Document:

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                                                                   Exhibit 10.10

                               AGREEMENT OF LEASE

                                 By and Between

                       THE RITTENHOUSE DEVELOPMENT COMPANY
                                    Landlord

                                       and

                           S & W OF PHILADELPHIA, LLC
                                     Tenant

                     For the SMITH AND WOLLENSKY RESTAURANT

                            at THE RITTENHOUSE HOTEL

                           Philadelphia, Pennsylvania

                            Dated: February 18, 2000
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                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE I - LEASE TO TENANT ...............................................  2
            1.01  Premises ................................................  2
            1.02  Standard ................................................  2
            1.03  Relation of Parties .....................................  2

ARTICLE II - TERM .........................................................  2
            2.01  Term ....................................................  2
            2.02  Rent Commencement Date ..................................  3
            2.03  Lease Commencement Date .................................  3
            2.04  Option Period ...........................................  3
            2.05  Lease Year ..............................................  4

ARTICLE III - RENOVATING, FURNISHING AND EQUIPPING OF RESTAURANT;
              PRE-OPENING SERVICES ........................................  4
            3.01  Construction; Opening ...................................  4
            3.02  Project Costs ...........................................  4
            3.03  Pre-Opening .............................................  5

ARTICLE IV - POSSESSION; TENANT IMPROVEMENTS; EXPANSION OPTION ............  6
            4.01  Possession ..............................................  6

ARTICLE V - OPERATING STANDARDS; USE ......................................  6
            5.01  Operating Standards .....................................  6
            5.02  Personnel ...............................................  8
            5.03  Licenses, Permits and Zoning; Compliance with Law .......  8
            5.04  Limitations on Marketing, Advertising and Promotion .....  9
            5.05  Maintenance and Repairs .................................  9
            5.06  Alterations .............................................  9
            5.07  Tenant's Fixtures ....................................... 10
            5.08  Legal Actions ........................................... 10
            5.09  Cooperation with Hotel - Shared Services ................ 10
            5.10  Utility Services ........................................ 11
            5.11  Taxes ................................................... 11
            5.12  Net Lease ............................................... 13

ARTICLE VI - MINIMUM RENT; PERCENTAGE RENT AND ADDITIONAL RENT ............ 13
            6.01  Minimum Rent ............................................ 13
            6.02  Percentage Rent ......................................... 14
            6.03  Gross Revenue ........................................... 16
            6.04  Use and Occupancy Tax ................................... 17

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            6.05  Rent .................................................... 17

ARTICLE VII - INDEMNIFICATION ............................................. 17
            7.01  Tenant's Indemnity ...................................... 17
            7.02  Landlord's Indemnity .................................... 17
            7.03  Conditions of Indemnification ........................... 17

ARTICLE VIII - NON-COMPETITION ............................................ 18
            8.01  Non-Competition ......................................... 18
            8.02  Definition of Affiliate ................................. 18

ARTICLE IX - INSURANCE .................................................... 18
            9.01  Waiver of Subrogation ................................... 18
            9.02  Investigation of Claims ................................. 19
            9.03  Tenant's Insurance ...................................... 19
            9.04  Landlord's Insurance .................................... 20

ARTICLE X - TRADE NAME, SERVICE MARKS ..................................... 21
           10.01  Trade Name .............................................. 21
           10.02  Landlord's Trade and Service Marks ...................... 21

ARTICLE XI - ASSIGNMENTS AND TRANSFERS .................................... 21
           11.01  Assignment by Tenant .................................... 21
           11.02  Assignment by Landlord .................................. 22

ARTICLE XII - MORTGAGES AND FINANCINGS .................................... 22
           12.01  Definitions ............................................. 22
           12.02  Subordination; Changes .................................. 23
           12.03  Notice and Right to Cure ................................ 23
           12.04  Acquisition by Mortgagee; Non-Disturbance ............... 23
           12.05  Termination ............................................. 25

ARTICLE XIII - TERMINATION ................................................ 25
           13.01  Termination ............................................. 25
           13.02  Landlord's Additional Termination Right ................. 25
           13.03  Termination Fee ......................................... 25
           13.04  Effect of Termination ................................... 26

ARTICLE XIV - MECHANIC'S LIENS ............................................ 26
           14.01  Mechanics' Liens, etc. .................................. 26

ARTICLE XV - DAMAGE TO PREMISES ........................................... 27
           15.01  Damage to Premises ...................................... 27
           15.02  Damage to Hotel ......................................... 27
           15.03  Limitation .............................................. 28

