                           Obligor  under the Carveout  Guaranty and  Indemnity,
                           and the Environmental  Indemnity  Agreement,  so that
                           the Carveout Obligors collectively meet the Net Worth
                           Requirement  and have the direct or indirect power to
                           exercise  management  control over the Real Property.
                           Nothing contained herein shall be deemed or construed
                           to impose the requirement that the Carveout  Obligors
                           maintain a specified net worth during the term of the
                           Loan, provided,  however,  that the Carveout Obligors
                           shall be prohibited from taking voluntary actions not
                           in the ordinary course of business which would reduce
                           its net  worth  to less  than  the  then  outstanding
                           principal  balance of the Loan if a Default exists or
                           during any time when the  loan-to-value  ratio of the
                           Loan,  if  calculated  using  the  value  of the Real
                           Property, would exceed 75%.

                  (k)      Air Rights Leases Default

                           There shall be a termination, surrender, modification
                           or  amendment  of any Air Rights  Lease  without  the
                           prior written consent of Mortgagee.

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<PAGE>

9.       RIGHT TO CURE

         Upon Default or upon the failure of Mortgagor, following a Notice given
         under  Subsection  8.3,  to  diligently  pursue  the  cure of any  act,
         omission or circumstance  that may cause Default,  Mortgagee shall have
         the right to cure the Default or the act, omission or circumstance. The
         expenses of doing so shall be part of the  Indebtedness,  and Mortgagor
         shall pay them to Mortgagee on demand.

10.      CONTEST RIGHTS

         Mortgagormay  secure the right to contest Impositions and construction,
         mechanics' or  materialmen's  liens,  through  appropriate  proceedings
         conducted in good faith,  by either (A)  depositing  with  Mortgagee an
         amount (or a letter of credit from a financial  institution  having not
         less  than an A rating  from  Standard  & Poor's  or one or more  other
         nationally   recognized  rating  agencies,   and  otherwise  reasonably
         acceptable to Mortgagee)  equal to 110% of the amount of the Imposition
         or the lien, or (B) obtaining and  maintaining  in effect a bond issued
         by a surety reasonably  acceptable to Mortgagee,  in an amount equal to
         the greater of (i) the amount of a required  deposit  under  clause (A)
         above and (ii) the  amount  required  by the  surety or by the court in
         order to  obtain a court  order  staying  the  foreclosure  of the lien
         pending  resolution  of the dispute,  and releasing the lien of record.
         The proceeds of such a bond must be payable directly to Mortgagee.  The
         surety  issuing  such a bond shall be  acceptable  to  Mortgagee in its
         sole, but reasonable,  discretion. After such a deposit is made or bond
         issued,  the Mortgagor shall promptly  commence the contest of the lien
         and continuously  pursue that contest in good faith and with reasonable
         diligence.  If the  contest  of  the  related  Imposition  or  lien  is
         unsuccessful,  any deposits or bond  proceeds  shall be used to pay the
         Imposition or to satisfy the obligation from which the lien has arisen.
         Any surplus shall be refunded to Mortgagor.

11.      DUE ON TRANSFER OR ENCUMBRANCE

         Upon  the  sale  of any  portion  of the  Real  Property  or any  other
         conveyance,  transfer or vesting of any direct or indirect  interest in
         Mortgagor  or the  Property,  including  (i)  the  direct  or  indirect
         transfer of, or the granting of a security  interest in, the  ownership
         of Mortgagor, (ii) any encumbrance (other than a Permitted Encumbrance)
         of the Real Property (unless the Mortgagor  contests the encumbrance in
         compliance  with  Section 11) and (iii) the  granting  of any  security
         interest  in the  Property,  the  Indebtedness  shall,  at  Mortgagee's
         option,  become immediately due and

                                       31
<PAGE>

         payable  without  Notice,  unless  the sale,  conveyance,  transfer  or
         vesting is a Permitted Transfer.

12.      DUE ON SALE EXCEPTIONS

         12.1.    PERMITTED TRANSFERS

                  The following are "Permitted Transfers":

                  (a)      A single  transfer of the  Property to a purchaser of
                           Reckson  Associates  ("Reckson")  or to any entity to
                           which  substantially all of the assets of Reckson are
                           transferred  or as a result  of a change  in  control
                           through the merger or  consolidation  of Reckson into
                           another  entity,   if  (i)  the  purchaser  or  other
                           transferee is a  corporation  whose stock is publicly
                           traded  with  a  minimum   stockholder's   equity  of
                           $500,000,000,  (ii) the Loan is not in  Default,  and
                           (iii) the Mortgagee, applying commercially reasonable
                           standards,  approves  of  the  proposed  transferee's
                           ownership    structure,    financial   strength   and
                           management   capability,   and  of   the   management
                           capability  of  the   transferee's   principals   The
                           following  additional  conditions  shall  apply  to a
                           Permitted Transfer under this subparagraph (a).

                                    (i)  If  title  to  the  Real   Property  is
                                    transferred  in connection  with the subject
                                    transaction,  the transferee must assume all
                                    liabilities and obligations  under the terms
                                    of the Loan Documents.

                                    (ii) The Carveout  Obligor shall be released
                                    from   accrued   and/or   future    Carveout
                                    Obligations,  provided accrued and/or future
                                    Carveout  Obligations are expressly  assumed
                                    by a replacement obligor satisfactory to the
                                    Mortgagee.  The Mortgagee shall not withhold
                                    its consent to any such replacement  obligor
                                    having a net worth  equal to the  greater of
                                    (i) the net worth of the Carveout Obligor at
                                    the  time  of  the  transfer  and  (ii)  the
                                    then-current  principal balance of the Loan.
                                    Those  having  obligations  under  the  Loan
                                    Documents  before the  transfer  will not be
                                    released from obligations  arising after the
                                    date of the transfer,  except at Mortgagee's
                                    sole discretion.

                                    (iii)  If  title  to the  Real  Property  is
                                    transferred  in connection  with the subject
                                    transaction,   such  a   transfer   will  be
                                    conditioned  on the payment of an assumption
                                    fee of one-half of one percent (1/2%) of the
                                    then-outstanding  principal  balance  of the
                                    Loan.

                                       32
<PAGE>

                                    If no Real  Property is so  transferred,  an
                                    administrative   fee  of  $50,000  shall  be
                                    charged in connection  with the  Mortgagee's
                                    review and underwriting of the request.

                  (b)      A single transfer of the Real Property, either (i) to
                           a purchaser of  Metropolitan  Operating  Partnership,
                           L.P., a Delaware limited partnership ("Metropolitan")
                           or to any  entity to which  substantially  all of the
                           assets of Metropolitan are transferred or as a result
                           of  a  change  in  control   through  the  merger  or
                           consolidation of Metropolitan into another entity, if
                           the purchaser or  transferee  is a corporation  whose
                           stock is publicly traded with a minimum stockholder's
                           equity of $500,000,000, or (ii) to a purchaser of the
                           Real Property,  if the Loan is not in Default, and if
                           the  Mortgagee,   applying  commercially   reasonable
                           standards,  approves  of  the  proposed  transferee's
                           ownership    structure,    financial   strength   and
                           management   capability,   and  of   the   management
                           capability  of  the  transferee's   principals.   The
                           following  additional  conditions  shall  apply  to a
                           Permitted Transfer under this subparagraph (b):

                                    (i)  If  title  to  the  Real   Property  is
                                    transferred  in connection  with the subject
                                    transaction,  the transferee must assume all
                                    liabilities and obligations  under the terms
                                    of the Loan Documents.

                                    (ii) The Carveout  Obligor shall be released
                                    from   accrued   and/or   future    Carveout
                                    Obligations,  provided accrued and/or future
                                    Carveout  Obligations are expressly  assumed
                                    by a replacement obligor satisfactory to the
                                    Mortgagee.  The Mortgagee shall not withhold
                                    its consent to any such replacement  obligor
                                    having a net worth  equal to the  greater of
                                    (i) the net worth of the Carveout Obligor at
                                    the  time  of  the  transfer  and  (ii)  the
                                    then-current principal balance of the Loan.

                                    (iii)  Any  transfer  permitted  under  this
                                    Paragraph  (b)  will be  conditioned  on the
                                    payment of an assumption fee one-half of one
                                    percent   (1/2%)  of  the   then-outstanding
                                    principal   balance  of  the  Loan.  If  the
                                    subject   transfer   does  not   occur,   an
                                    administrative   fee  of  $50,000  shall  be
                                    charged in connection  with the  Mortgagee's
                                    review and underwriting of the request.

                  (c)      The  transfer of any direct or  indirect  interest in
                           the Mortgagor,  subject to the condition that,  after
                           such transfer,  Reckson (or any entity which directly
                           or indirectly succeeds

                                       33
<PAGE>

                           to  the   interests   of   Reckson   by   merger   or
                           consolidation or sale of all or substantially  all of
                           its assets) shall,  directly or  indirectly,  control
                           the managing member of the Mortgagor by the ownership
                           of  voting  securities,   or  shall  by  contract  or
                           otherwise  hold  the  right  to the  present  control
                           (which  right  shall not be capable  being  withdrawn
                           without  Reckson's  consent,  except for  cause,  but
                           which  control may exist even though  others may have
                           approval  rights in  respect of major  decisions)  of
                           such managing  member,  and shall retain a beneficial
                           interest in the Mortgagor of not less than 30%.

         12.2.    TRANSACTION COSTS

                  The Mortgagor shall pay all out-of-pocket expenses incurred by
                  the  Mortgagee  in the review and  processing  of a  Permitted
                  Transfer.

         12.3.    RELEASE AND SUBSTITUTION OF COLLATERAL

                  If the  Mortgagor  desires to secure  the  release of the Real
                  Property  from the lien of this  Mortgage  in an arm's  length
                  transaction  to  an  unaffiliated  purchaser,  it  may  do  so
                  provided   that  the  Loan  is  not  in  default  and  another
                  commercial  real  property  satisfactory  to the  Mortgagee is
                  substituted  for the  released  Real  Property  as  collateral
                  encumbered  hereby.  The  Mortgagee  may  consider  any factor
                  reasonably  related to the quality of the proposed  substitute
                  property  as  collateral,   including,   without   limitation,
                  property  type,  market value,  cash flow,  projected  capital
                  requirements,  overall tenant quality, location,  condition of
                  title, quality and expected life of the improvements,  and the
                  environmental  condition of the property,  so that Mortgagee's
                  overall  credit  package  after  the  substitution  is no less
                  desirable to Mortgagee,  in its sole and absolute  discretion,
                  than  it was  before  the  substitution.  The  closing  of the
                  substitution  of  the  collateral  shall  be  carried  out  in
                  accordance  with the  Mortgagee's  then-current  mortgage loan
                  origination practice,  however the Mortgagee shall collect, as
                  compensation for its  underwriting and closing efforts,  a fee
                  of one half of one percent (1/2%) of the principal  balance of
                  the Note (if the substituted  collateral  consists of a single
                  real property) or of one percent (1%) of the principal balance
                  of the Note (if the  substituted  collateral  consists of two,
                  three, or four real properties). The substitute collateral may
                  not be  comprised  of more  than  four  real  properties.  The
                  Mortgagor  shall  pay  all  of  the   Mortgagee's   reasonable
                  out-of-pocket  expenses in  connection  with such  release and
                  substitution.

13.      NOTICE OF ABSOLUTE ASSIGNMENT OF LEASES AND RENTS

                  Under the Absolute  Assignment of Leases and Rents,  Mortgagor
                  has assigned to Mortgagee,  and to its successors and assigns,
                  all of

                                       34
<PAGE>

                  Mortgagor's  right and title to, and  interest in, the Leases,
                  including  all rights  under the Leases and all benefits to be
                  derived from them. The rights  assigned  include all authority
                  of Mortgagor to modify or terminate Leases, or to exercise any
                  remedies,  and the benefits  assigned include all Rents.  This
                  assignment is present and absolute, but under the terms of the
                  Absolute Assignment of Leases and Rents, Mortgagee has granted
                  the  Mortgagor  a  conditional  license to collect and use the
                  Rents,  and to  exercise  the  rights  assigned,  in a  manner
                  consistent  with  the  Obligations.  Mortgagee  may,  however,
                  terminate  the  license  by  written  Notice  upon  either (i)
                  Default or (ii) the  occupancy  of more than  one-half  of the
                  leasable space in the  Improvements by a single tenant that is
                  the subject of a petition under the U.S.  Bankruptcy Code (the
                  "Bankruptcy  Code"),  that  has  threatened  to  file  such  a
                  petition,  or whose insolvency is imminent.  If the license to
                  collect Rents is terminated  under clause (ii) and there is no
                  Default,  then the  Mortgagee  shall have the right to collect
                  the Rents  directly,  shall  apply any Rents  received to that
                  portion of the  Indebtedness  then due and payable,  and shall
                  promptly  remit  any  excess  amount to  Mortgagor.  Mortgagor
                  agrees to collect in trust for Mortgagee any Rents remitted to
                  Mortgagor  after the  expiration or termination of Mortgagor's
                  license to collect the Rents.  Mortgagor further agrees to pay
                  any such Rents to Mortgagee promptly after they are received.

                  In connection with the above-described  Assignment,  Mortgagee
                  shall have all the rights against lessees of the Real Property
                  as set forth in Section 291(f) of the Real Property Law of New
                  York.

                  Pursuant to the Absolute  Assignment of Rents,  and subject to
                  the terms and  conditions  set forth  therein,  Mortgagor  may
                  request,  and  Mortgagee  has agreed to grant,  subordination,
                  non-disturbance  and  attornment  agreements  with  respect to
                  certain Leases.

14.      ACCELERATION

                  Under the terms of the Note,  if a Default  exists,  Mortgagee
                  may, at its option,  without Notice to Mortgagor,  declare the
                  Indebtedness to be immediately due and payable.

15.      RIGHTS OF ENTRY AND TO OPERATE

         15.1.    ENTRY ON REAL PROPERTY

                  If a Default  exists,  Mortgagee may without Notice enter upon
                  the Real  Property and take  exclusive  possession of the Real
                  Property and of all books,  records and accounts,  all without
                  Notice and without  being  guilty of  trespass.  If  Mortgagor
                  remains in possession of all or any part of the Property after
                  Default  and  without

                                       35
<PAGE>

                  Mortgagee's  prior written  consent,  Mortgagee  may,  without
                  Notice to  Mortgagor,  invoke  any and all legal  remedies  to
                  dispossess Mortgagor.

         15.2.    OPERATION OF REAL PROPERTY

                  Following Default,  Mortgagee may hold, lease, manage, operate
                  or  otherwise  use or  permit  the use of the  Real  Property,
                  either itself or by other persons,  firms or entities, in such
                  manner,  for such time and upon such other terms as  Mortgagee
                  may deem to be prudent and reasonable under the  circumstances
                  (making such repairs, alterations,  additions and improvements
                  thereto  and taking any and all other  action  with  reference
                  thereto,  from time to time, as Mortgagee  deems  necessary or
                  desirable), and apply all Rents and other amounts collected by
                  Mortgagee in  accordance  with the  provisions of the Absolute
                  Assignment of Leases and Rents.

16.      RECEIVERSHIP

                  Following Default, Mortgagee may apply to a court of competent
                  jurisdiction   for  the  appointment  of  a  receiver  of  the
                  Property,  without  Notice to  Mortgagor,  whether  or not the
                  value of the Property exceeds the Indebtedness, whether or not
                  waste or deterioration of the Real Property has occurred,  and
                  whether or not other  arguments  based on equity would justify
                  the appointment. Mortgagor irrevocably, with knowledge and for
                  valuable consideration,  consents to such an appointment.  Any
                  such receiver shall have all the rights and powers customarily
                  given to  receivers  in New York,  including  the  rights  and
                  powers  granted to  Mortgagee by this  Mortgage,  the power to
                  maintain,  lease  and  operate  the  Real  Property  on  terms
                  approved by the court,  and the power to collect the Rents and
                  apply them to the  Indebtedness  or otherwise as the court may
                  direct.  Once appointed,  a receiver may at Mortgagee's option
                  remain in place until the Indebtedness has been paid in full.

17.      FORECLOSURE; POWER OF SALE

         17.1.    AVAILABLE REMEDIES

                  Upon Default,  Mortgagee may immediately  proceed to foreclose
                  the  lien  of  this  Mortgage,  against  all  or  part  of the
                  Property,  or to sell the Property, by judicial or nonjudicial
                  foreclosure  or power of sale in  accordance  with the laws of
                  New York and may pursue any other remedy available to mortgage
                  lenders  under  the  laws  of New  York.  In case of a sale by
                  foreclosure   or   otherwise,   the  Real   Property  may,  in
                  Mortgagee's sole  discretion,  be sold in one or more parcels,
                  any  provision of any statute,  regulation or other law to the
                  contrary notwithstanding.