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           15.04  Time to Restore ......................................... 28

ARTICLE XVI - CONDEMNATION ................................................ 28
           16.01  Condemnation ............................................ 28

ARTICLE XVII - DEFAULTS; REMEDIES ......................................... 30
           17.01   Defaults ............................................... 30
           17.02   Remedies ............................................... 31
           17.03   Expenses of Enforcement ................................ 35
           17.04   Landlord May Cure Defaults ............................. 35

ARTICLE XVIII - MISCELLANEOUS ............................................. 36
           18.01   Access and Information ................................. 36
           18.02   Quiet Enjoyment ........................................ 37
           18.03   Notices ................................................ 37
           18.04   Waivers ................................................ 38
           18.05   Partial Invalidity ..................................... 38
           18.06   Entire Lease ........................................... 38
           18.07   Intentionally Omitted .................................. 38
           18.08   Successors and Assigns ................................. 38
           18.09   Consents ............................................... 39
           18.10   Governing Law .......................................... 39
           18.11   Signs .................................................. 39
           18.12   Landlord's Right of Entry .............................. 39
           18.13   Common Areas ........................................... 40
           18.14   Estoppel Certificates .................................. 40
           18.15   Limitation of Liability ................................ 40
           18.16   Binding Effect ......................................... 40
           18.17   Headings ............................................... 40
           18.18   Counterparts ........................................... 40
           18.19   Waiver of Trial by Jury ................................ 40
           18.20   Adverse Possession ..................................... 41
           18.21   Condition of Title and of Premises ..................... 41
           18.22   Surrender .............................................. 41
           18.23   Holdover ............................................... 41
           18.24   Definitions ............................................ 42
           18.25   Hazardous Materials .................................... 43
           18.26   Brokers ................................................ 44
           18.27   Effect of Submission ................................... 45

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EXHIBITS

EXHIBIT "A" - Description of Restaurant Space
EXHIBIT "B" - Plans and Specifications of Restaurant
EXHIBIT "C" - Project Budget
EXHIBIT "C-1" - Tenant's Furniture, Fixtures and Equipment (Section 5.07)
EXHIBIT "D" - Termination Fee (Section 13.03)
EXHIBIT "E" - Operating Results Standard (Section 13.02)

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                               AGREEMENT OF LEASE

            THIS AGREEMENT ("Lease" or "Agreement") dated as of the 18th day of
February, 2000, by and among RITTENHOUSE DEVELOPMENT COMPANY, a general
partnership, organized and existing under the laws of the State of Delaware,
with offices at The Rittenhouse, 210 Rittenhouse Square, Philadelphia,
Pennsylvania 19103 (hereinafter called "Landlord"), and S & W OF PHILADELPHIA,
LLC, a limited liability company organized and existing under the laws of the
State of Delaware, with offices at c/o The Smith & Wollensky Restaurant Group,
Inc., 1114 First Avenue, 6th Floor, New York, New York 10021 (hereinafter called
"Tenant").

                                   WITNESSETH:

            WHEREAS, Landlord owns a luxury hotel known as and operating under
the name "The Rittenhouse" (the "Hotel") located at 210 Rittenhouse Square,
Philadelphia, Pennsylvania;

            WHEREAS, atop the Hotel is a private, residential, luxury
condominium development known as The Rittenhouse Condominium (the "Condominium")
and residents of the Condominium are provided certain services and amenities
through the Hotel;

            WHEREAS, Landlord wishes to lease certain space within the Hotel
described on Exhibit "A" hereto, to be operated and managed as a hotel
restaurant facility (the "Restaurant") which, in addition to serving the general
public, will serve as an amenity to Hotel and its guests, and will also provide
Condominium residents with certain services and privileges;

            WHEREAS, Tenant is the owner and operator of various restaurants,
and Tenant is experienced in the planning, decorating, furnishing, equipping,
promoting, managing and operating of commercial restaurants and hotel restaurant
facilities;

            WHEREAS, Landlord and Tenant desire to enter into an agreement
whereby Landlord and Tenant will each contribute to the cost to renovate,
construct, furnish and equip the Restaurant on the terms and conditions
hereinafter set forth; and

            WHEREAS, Tenant desires to operate a restaurant and food and
beverage services within the Hotel and Landlord desires to lease space in the
Hotel to Tenant for such use on the terms and conditions hereinafter set forth.

            NOW, THEREFORE, in consideration of the promises and the mutual
covenants hereinafter contained, and intending to be legally bound, the parties
hereby agree as follows:
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                                    ARTICLE I
                                 LEASE TO TENANT

            1.01 Premises.

                  (a) Premises. Landlord does hereby demise and let unto Tenant
and Tenant does hereby hire and lease from Landlord, for the term and upon the
conditions and covenants set forth herein, those portions of the lobby, second
floor and third floor at the Hotel more fully described on the plan marked
Exhibit "A" and attached hereto and made a part hereof (the "Premises" or
"Leased Premises").

                  (b) Landlord shall use commercially reasonable efforts to
obtain from the Rittenhouse Condominium Association permission for Tenant to use
as an outdoor patio and customer seating area, for approximately five months per
year during warm weather months, the outdoor space adjacent to the Leased
Premises in the area indicated as "outdoor space" on Exhibit A. Landlord shall
have no liability to Tenant if Landlord is unable to obtain such permission. If
Landlord is successful in doing so, during the periods in which Tenant is
permitted to use such space, such space shall be deemed part of the Lease
Premises, but no additional rent or real estate taxes will be due from Tenant on
account of such space. Tenant, and not Landlord, shall be responsible at its
expense, to obtain all necessary permits and governmental approvals for use of
such space.

            1.02 Standard. Tenant hereby agrees to supervise, operate, maintain
and repair the Restaurant as provided in this Lease, to create an image for the
Restaurant consistent with, and so as to enhance the image of the Hotel as, a
world-class luxury hotel, and to maximize the profit potential of the Hotel and
of the space being occupied by the Restaurant.

            1.03 Relation of Parties. Nothing in this Lease shall be construed
as creating a franchise, partnership, or joint venture between the parties
hereto. Tenant shall have no power or authority, express or implied, to bind or
obligate Landlord in any manner whatsoever except as specifically set forth in
this Agreement.

                                   ARTICLE II
                                      TERM

            2.01 Term. The term of this Agreement shall commence on the Lease
Commencement Date (defined in 2.03 below) ("Term") and shall continue in force
thereafter for a period expiring on (i) the 10th anniversary of the Rent
Commencement Date (if the Rent Commencement Date is the first day of a calendar
month) or (ii) the 10th anniversary of the last day of the calendar month in
which occurs the Rent Commencement Date (if the Rent Commencement Date is not
the first day of a calendar month) (the "Expiration Date"), unless sooner
terminated in accordance with the provisions of this Agreement. This Agreement
shall not extend beyond the Term unless Tenant exercises Tenant's Option
(defined in 2.04 below) in which case the Term shall extend and include the
applicable Option Period on the terms and conditions set forth below.

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            2.02 Rent Commencement Date. Tenant's obligation to pay minimum rent
and Percentage Rent shall commence on the date (the "Rent Commencement Date")
which is the earlier of (i) the date Tenant or anyone claiming under or through
Tenant first opens the Restaurant to the public for business or (ii) July 1,
2000 (the "Scheduled Commencement Date"). In either case, all other obligations
of Tenant under this Lease, including but not limited to Tenant's obligation to
pay all utility charges and insurance premiums as set forth below, and Tenant's
indemnification obligations, shall commence on the Lease Commencement Date.

            2.03 Lease Commencement Date. Tenant's obligations under this Lease
(other than its obligations to pay minimum rent and Percentage Rent under
Article 6) shall commence on the date possession of the Premises in the
condition described in Article 4.01 below is delivered to Tenant (the "Lease
Commencement Date").