                                       36
<PAGE>

         17.2.    EXPENSES

                  In connection with any foreclosure of the lien hereof (whether
                  by  judicial  proceeding  or power or sale) or any  action  to
                  enforce any other remedy of Mortgagee under this Mortgage, the
                  Note or any other Loan Document,  Mortgagor  agrees to pay all
                  expenditures  and expenses which may be paid or incurred by or
                  on  behalf  of  Mortgagee   including,   without   limitation,
                  attorneys' fees and  disbursements,  court costs,  appraiser's
                  fees,   outlays   for   documentary   and   expert   evidence,
                  stenographers'  charges,  publication  costs, and costs (which
                  may be estimated as to items to be expended after entry of the
                  decree)  of  procuring  all such  abstracts  of  title,  title
                  searches  and  examinations,  title  insurance  policies,  and
                  similar data and assurances with respect to title and value as
                  Mortgagee may deem  reasonably  necessary  either to prosecute
                  such suit or to  evidence  to bidders at any sale which may be
                  had pursuant to such decree the true  condition of title to or
                  the value of the Real Property, and the right to such fees and
                  expenses  shall be deemed to have accrued on  commencement  of
                  such  action  and  shall be  enforceable  whether  or not such
                  action is prosecuted to judgment. Subject to the limitation on
                  the maximum  secured  amount set forth in this  Mortgage,  all
                  expenditures  and  expenses  of the  nature  in  this  Section
                  mentioned and such expenses and fees as may be incurred in the
                  protection of Mortgagee's interest in the Real Property or the
                  maintenance  of the lien of this  Mortgage as permitted  under
                  the  terms of this  Mortgage  and the  other  loan  documents,
                  including  the fees of any attorney  employed by Mortgagee (i)
                  in  any   litigation   or   proceeding   (including,   without
                  limitation,  any bankruptcy  proceeding if Mortgagor  shall be
                  the  debtor  in  a  case  filed  under  the  Bankruptcy  Code)
                  affecting  this  Mortgage,  the Note or any of the other  Loan
                  Documents or concerning the protection of Mortgagee's interest
                  in the Real  Property or the  maintenance  of the lien of this
                  Mortgage, whether or not Mortgagee is a party thereto, or (ii)
                  in  preparation  for  the   commencement  or  defense  of  any
                  litigation  or  proceeding  described in (i) above or any such
                  litigation  or  proceeding  that may be threatened in writing,
                  whether  or not such  litigation  or  proceeding  is  actually
                  commenced,  shall be immediately  due and payable by Mortgagor
                  upon  demand,  with  interest  thereon at the Default Rate and
                  shall  be  secured  by  this   Mortgage  and  the  other  Loan
                  Documents.

         17.3     APPLICATION OF PROCEEDS OF FORECLOSURE SALE

                  The  proceeds  of any  foreclosure  sale of the Real  Property
                  shall be  distributed  and applied in the  following  order of
                  priority:  (a) first,  to  payment  of all costs and  expenses
                  incident to the foreclosure  proceedings,  including,  without
                  limitation,  all such  items as are

                                       37
<PAGE>

                  mentioned in Subsection  18.2; (b) second,  to the cost of any
                  search and/or other  evidence of title  procured in connection
                  therewith and the transfer tax on any deed or conveyance;  (c)
                  third,  to all sums expended under the terms hereof,  not then
                  repaid, with accrued interest at the rate provided herein; (d)
                  fourth,  to all other sums  secured  hereby,  in such order as
                  Mortgagee may  determine in its sole and absolute  discretion;
                  and (e) fifth, the remainder,  if any to the person or persons
                  legally entitled thereto.

         17.4     CONTINUATION OF LEASES

                  Upon the foreclosure of the lien created by this Mortgage,  no
                  Lease then  existing  shall be  destroyed or  terminated  as a
                  result of such  foreclosure  unless Mortgagee or any purchaser
                  of the  Property  shall be so elect by notice to the tenant or
                  lessee in question.

18.      WAIVERS

                  To the maximum extent permitted by law, Mortgagor  irrevocably
                  and unconditionally  WAIVES and RELEASES any present or future
                  rights (a) of  reinstatement or redemption (b) that may exempt
                  the  Property  from any civil  process,  (c) to  appraisal  or
                  valuation  of the  Property,  (d) to  extension  of  time  for
                  payment,  (e) that may  subject  Mortgagee's  exercise  of its
                  remedies to the  administration of any decedent's estate or to
                  any partition or liquidation  action, (f) to any homestead and
                  exemption  rights provided by the Constitution and laws of the
                  United States and of New York,  (g) to notice of  acceleration
                  or notice of  intent  to  accelerate,  and (h) that in any way
                  would delay or defeat the right of Mortgagee to cause the sale
                  of the  Real  Property  for  the  purpose  of  satisfying  the
                  Indebtedness. Mortgagor agrees that the price paid at a lawful
                  foreclosure  sale,  whether by  Mortgagee or by a third party,
                  and whether paid through  cancellation  of all or a portion of
                  the Indebtedness or in cash, shall conclusively  establish the
                  value of the Real Property.

19.      EXCULPATION CLAUSE AND CARVEOUT OBLIGATIONS

                  Mortgagee  agrees  that  it  shall  not  seek to  enforce  any
                  monetary  judgment with respect to the indebtedness  evidenced
                  by the Note against  Mortgagor  and  Mortgagee  shall not have
                  recourse  to  Mortgagor  or any of its assets  except  through
                  recourse to the Property, unless the obligation from which the
                  judgment  arises  is  a  Carveout  Obligation.   The  Carveout
                  Obligations include (i) the obligation to repay any portion of
                  the  Indebtedness  that  arises  from  a  Carveout,  (ii)  the
                  obligation to repay the entire  Indebtedness,  if  Mortgagee's
                  exculpation  of the Mortgagor  from personal  liability

                                       38
<PAGE>

                  under  this  Section  has  become  void  pursuant  to the last
                  paragraph  of  this  Section  19,  (iii)  the   obligation  to
                  indemnify  the  Mortgagee  in respect  of its  actual  damages
                  suffered  in  connection   with  a  Carveout,   and  (iv)  the
                  obligation  to  defend  the  Mortgagee  from and  against  any
                  claims,  judgments,  causes of action or  proceedings  arising
                  from the Carveouts. The Carveouts include:

                  (i)      fraud or material written misrepresentation;

                  (ii)     waste of the  Property  (which  shall be  defined  to
                           include damage,  destruction or disrepair of the Real
                           Property caused by a willful act or grossly negligent
                           omission of the  Mortgagor,  but to exclude  ordinary
                           wear and tear in the absence of gross negligence);

                  (iii)    misapplication of tenant security deposits, Insurance
                           Proceeds or Condemnation Proceeds;

                  (iv)     failure to pay property  taxes,  assessments or other
                           lienable Impositions, to the extent that amounts held
                           by the  Mortgagee  in escrow for the  payment of such
                           impositions  and amounts  held by any  receiver or in
                           any  lock-box,  or collected  by Mortgagee  under the
                           related   assignment,   are   insufficient  for  such
                           payment,  provided,  however,  that no  such  failure
                           shall be  considered  to have  occurred in respect of
                           any  period  more  than  sixty  (60)  days  after the
                           Mortgagor has  unconditionally  offered to enter into
                           the Mortgagee's  choice of either (A) an agreement to
                           permit  an   uncontested   foreclosure,   or  (B)  an
                           agreement  to deliver a deed in lieu of  foreclosure,
                           in  either  case  within   sixty  (60)  days  of  the
                           Mortgagee's acceptance of the offer;

                  (v)      failure to pay to  Mortgagee  all  Rents,  income and
                           profits,  net of reasonable  and customary  operating
                           expenses,  received  in respect of a period  when the
                           Loan is in Default (as defined herein);

                  (vi)     the  out-of-pocket  expenses  of  enforcing  the Loan
                           Documents  following Default,  not including expenses
                           incurred after the Mortgagor has agreed in writing to
                           transfer  the Real  Property to the  Mortgagee by the
                           Mortgagee's   choice   of   either   an   uncontested
                           foreclosure   or  delivery  of  a  deed  in  lieu  of
                           foreclosure;

                  (vii)    terminating  or amending a Lease in  violation of the
                           Loan Documents;

                  (viii)   any presence or release of hazardous substances;

                  (ix)     any  and  all   liabilities,   obligations,   losses,
                           damages,   penalties,   actions,  causes  of  action,
                           judgments, suits, claims, costs, expenses of any kind
                           or nature, including the reasonable fees and expenses
                           of counsel,  which  arise as a result of  Mortgagor's
                           failure  to  perform  its   obligations   as  tenant,
                           including  without  limitation,  payment  of  rent or
                           taxes, pursuant to any Air Rights lease (as such term
                           is defined in

                                       39
<PAGE>

                           the  Mortgage) or  Borrower's  failure to perform its
                           obligations as  sublandlord  pursuant to any sublease
                           of an Air Rights Lease;

                  (x)      any  and  all   liabilities,   obligations,   losses,
                           damages,   penalties,   actions,  causes  of  action,
                           judgments, suits, claims, costs, expenses of any kind
                           or nature, including the reasonable fees and expenses
                           of   counsel,   which   arise  as  a  result  of  the
                           termination  or  expiration  of any Air Rights Lease,
                           whether  by reason of  Mortgagor's  failure to timely
                           exercise  any  right or  option  to such  Air  Rights
                           Lease,  Mortgagor's default thereunder,  or any other
                           cause or circumstance; and

                  (xi)     claims  made,  or  causes  of  action  commenced,  by
                           tenants at the Property known as 810 Seventh  Avenue,
                           resulting from the interruption of telephone  service
                           arising from damage to the Bell Atlantic equipment in
                           the parking  garage which  occurred prior to the date
                           hereof.

                  The  Mortgagee's  exculpation  of the Mortgagor  from personal
                  liability for the repayment of the Indebtedness  shall be void
                  without  Notice if  Mortgagor  (a)  voluntarily  transfers  or
                  encumbers the Property in violation of this  Mortgage,  or (b)
                  files a voluntary petition for  reorganization  under Title 11
                  of the  United  States  Code (or under any  other  present  or
                  future law,  domestic or foreign,  similarly  affording relief
                  from creditors),  and has not offered, prior to the filing, to
                  enter into the  Mortgagee's  choice of either an  agreement to
                  permit an uncontested foreclosure,  or an agreement to deliver
                  a deed in lieu of  foreclosure  within  sixty (60) days of the
                  Mortgagee's  acceptance  of the  offer.  After  the  Mortgagee
                  accepts such an offer,  default by the Mortgagor in fulfilling
                  the  terms  of  the  accepted  offer  shall  trigger  personal
                  liability for the entire Indebtedness.  No such offer shall be
                  conditioned on any payment by the Mortgagee, on the release of
                  any obligor from any Obligation,  or on any other  concession.
                  If the Mortgagor  voluntarily assumes recourse liability under
                  Loan  Documents or other  written  agreements  that  expressly
                  provide for such personal  liability,  such Loan  Documents or
                  written   agreements,   if  any,   shall  not  be  subject  to
                  exculpation from personal liability.

20.      SECURITY AGREEMENT AND FIXTURE FILING

         20.1.    SECURITY AGREEMENT

                  This Mortgage shall be  self-operative  and shall constitute a
                  Security Agreement pursuant to the provisions of the Code with
                  respect to those items comprising Property that may be subject
                  to a security interest under the Code.  Mortgagor,  as debtor,
                  hereby grants Mortgagee, as secured party, a security interest
                  in those  items and in all  related  additions,  replacements,
                  substitutions  and  proceeds,  for the purpose of securing the
                  Indebtedness.  Mortgagor  hereby

                                       40
<PAGE>

                  agrees to  execute  and  deliver on  demand,  and  irrevocably
                  constitutes  and appoints  Mortgagee the  attorney-in-fact  of
                  Mortgagor,  to execute,  deliver and, if appropriate,  to file
                  with the appropriate  filing officer or office,  such security
                  agreements,  financing  statements  or  other  instruments  as
                  Mortgagee may reasonably require in order to create,  perfect,
                  or continue this security  interest.  Mortgagor  shall pay all
                  related  filing  fees and  costs,  all  reasonable  costs  and
                  expenses of any record searches (or their  continuations),  as
                  Mortgagee may  reasonably  require.  Without the prior written
                  consent of Mortgagee, Mortgagor shall not create or suffer the
                  creation of any other lien on or  security  interest in any of
                  the Property subject to the security  interest.  Upon Default,
                  Mortgagee  shall  have the rights  and  remedies  of a secured
                  party under the Code as well as all other  rights and remedies
                  available  at law or in equity,  and, at  Mortgagee's  option,
                  Mortgagee may also invoke the remedies  provided  elsewhere in
                  this  Mortgage as to such  property.  Mortgagor  and Mortgagee
                  agree that the rights  granted to Mortgagee  as secured  party
                  under  this  Section  21  are in  addition  to  rather  than a
                  limitation  on any of  Mortgagee's  other  rights  under  this
                  Mortgage with respect to the Personal Property.  No failure to
                  mention  any item in a  financing  statement  shall  limit the
                  scope of  Mortgagor's  assignment of any Property,  impair the
                  priority of  Mortgagee`s  lien on any  Personal  Property,  or
                  alter   Mortgagee's   rights   to   Insurance   Proceeds   and
                  Condemnation Proceeds.

         20.2.    FIXTURE FILING

                  This  Mortgage  constitutes a financing  statement  filed as a
                  fixture filing in the Official  Records of the County Clerk of
                  New York County, New York with respect to any and all fixtures
                  comprising Property. The "debtor" is Metropolitan 810 7th Ave,
                  LLC, a limited liability company organized under Delaware law,
                  and  100  Wall  Company  LLC,  a  limited   liability  company
                  organized   under   Delaware  law,  the  "secured   party"  is
                  Monumental Life Insurance Company, a Maryland corporation, the
                  collateral  is as  described  in  Section  20  above  and  the
                  granting  clause of this  Mortgage,  and the  addresses of the
                  debtor  and  secured  party  are  the   addresses   stated  in
                  Subsection 22.12 of this Mortgage for Notices to such parties.
                  The owner of record of the Real Property is  Metropolitan  810
                  7th Ave,  LLC with respect to the Real  Property  described on
                  Exhibit B-1 and 100 Wall  Company LLC with respect to the Real
                  Property described on Exhibit B-2.

                                       41
<PAGE>

21.      ENVIRONMENTAL MATTERS

         21.1.    REPRESENTATIONS

                  The Mortgagor represents as follows:

                  (a)      No Hazardous Substances

                           To  the  best  of  Mortgagor's  knowledge  as a  duly
                           diligent  property owner,  and except as disclosed in
                           the ESA, no release of any  Hazardous  Substance  has
                           occurred on or about the Real  Property in quantities
                           or at concentration  levels that would be expected to
                           give rise to response action.

                  (b)      Compliance with Environmental Laws

                           The Real  Property and its current use and  presently
                           anticipated uses comply with all Environmental  Laws,
                           including   those   requiring   permits,    licenses,
                           authorizations, and other consents and approvals.

                  (c)      No Actions or Proceedings

                           No governmental authority or agency has commenced any
                           action,  proceeding  or  investigation  based  on any
                           suspected or actual  violation  of any  Environmental
                           Law on or  about  the Real  Property.  To the best of
                           Mortgagor's  knowledge  as a duly  diligent  property
                           owner,  no such authority or agency has threatened to
                           commence    any   such   action,    proceeding,    or
                           investigation.

         21.2.    COVENANTS

                  Mortgagor covenants as follows:

                  (a)      Compliance with Environmental Laws

                           Mortgagor   shall,  and  Mortgagor  shall  cause  all
                           employees,   agents,  contractors,   and  tenants  of
                           Mortgagor  and  any  other  persons   present  on  or
                           occupying the Real Property, to keep and maintain the
                           Real  Property  in  material   compliance   with  all
                           Environmental Laws.

                  (b)      Notices, Actions and Claims

                           The Mortgagor shall  immediately  advise Mortgagee in
                           writing of (i) any notices from any  governmental  or
                           quasi-governmental  agency or  authority of violation
                           or  potential  violation  of  any  Environmental  Law
                           received by Mortgagor,  (ii) any and all enforcement,
                           cleanup,  removal or other governmental or regulatory
                           actions instituted,  completed or

                                       42
<PAGE>

                           threatened  pursuant to any Environmental  Law, (iii)
                           all  claims  made or  threatened  by any third  party
                           against  Mortgagor or the Real  Property  relating to
                           damage,  contribution,  cost recovery,  compensation,
                           loss  or   injury   resulting   from  any   Hazardous
                           Substances,  and (iv)  discovery  by Mortgagor of any
                           occurrence   or  condition   on  any  real   property
                           adjoining  or in the  vicinity  of the Real  Property
                           that  could   cause  the  Real   Property  to  become
                           contaminated by or with Hazardous Substances.

         21.3.    MORTGAGEE'S RIGHT TO CONTROL CLAIMS

                  Mortgagee  shall  have the right (but not the  obligation)  to
                  join and participate in, as a party if it so elects, any legal
                  proceedings  or  actions  initiated  in  connection  with  any
                  Hazardous  Substances  and to have its  consultants'  fees and
                  attorneys' fees paid by Mortgagor, provided however, that with
                  respect to attorneys' fees, so long as no Default has occurred
                  hereunder or under the other Loan  Documents,  Mortgagee shall
                  not be entitled to seek payment  thereof from Mortgagor  under
                  this Section 21.3 unless  Mortgagee has reasonably  determined
                  that its  representation by counsel separate from Mortgagor in
                  any such  proceeding  or  action  is  necessary  or  advisable
                  (whether by reason of a conflict of interest, a determination,
                  in   Mortgagee's   reasonable   good  faith   judgment,   that
                  Mortgagor's counsel is not adequately representing Mortgagee's
                  interest, or other reasonable basis for such determination).

         21.4.    INDEMNIFICATION

                  Mortgagor   shall  be  solely   responsible   for,  and  shall
                  indemnify,   defend,  and  hold  harmless  Mortgagee  and  its
                  directors, officers, employees, agents, successors and assigns
                  from and against, any claim,  judgment,  loss, damage, demand,
                  cost,  expense or liability of whatever kind or nature,  known
                  or unknown,  contingent or  otherwise,  directly or indirectly
                  arising  out  of  or  attributable  to  the  use,  generation,
                  storage, release, threatened release, discharge,  disposal, or
                  presence (whether prior to or after the date of this Mortgage)
                  of  Hazardous  Substances  on,  in,  under or  about  the Real
                  Property  (whether by Mortgagor,  a predecessor in title,  any
                  tenant, or any employees, agents, contractor or subcontractors
                  of any of the  foregoing  or any  third  persons  at any  time
                  occupying  or present on the Real  Property),  including:  (i)
                  personal injury;  (ii) death;  (iii) damage to property;  (iv)
                  all  consequential  damages;  (v) the cost of any  required or
                  necessary  repair,  cleanup  or  detoxification  of  the  Real
                  Property, including the soil and ground water thereof, and the
                  preparation  and  implementation  of any closure,  remedial or
                  other required  plans;  (vi) damage to any natural  resources;
                  and  (vii)  all  reasonable  costs and  expenses

                                       43
<PAGE>

                  incurred by Mortgagee in  connection  with clauses (i) through
                  (vi), including  reasonable  attorneys' and consultants' fees;
                  provided,  however,  that  nothing  contained  in this Section
                  shall  be   deemed  to   preclude   Mortgagor   from   seeking
                  indemnification  from, or otherwise  proceeding  against,  any
                  third party  including any tenant or  predecessor  in title to
                  the Real Property. The covenants,  agreements, and indemnities
                  set forth in this Section shall be binding upon  Mortgagor and
                  its heirs, personal  representatives,  successors and assigns,
                  and shall survive repayment of the  Indebtedness,  foreclosure
                  of the Real Property,  and  Mortgagor's  granting of a deed to
                  the Real Property in lieu of foreclosure. Payment shall not be
                  a condition precedent to this indemnity. Any costs or expenses
                  incurred by Mortgagee for which  Mortgagor is  responsible  or
                  for which Mortgagor has indemnified Mortgagee shall be paid to
                  Mortgagee  within ten (10) Business  Days after  demand,  with
                  interest  at the  Default  Rate  from  the  date  incurred  by
                  Mortgagee  until  paid in full,  and shall be  secured by this
                  Mortgage.  Without  the prior  written  consent of  Mortgagee,
                  Mortgagor  shall  not  enter  into any  settlement  agreement,
                  consent decree,  or other  compromise in respect to any claims
                  relating to Hazardous  Substances;  provided  however,  if (1)
                  there is no Default  hereunder  or under any of the other Loan
                  Documents,  (2) the  settlement,  compromise or consent decree
                  does not  require  or impose on  Mortgagee  any  admission  of
                  liability,  negligence  or wrong  doing,  and (3)  there is no
                  performance  required  under such  settlement,  compromise  or
                  consent  decree on Mortgagee's  part and any such  performance
                  required by Mortgagor is, in Mortgagee's  reasonable judgment,
                  adequately provided for, then, in such event,  Mortgagee shall
                  not unreasonably withhold, condition or delay its consent.

                  Notwithstanding  the foregoing,  the indemnification set forth
                  in this Section 21.4 shall not extend to matters caused by the
                  Mortgagee's gross negligence or willful  misconduct or arising
                  from a release, discharge,  disposal, or presence of Hazardous
                  Substances   that  occurs  after  the   Mortgagee   has  taken
                  possession  of the Real  Property  (provided the Mortgagor has
                  not caused  the  release,  discharge,  disposal,  or  presence
                  though an act or omission).

         21.5.    ENVIRONMENTAL AUDITS

                  If a Default  exists,  or at any time  Mortgagee has reason to
                  believe  that a  release  of  Hazardous  Substances  may  have
                  occurred or may be likely to occur, Mortgagee may require that
                  Mortgagor  retain,  or Mortgagee may retain  directly,  at the
                  sole cost and  expense of  Mortgagor,  a  licensed  geologist,
                  industrial hygienist or an environmental consultant acceptable
                  to Mortgagee to conduct an  environmental  assessment or audit
                  of the Real

                                       44
<PAGE>

                  Property.  In the  event  that  Mortgagee  makes a  reasonable
                  determination of the need for an  environmental  assessment or
                  audit,  Mortgagee shall inform Mortgagor  (either orally or in
                  writing)  that such a  determination  has been  made  and,  if
                  requested  to do so by  Mortgagor,  give  Mortgagor  a written
                  explanation  of that  determination  before the  assessment or
                  audit  is  conducted.   Mortgagor   shall  afford  any  person
                  conducting an environmental  assessment or audit access to the
                  Real   Property  and  all  materials   reasonably   requested.
                  Mortgagor shall pay within ten (10) Business Days after demand
                  the cost and expenses of any environmental assessment or audit
                  obtained by Mortgagee. Mortgagor shall, at Mortgagee's request
                  and  at   Mortgagor's   sole  cost  and  expense,   take  such
                  investigative   and  remedial   measures   determined  by  the
                  geologist,  hygienist or consultant to be necessary to address
                  any condition  discovered  by the  assessment or audit so that
                  (i)  the  Real  Property  shall  be  in  compliance  with  all
                  Environmental  Laws,  (ii) the  condition of the Real Property
                  shall not constitute any identifiable  risk to human health or
                  to the  environment,  and (iii) the value of the Real Property
                  shall not be affected by the presence of Hazardous Substances.

22.      MISCELLANEOUS

         22.1.    SUCCESSORS AND ASSIGNS

                  All of the  terms of the Loan  Documents  shall  apply  to, be
                  binding  upon and inure to the benefit of the heirs,  personal
                  representatives, successors and assigns of the Obligors, or to
                  the holder of the Note, as the case may be.

         22.2.    SURVIVAL OF OBLIGATIONS

                  Each and all of the  Obligations  shall  survive the execution
                  and delivery of the Loan  Documents  and will continue in full
                  force  and  effect  until  the  latest  of (a)  the  date  the
                  Indebtedness  has been paid in full and the  Obligations  have
                  been  performed  and  satisfied  in full,  (b) the  last  date
                  permitted by law for bringing any claim or action with respect
                  to which  Mortgagee  may seek  payment or  indemnification  in
                  connection with the Loan Documents,  and (c) the date on which
                  any  claim or action  for which  Mortgagee  seeks  payment  or
                  indemnification   is  fully  and  finally   resolved  and,  if
                  applicable,  any  compromise  thereof  of  judgment  or  award
                  thereon is paid in full.

         22.3.    FURTHER ASSURANCES

                  Mortgagor,  upon the  request of  Mortgagee,  shall  complete,
                  execute, acknowledge,  deliver and record or file such further
                  instruments  and do such  further  acts  as may be  reasonably

                                       45
<PAGE>

                  necessary,  desirable or proper to carry out more  effectively
                  the  purposes  of  this  Mortgage,  to  subject  any  property
                  intended  to be  covered  by this  Mortgage  to the  liens and
                  security  interests  it  creates,  to place  third  parties on
                  notice of those liens and  security  interests,  or to correct
                  any defects which may be found in any Loan Document.

         22.4.    EXPENSE INDEMNIFICATION

                  Mortgagor shall pay all filing and recording fees, documentary
                  stamps,  intangible  taxes,  and all expenses  incident to the
                  execution and acknowledgment of this Mortgage, the Note or any
                  of the other  Loan  Documents,  any  supplements,  amendments,
                  renewals  or  extensions  of any of  them,  or any  instrument
                  entered into under  Subsection  22.3.  Mortgagor  shall pay or
                  reimburse Mortgagee,  upon demand, for all costs and expenses,
                  including  appraisal and reappraisal costs of the Property and
                  reasonable   attorneys'  and  legal  assistants'  fees,  which
                  Mortgagee may incur in connection with enforcement proceedings
                  under  the  Note,  this  Mortgage,  or any of the  other  Loan
                  Documents  (including all fees and costs incurred in enforcing
                  or protecting  the Note,  this  Mortgage,  or any of the other
                  Loan Documents in any bankruptcy  proceeding),  and reasonable
                  attorneys' and legal assistants' fees incurred by Mortgagee in
                  any other suit,  action,  legal  proceeding  or dispute of any
                  kind in which  Mortgagee  is made a party or  appears as party
                  plaintiff or defendant,  affecting the Indebtedness, the Note,
                  this  Mortgage,  any  of  the  other  Loan  Documents,  or the
                  Property,  or  required to protect or sustain the lien of this
                  Mortgage. Mortgagor shall be obligated to pay (or to reimburse
                  Mortgagee)  for  such  fees,  costs  and  expenses  and  shall
                  indemnify and hold Mortgagee harmless from and against any and
                  all loss,  cost,  expense,  liability,  damage  and claims and
                  causes  of  action,   including  reasonable  attorneys'  fees,
                  incurred  or  accruing  by reason of  Mortgagor's  failure  to
                  promptly repay any such fees, costs and expenses.  If any suit
                  or action is brought to enforce or interpret  any of the terms
                  of this Mortgage (including any effort to modify or vacate any
                  automatic  stay or  injunction,  any trial,  any  appeal,  any
                  petition  for  review  or  any  bankruptcy  proceeding),   the
                  Mortgagee shall be entitled to recover all expenses reasonably
                  incurred in preparation for or during the suit or action or in
                  connection with any appeal of the related decision, whether or
                  not taxable as costs.  Such expenses include  attorneys' fees,
                  witness fees (expert or otherwise),  deposition costs, copying
                  charges and other expenses. Whether or not any court action is
                  involved,  all  reasonable  expenses,  including  the costs of
                  searching  records,   obtaining  title  reports,   appraisals,
                  environmental  assessments,  surveying costs,  title insurance
                  premiums,  and attorneys' fees, incurred by Mortgagee that are
                  necessary  at  any  time  in

                                       46
<PAGE>

                  Mortgagee's  opinion  for the  protection  of its  interest or
                  enforcement   of  its  rights  shall  become  a  part  of  the
                  Indebtedness  payable on demand and shall bear  interest  from
                  the date of  expenditure  until repaid at the interest rate as
                  provided in the Note.

         22.5.    GENERAL INDEMNIFICATION

                  Mortgagor shall indemnify,  defend and hold Mortgagee harmless
                  against:  (i) any  and  all  claims  for  brokerage,  leasing,
                  finder's  or similar  fees which may be made  relating  to the
                  Real Property or the Indebtedness, (ii) any and all liability,
                  obligations,  losses,  damages,  penalties,  claims,  actions,
                  suits costs and  expenses  (including  Mortgagee's  reasonable
                  attorneys' fees,  together with reasonable  appellate  counsel
                  fees, if any) of whatever kind or nature which may be asserted
                  against,  imposed on or incurred by  Mortgagee  in  connection
                  with the Indebtedness, this Mortgage, the Real Property or any
                  part  thereof,  or  the  operation,   maintenance  and/or  use
                  thereof,  or  the  exercise  by  Mortgagee  of any  rights  or
                  remedies  granted to it under this  Mortgage  or  pursuant  to
                  applicable law; provided,  however,  that nothing herein shall
                  be construed to obligate  Mortgagor to  indemnify,  defend and
                  hold harmless  Mortgagee from and against any of the foregoing
                  which is  imposed on or  incurred  by  Mortgagee  by reason of
                  Mortgagee's willful misconduct or gross negligence.

         22.6.    RECORDING AND FILING

                  Mortgagor  shall  cause  this  Mortgage  and  all  amendments,
                  supplements,   and   substitutions  to  be  recorded,   filed,
                  re-recorded  and  refiled in such manner and in such places as
                  Mortgagee  may  reasonably  request.  Mortgagor  will  pay all
                  recording  filing,  re-recording and refiling taxes,  fees and
                  other charges.

         22.7.    NO WAIVER

                  No deliberate or unintentional failure by Mortgagee to require
                  strict  performance  by Mortgagor of any  Obligation  shall be
                  deemed a waiver,  and  Mortgagee  shall  have the right at any
                  time  to  require  strict  performance  by  Mortgagor  of  any
                  Obligation.

         22.8.    COVENANTS RUNNING WITH THE LAND

                  All Obligations are intended by the parties to be and shall be
                  construed as covenants running with the Land.

         22.9.    SEVERABILITY

                  The Loan  Documents are intended to be performed in accordance
                  with,  and only to the extent  permitted  by,  all

                                       47
<PAGE>

                  applicable  Legal  Requirements.  Any  provision  of the  Loan
                  Documents   that  is  prohibited  or   unenforceable   in  any
                  jurisdiction  shall nevertheless be construed and given effect
                  to the extent possible.  The invalidity or unenforceability of
                  any  provision  in a  particular  jurisdiction  shall  neither
                  invalidate nor render unenforceable any other provision of the
                  Loan Documents in that jurisdiction,  and shall not affect the
                  validity  or  enforceability  of that  provision  in any other
                  jurisdiction.  If  a  provision  is  held  to  be  invalid  or
                  unenforceable as to a particular  person or under a particular
                  circumstance,  it shall  nevertheless  be  presumed  valid and
                  enforceable as to others, or under other circumstances.

         22.10.   USURY

                  The parties  intend that no  provision of the Note or the Loan
                  Documents be interpreted,  construed,  applied, or enforced so
                  as to permit or require the payment or  collection of interest
                  in  excess  of the  highest  rate of  interest  (the  "Maximum
                  Permitted   Rate")  permitted  to  be  paid  or  collected  by
                  applicable  law  with  respect  to this  transaction.  In this
                  regard,  Mortgagor and Mortgagee each stipulate and agree that
                  it is their common and overriding intent to contract in strict
                  compliance with applicable  usury laws.  Accordingly,  none of
                  the terms of this Mortgage,  the Note or any of the other Loan
                  Documents shall ever be construed to create a contract to pay,
                  as  consideration  for the use,  forbearance  or  detention of
                  money,  interest at a rate in excess of the Maximum  Permitted
                  Rate,  and  Mortgagor  shall  never be liable for  interest in
                  excess of the Maximum  Permitted Rate.  Therefore,  (a) in the
                  event that the Indebtedness and Obligations are prepaid or the
                  maturity of the Indebtedness and Obligations is accelerated by
                  reason of an election by Mortgagee, unearned interest shall be
                  canceled and, if theretofore paid, shall either be refunded to
                  Mortgagor or credited on the  Indebtedness,  as Mortgagee  may
                  elect;  (b) the  aggregate of all  interest and other  charges
                  constituting  interest  under  applicable  laws and contracted
                  for,  chargeable  or  receivable  under the Note and the other
                  Loan Documents or otherwise in connection with the transaction
                  contemplated  thereby shall never exceed the maximum amount of
                  interest,  nor  produce  a  rate  in  excess  of  the  Maximum
                  Permitted Rate; and (c) if any excess interest is provided for
                  or received, it shall be deemed a mistake, and the same shall,
                  at the option of Mortgagee, either be refunded to Mortgagor or
                  credited  on the unpaid  principal  amount  (if any),  and the
                  Indebtedness  shall be automatically  reformed so as to permit
                  only the  collection of the interest at the Maximum  Permitted
                  Rate. Furthermore,  if any provision of the Note or any of the
                  other Loan Documents is interpreted,  construed,  applied,  or
                  enforced,  in such a manner  as to  provide  for  interest  in
                  excess of the Maximum  Permitted Rate, then the parties intend
                  that such

                                       48
<PAGE>

                  provision automatically shall be deemed reformed retroactively
                  so as to  require  payment  only of  interest  at the  Maximum
                  Permitted Rate. If, for any reason  whatsoever,  interest paid
                  or   received   during   the  full  term  of  the   applicable
                  Indebtedness   produces  a  rate  which  exceeds  the  Maximum
                  Permitted Rate, then the amount of such excess shall be deemed
                  credited  retroactively  in reduction of the then  outstanding
                  principal amount of the  Indebtedness,  together with interest
                  at such Maximum Permitted Rate. Mortgagee shall credit against
                  the principal of such  Indebtedness  (or, if such Indebtedness
                  shall  have  been paid in full,  shall  refund to the payor of
                  such  interest)  such  portion  of said  interest  as shall be
                  necessary to cause the  interest  paid to produce a rate equal
                  to the Maximum  Permitted  Rate. All sums paid or agreed to be
                  paid to  Mortgagee  for the use,  forbearance  or detention of
                  money shall,  to the extent  permitted by  applicable  law, be
                  amortized,  prorated,  allocated  and  spread  in equal  parts
                  throughout  the full term of the applicable  Indebtedness,  so
                  that the interest rate is uniform  throughout the full term of
                  such  Indebtedness.  In connection  with all  calculations  to
                  determine the Maximum  Permitted Rate, the parties intend that
                  all  charges  be  excluded  to the  extent  they are  properly
                  excludable  under  applicable usury laws, as they from time to
                  time  are  determined  to  apply  to  this  transaction.   The
                  provisions  of this  Section  shall  control  all  agreements,
                  whether now or hereafter existing and whether written or oral,
                  between Mortgagor and Mortgagee.

         22.11.   ENTIRE AGREEMENT

                  The Loan Documents contain the entire  agreements  between the
                  parties  relating to the financing of the Real  Property,  and
                  all  prior  agreements  which  are not  contained  in the Loan
                  Documents are  terminated.  The Loan  Documents  represent the
                  final   agreement   between   the   parties  and  may  not  be
                  contradicted  by  evidence  of  prior,   contemporaneous,   or
                  subsequent  oral  agreements  of  the  parties.  There  are no
                  unwritten  oral  agreements  between  the  parties.  The  Loan
                  Documents  may  be  amended,   revised,  waived,   discharged,
                  released  or  terminated  only  by  a  written  instrument  or
                  instruments  executed by the party against whom enforcement of
                  the  amendment,   revision,  waiver,  discharge,   release  or
                  termination  is  asserted.  Any alleged  amendment,  revision,
                  waiver,  discharge,  release  or  termination  that  is not so
                  documented shall be null and void.