            2.04 Option Period. Provided that Tenant at the time of the exercise
of the option herein granted is not in default beyond any applicable notice and
cure period of any term, covenant, condition or agreement provided for in this
Lease, and further provided that Tenant has achieved Gross Revenue (as defined
in Article 6 below) in excess of Four Million Five Hundred Thousand Dollars
($4,500,000) for the Lease Year immediately preceding the final year of the then
current Term, Tenant shall have the option ("Tenant's Option") to extend the
term of this Lease for two (2) additional periods of five (5) years each (the
"Option Period"). Tenant may, at its option, elect to extend the term for one or
more of such additional periods; however, if Tenant does not extend the term for
any period it shall have no right to extend it for any subsequent additional
period. The option for any additional period may be exercised by Tenant only by
written notice to Landlord given at least twelve months prior to the expiration
of the period of the term immediately preceding the additional period for which
the option is being exercised. Except as herein stated, all of the terms,
covenants and conditions of this Lease last pertaining to the initial term
hereof shall equally pertain in all respects to all extensions of the term of
this Lease. The minimum annual rental during each year of each additional period
shall be an amount equal to the greater of (a) the minimum rent (as defined in
Article 6 below) in effect during the year preceding the commencement of the
additional period or (b) the sum derived by multiplying the minimum rent in
effect for the initial term hereof by a fraction, the numerator of which shall
be the Index (as hereinafter defined) for the month which is two calendar months
before the commencement of such additional period and the denominator of which
shall be the Index for the month which is two calendar months before the date of
this Lease. The "Index" shall mean the Consumer Price Index for All Urban
Consumers (CPI-U) - U.S. City Average, All Items (1982-84 = 100), published by
the Bureau of Labor Statistics of the U.S. Department of Labor. The Index is no
longer published, the "Index" shall mean whichever of the following indices
shall yield a greater fraction: (1) the index referred to above which continues
to be published (if any continues to be published), or (2) the index of consumer
prices in the U.S. reasonably determined by Landlord to be most closely
comparable to the discontinued index (or if both are discontinued, the index of
consumer prices in the U.S. most closely comparable to one of the discontinued
indices) after making such adjustments in items included or method of
compensation as may be prescribed by the agency publishing the same or as
otherwise may be

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reasonably determined by Landlord as being required to compensate for changes
subsequent to the date of this Lease.

            2.05 Lease Year. The "First Lease Year" shall be the period
commencing on the Rent Commencement Date and ending on the first anniversary of
the last day of the calendar month in which the Rent Commencement Date occurs,
unless the Rent Commencement Date occurs on the first day of a calendar month,
in which case the First Lease Year shall terminate on the day preceding the
first anniversary of the Rent Commencement Date. Each "Lease Year" after the
First Lease Year shall be a consecutive twelve (12) month period commencing on
the first day of the calendar month immediately following the preceding Lease
Year, with the final Lease Year ending on the Expiration Date.

                                   ARTICLE III
               RENOVATING, FURNISHING AND EQUIPPING OF RESTAURANT

            3.01 Construction; Opening. Tenant shall not later than the
Scheduled Commencement Date (i) construct, furnish, equip and supply the
Restaurant on a ready-to-operate, full turn-key basis, including but not limited
to all initial and replacement chinaware, glassware, dishes, silverware, small
wares, linen, food service equipment and utensils necessary for the full
operation of each of the various food service areas and facilities in the
Restaurant, (ii) open the Restaurant to the public and receive paying customers;
and (iii) operate the Restaurant in accordance with the requirements and
standards of this Lease. Tenant shall engage such licensed architects,
contractors, engineers, kitchen, laundry and other interior designers, sound and
lighting designers and other specialists as are determined by Tenant to be
necessary to construct, improve, design, decorate, and fully equip the
Restaurant in accordance with plans and specifications ("Plans") described on
Exhibit "B" hereto. The Plans shall be subject to such changes, modifications,
additions, deletions or substitutions as Tenant shall determine, subject to
Landlord's approval of such changes, which approval shall not be unreasonably
withheld or delayed.

            3.02 Project Costs.

                  (a) Attached hereto as Exhibit "C" is Tenant's budget for the
costs for renovations to the Premises and the furnishing, equipping and
supplying of the Restaurant (the "Project Budget"). Landlord and Tenant shall
each pay and be responsible for costs reflected on the Project Budget ("Project
Costs") on the basis of forty percent (40%) contribution by Tenant and sixty
percent (60%) contribution by Landlord up to a maximum joint contribution of One
Million Five Hundred Thousand Dollars ($1,500,000), provided, however, that
anything in this Lease to the contrary notwithstanding Landlord's share of the
Project Costs shall not exceed Nine Hundred Thousand Dollars ($900,000), and
Tenant shall pay and be solely responsible for 100% of the Project Costs in
excess of One Million Five Hundred Thousand Dollars ($1,500,000). Landlord's
share of Project Costs shall be paid by Landlord to Tenant periodically as
incurred, but not more frequently than once per month, provided that (i) Tenant
is not then in default under this lease, (ii) Tenant furnishes Landlord with a
requisition in form of