         22.12.   NOTICES

                  In  order  for  any   demand,   consent,   approval  or  other
                  communication   to  be  effective  under  the  terms  of  this
                  Mortgage,  "Notice"  must be provided  under the terms of this
                  Subsection. All

                                       49
<PAGE>

                  Notices  must be in writing.  Notices may be (a)  delivered by
                  hand, (b)  transmitted by telecopy (with a duplicate copy sent
                  by one of the  other  methods  provided  herein),  (c) sent by
                  certified or registered mail, postage prepaid,  return receipt
                  requested, or (d) sent by reputable overnight courier service,
                  delivery  charges  prepaid.  Notices shall be addressed as set
                  forth below:

                  If to Mortgagee:

                  Monumental Life Insurance Company
                  c/o AEGON USA Realty Advisors, Inc.
                  4333 Edgewood Road, N.E.
                  Cedar Rapids, Iowa 52499-5443
                  Attn:  Mortgage Loan Department
                  Telecopy Number: (319) 369-2277
                  Reference:  Loan #87947

                  If to Mortgagor:

                  Metropolitan 810 7th Ave, LLC
                  c/o Reckson Associates
                  10 East 50th Street--27th Floor
                  New York, New York 10022
                  Attention:  Jason Barnett, Esq.
                  Telecopy Number: (212) 715-6535

                  and 100 Wall Company LLC
                  c/o Reckson Associates
                  10 East 50th Street - 27th Floor
                  New York, New York 10022
                  Attention:  Jason Barnett, Esq.
                  Telecopy Number: (212) 715-6535

                  With a copy to

                  Reckson Associates Realty Corp.
                  225 Broadhollow Road
                  Melville, New York  11747
                  Attn:  Jason Barnett, Esq.
                  Telecopy No.: 516-622-6788

                  Notices  delivered  by hand or by overnight  courier  shall be
                  deemed given when  actually  received or when refused by their
                  intended   recipient.   Telecopied   Notices  will  be  deemed
                  delivered  when a  legible  copy has been  received  (provided
                  receipt has been verified by telephone  confirmation or one of
                  the  other  permitted  means  of  giving  Notices  under  this
                  Subsection).  Mailed  Notices

                                       50
<PAGE>

                  shall be deemed  received  three  days after  mailing.  Either
                  Mortgagee  or  Mortgagor  may change its address for Notice by
                  giving at least  fifteen (15)  Business  Days' prior Notice of
                  such change to the other party.

         22.13.   COUNTERPARTS

                  This  Mortgage may be executed in any number of  counterparts,
                  each of which shall be an original,  but all of which together
                  shall constitute but one instrument.

         22.14.   APPLICABLE LAW

                  This Mortgage will be  interpreted,  construed,  applied,  and
                  enforced  according  to, and will be governed  by, the laws of
                  the State of New  York,  without  regard to any  choice of law
                  principles  which,  but for this provision,  would require the
                  application of the law of another  jurisdiction and regardless
                  of where executed or delivered,  where payable or paid,  where
                  any  cause  of  action   accrues  in   connection   with  this
                  transaction,  where any action or other  proceeding  involving
                  this Mortgage is instituted or pending, or whether the laws of
                  the  State  of New  York  otherwise  would  apply  the laws of
                  another  jurisdiction.  Mortgagor  agrees  that  the  sole and
                  exclusive forum for the  determination  of any action relating
                  to the validity and  enforceability of the Note, this Mortgage
                  and  the  other  Loan  Documents,  and any  other  instruments
                  securing the Note shall be either in an  appropriate  court of
                  the State of New York or the applicable United States District
                  Court.

         22.15.   SOLE BENEFIT

                  This Mortgage and the other Loan  Documents have been executed
                  for the  sole  benefit  of  Mortgagor  and  Mortgagee  and the
                  successors  and assigns of Mortgagee  and the  successors  and
                  permitted  assigns of  Mortgagor.  No other  party  shall have
                  rights  thereunder  or be  entitled to assume that the parties
                  thereto  will insist upon strict  performance  of their mutual
                  obligations hereunder, any of which may be waived from time to
                  time. Except as expressly permitted in the Mortgage, Mortgagor
                  shall have no right to assign any of its rights under the Loan
                  Documents to any party whatsoever.

         22.16.   RELEASE OF CLAIMS

                  Mortgagor  hereby  RELEASES,  DISCHARGES  and ACQUITS  forever
                  Mortgagee  and  its  officers,  directors,  trustees,  agents,
                  employees and counsel (in each case, past,  present or future)
                  from any and all Claims existing as of the date hereof (or the
                  date of actual  execution hereof by Mortgagor,  if later).  As
                  used  herein,   the  term

                                       51
<PAGE>

                  "Claim" shall mean any and all liabilities,  claims, defenses,
                  demands, actions, causes of action,  judgments,  deficiencies,
                  interest,  liens,  costs or expenses  (including  court costs,
                  penalties, attorneys' fees and disbursements, and amounts paid
                  in settlement) of any kind and character whatsoever, including
                  claims for usury,  breach of contract,  breach of  commitment,
                  negligent  misrepresentation  or failure to act in good faith,
                  in each  case  whether  now  known or  unknown,  suspected  or
                  unsuspected,  asserted or unasserted or primary or contingent,
                  and  whether  arising  out  of  written  documents,  unwritten
                  undertakings,  course of conduct,  tort, violations of laws or
                  regulations or otherwise.

         22.17.   NO PARTNERSHIP

                  Nothing  contained in the Loan Documents is intended to create
                  any   partnership,   joint  venture  or  association   between
                  Mortgagor  and  Mortgagee,  or in any  way  make  Mortgagee  a
                  co-principal with Mortgagor with reference to the Property.

         22.18.   PAYOFF PROCEDURES

                  In  connection  with any  prepayment or payment at maturity by
                  Mortgagor, upon Mortgagor's request, Mortgagee shall deliver a
                  payoff letter  setting  forth all amounts  required to satisfy
                  the  Indebtedness.  If Mortgagor  pays or causes to be paid to
                  Mortgagee all of the Indebtedness,  then Mortgagee's  interest
                  in the Property shall cease,  and upon receipt by Mortgagee of
                  such payment, Mortgagee shall, at Mortgagor's election, either
                  (a) release this Mortgage or (b) assign the Loan Documents and
                  endorse the Note (in either case without  recourse or warranty
                  of any  kind)  and  upon  satisfaction  of  the  Indebtedness,
                  deliver the original  Note and Existing  Notes (or, if lost, a
                  lost note affidavit) to a takeout lender, upon payment (in the
                  latter  case)  of  an  administrative  fee  of  $750  and  all
                  reasonable attorneys' fees incurred by Mortgagee in connection
                  therewith.

         22.19.   SURVIVAL OF COMMITMENT TERMS

                  The  Commitment  shall  survive the execution of this Mortgage
                  and the other Loan Documents.  Any term of the Commitment that
                  has been  inadvertently  omitted  from the Loan  Documents  is
                  hereby incorporated in this Mortgage by reference. If any term
                  of the Commitment  conflicts with a provision of this Mortgage
                  that  addresses the same  subject,  the terms of this Mortgage
                  shall prevail.

                                       52
<PAGE>

         22.20.   MAXIMUM AMOUNT SECURED

                  Under   this   Mortgage,   "Indebtedness"   has  the   meaning
                  hereinabove set forth, and includes,  without limitation,  any
                  additional  disbursements  to Mortgagor  (unless in connection
                  with another,  independent mortgage financing), as well as any
                  amounts advanced to pay Impositions,  to cure Defaults,  or to
                  pay the costs of collection and receivership. Accordingly, any
                  such sums shall be  equally  secured  with,  and have the same
                  priority as, the Indebtedness,  and shall be subject to all of
                  the  terms  and  provisions  of this  Mortgage.  However,  the
                  Indebtedness  secured  by this  Mortgage  shall not  exceed an
                  amount equal to a maximum principal balance of $125,000,000.00
                  plus accrued  interest and advances by Mortgagee in respect of
                  Impositions,  or to cure any Default.  Mortgagor shall pay any
                  taxes  that may be due in  connection  with  any  such  future
                  advance.

                  Notwithstanding anything contained herein to the contrary, the
                  maximum  amount of  indebtedness  secured by this  Mortgage at
                  execution or which under any  contingency  may become  secured
                  hereby at any time hereafter is $125,000,000.00  plus interest
                  thereon,  plus (a) taxes,  charges or assessments which may be
                  imposed by law upon the  Property,  (b)  premiums on insurance
                  policies  covering  the  Property,  (c)  expenses  incurred in
                  upholding  the  lien  of  this  Mortgage,  including,  but not
                  limited to (1) the expenses of any  litigation to prosecute or
                  defend the rights and lien created by this  Mortgage,  (2) any
                  amount,  cost  or  charges  to  which  the  Mortgagee  becomes
                  subrogated,  upon payment, whether under recognized principles
                  of law or equity, or under express statutory authority and (3)
                  interest at the default rate (or regular interest rate).

         22.21.   INTERPRETATION

                  (a)      Headings and General Application

                           The section,  subsection,  paragraph and subparagraph
                           headings   of  this   Mortgage   are   provided   for
                           convenience  of  reference  only and  shall in no way
                           affect,  modify or define,  or be used in construing,
                           the text of the sections, subsections,  paragraphs or
                           subparagraphs.  If the text  requires,  words used in
                           the singular  shall be read as including  the plural,
                           and pronouns of any gender shall include all genders.

                  (b)      Sole Discretion

                           Mortgagee  may take any  action or decide  any matter
                           under the terms of this Mortgage or of any other Loan
                           Document    (including    any   consent,    approval,
                           acceptance,

                                       53
<PAGE>

                           option,  election or  authorization)  in its sole and
                           absolute discretion, for any reason or for no reason,
                           unless the related Loan  Document  contains  specific
                           language  to the  contrary.  Any  approval or consent
                           which the Mortgagee might withhold may be conditioned
                           in any way unless the related Loan Document  contains
                           specific language to the contrary.

                  (c)      Result of Negotiations

                           This  Mortgage  results  from  negotiations   between
                           Mortgagor   and   Mortgagee  and  from  their  mutual
                           efforts. Therefore, it shall be so construed, and not
                           as though it had been prepared solely by Mortgagee.

                  (d)      Reference to Particulars

                           The  scope  of  a  general  statement  made  in  this
                           Mortgage or in any other Loan  Document  shall not be
                           construed   as  having  been   reduced   through  the
                           inclusion  of  references  to  particular  items that
                           would  be  included  within  the  statement's  scope.
                           Therefore,  unless the  relevant  provision of a Loan
                           Document  contains specific language to the contrary,
                           the term "include" shall mean "include, but shall not
                           be limited  to" and the term  "including"  shall mean
                           "including, without limitation."

                  (e)      Construction in Accordance with Real Property Law

                           The provisions hereof shall be construed as affording
                           to Mortgagee  rights  additional to and not exclusive
                           of the  rights  conferred  under  the  provisions  of
                           Sections  254,  271, 272 and 273 of the Real Property
                           Law of the State of New York;  provided,  however, in
                           the event of any inconsistency between the provisions
                           hereof and the  provisions of said Sections 254, 271,
                           272 and 273, the provisions hereof shall govern.

         22.22.   JOINT AND SEVERAL LIABILITY

                  If there is more than one individual or entity  executing this
                  Mortgage  as  Mortgagor,  liability  of such  individuals  and
                  entities under this Mortgage shall be joint and several.

         22.23.   TIME OF ESSENCE

                  Time is of the essence of each and every  covenant,  condition
                  and provision of this Mortgage to be performed by Mortgagor.

                                       54
<PAGE>

         22.24.   JURY WAIVER

                  MORTGAGOR  AND  MORTGAGEE  EACH  HEREBY  WAIVES ANY RIGHT TO A
                  TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
                  ANY RIGHTS (I) UNDER THIS  MORTGAGE OR ANY OTHER LOAN DOCUMENT
                  OR (II)  ARISING  FROM ANY  LENDING  RELATIONSHIP  EXISTING IN
                  CONNECTION WITH THIS MORTGAGE OR ANY OTHER LOAN DOCUMENT,  AND
                  MORTGAGOR  AND  MORTGAGEE  EACH AGREES THAT ANY SUCH ACTION OR
                  PROCEEDING  SHALL BE TRIED  BEFORE  A JUDGE  AND NOT  BEFORE A
                  JURY.

         22.25.   RENEWAL, EXTENSION, MODIFICATION AND WAIVER

                  Mortgagee, at its option, may at any time renew or extend this
                  Mortgage,  the Note or any other Loan Document.  Mortgagee may
                  enter into a  modification  of any Loan  Document  without the
                  consent  of any  person  not a  party  to the  document  being
                  modified. Mortgagee may waive any covenant or condition of any
                  Loan  Document,  in whole or in part,  at the  request  of any
                  person then  having an interest in the  Property or in any way
                  liable for any part of the  Indebtedness.  Mortgagee may take,
                  release,  or  resort  to any  security  for the  Note  and the
                  Obligations and may release any party primarily or secondarily
                  liable  on any  Loan  Document  , all  without  affecting  any
                  liability not expressly released in writing by Mortgagee.

         22.26.   CUMULATIVE REMEDIES

                  Every  right and remedy  provided  in this  Mortgage  shall be
                  cumulative  of every  other  right  or  remedy  of  Mortgagee,
                  whether  conferred by law or by grant or contract,  and may be
                  enforced  concurrently  with any such  right  or  remedy.  The
                  acceptance of the  performance  of any  obligation to cure any
                  Default  shall not be construed as a waiver of any rights with
                  respect  to any other  past,  present  or future  Default.  No
                  waiver in a particular  instance of the  requirement  that any
                  Obligation  be  performed  shall be construed as a waiver with
                  respect to any other Obligation or instance.

         22.27.   TRANSFER OF OWNERSHIP

                  Mortgagee  may,  without  notice to  Mortgagor,  deal with any
                  person in whom  ownership of any part of the Real Property has
                  vested,  without in any way vitiating or discharging Mortgagor
                  from liability for any of the Obligations.

                                       55
<PAGE>

         22.28.   NO MERGER

                  Even  though  title  to the Real  Property  may be held in the
                  future by  Mortgagee,  the  interest  of the owner of the Real
                  Property  and the  interest of the holder of the title or lien
                  granted  by this  Mortgage  shall at all  times  be  separate,
                  distinct  and  apart,  and  shall  in no event  be  merged  by
                  operation of law or otherwise, unless and until all persons at
                  the time  having an  interest  in the Real  Property  and this
                  Mortgage  shall join in the execution of a written  instrument
                  effecting  such  merger of estates (it being  understood  that
                  this  provision  shall  survive  the  payment  in  full of the
                  Indebtedness).

         22.29.   ADDITIONAL TAXES

                  In the event of the  enactment  after  this date of any law of
                  the  State of New York or any  political  subdivision  thereof
                  deducting  from the value of Real  Property for the purpose of
                  taxation any lien  thereon,  or imposing  upon  Mortgagee  the
                  payment  of the whole or any part of the taxed or  assessments
                  or charges or liens herein  required to be paid by  Mortgagor,
                  or  changing in any way the laws  relating to the  taxation of
                  mortgages  or  debts  secured  by  mortgages  or   Mortgagee's
                  interest in the Real Property,  or the manner of collection of
                  taxes or  assessments,  so as to affect  this  Mortgage or the
                  indebtedness  or the  holder  hereof,  then,  and in any  such
                  event,  Mortgagor,  upon  demand by  Mortgagee  shall pay such
                  taxes  or  assessments,   or  reimburse   Mortgagee  therefor;
                  provided,  however,  that  if in  the  reasonable  opinion  of
                  counsel  for  Mortgagee  (i) it might be  unlawful  to require
                  Mortgagor  to make  such  payment  or (ii) the  making of such
                  payment might result in the imposition of interest  beyond the
                  maximum  amount  permitted by law, then, in either such event,
                  Mortgagee may elect,  by notice in writing given to Mortgagor,
                  to declare  all of the  Indebtedness  to be and become due and
                  payable  (without penalty or premium) sixty (60) days from the
                  giving of such notice.

         22.30.   LOAN DOCUMENTS CONTROL

                  Notwithstanding  any  assignment  of  loan  documents  made to
                  Mortgagee  prior to or on the date hereof by UBS AG,  Stamford
                  Branch,  the terms  and  conditions  of the Loan are,  and are
                  intended to be,  governed by the Loan  Documents (as such term
                  is defined herein).

23.      PARTIAL RELEASE.

         23.1.    PARCEL 2 RELEASE.

                  Mortgage  shall have the right to obtain a release of the Real
                  Property  described  on Exhibit B-2  (hereinafter  "Parcel 2")
                  from  the

                                       56
<PAGE>

                  lien of  this  Mortgage  provided  that  all of the  following
                  conditions shall be satisfied:

                  (a)      Mortgagor  shall request such release by Mortgagee by
                           written notice ("Mortgagor's Release Request Notice")
                           to   Mortgagee   (with  a  copy  of  such  notice  to
                           Mortgagee's  counsel,  Piper & Marbury  L.L.P.,  1251
                           Avenue of the  Americas,  New York,  New York  10020,
                           Attn:  Koren  Blair,  Esq.) not less than thirty (30)
                           days prior to Mortgagor's requested release date.

                  (b)      Mortgagor  shall pay to Mortgagee the Release  Price.
                           For purposes of this Section 23, the "Release  Price"
                           shall mean an amount equal to the greater of: (i) the
                           amount  required to prepay the Designated  Amount for
                           Parcel 2, together with prepayment premium applicable
                           to such  amount as  determined  pursuant to the Note;
                           and  (ii)  the  amount  which,  when  applied  to the
                           outstanding  principal  balance  of  the  Loan  as  a
                           prepayment,  with  prepayment  premium  applicable to
                           such amount as determined  pursuant to the Note, will
                           result in a Loan to Value  ratio (the  "LTV"),  after
                           giving  effect to the  release  of Parcel 2, equal to
                           the lesser of seventy-five (75%) percent and the Loan
                           to Value  Ratio  immediately  prior to the Release of
                           Parcel 2. The LTV shall be  determined  by Mortgagee,
                           in  Mortgagee's  discretion,  and upon  determination
                           thereof, Mortgagee shall promptly advise Mortgagor of
                           its   determination  in  writing   ("Mortgagee's  LTV
                           Notice"). Mortgagee shall make such determination and
                           deliver  Mortgagee's  determination  to  Mortgagor as
                           soon  as  reasonably   practical   after  receipt  of
                           Mortgagor's  Release Request Notice,  consistent with
                           Mortgagee's standard procedures, but in any event not
                           later than thirty (30) days after Mortgagee's receipt
                           of Mortgagor's Release Request Notice.

                           Notwithstanding   the   foregoing  to  the  contrary,
                           however,  in the event Mortgagor shall not agree with
                           Mortgagee's  determination of the LTV, Mortgagor may,
                           by  written  notice  to  Mortgagee  within  three (3)
                           Business  Days  following   Mortgagor's   receipt  of
                           Mortgagee's  LTV  Notice,  elect  to  have  Mortgagee
                           repeat  the  appraisal  procedure  described  in 23.2
                           hereof  and  the  LTV  determined  pursuant  to  such
                           procedure  shall be  utilized  for  purposes  of this
                           Section  23.1 (b). In the event  Mortgagor  makes the
                           election  set  forth  in  the  immediately  preceding
                           sentence,  Mortgagee  shall  have the  longer  of (x)
                           thirty  (30) days  following  receipt of  Mortgagor's
                           notice of election and (y) sixty (60) days  following
                           Mortgagor's  Release  Request  Notice to complete

                                       57
<PAGE>

                           the  appraisal  and make the  determination  required
                           under this Section  23.1(b).  Mortgagor and Mortgagee
                           agree to  reasonably  cooperate  with  each  other to
                           accomplish  the foregoing in an  expeditious  manner,
                           including,  without limitation, by promptly providing
                           such  information  as may be necessary or  reasonably
                           requested  by the  appraiser or by Mortgagee in order
                           to  permit   the   determination   and/or   appraisal
                           contemplated hereinabove to be performed.

                  (c)      No Default shall have occurred hereunder or under the
                           other Loan Documents and be continuing.

                  (d)      Mortgagor and, as applicable,  the Carveout  Obligor,
                           shall    execute   and   deliver   such    documents,
                           instruments,         certificates,        agreements,
                           re-affirmations,    financing    statements    and/or
                           amendments  thereto and shall  cause to be  delivered
                           such  other  certificates  or  agreements  as  may be
                           necessary  to  effectuate  the  release  of  Parcel 2
                           and/or as may be reasonably requested by Mortgagee in
                           connection  therewith.  Mortgagor  shall  pay  all of
                           Mortgagee's  reasonable   out-of-pocket  expenses  in
                           connection  with such  release of Parcel 2 including,
                           without  limitation,  reasonable  attorneys  fees and
                           expenses.

                  Without limitation to the foregoing,  Mortgagee agrees that if
                  requested by  Mortgagor,  Mortgagee  will permit the severance
                  and splitter of the  Indebtedness in connection with a release
                  of Parcel 2 for the purpose of  permitting  an  assignment  of
                  mortgage, provided and on condition that:

                           (1)  Mortgagor  shall  execute and deliver (and shall
                           cause  any  Carveout  Guarantor,  as  applicable,  to
                           execute and deliver)  such  agreements,  instruments,
                           affidavits,  consents,   re-affirmations,   financing
                           statements,  opinions of counsel, and other documents
                           and/or amendments as Mortgagee may reasonably request
                           in order to effect the  severance and splitter of the
                           Indebtedness  evidenced  by the  Note and the lien of
                           this  Mortgage  and other  Loan  Documents,  into two
                           separate indebtednesses and two separate liens, which
                           are  cross-collateralized  and  cross-defaulted,  one
                           made, respectively, by 810 and the other made by 100,
                           or their  respective  successors  or assigns,  as the
                           case may be;

                           (2)   Mortgagor   shall   cause  to  be  provided  in
                           connection  with such  transaction  such  opinions of
                           counsel and title  endorsements to Mortgagee's policy
                           of title  insurance for the Mortgage as Mortgagee may
                           reasonably request;

                           (3)  Mortgagor  shall pay all of  Mortgagee's  out of
                           pocket expenses in connection with such  transactions
                           including,

                                       58
<PAGE>

                           without  limitation,  reasonable  attorneys  fees and
                           expenses; and

                           (4) any such assignment of the Mortgage or other Loan
                           Documents  shall be without  recourse  or warranty of
                           any kind to or by Mortgagee.

         23.2.    APPRAISAL PROCEDURE.

                  If requested by written  notice from Mortgagor to Mortgagee as
                  provided  in  Section  23.1  above,  the  following  appraisal
                  procedure shall be employed:

                  Mortgagee  shall hire an appraiser  (the "Fee  Appraiser")  to
                  prepare  and submit to  Mortgagee a full  narrative  appraisal
                  report  estimating the market value of the Real Property.  The
                  Fee  Appraiser  shall be  certified  in the state in which the
                  property  is  located  and  shall  be a member  of a  national
                  appraisal  organization that has adopted the Uniform Standards
                  of Professional  Appraisal Practice (USPAP) established by the
                  Appraisal Standards Board of the Appraisal Foundation. The Fee
                  Appraiser  will be required to use  assumptions  and  limiting
                  conditions   established  by  Mortgagee  and  to  prepare  the
                  appraisal in conformity with Mortgagee's Appraisal Guidelines.
                  When  the Fee  Appraiser's  report  is  received,  Mortgagee's
                  review  appraiser  will  perform an appraisal  review.  If the
                  review  appraiser  does not  concur  with the Fee  Appraiser's
                  estimate of market value,  the review  appraiser will estimate
                  the market  value of the Real  Property.  Mortgagee  will then
                  calculate  the  Loan-to-Value  ratio,  using  either  the  Fee
                  Appraiser's estimate, if the review appraiser concurs with it,
                  or the review appraiser's estimate, if the two estimates vary.

24.      COVENANTS AND REPRESENTATIONS RESPECTING THE AIR RIGHTS LEASES

                  (a)      Mortgagor   hereby   represents   and   warrants   to
                           Mortgagee,  its  successors  and  assigns,  that  the
                           following  statements are true as of the date of this
                           Mortgage,  and warrants and  covenants to  Mortgagee,
                           and to its successors and assigns, that the following
                           statements  shall remain true during the term of this
                           Mortgage:

                           (1) To Mortgagor's  knowledge:  the Air Rights Leases
                           are now valid and  subsisting  leases and are in full
                           force and effect in accordance with the terms thereof
                           and have not been  modified  except  as set  forth in
                           Exhibit F annexed  hereto;  all of the rents  payable
                           under the Air Rights Leases  (whether  denominated as
                           rent or additional  rent or  otherwise)  prior to the
                           date hereof have been paid.

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<PAGE>

                           (2)  Mortgagor  has not  delivered  or  received  any
                           notices of default  under the Air Rights Leases as of
                           the  date  hereof  which  remain  uncured,   and,  to
                           Mortgagor's  knowledge,  no  predecessor of Mortgagor
                           has  delivered  or  received  any  notices of default
                           under the Air Rights Leases which have not been cured
                           or waived in  accordance  with the  provisions of the
                           Air Rights  Leases or which have not been  settled by
                           the  parties  thereto.  Mortgagor  is not in  default
                           beyond any applicable notice or cure period under any
                           of the  terms  of the  Air  Rights  Leases,  and,  to
                           Mortgagor's  knowledge,  there are no  events  which,
                           with the passage of time or giving of notice or both,
                           would  constitute  a  default  under  the Air  Rights
                           Leases.

                           (3)  Mortgagor  has delivered to Mortgagee a true and
                           complete copy of the Air Rights Leases.

                           (4) This Mortgage is lawfully  executed and delivered
                           in  conformity  with the Air  Rights  Leases and this
                           Mortgage  is and  will be  kept a  valid  lien on the
                           interest of Mortgagor under the Air Rights Leases.

                           (5) Mortgagor will promptly  notify  Mortgagee of any
                           request made by either party to the Air Rights Leases
                           for  arbitration  proceedings  pursuant to any of the
                           Air  Rights  Leases  and  of the  institution  of any
                           arbitration  proceedings and will promptly deliver to
                           Mortgagee  a  copy  of  the   determination   of  the
                           arbitrators in each such arbitration proceeding.

                           (6) Mortgagor shall exercise each individual  option,
                           if any,  to  extend  or renew the term of each of the
                           Air Rights  Leases which  extension or renewal of the
                           term of the Air  Rights  Leases  occurs  prior to the
                           Maturity Date of the Note. Mortgagor hereby expressly
                           authorizes     and     appoints     Mortgagee     its
                           attorney-in-fact  to exercise  any such option in the
                           name of an on behalf  of  Mortgagor,  which  power of
                           attorney shall be irrevocable  and shall be deemed to
                           be coupled with an interest.

                  (b)      Mortgagor will not, without the prior written consent
                           of  Mortgagee,  which  may be  given or  withheld  in
                           Mortgagee's sole  discretion:  fail or refuse to take
                           timely and necessary  action to renew each of the Air
                           Rights  Leases  pursuant to the  provisions  thereof;
                           consent  to any  action  taken  or to be taken by the
                           lessor or  anyone  else  under any of the Air  Rights
                           Leases the result of which  would be to  diminish  or
                           impair

                                       60
<PAGE>

                           the security of this Mortgage;  further  encumber the
                           leasehold  estate  under  the Air  Rights  Leases  or
                           subordinate or consent to the subordination of any of
                           the Air Rights  Leases or the  interest of  Mortgagor
                           thereunder  to any  mortgage  or deed of trust on the
                           lessor's  interest in the premises demised by the Air
                           Rights Leases or any portion thereof.

                  (c)      Mortgagor  will  at  all  times  fully  and  promptly
                           perform  and comply  with all  obligations  of tenant
                           under the Air Rights  Leases  without  relying on any
                           grace period provided therein, and if Mortgagor shall
                           fail  so to  do,  Mortgagee  may  (but  shall  not be
                           obligated to) take any such action,  without awaiting
                           the  expiration  of any grace  period,  as  Mortgagee
                           deems  necessary  or  desirable to prevent or to cure
                           any  default  by  Mortgagor  thereunder;   that  upon
                           receipt by Mortgagee  from the landlord under the Air
                           Rights Leases of any written notice of default by the
                           tenant,  Mortgagee may rely thereon and take any such
                           action even though the  existence  of such default or
                           the nature  thereof be  questioned or denied by or on
                           behalf  of  the  Mortgagor;   that  Mortgagor  hereby
                           expressly  grants  to  Mortgagee,   and  agrees  that
                           Mortgagee shall have the absolute and immediate right
                           (but no  obligation)  to  enter  in and upon the Real
                           Property  or any part  thereof to such  extent and as
                           often as  Mortgagee,  in its sole  discretion,  deems
                           necessary or desirable in order to prevent or to cure
                           any such default by Mortgagor;  that Mortgagor  shall
                           pay to Mortgagee,  immediately and without deduction,
                           demand,  offset  or  counterclaim,  all sums  paid by
                           Mortgagee  pursuant to this  section,  with  interest
                           thereon  from the date of each  such  payment  at the
                           Default  Rate;  and that,  without  limitation to any
                           other provision hereof, all sums so paid and expended
                           by  Mortgagee,  and the  interest  thereon,  shall be
                           added to and be secured by the lien of this Mortgage.
                           Mortgagor agrees not to suffer or incur, or permit to
                           be suffered or  incurred,  any default on the part of
                           the tenant under the Air Rights Leases.

                  (d)      Mortgagor  agrees  not  to  amend  or  modify  in any
                           respect,  or terminate or  surrender,  the Air Rights
                           Leases without the prior written consent of Mortgagee
                           being first had and  obtained,  which  consent may be
                           given or withheld in Mortgagee's sole discretion. Any
                           such surrender of the leasehold  estate under any Air
                           Rights Lease, or any part thereof, or any termination
                           of any Air Rights Lease, or any part thereof,  or any
                           modification,  amendment or  supplement to any of the
                           Air Rights Leases  without the prior written  consent
                           of the  Mortgagee  shall  be void  and of no force or
                           effect.

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<PAGE>

                  (e)      Mortgagor  agrees to furnish to  Mortgagee  copies of
                           any and all notices of default served on Mortgagor as
                           tenant by landlord,  or upon Mortgagor as sublandlord
                           by any  subtenant,  under the Air  Rights  Leases and
                           such other  notices as said landlord or subtenant may
                           serve on Mortgagor  relating to any Air Rights Leases
                           or the terms and provisions  thereof or operations by
                           Mortgagor thereunder.

                  (f)      Notwithstanding any advances made by Mortgagee of any
                           monetary  amounts  required  to be made by the tenant
                           under any Air  Rights  Leases,  thus  curing  default
                           thereunder,  non-payment by Mortgagor to Mortgagee of
                           such amount or amounts so advanced  shall continue to
                           be and  remain  a  default  by  Mortgagor  hereunder,
                           unless and until such amounts are paid to Mortgagee.

                  (g)      Mortgagor   shall   from  time  to  time  as  may  be
                           reasonably   requested   by   Mortgagee   furnish  to
                           Mortgagee  evidence  of  Mortgagor's  performance  as
                           tenant under the Air Rights Leases and substantiating
                           that the terms and provisions  thereof to be kept and
                           performed by Mortgagor as tenant thereunder have been
                           duly performed.

                  (h)      In the event the lessor's and lessee's interest under
                           any Air Rights Leases, or any interest therein, shall
                           be held by the same person,  such interests shall not
                           merge  but such fee  ownership  or  interest  therein
                           shall immediately  become subject to the lien of this
                           Mortgage, and Mortgagor shall execute any instruments
                           Mortgagee may reasonably  require to that end. In the
                           event that a merger shall for any reason be deemed or
                           otherwise   adjudicated   by  a  court  of  competent
                           jurisdiction  to  have  occurred  by  virtue  of  the
                           acquisition  by  Mortgagor  of the fee  title  to the
                           property  covered  by  the  Air  Rights  Leases,   or
                           otherwise,  then and in such  event  the lien of this
                           Mortgage shall automatically  encompass and attach to
                           the fee title to such  property  and  subject the fee
                           title to such  property to this  Mortgage.  Mortgagor
                           will not divide or segregate  into  separate  parcels
                           the Real  Property  or any part  thereof  without the
                           prior  written  consent of Mortgagee  being first had
                           and obtained,  which consent may be given or withheld
                           in Mortgagee's sole discretion.

                  (i)      If the  lessor  under  any of the Air  Rights  Leases
                           seeks to reject or  disaffirm  any of the Air  Rights
                           Leases  pursuant to any  provisions of the Bankruptcy
                           Code and Mortgagee elects in its absolute  discretion
                           to have  Mortgagor  exercise  its  right to remain in
                           possession   under  any  legal  or  equitable   right
                           Mortgagor may have to continue to occupy the premises

                                       62
<PAGE>

                           leased pursuant to any of the Air Rights Leases, then
                           Mortgagor  shall remain in such  possession and shall
                           perform all acts  necessary  for  Mortgagor to retain
                           its  right  to  remain  in  such  possession  for the
                           unexpired  term of such Air Rights Leases  (including
                           renewals  thereof),  whether  such acts are  required
                           under the then existing  terms and provisions of such
                           Air Rights Leases; or otherwise, and all of the terms
                           and provisions of this Mortgage and the liens created
                           by this  Mortgage  shall  remain  in full  force  and
                           effect and shall be  extended  automatically  to such
                           possession,  occupancy  and  interest  of  Mortgagor.
                           Mortgagor shall not,  without the  Mortgagee's  prior
                           written consent, elect to treat the Air Rights Leases
                           as terminated  under Section  365(h)(i) (or any other
                           applicable  section of the Bankruptcy  Code), and any
                           such election made without  Mortgagee's prior written
                           consent shall be void.

                  (j)      If pursuant  toss.365(h)(2)  of the Bankruptcy  Code,
                           the  Mortgagor  seeks  to  offset  against  the  rent
                           reserved  in the Air Rights  Leases the amount of any
                           damages caused by the  non-performance  by the lessor
                           of any of the  lessor's  obligations  under  the  Air
                           Rights  Leases  after the  rejection by the lessor of
                           the Air Rights Leases under the Bankruptcy  Code, the
                           Mortgagor  shall,  prior to  effecting  such  offset,
                           notify  the  Mortgagee  of  its  intention  to do so,
                           setting forth the basis therefor. The Mortgagee shall
                           have the  right to  object to all or any part of such
                           offset,  and,  in the  event of such  objection,  the
                           Mortgagor  shall not effect any offset of the amounts
                           so objected to by the Mortgagee. If the Mortgagee has
                           failed  to  object  as  aforesaid   within  ten  (10)
                           Business  Days after  notice  from the  Mortgagor  in
                           accordance  with the first  sentence of this  Section
                           24(b),  the  Mortgagor  may  proceed  to effect  such
                           offset in the  amounts  set forth in the  Mortgagor's
                           notice.  Neither the Mortgagee's failure to object as
                           aforesaid  nor any  objection or other  communication
                           between the Mortgagee  and the Mortgagor  relating to
                           such offset shall  constitute an approval of any such
                           offset  by  the   Mortgagee.   The  Mortgagor   shall
                           indemnify  and save the  Mortgagee  harmless from and
                           against any and all claims, demands,  actions, suits,
                           proceedings,  damages,  losses,  cost and expenses of
                           every   nature   whatsoever    (including,    without
                           limitation,   attorneys'   fees  and   disbursements)
                           arising  from or  relating  to any such offset by the
                           Mortgagor against the rent reserved in the Air Rights
                           Leases.