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AIA G-702 and G-703, or such other form as is reasonably acceptable to Landlord,
specifying the amount requested, with line item descriptions of the work,
materials, equipment and/or fixtures and reasonably supporting documentation
(such as invoices or receipts), (iii) the chief financial officer of Tenant
certifies that the items for which reimbursement have been requested have been
physically incorporated into the Premises, free of liens and encumbrances and
for amounts actually due and owing or paid by Tenant, and for work which has
been approved and accepted by Tenant, and (iv) Tenant furnishes Landlord with
evidence that Tenant has paid Tenant's share of all previous requisitions and
Tenant's share of the items described on the current requisition, or otherwise
provides reasonable assurance acceptable to Landlord that Tenant's share of the
current requisition will be paid concurrently with Landlord's payment to Tenant.
Notwithstanding such payment by Tenant of forty percent (40%) of the Project
Budget up to $1,500,000, and the payment by Tenant of the entire amount in
excess of $1,500,000, the Restaurant and all improvements thereto or to the
Hotel, and all leasehold improvements, furniture, furnishings, equipment
(including kitchen and refrigeration equipment and dishwasher), fixtures,
supplies, and other items constructed, installed, placed on or at the Premises,
and intended to be used in connection with the use and operation of the
Premises, are part of the Premises shall be and remain the sole property of
Landlord, excluding those items listed on Exhibit C-1 attached hereto, which are
and shall remain Tenant's property.

                  (b) In addition to the foregoing contributions in subparagraph
(a) above, Landlord and Tenant shall each contribute 50% of the cost to purchase
and install a new dishwasher and related equipment (such as stainless steel
tables). The usage of this dishwasher shall be shared by Tenant and Landlord, in
such manner as they shall mutually agree, in their reasonable discretion. During
the Term of this Lease, Landlord and Tenant shall each pay one-half of all
maintenance and repair costs relating to the dishwasher, provided that if one
party makes significantly more use of the dishwasher than the other, Landlord
and Tenant shall adjust the cost sharing in a manner which is equitable under
the circumstances. The dishwasher shall be and remain the sole property of
Landlord, notwithstanding the foregoing contributions and payments by Tenant.

            3.03 Pre-Opening. Tenant shall perform all activities necessary to
prepare the Restaurant for opening for business to the public or before the
Scheduled Commencement Date, including the following:

                  (a) Establishing credit policies to be used at the Restaurant
with respect to house accounts, Hotel room accounts, and Condominium residents
accounts, which credit policies and agreements must be approved in writing by
Landlord prior to the Rent Commencement Date.

                  (b) Establishing systems in conjunction with the Hotel to
enable the Hotel to include selected Restaurant menu items in the Hotel's room
service menu.

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                                   ARTICLE IV
                POSSESSION; TENANT IMPROVEMENTS; EXPANSION OPTION

            4.01 Possession. Landlord shall deliver possession of the Premises
to Tenant upon the full execution and delivery of this Lease by Landlord and
Tenant. Tenant leases and accepts the Premises in its "AS-IS WHERE IS" condition
and state of repair, without any representation or warranty, express or implied,
of any kind by Landlord, or any employee, agent or representative of Landlord.
Tenant acknowledges that Tenant has examined the Premises prior to the execution
and delivery of this Lease, and has found the same to be satisfactory to it for
all purposes, and suitable for the conduct of Tenant's business. In connection
with Tenant's initial occupancy of the Premises, the Premises will be improved
by Tenant as set forth on Exhibit "B" attached hereto and made a part hereof.

                                    ARTICLE V
                            OPERATING STANDARDS; USE

            5.01 Operating Standards. Tenant will, on or before the Scheduled
Commencement Date, operate a first class, high quality restaurant with liquor
sales upon the Premises, open to the public and receiving paying customers, and
consistent with the Restaurant's facilities and the Hotel's image and standards,
and will provide service and operation of the Restaurant, in accordance with the
terms of this Lease. Tenant shall provide or cause to be provided all amenities
in connection therewith which are customary and usual to such an operation.
Tenant shall carry out its responsibilities in accordance with the operating
standards set forth below:

                  (a) Tenant shall at all times continuously use and occupy the
Premises and operate the Restaurant therein, in accordance with the terms,
standards and requirements of this Lease and consistent with the greater of (i)
a high quality first class restaurant, and (ii) the level of service provided at
other "Smith and Wollensky" and Smith & Wollensky Restaurant Group, Inc.,
restaurants. The Premises may not be used or occupied for any other purpose.
Anything in this Lease to the contrary notwithstanding, that portion of the
Premises on the third floor of the Hotel (such space, the "Third Floor Space")
shall be used only for "back of the house" functions, not accessible to the
public, as office, general and refrigerated storage, and employee facilities in
support of the operation of the Restaurant.