                  (k)      Mortgagor  shall promptly after  obtaining  knowledge
                           thereof notify the Mortgagee  orally of any filing by
                           or  against  the

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<PAGE>

                           lessor  under  any  of the  Air  Rights  Leases  of a
                           petition  under the  Bankruptcy  Code.  The Mortgagor
                           shall  thereafter  forthwith  give written  notice of
                           such  filing  to the  Mortgagee,  setting  forth  any
                           information available to the Mortgagor as to the date
                           of such filing,  the court in which such petition was
                           filed,  and the relief sought therein.  The Mortgagor
                           shall  promptly  deliver to the  Mortgagee  following
                           receipt any and all  notices,  summonses,  pleadings,
                           applications  and  other  documents  received  by the
                           Mortgagor in  connection  with any such  petition and
                           any proceedings relating thereto. Upon the occurrence
                           and  during  the  continuance  of a  Default  (a) the
                           Mortgagee shall have the option,  to the exclusion of
                           the  Mortgagor,  exercisable  upon  notice  from  the
                           Mortgagee  to the  Mortgagor,  to conduct and control
                           any such  litigation  with counsel of the Mortgagee's
                           choice and (b) the  Mortgagee  may proceed in its own
                           name or in the name of the  Mortgagor  in  connection
                           with any such litigation, and the Mortgagor agrees to
                           execute any and all powers, authorizations,  consents
                           and other  documents  required  by the  Mortgagee  in
                           connection therewith.  The Mortgagor shall pay to the
                           Mortgagee all costs and expenses (including,  without
                           limitation,  attorneys' fees and disbursements)  paid
                           or incurred by the Mortgagee in  connection  with the
                           prosecution or conduct of any such proceedings within
                           ten (10)  Business  Days after notice from  Mortgagee
                           setting  forth such costs and expenses in  reasonable
                           detail.  Without  limitation  to any other  provision
                           hereof,  any such costs or  expenses  not paid by the
                           Mortgagor as  aforesaid  shall be secured by the lien
                           of this  Mortgage and shall be added to the principal
                           amount  of  the  indebtedness   secured  hereby.  The
                           Mortgagor  shall  not  commence  any  action,   suit,
                           proceeding or case, or file any  application  or make
                           any  motion,  in respect of the Air Rights  Leases in
                           any such case under the  Bankruptcy  Code without the
                           prior  written  consent  of the  Mortgagee  provided,
                           however,  that such consent shall not be unreasonably
                           withheld,  conditioned  or  delayed  if such  action,
                           suit, proceeding,  case, application or motion is for
                           the   preservation  and  protection  of  the  rights,
                           benefits and privileges  benefiting or granted to the
                           Mortgagor,  as tenant,  or Mortgagee,  as a leasehold
                           mortgagee, pursuant to such Air Rights Lease.

                  (l)      If there shall be filed by or against the Mortgagor a
                           petition   under  the   Bankruptcy   Code,   and  the
                           Mortgagor, as the lessee under the Air Rights Leases,
                           shall  determine  to  reject  the Air  Rights  Leases
                           pursuant to Section  365(a) of the  Bankruptcy  Code,
                           then the Mortgagor  shall give the

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<PAGE>

                           Mortgagee not less than ten (10) business days' prior
                           notice of the date on which the Mortgagor shall apply
                           to the  bankruptcy  court for authority to reject the
                           Air  Rights  Leases.  The  Mortgagee  shall  have the
                           right,  but not the  obligation,  to  serve  upon the
                           Mortgagor  within such 10-day period a notice stating
                           that (x) the  Mortgagee  demands  that the  Mortgagor
                           assume  and  assign  the  Air  Rights  Leases  to the
                           Mortgagee  pursuant to Section 365 of the  Bankruptcy
                           Code  and  (y)  the  Mortgagee  covenants  to cure or
                           provide  adequate  assurance  of  future  performance
                           under the Air Rights Leases.  If the Mortgagee serves
                           upon  the  Mortgagor  the  notice  described  in  the
                           preceding  sentence,  the Mortgagor shall not seek to
                           reject the Air Rights  Leases and shall  comply  with
                           the  demand   provided  for  in  clause  (x)  of  the
                           preceding sentence.

                  (m)      Effective  upon the entry of an order  for  relief in
                           respect of the Mortgagor  under the Bankruptcy  Code,
                           the  Mortgagor  hereby  assigns  and  transfer to the
                           Mortgagee  a  non-exclusive  right  to  apply  to the
                           Bankruptcy   Court   under  ss.   365(d)(4)   of  the
                           Bankruptcy  Code for an order  extending  the  period
                           during which the Air Rights Leases may be rejected or
                           assumed.

                  (n)      Simultaneous with Mortgagor's delivery thereof to the
                           landlord  or  subtenant  under any Air Rights  Lease,
                           Mortgagor shall provide  Mortgagee with a copy of the
                           checks and cover correspondence,  if any, pursuant to
                           which  Mortgagor  makes payment of the rent under any
                           of the Air Rights Leases.

25.      SPLITTER OF INDEBTEDNESS AND LIENS

                  Upon request of Mortgagee, Mortgagor shall execute and deliver
                  (and shall cause any Carveout  Guarantor,  as  applicable,  to
                  execute and deliver) such agreements, instruments, affidavits,
                  consents,  re-affirmations,  financing  statements,  and other
                  documents   and/or   amendments   thereto  as  Mortgagee   may
                  reasonably  request  in  order to  effect  the  severance  and
                  splitter  of the  Indebtedness  evidenced  by the Note and the
                  lien of this  Mortgage  and  other  Loan  Documents,  into two
                  separate  indebtednesses  and two  separate  liens,  one made,
                  respectively,  by 810 and the  other  made  by 100,  or  their
                  respective  successors  or assigns,  as the case may be, which
                  indebtednesses  and  liens  shall be (x)  cross-defaulted  and
                  cross-collateralized,  but  shall  be  evidenced  by  separate
                  notes,  mortgages  and  other  Loan  Documents  and (y) in the
                  respective  Designated  Amount for the Real Property  known as
                  100 Wall Street and 810 Seventh  Avenue,  New York,  New York,
                  respectively.

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<PAGE>

26.      TENANT IMPROVEMENTS RESERVE

                  As additional  security for the  indebtedness  secured hereby,
                  Mortgagor shall establish and maintain at all times while this
                  Mortgage   continues   in  effect  a  reserve   (the   "Tenant
                  Improvement  Reserve") with Mortgagee for the payment of costs
                  and expenses incurred by Mortgagor for Tenant Improvements and
                  Leasing  Commissions  relative  to  the  space  leased  to the
                  Termination Rights Tenants (as hereinafter defined).  All such
                  sums,  together  with any interest  thereon,  are  hereinafter
                  collectively  referred to as the "Funds".  As used herein, the
                  term  'Tenant   Improvements'   shall  mean   construction  or
                  modification of improvements  and/or  installation of fixtures
                  and/or  equipment  in the Property as required to be performed
                  or paid for by  Mortgagor  pursuant  to the terms of any lease
                  which is hereafter  entered into by Mortgagor  and a tenant in
                  accordance  with the  terms  and  conditions  of the  Absolute
                  Assignment of Leases and Rents ("Approved Lease"), relative to
                  the space  leased to new or  replacement  tenants of the space
                  currently demised to a Termination Rights Tenant following the
                  termination  of  any  such  lease  with a  Termination  Rights
                  Tenant.  As used  herein,  `Leasing  Commissions'  shall  mean
                  reasonable  and  customary  commissions  paid to a real estate
                  broker licensed in New York (including  those  affiliated with
                  Mortgagor) in connection  with an Approved Lease pursuant to a
                  commission   agreement   containing   terms  and   provisions,
                  including,  as to timing of payment of the commission,  as are
                  then prevailing between third party  unaffiliated  brokers and
                  owners for comparable leases of space at similar properties in
                  the market area of the Property in question.

                  (a)      Deposits   Into  the  Tenant   Improvement   Reserve.
                           Mortgagor  shall  deposit or cause to be .  deposited
                           into the Tenant Improvement  Reserve any amounts paid
                           to Mortgagor as a termination fee or charge under the
                           leases with the following  tenants (the  "Termination
                           Rights  Tenants") in connection  with the exercise of
                           any  such  tenant's  right  to  terminate  its  lease
                           pursuant  to the terms  thereof:  BDM  International;
                           Ikon  Office   Solutions;   AT&T   Wireless;   Wausau
                           Insurance; National Geographic; GFI Group; MCI; First
                           Bank  System;  Waterhouse  Securities;  and  Atlantic
                           Mutual.  So long as no Default hereunder or under the
                           other Loan  Documents has  occurred,  all sums in the
                           Tenant Improvement Reserve shall be held by Mortgagee
                           in  the  Tenant  Improvement   Reserve  to  reimburse
                           Mortgagor  for  the  costs  and  expenses  of  Tenant
                           Improvements  and Leasing  Commissions  as herein set
                           forth.

                  (b)      Disbursements from the Tenant Improvement Reserve. So
                           long as no Default  hereunder or under the other Loan
                           Documents has  occurred,  and to the extent Funds are
                           in the

                                       66
<PAGE>

                           Tenant Improvement  Reserve,  Mortgagee shall, within
                           ten (10)  Business  Days  after  receipt of a written
                           request   from   Mortgagor   specifying   the  amount
                           requested and the applicable Tenant  Improvements and
                           Leasing Commissions to be paid for with the requested
                           Funds ("Disbursement Request"),  release to Mortgagor
                           Funds  in the  amount  of the  Disbursement  Request;
                           subject,   however,   to  the  following   conditions
                           precedent.  Mortgagee  shall not be  required to make
                           (i) advances from the Tenant Improvement Reserve more
                           frequently  than once in any thirty  (30) day period,
                           provided,  however, that Mortgagor shall be permitted
                           to make  Disbursement  Requests  (and receive  Funds)
                           more   frequently   provided   any  such   additional
                           Disbursement Request is for more than $50,000.00;  or
                           (ii) any disbursement  which is less than $25,000.00;
                           or  (iii)  any  disbursement  from the  Funds  unless
                           Mortgagor has delivered to Mortgagee a fully executed
                           copy of the lease for the space which was  previously
                           demised to a Termination Rights Tenant,  certified by
                           Mortgagor  to be true and  complete.  In  making  any
                           payment   from  the   Tenant   Improvement   Reserve,
                           Mortgagee  shall be entitled to rely on such  request
                           from  Mortgagor,  and  on  any  bill,  statement,  or
                           estimate  from any third  party,  without any inquiry
                           into the accuracy,  validity or contestability of any
                           such amount.

                  (x)      With respect to each Disbursement  Request for Tenant
                           Improvements,   Mortgagor   shall  provide   evidence
                           reasonably  satisfactory to Mortgagee that the Tenant
                           Improvements,  or such portion thereof, for which the
                           Funds are being  requested  have  been  completed  in
                           accordance   herewith.   Mortgagor  shall  submit  to
                           Mortgagee  copies of  invoices  for  which  Funds are
                           being requested and shall also submit waivers of lien
                           (which  may be  conditioned  upon the  payment  being
                           requested by Mortgagor in such Disbursement Request).
                           Mortgagor  shall  execute and deliver to  Mortgagee a
                           certificate   (in  form  and   substance   reasonably
                           satisfactory    to   Mortgagee)   that   the   Tenant
                           Improvements  covered by the applicable  Disbursement
                           Request  comply with, and have fully  satisfied,  the
                           terms  and  provisions  of  hereof.  Mortgagor  shall
                           provide such additional  documents,  certificates and
                           affidavits of Mortgagor as Mortgagee  may  reasonably
                           request.

                  (y)      With  respect  to  the  final  Disbursement   Request
                           relative  to  any  Approved  Lease,  Mortgagor  shall
                           provide   Mortgagee  with  a  copy  of  any  and  all

                                       67
<PAGE>

                           applicable  temporary  or permanent  certificates  of
                           occupancy  if any be required,  issued by  applicable
                           governmental authorities which certificates allow the
                           tenant to open for  business  as  contemplated  under
                           such Lease and with an original  certificate executed
                           by the  Mortgagor  for which  such  request  relates,
                           stating  that (1) such tenant has accepted the Tenant
                           Improvements, (2) such tenant has taken possession of
                           the space covered by the Tenant Improvements, (3) the
                           Lease is in full  force and  effect  and has not been
                           modified or amended,  (3) to the best of  Mortgagor's
                           knowledge,  tenant  has  not  claims  to  offset,  or
                           defenses to, the payment of rent  thereunder,  (4) to
                           the  best  of  Mortgagor's  knowledge,  there  are no
                           defaults  under such Lease (nor does there  exist any
                           event or  conditions,  which with the passage of time
                           or the giving of  notice,  or both,  could  result in
                           such  a   default),   and  (5)  that   there  are  no
                           concessions,  allowances, credits, or rebates payable
                           or due to  tenant  except as  expressly  set forth in
                           such  Lease  and  all  such  allowances,  credits  or
                           rebates  payable or due to tenant in connection  with
                           such Tenant Improvements have been paid.

                  Notwithstanding any provision of this Section to the contrary,
                  Funds  disbursed with respect to any Approved Lease for Tenant
                  Improvements  shall be an  amount  not to  exceed,  under  any
                  circumstances, the actual costs and expenses actually incurred
                  by Mortgagor therefore.

                  (c)      Mortgagor  shall  construct  and  complete all Tenant
                           Improvements   to  be   performed   by  Mortgagor  in
                           accordance  with  the  terms  and  provisions  of the
                           Approved  Leases.  Mortgagor  or tenant shall pay for
                           and obtain or cause to be paid for and  obtained  all
                           permits,  licenses  and  approvals  required  by  all
                           applicable   laws   with   regard   to   the   Tenant
                           Improvements,  whether  necessary  for  commencement,
                           completion, use or otherwise. Mortgagor shall perform
                           or cause to be performed all work in connection  with
                           the  Tenant  Improvements  in a good and  workmanlike
                           manner,   in  compliance  with  all  applicable  laws
                           (including,   without   limitation,   any   and   all
                           applicable life safety laws,  environmental  laws and
                           laws for the  handicapped  and/or  disabled) and with
                           the plans and specifications  provided  therefor,  if
                           any,   pursuant   to  the   Approved   Lease,   which
                           performance  by Mortgagor  shall be without regard to
                           the sufficiency of the Funds. Mortgagor covenants and
                           agrees that Tenant Improvements shall be constructed,
                           installed or completed, as applicable, free and clear
                           of  any  and   all   liens   (including

                                       68
<PAGE>

                           mechanic's, materialman's or other liens), claims and
                           encumbrances whatsoever.

                  (d)      If,  at any  time,  (i) the  conditions  to the final
                           Disbursement  Request for all  Approved  Leases which
                           demise space relative to which any Termination Rights
                           Tenants have  exercised  their rights of  termination
                           have been  satisfied  and (ii) there are Funds in the
                           Tenant Improvement Reserve which are in excess of the
                           amounts  required to satisfy such final  disbursement
                           request,  then  the  balance  of the  Funds  shall be
                           disbursed to Borrower  concurrently  with the payment
                           of such Final Disbursement Request.

                  (e)      Notwithstanding any provision hereof to the contrary,
                           in no event shall  Mortgagor  have the  obligation to
                           deposit  any sums in the Tenant  Improvement  Reserve
                           other  than  termination  fees  paid  by  Termination
                           Rights Tenants in connection with the exercise of any
                           such tenant's  rights to terminate its Lease pursuant
                           to the terms thereof.

                                       69
<PAGE>

IN WITNESS WHEREOF, Mortgagor has made and delivered this Mortgage under seal as
of the date first above written.

                                        MORTGAGOR:

                                        810  7TH  AVE,   LLC.,   a  Delaware
                                        limited liability company

                                            By: METROPOLITAN 810 7th AVE MM LLC,
                                            a   Delaware    limited    liability
                                            company, its Managing Member

                                            By:      METROPOLITAN      OPERATING
                                            PARTNERSHIP,    L.P.,   a   Delaware
                                            limited  partnership,  its  Managing
                                            Member

                                            By:  Metropolitan  Partners  LLC,  a
                                            Delaware limited liability  company,
                                            its General Partner

                                            By: __________________________[SEAL]
                                                Name:
                                                Title:

                                        100 WALL COMPANY LLC, a Delaware limited
                                        liability company

                                            By:  100  WALL  MM LLC,  a  Delaware
                                            limited   liability   company,   its
                                            Managing Member

                                            By:      METROPOLITAN      OPERATING
                                            PARTNERSHIP,    L.P.,   a   Delaware
                                            limited  partnership,  its  Managing
                                            Member

                                            By:  Metropolitan  Partners  LLC,  a
                                            Delaware limited liability  company,
                                            its General Partner

                                            By: _________________________ [SEAL]
                                                Name:
                                                Title:

                      [ Signatures continue on next page ]

<PAGE>

                          [ Signature Page to Agreement
                   of Consolidation, Spreader and Modification
                      of Mortgage and Security Agreement ]

                                   MORTGAGEE:

                                   Monumental Life Insurance Company, a
                                   Maryland corporation

                                   By ____________________________
                                      Name:
                                      Title:

                              [ End of Signatures ]

<PAGE>

                                    EXHIBIT A

                             THE EXISTING MORTGAGES

1.   Mortgage made by 810 Seventh Corp. to Bankers Trust Company,  in the amount
     of  $20,000,000.00,  dated  February  21, 1969 and recorded on February 26,
     1969 in Reel 132 Page 488.

         (a)      Assignment  of Mortgage  from Bankers Trust Company to the New
                  York State Teachers' Retirement System dated December 20, 1972
                  and recorded on December 22, 1972 in Reel 263 Page 39. Assigns
                  mortgage 1.

2.   Leasehold Mortgage made by Abraham Sommer to K.A.T.H.  Properties Corp., in
     the amount of  $244,500.00,  dated June 22, 1971 and recorded on 6/24/71 in
     Reel 208 Page 454.

         (a)      As  corrected  by Mortgage  Correction  Agreement  dated as of
                  December 18, 1972 and  recorded  December 22, 1972 in Reel 263
                  Page 15.

         (b)      Assignment of Mortgage from K.A.T.H.  Properties  Corp. to New
                  York State Teachers' Retirement System dated December 19, 1972
                  and recorded on December 22, 1972 in Reel 263 Page 33. Assigns
                  mortgage 2.

3.   Leasehold Mortgage made by Abraham Sommer to K.A.T.H.  Properties Corp., in
     the amount of  $2,755,500.00,  dated June 22, 1971 and recorded on June 24,
     1971 in Reel 208 Page 462.

         (a)      As  corrected  by Mortgage  Correction  Agreement  dated as of
                  December 18, 1972 and  recorded  December 22, 1972 in Reel 263
                  Page 21.

         (b)      Assignment of Mortgage from K.A.T.H.  Properties  Corp. to New
                  York State Teachers' Retirement System dated December 19, 1972
                  and recorded on December 22, 1972 in Reel 263 Page 27. Assigns
                  mortgage 3.

         (c)      Consolidation  and  Extension  Agreement  between  810 Seventh
                  Corp. and New York State Teachers'  Retirement System dated as
                  of December  20, 1972 and  recorded on

<PAGE>

                  January  4, 1973 in Reel 264 page 513.  Consolidates  mortgage
                  nos.  1, 2 and 3 to  form a  single  lien  in  the  amount  of
                  $23,000,000.00  and spreads  said lien to cover the Air Rights
                  Lease  recorded in Record Liber 294 Page 49,  Record Liber 294
                  Page 70, Record Liber 185 Page 27 and Liber 4940 Page 609.

         (d)      Assignment   of  Mortgage   from  New  York  State   Teachers'
                  Retirement  System  to Credit  Suisse  First  Boston  Mortgage
                  Capital LLC dated as of October 23, 1997 and recorded  4/15/98
                  in the Office of the City  Register,  New York  County in Reel
                  2563 at Page 1085. Assigns mortgages 1 to 3, as consolidated.

4.   Gap  Mortgage  made by 810  Partners  LLC to  Credit  Suisse  First  Boston
     Mortgage Capital LLC, in the amount of $49,465,508.29,  dated as of October
     23, 1997 and recorded 4/15/98 in the Office of the City Register,  New York
     County in Reel 2563 at Page 1093.

         (a)      Mortgage  Consolidation,  Modification and Extension Agreement
                  between  Credit Suisse First Boston  Mortgage  Capital LLC and
                  810 Partners LLC dated as of 10/23/97 and recorded  4/15/98 in
                  the Office of the City Register,  New York County in Reel 2563
                  at Page 1101. Consolidates mortgages nos. 1 to 4 into one lien
                  of $60,000,000.00.

5.   Gap  Mortgage  made by 810 7th Avenue,  L.P. to Credit  Suisse First Boston
     Mortgage  Capital LLC in the amount of  $40,000,000.00,  dated December 31,
     1997 and recorded July 9, 1998 in the Office of the City Register, New York
     County in Reel 2615 at Page 1780.

6.   Mortgage  Consolidation,  Modification,  Extension  and Security  Agreement
     between Credit Suisse First Boston Mortgage Capital LLC and 810 7th Avenue,
     L.P.  dated as of December 31, 1997 and recorded July 9, 1998 in the Office
     of the  City  Register,  New  York  County  in  Reel  2615  at  Page  1793.
     Consolidates mortgages nos. 1 to 5 into one lien of $100,000,000.00.

         Which  mortgage  was assigned by Credit  Suisse  First Boston  Mortgage
         Capital LLC to Norwest Bank Minnesota, National Association, As Trustee
         Under The Pooling and Servicing  Agreement  Dated June 12, 1998 For The
         Credit  Suisse  First  Boston  Mortgage  Securities  Corp.,  Commercial
         Mortgage  Pass-Through  Certificates,  Series  1998-FL1  (successor  in
         interest to Credit Suisse First Boston Mortgage Capital LLC, a Delaware
         limited liability company) dated

<PAGE>

         June 29,  1998 and  recorded on April 7, 1999 in the Office of the City
         Register,  New York County in Reel 2850 at Page 2380. Assigns mortgages
         nos. 1 to 5 as consolidated by mortgage consolidation no. 6.

         Which mortgage was further assigned by Norwest Bank Minnesota, National
         Association,  as trustee to Fleet  National  Bank,  a national  banking
         association,  as administrative  agent, by Assignment of Mortgage dated
         February  23,  1999 and  recorded on April 7, 1999 in the Office of the
         City  Register,  New York  County  in Reel 2850 at Page  2393.  Further
         assigns mortgages nos. 1 to 5 as consolidated by mortgage consolidation
         no. 6.

7.   Which  mortgage was amended and restated by a certain  Amended and Restated
     Mortgage Agreement by Tower Realty Operating Partnership,  L.P., a Delaware
     limited  partnership,  in favor of Fleet National Bank, a national  banking
     association,  as  administrative  agent,  dated  as of  March  1,  1999 and
     recorded April 7, 1999 in the Office of the City Register,  New York County
     in Reel 2850 at Page 2413.  Amends and  restates  mortgages  nos. 1 to 5 as
     consolidated by mortgage consolidation no. 6.

8.   Assignment of Mortgage from Fleet National Bank, as  administrative  agent,
     to UBS AG, Stamford Branch,  as administrative  agent,  dated as of May 20,
     1999,  and  recorded  on June 16,  1999 in Reel 2894,  Page  1786.  Assigns
     mortgages 1 to 7.

9.   Assignment  of Mortgage from USB AG,  Stamford  Branch,  as  administrative
     agent,  to  Monumental  Life  Insurance  Company,  dated July 23,  1999 and
     intended to be recorded  immediately  following  the execution and delivery
     hereof.

10.  Mortgage (Fee and Leasehold) made by Metropolitan  810 7th Ave, LLC and 100
     Wall Company,  LLC to Monumental Life Insurance  Company,  in the amount of
     $65,000,000.00, dated July 23, 1999 and intended to be recorded immediately
     following the recordation of the Assignment described in No. 9 above.

<PAGE>

                                    EXHIBIT B

                              Property Description

                         Exhibit B-1:     810 Seventh Avenue
                         Exhibit B-2:     100 Wall Street

                          [ Exhibits follow this page ]

<PAGE>

                                   Exhibit B-1
                              (810 Seventh Avenue)

LOT 38

ALL that certain plot, piece or parcel of land, situate,  lying and being in the
Borough of Manhattan,  County, City and State of New York, bounded and described
as follows:

BEGINNING  at a point on the  northerly  side of West 52nd Street  opposite  the
center of a certain party wall standing partly on the premises and partly on the
premises adjoining on the easterly side thereof,  which point is distant 74 feet
4 inches westerly from the northwesterly  corner of Seventh Avenue and West 52nd
Street; and

RUNNING THENCE  northerly  parallel with the westerly side of Seventh Avenue and
for part of the  distance  through  the  center of said  party  wall,  75 feet 5
inches;

THENCE  easterly and parallel with the said  northerly side of West 52nd Street,
74 feet 3-3/4 inches to the westerly side of Seventh Avenue;

THENCE  northerly  along the said  westerly side of Seventh  Avenue,  125 feet 5
inches to the corner  formed by the  intersection  of the said  westerly side of
Seventh Avenue and the southerly side of West 53rd Street;

THENCE  westerly  along the said  southerly  said of West 53rd Street,  195 feet
2-3/8 inches to the  intersection of the said southerly side of West 53rd Street
and the easterly side of Broadway;

THENCE southerly along the said easterly side of Broadway, 126 feet 1-1/2 inches
more or less, to a point in a line  parallel to the northerly  side of West 52nd
Street, 75 feet 5 inches northerly  therefrom measured on a line at right angles
to the northerly side of West 52nd Street;

THENCE  easterly  parallel with the said northerly side of West 52nd Street,  69
feet 11 inches;

THENCE southerly at right angles to the said northerly side of West 52nd Street,
75 feet 5 inches to the said northerly side of West 52nd Street, and

<PAGE>

THENCE  easterly along the said  northerly  side of West 52nd Street,  37 feet 7
inches to the point or place of BEGINNING.

<PAGE>

                              SCHEDULE B- 1 (CONT.)

AIR RIGHTS LOT 29:

The Air Rights Lease of Lot 29 covers  premises  more  particularly  bounded and
described as follows:

ALL that certain lot, piece or parcel of land,  situate,  lying and being in the
Borough of Manhattan,  City,  County and State of New York bounded and described
as follows:

BEGINNING at a point formed by the  intersection  of the northerly  side of West
52nd Street with the westerly side of Seventh Avenue; and

RUNNING THENCE  westwardly along the northerly side of West 52nd Street, 74 feet
4 inches to a point opposite the center line of a 16 inch party wall;

THENCE northwardly parallel with Seventh Avenue and part of the distance through
the center of said party wall, 75 feet 5 inches;

THENCE  eastwardly  parallel  with  West  52nd  Street,  74 feet 4 inches to the
westerly side of Seventh Avenue; and

THENCE  southwardly  along the westerly side of Seventh Avenue, 75 feet 5 inches
to the point or place of BEGINNING.

<PAGE>

                                 SCHEDULE B - 1

LOT 131:

The Air Rights Lease of Lot 131 covers  premises more  particularly  bounded and
described as follows:

ALL that certain lot, piece or parcel of land,  situate,  lying and being in the
Borough of Manhattan,  City, County and State of New York, bounded and described
as follows:

BEGINNING at the corner formed by the intersection of the northerly side of 52nd
Street with the easterly side of Broadway as now laid down;

RUNNING  THENCE  easterly  along the northerly  side of 52nd Street,  61 feet 10
inches to the  center  line of the  westerly  wall of  building  erected  in the
premises adjoining on the east of the premises hereby described;

RUNNING THENCE  northerly  parallel with the westerly side of Seventh Avenue and
along  said  line of said  wall and a line in  prolongation  thereof,  75 feet 5
inches;

RUNNING THENCE westerly parallel with the northerly side of 52nd Street, 69 feet
11 inches to the said easterly side of Broadway; and

RUNNING THENCE southerly along the easterly side of Broadway,  75 feet 11 inches
to the point or place of BEGINNING.

BE said several distances and dimensions more or less.

<PAGE>

                                  SCHEDULE B-2
                                (100 WALL STREET)

PARCEL I - LOT 1:

ALL that certain plot, piece or parcel of land, situate,  lying and being in the
Borough of Manhattan,  County, City and State of New York, bounded and described
as follows:

BEGINNING at the corner formed by the intersection of the northerly side of Wall
Street and the westerly side of Front Street;

THENCE  northerly  along the said westerly side of Front Street,  196 feet 6-1/2
inches to the corner  formed by the  intersection  of the westerly side of Front
Street with the southerly side of Pine Street (now discontinued and closed);

THENCE  westerly along the said  southerly  side of Pine Street,  113 feet 3-3/8
inches to the corner formed by the  intersection of the southerly side of former
Pine Street with the easterly side of Water Street;

THENCE  southerly  along the said easterly side of Water Street,  195 feet 0-5/8
inches to the corner  formed by the  intersection  of the said  easterly side of
Water Street with the northerly side of Wall Street;

THENCE  easterly along the northerly  side of Wall Street,  117 feet 3 inches to
the point or place of BEGINNING.

Be the said several distances and dimensions more or less.

<PAGE>

                             SCHEDULE B - CONTINUED

PARCEL II - PART OF LOT 17:

ALL that certain plot, piece or parcel of land, situate,  lying and being in the
Borough of Manhattan,  County, City and State of New York, bounded and described
as follows:

BEGINNING at the corner formed by the intersection of the easterly side of Water
Street with the  southerly  side of Pine Street as these  streets are shown on a
map dated 4/6/70 and approved by the Board of Estimate on 7/23/70, Calendar #8;

RUNNING THENCE  northerly along the northerly  prolongation of the said easterly
side of Water  Street a distance of 12.18 feet to the center line of Pine Street
(now discontinued and closed);

THENCE  easterly along the said center line of Pine Street,  forming an interior
angle of 99 degrees 31 minutes 58  seconds  with the last  mentioned  course,  a
distance of 112.25 feet to the  southerly  prolongation  of the westerly side of
Front  Street as shown on a map  approved  by the Board of Estimate on March 12,
1970, Calendar #37;

THENCE southerly along the said southerly  prolongation of Front Street, forming
an interior  angle of 80 degrees 40 minutes 42 seconds  with the last  mentioned
course, a distance of 12.33 feet to the southerly side of Pine Street;

THENCE westerly along the said southerly side of former Pine Street,  forming an
interior  angle of 99 degrees 15  minutes  37  seconds  with the last  mentioned
course, a distance of 112.06 feet to the point or place of BEGINNING.

<PAGE>

                                   EXHIBIT C

                              Permitted Exceptions

As to 810 Seventh Avenue Only:

1.       Distinctive  Street  Improvement  Maintenance  Declaration  made by 810
         Associates and approved by the Department of Transportation,  Bureau of
         Highway Operation,  dated April 18, 1985 recorded July 11, 1985 in Reel
         935 Page 611. (Affects lot 38)

2.       Distinctive  Sidewalk  Improvement  Maintenance  Agreement  made by 810
         Associates and approved by the Department of Transportation  and Acting
         Corporation Counsel, dated August 21, 1991, recorded August 23, 1991 in
         Reel 1807 Page 622. (Affects lot 38).

3.       Terms, covenants, restrictions,  provisions and agreements contained in
         the Lease  between  Moses  Dyckman,  as lessor and Abraham  Sommer,  as
         lessee,  dated March 28,  1967,  recorded May 13, 1981 in Reel 566 Page
         39, with  Memorandum of Lease recorded May 29, 1967 in Record Liber 185
         Page 27. (Covers the Air Rights over Lot 29).

         With Regard Thereto:

         a.       Agreement  [re Lot 38 rent  payment  covenant  from Lot 29 Air
                  Rights] between Abraham Sommer and Moses Dyckman,  dated March
                  28, 1967 and recorded May 29, 1967 in Record Liber 185 Page 44
                  and on May 13, 1981 in Reel 566 Page 88.

         b.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building,  Inc.,  dated 2/21/69  recorded  2/29/69 in Reel 132
                  Page 394.

         c.       Assignment of Lease made by Croydon Office  Building,  Inc. to
                  Abraham  Sommer dated  2/21/69  recorded  2/267/69 in Reel 132
                  Page 583.

         d.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building, Inc., dated 9/9/69 recorded 9/12/69 in Reel 150 Page
                  1951.

         e.       Assignment of Lease made by Croydon Office  Building,  Inc. to
                  Abraham  Sommer,  dated 9/10/69  recorded  6/16/69 in Reel 151
                  Page 425.
<PAGE>

         f.       Assignment of Leases from Beverly Sommer and Harold Kantor, as
                  Trustees  of the  Trust  Under  Article  Fifth  of the Will of
                  Abraham Sommer and Amy Sommer to 810 Seventh Avenue, LLC dated
                  September 22, 1995 and recorded December 15, 1995 in Reel 2271
                  Page 2237.

         g.       Assignment of Air Rights Lease from 810 Seventh  Avenue LLC to
                  810 Partners,  LLC, dated 10/23/1997,  and recorded 4/15/98 in
                  Reel 2563 Page 1074.

         h.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners LLC to Bhone Inc., dated 12/31/97 and recorded 7/9/98
                  in Reel 2615 Page 1868.

         i.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners  LLC and Bhone Inc.  to 810 7th Avenue,  L.P.,  dated
                  12/31/97 and recorded 7/9/98 in Reel 2615 Page 1762.

         j.       Assignment  and Assumption of Air Rights Lease made by 810 7th
                  Avenue, L.P. to Tower Realty OperatingPartnership,  L.P. dated
                  3/1/1999 and recorded 4/7/1999 in Reel 2850 Page 2365.

         k.       Conveyance  of  Leasehold   Interest   made  by   Metropolitan
                  Operating  Partnership  L.P. as successor by merger with Tower
                  Realty  Operating  Partnership  L.P.  to 810 7th Avenue  L.P.,
                  dated 5/24/ 1999 and  recorded on  6/16/1999 in Reel 2894 Page
                  1805.

         l.       Assignment  and Assumption of Air Rights Lease made by 810 7th
                  Avenue L.P. to  Metropolitan  810 7th Ave LLC, dated as of and
                  to be  recorded  in the Office of the New York City  Register,
                  New York County.

4.       Terms, covenants, restrictions,  provisions and agreements contained in
         Agreement of Lease between  Chatham  Associates,  Inc., as landlord and
         Abraham Sommer, as tenant,  dated April 10, 1968 and recorded April 11,
         1968 in Record Liber 294 Page 49. (Covers the Air Rights over Lot 131).

With Regard Thereto:

         a.       Amendment of Lease made between Chatham  Associates,  Inc. and
                  Abraham Sommer,  dated as of 2/13/69  recorded 2/25/69 in Reel
                  132 Page 171.

         b.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building,  Inc.,  dated 2/21/69  recorded  2/26/69 in Reel 132
                  Page 390.
<PAGE>

         c.       Assignment  of Lease made by Croydon  Office  Building Inc. to
                  Abraham  Sommer,  dated 2/21/69  recorded  2/26/69 in Reel 132
                  Page 587.

         d.       Subordination  and  Non-disturbance   Agreement  made  between
                  Rosenthal and Rosenthal,  Inc., Chatham  Associates,  Inc. and
                  Abraham  Sommer,  dated 2/26/69  recorded  2/28/69 in Reel 132
                  Page 1276.

         e.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building, Inc., dated 9/9/69 recorded 9/12/69 in Reel 150 Page
                  1947.

         f.       Assignment of Lease made by Croydon Office  Building,  Inc. to
                  Abraham  Sommer,  dated 9/10/69  recorded  9/16/69 in Reel 151
                  Page 421.

         g.       Assignment of Leases made by Beverly  Sommer and Harold Kantor
                  as Trustees of the Trust under  Article Fifth of the Land Will
                  and Testament of Abraham  Sommer and Amy Sommer to 810 Seventh
                  Avenue,  LLC dated 9/22/95 recorded 12/15/95 in Reel 2271 Page
                  2237.

         h.       Assignment of Air Rights Lease from 810 Seventh  Avenue LLC to
                  810 Partners LLC, dated 10/23/97, and recorded 4/15/98 in Reel
                  2563 Page 1078.

         i.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners LLC to Bhone Inc., dated 12/31/97 and recorded 7/9/98
                  in Reel 2615 Page 1876.

         j.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners  LLC and Bhone Inc.  to 810 7th Avenue,  L.P.,  dated
                  12/31/97 and recorded 7/9/98 in Reel 2615 Page 1771.

         k.       Assignment  and Assumption of Air Rights Lease made by 810 7th
                  Avenue L.P. to Tower Realty  OperatingPartnership  L.P.  dated
                  3/1/1999 and recorded 4/7/1999 in Reel 2850 Page 2372.

         l.       Conveyance  of  Leasehold   Interest   made  by   Metropolitan
                  Operating  Partnership  L.P. as successor by merger with Tower
                  Realty  Operating  Partnership  L.P.  to 810 7th Avenue  L.P.,
                  dated  5/24/1999  and  recorded on 6/16/1999 in Reel 2894 Page
                  1805.

         m.       Assignment  and Assumption of Air Rights Lease made by 810 7th
                  Avenue  L.P.  to  Metropolitan  810 7th Ave  LLC,  dated as of
                  _____________ and to be recorded in the Office of the New York
                  City Register, New York County.
<PAGE>

As to 100 Wall Street Only:

1.       Agreement dated as of 8/18/1970 between Associated  Maritime Industries
         Inc.,  Sylvan Lawrence and Seymour Cohn d/b/a Sylvan  Lawrence  Company
         and Arthur H. Bienenstock, recorded on 8/26/1970 in Reel 182 Page 883.

2.       Amended  Agreement  dated as of 6/5/1970  between  Associated  Maritime
         Industries  Inc.,  Sylvan  Lawrence  and  Seymour  Cohen  d/b/a  Sylvan
         Lawrence  Company,  Arthur  H.  Bienenstock  and The City of New  York,
         recorded on 9/8/1970 in Reel 183 Page 701.

3.       Joint  Operating  Agreement  dated  3/28/1969  by  and  between  Sylvan
         Lawrence,  Seymour Cohn d/b/a Sylvan  Lawrence  Company and  Associated
         Maritime Industries Inc., recorded on 4/8/1969 in Reel 136 Page 374.

         1)       Amendment dated as of 5/15/1970 between said parties, recorded
                  on 11/27/1970 in Reel 174 Page
                  929.

         2)       Amendment  dated  as  of  12/28/1970  by  and  between  Sylvan
                  Lawrence and Seymour Cohn d/b/a  Sylvan  Lawrence  Company and
                  Orient Overseas Building Corp. and Arthur H. Bienenstock,  100
                  Wall Street Associates, recorded on 1/26/1971 in Reel 194 Page
                  1080.

4.       Covenants  contained  in deed from the City of New York to One  Hundred
         Wall Street  Corporation,  dated 6/30/1966 and recorded on 8/31/1966 in
         Record Liber 97 Page 396.

5.       Grant of Easement dated 7/8/1970  between Arthur H. Bienenstock and The
         City of New York, recorded on 1/6/1971 in Reel 192 Page 1898.

6.       Distinctive Sidewalk Improvement Maintenance Agreement dated 11/14/1990
         made by Cushman & Wakefield (Agent for owner,  CGR Advisors),  recorded
         on 2/28/991 in Reel 1765 Page 1742.

7.       Terms, Covenants, Conditions and Provisions of the Lease made by Sylvan
         Lawrence  and Seymour  Cohn d/b/a Sylvan  Lawrence  Company,  Arthur H.
         Bienenstock and 100 Wall Street Associates (lessor) and Orient Overseas
         Building  Corp.  (lessee),  a memorandum  of which was dated  12/24/70,
         recorded 1/26/71 in Reel 194 Page 1048. (Affects Lot 17 only).

8.       Terms,  Covenants,  Conditions  and  Provisions  of the  Lease  between
         Associated Maritime  Industries,  Inc., as landlord and Orient Overseas
         Associates,  as  tenant,  dated  5/22/70,  a  memorandum  of which  was
         recorded  on  5/27/70  in Reel 174 Page  949,  which  affects  only the
         leasehold  on Parcel  II (Lot 17 only) by  virtue of terms,  covenants,
<PAGE>

         conditions  and  agreements   contained  in  Agreement  between  Orient
         Overseas Building Corp. and Orient Overseas  Associates,  dated 1/15/71
         and recorded 1/26/71 in Reel 194 Page 1123.

         With Respect Thereto:

         a.       Assignment  of  Lease  dated  12/10/70  from  Orient  Overseas
                  Associates to 88 Pine Corp.,  recorded on 12/16/70 in Reel 191
                  Page 538.

         b.       Assignment  of Lease  dated  12/10/70  from 88 Pine  Corp.  to
                  Orient Overseas  Associates,  recorded on 12/16/70 in Reel 191
                  Page 543.

         c.       Assignment  of Lease dated as of 1/12/71 from Orient  Overseas
                  Associates  to 88 Pine Corp.,  recorded on 1/13/71 in Reel 193
                  Page 1138.

         d.       Assignment  of Lease dated as of 1/12/71 from 88 Pine Corp. to
                  Orient  Overseas  Associates,  recorded on 1/13/71 in Reel 193
                  Page 1133.

         e.       Assignment   of  Lease  dated  2/9/71  from  Orient   Overseas
                  Associates  to 88 Pine Corp.,  recorded on 2/10/71 in Reel 196
                  Page 453.

         f.       Assignment of Lease dated 11/1/13 from 88 Pine Corp. to Orient
                  Overseas  Associates,  recorded  on  11/7/73  in Reel 296 Page
                  1506.

9.       Possible  private  and public  easements  within the bed of former Pine
         Street for the purposes of access,  the  supplying of water,  telephone
         service,  electricity and gas, and for the installing,  maintaining and
         replacing of cables,  sewers,  conduits,  pipes and mains. (Affects Lot
         17).
<PAGE>

                                    EXHIBIT D

                                    Reserved

<PAGE>

                                    EXHIBIT E

                                    Reserved

<PAGE>

                                    EXHIBIT F

                                Air Rights Leases

810 Seventh Avenue

LOT 29

That certain Lease dated March 28, 1967 by and between Moses Dyckman,  as lessor
and Abraham  Sommer,  as lessee,  recorded May 13, 1981 in Reel 566,  Page 39, a
memorandum of which was recorded on May 29, 1967 in the City Register's  Office,
New York County (the "Register's Office") in Record Liber 185, Page 27.

WITH RESPECT THERETO:

         a.       Agreement  between  Abraham  Sommer and Moses  Dyckman,  dated
                  March 28, 1967 and  recorded  May 29,  1967 in the  Register's
                  Office in Record  Liber 185,  Page 44; and on May 13,  1981 in
                  Record Liber 566, Page 88.

         b.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building,  Inc., dated February 21, 1969 and recorded February
                  29, 1969 in the Register's Office in Reel 132, Page 394.

         c.       Assignment of Lease made by Croydon Office  Building,  Inc. to
                  Abraham Sommer,  dated February 21, 1969 and recorded February
                  26, 1969 in the Register's Office in Reel 132, Page 583.

         d.       Assignment of Lease made by Abraham  Sommer to Croydon  Office
                  Building, Inc., dated September 9, 1969 and recorded September
                  12, 1969 in the Register's Office in Reel 150, Page 1951.

         e.       Assignment of Lease made by Croydon Office  Building,  Inc. to
                  Abraham Sommer, dated September 10, 1969 and recorded June 16,
                  1969 in the Register's Office in Reel 151, Page 425.

         f.       Assignment of Lease made by Beverly  Sommer and Harold Kantor,
                  as Trustees of the Trust  under  Article  Fifth of the Will of
                  Abraham  Sommer,  and Amy Sommer to 810  Seventh  Avenue  LLC,
                  dated September 22, 1995 and recorded December 15, 1995 in the
                  Register's Office in Reel 2271, Page 2237.

         g.       Assignment of Air Rights Lease from 810 Seventh  Avenue LLC to
                  810 Partners,  LLC,  dated October 23, 1997 and recorded April
                  15, 1998, in the Register's Office in Reel 2563 Page 1074.
<PAGE>

         h.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners  LLC to  Bhone  Inc.,  dated  December  31,  1997 and
                  recorded July 9, 1998 in Reel 2615 Page 1868.

         i.       Assignment  and  Assumption  of Air  Rights  Lease made by 810
                  Partners  LLC and Bhone Inc.  to 810 7th Avenue,  L.P.,  dated
                  December 31, 1997 and recorded  July 9, 1998 in Reel 2615 Page
                  1762.

         j.       Assignment  and  Assumption  of Air Rights  Lease from 810 7th
                  Avenue,  L.P. to Tower  Realty  Operating  Partnership,  dated
                  March 1, 1999 and recorded in the  Register's  Office on April
                  7, 1999 in Reel 2850, Page 2365.

         k.       Assignment  of Air  Rights  Lease by  operation  of deed  from
                  Metropolitan Operating Partnership,  L.P., successor by merger
                  to  Tower  Realty  Operating  Partnership,  L.P.,  to 810  7th
                  Avenue,  L.P.  dated May 24,  1999 and to be  recorded  in the
                  Register's Office.

         That  certain  Sublease  dated  October 19,  1955 by and between  Moses
         Dyckman,  as lessor and 800 Estates Corp.,  as lessee,  which lease was
         recorded on May 31, 1981 in Reel 566, Page 9, and Agreement (Memorandum
         of Lease) dated  October 19, 1955,  recorded on November 2, 1955 in the
         City Register's  Office,  New York County (the "Register's  Office") in
         Record Liber 4940, Page 609 and Reel 566, Page 36.

         WITH RESPECT THERETO:

                  A.       Agreement  between Moses Dyckman,  Abraham Sommer and
                           800 Estates Corp.,  dated March 28, 1967 and recorded
                           May 29, 1967 in the Register's Office in Record Liber
                           185, Page 30.

                  B.       Agreement between Moses Dyckman,  Abraham Sommer, and
                           800 Estates  Corp.,  dated Mach 28, 1967 and recorded
                           May 13,  1981 in the  Register's  Office in Reel 566,
                           Page 1.

                  C.       Amendment  of  Lease  dated  March  28,  1967  by and
                           between 800 Estates Corp. and Abraham Sommer recorded
                           May 13, 1981 in Reel 566, Page 95.

                  D.       Assignment  of Lease  made by 800  Estates  Corp.  to
                           Tydel  Holding  Corp.  dated May 5, 1981 and recorded
                           May 22,  1981 in the  Register's  Office in Reel 567,
                           Page 507.

                  E.       Amendment to Lease made by and between Beverly Sommer
                           and Robert S. Puder,  as Trustee  under Article Fifth
                           of the Last Will and Testament of Abraham Sommer, and
                           Beverly Sommer and Robert S. Puder, as Trustees under
                           Article  Ninth of the  Last  will  and  Testament  of
                           Abraham Sommer,  and Tydel Holding Corp., dated

<PAGE>

                           April  17,  1986  and  recorded  May 28,  1986 in the
                           Register's Office in Reel 1069, Page 817.

Sublease between Moses Dyckman, as lessor and 800 Estates Corp., as lessee dated
October 19,  1955 and  recorded  May 13, 1981 in Reel 566 Page 9, and  Agreement
(Memorandum of Lease) dated October 19, 1955, recorded November 2, 1955 in Liber
4940 Page 609 and Reel 566 Page 36 (Lot 29 improvements)

         a.       Agreement  restricting  height  of  the  building  at  800-806
                  Seventh Avenue between Abraham  Sommer,  Moses Dyckman and 800
                  Estates Corp.,  dated March 28, 1967 and recorded May 29, 1967
                  in Record Liber 185 Page 30.

         b.       Terms,  provisions of an Attornment  and  Non-Disturbance  and
                  Consent to Sublease Amendment Agreement made by Moses Dyckman,
                  800 Estate Corp.  and Abraham  Sommer dated  3/28/67  recorded
                  5/13/81 in Reel 566 Page 1.

         c.       Amendment of (Sub)lease (and  subordination of Sublease to Air
                  Rights Lease)  between 800 Estates Corp.  and Abraham  Sommer,
                  dated 3/28/67 and recorded 5/13/81 in Reel 566 Page 95.

         d.       Assignment  of Lease made by 800  Estates  Corp.,  Assignor to
                  Tydel Holding Corp.,  Assignee,  dated 5/5/81 recorded 5/22/81
                  in Reel 567 Page 507.

         e.       Amendment  to Lease  made by and  between  Beverly  Sommer and
                  Robert S. Puder,  as Trustees  under Article Fifth of the Last
                  Will and Testament of Abraham  Sommer,  and Beverly Sommer and
                  Robert S. Puder as  Trustee  under  Article  Ninth of the Last
                  Will and Testament of Abraham  Sommer and Tydel Holding Corp.,
                  dated 4/17/86 recorded 5/28/86 in Reel 1069 Page 817.

<PAGE>

LOT 131

That certain Lease dated April 10, 1968 by and between Chatham Associates, Inc.,
as landlord and Abraham Sommer, as tenant, which lease was recorded on April 11,
1968 in the City Register's Office, New York County (the "Register's Office") in
Record Liber 294, Page 49.

WITH RESPECT THERETO:

a.       Amendment of Lease made between  Chatham  Associates,  Inc. and Abraham
         Sommer, dated as of February 13, 1969 and recorded February 25, 1969 in
         the Register's Office in Reel 132, Page 171.

b.       Assignment of Lease made by Abraham Sommer to Croydon Office  Building,
         Inc.,  dated  February 21, 1969 and  recorded  February 26, 1969 in the
         Register's Office in Reel 132, Page 390.

c.       Assignment of Lease made by Croydon  Office  Building,  Inc. to Abraham
         Sommer,  dated February 21, 1969 and recorded  February 26, 1969 in the
         Register's Office in Reel 132, Page 587.

d.       Subordination and Non-disturbance  Agreement made between Rosenthal and
         Rosenthal,  Inc., Chatham  Associates,  Inc. and Abraham Sommer,  dated
         February 26, 1969,  and  recorded  February 28, 1969 in Reel 132,  Page
         1276.

e.       Assignment of Lease made by Abraham Sommer to Croydon Office  Building,
         Inc.,  dated  September 9, 1969 and recorded  September 12, 1969 in the
         Register's Office in Reel 150, Page 1947.

f.       Assignment of Lease made by Croydon  Office  Building,  Inc. to Abraham
         Sommer, dated September 10, 1969 and recorded September 16, 1969 in the
         Register's Office in Reel 151, Page 421.

g.       Assignment  of Lease made by  Beverly  Sommer  and  Harold  Kantor,  as
         Trustees  of the  Trust  under  Article  Fifth of the  Will of  Abraham
         Sommer,  and Amy Sommer to 810 Seventh Avenue LLC, dated  September 22,
         1995 and recorded  December 15, 1995 in the  Register's  Office in Reel
         2271, Page 2237.

h.       Assignment  of Air  Rights  Lease  from 810  Seventh  Avenue LLC to 810
         Partners,  LLC,  dated October 23, 1997 and recorded  April 15, 1998 in
         the Register's Office in Reel 2563, Page 1078.

i.       Assignment  and Assumption of Air Rights Lease made by 810 Partners LLC
         to Bhone Inc.,  dated  December 31, 1997 and  recorded  July 9, 1998 in
         Reel 2615, Page 1876
<PAGE>

j.       Assignment  and  Assumption of Air Rights Lease from 810 Partners,  LLC
         and Bhone Inc., to 810 7th Avenue,  L.P.,  dated  December 31, 1997 and
         recorded July 9, 1998 in the Register's office in Reel 2615, Page 1771.

k.       Assignment  and  Assumption  of Air Rights  Lease from 810 7th  Avenue,
         L.P., to Tower Realty  Operating  partnership,  dated March 1, 1999 and
         recorded in the Register's  Office on April 7, 1999, in Reel 2850, Page
         2372.

l.       Together with Lessor's  interest in Agreement of Sublease of Air Rights
         Lot 131,  made by and  between  Abraham  Sommer,  as  Sublandlord,  and
         Chatham  Associates,  Inc.,  as  subtenant,  dated  April  10,  1968 as
         referenced in the  Memorandum of Lease recorded April 11, 1968 in Liber
         294, Page 70.

m.       Assignment  of Air Rights Lease by operation of deed from  Metropolitan
         Operating  Partnership,  L.P.,  successor  by  merger  to Tower  Realty
         Operating Partnership, L.P.. to 810 7th Avenue, L.P. dated May 24, 1999
         and to be recorded in the Register's Office.

 That certain Sublease of Air Rights Lot 131 dated April 10, 1968 by and between
 Abraham Sommer, as sublandlord and Chatham  Associates,  Inc., as subtenant,  a
 memorandum of which lease was recorded in the City Register's  Office, New York
 County on April 11, 1968 in Record Liber 294, Page 70.

<PAGE>

             METROPOLITAN 810 7th AVE, LLC AND 100 WALL COMPANY LLC,

                                   MORTGAGOR,

                                       AND

                       MONUMENTAL LIFE INSURANCE COMPANY,

                                    MORTGAGEE

 ------------------------------------------------------------------------------

        AGREEMENT OF SPREADER, CONSOLIDATION AND MODIFICATION OF MORTGAGE

                             AND SECURITY AGREEMENT

 ------------------------------------------------------------------------------

                           DATED: AS OF JULY __, 1999

THIS INSTRUMENT  AFFECTS REAL AND PERSONAL PROPERTY SITUATED IN THE STATE OF NEW
YORK,  COUNTY OF NEW YORK,  SECTION  ___,  BLOCK 1024,  LOT 38, AND SECTION ___,
BLOCK 38, LOTS 1 AND P/O 17,  RESPECTIVELY,  KNOWN BY THE STREET  ADDRESS OF 810
SEVENTH  AVENUE AND 100 WALL STREET,  RESPECTIVELY,  AND WITH RESPECT TO THE AIR
RIGHTS  LEASES,  SECTION  ____,  BLOCK  1024,  AND LOTS 29 AND 131. AS STATED IN
SECTION 4.18 HEREOF,  SAID REAL  PROPERTY IS NOT  PRINCIPALLY  IMPROVED OR TO BE
IMPROVED BY ONE OR MORE STRUCTURES CONTAINING IN THE AGGREGATE NOT MORE THAN SIX
RESIDENTIAL DWELLING UNITS, EACH HAVING ITS OWN COOKING FACILITIES.

THIS AGREEMENT IS TO BE FILED AND INDEXED IN THE REAL ESTATE RECORDS AND IS ALSO
TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS UNDER THE NAMES OF MORTGAGOR,
AS "DEBTOR", AND MORTGAGEE, AS "SECURED PARTY".

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}]]