                  (b) Tenant will maintain the Restaurant in a clean, safe and
orderly manner, in accordance with the terms of this Lease, and provide
courteous, high-quality service to the public.

                  (c) Tenant will comply with all laws and governmental
requirements and obtain and maintain the governmental licenses and approvals,
including liquor licenses, necessary to operate the Restaurant.

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                  (d) Tenant will ensure that no part of the Restaurant publicly
displays advertisements that further or promote a competing business without the
prior written approval of Landlord. Tenant, or its Affiliate, may promote other
Smith & Wollensky restaurants located outside the Philadelphia Metropolitan Area
(as defined in Section 8.01(a) below), but may not promote or advertise at or
within the Premises any restaurants (whether or not operated under the Trade
Name (as defined in Section 10.01(a) below) which are located in or serve
customers within the Philadelphia Metropolitan Area, unless Tenant or its
Affiliate provides equivalent promotion or advertising at such other restaurant,
which promotes and advertises the Restaurant at the Premises.

                  (e) Tenant will use its best efforts to reflect credit upon
and create a favorable public response to the Hotel, the Restaurant and the
Trade Name.

                  (f) Tenant agrees that during the Term, it will not contract
for or delegate in any manner the management or operation of the Restaurant, or
any other services or obligations to be performed hereunder by Tenant, with or
to any other person, firm or entity without the prior written approval of
Landlord, except Landlord's approval should not be required for services or
obligations performed by Guarantor.

                  (g) Tenant shall actively open and continuously operate the
Restaurant for business (including the bar), at a minimum, for lunch between the
hours of 11:30 a.m. and 2:30 p.m. on Monday through Friday; and for dinner
between the hours of 5:30 p.m. and 10:00 p.m. Monday through Thursday and
between the hours of 5:30 p.m. through 11:00 p.m. on Friday and Saturday (the
hours during which dinner is to be served are the "Dinner Hours", the Dinner
Hours and the other times when the Restaurant is required to be open are
collectively the "Operating Hours"). Tenant may operate the Restaurant on
Sundays, at Tenant's option. The bar shall be open on Sundays, subject to a
review by Landlord and Tenant of the economic feasibility of so doing.

                  (h) Tenant shall provide menu items mutually agreed to with
Landlord to be included in Hotel's room service menu to be furnished to any
person or entity residing at the Hotel or Condominium upon request.

                  (i) Tenant will afford charge privileges to all Hotel guests
and Condominium residents, in accordance with the credit policies mutually
established by Landlord and Tenant. Landlord shall bear the credit risk and be
responsible for collection of such accounts, unless Tenant extends credit or
charge privileges to a person or entity which Landlord has notified Tenant shall
not be afforded credit or charge privileges. If Tenant has failed to follow
Landlord's instruction not to extend credit or afford charge privileges as to
any specified accounts, Tenant shall bear the credit risk and shall be
responsible for collection of such specified account(s).

                  (j) The Premises and Restaurant shall comply with The
Rittenhouse Condominium Owners Association Declaration, By-Laws, Rules and
Regulations (collectively the "Condominium Documents") as the same may be from
time to time and

                                      -7-
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amended, provided no future amendment thereto shall be binding on Tenant if it
materially adversely affects Tenants rights under this Lease. Landlord warrants
and represents that it has furnished Tenant with a true copy of the current
Condominium Documents. Notwithstanding the foregoing, Tenant shall not be
responsible for any fees or assessments applicable to the Premises which are
imposed on unit owners pursuant to the Condominium Documents.

            5.02 Personnel.

                  (a) Without the consent of Landlord, Tenant will not solicit
or hire any employee employed at the Hotel to work at the Restaurant while such
person is employed at the Hotel.

                  (b) The supervision, direction, training and assignment of
duties of all personnel engaged in the operation of the Restaurant shall be the
duty and responsibility of Tenant.

                  (c) All salaries, wages, payroll taxes, FICA, and other
compensation and benefits of Restaurant employees shall be an operating expense
borne solely by Tenant.

                  (d) Tenant shall fully comply with all applicable laws and
regulations having to do with worker's compensation, social security,
unemployment insurance, hours of labor, wages, pension plans, employment of
foreign nationals, working conditions, employment discrimination and other
employer-employee related subjects in connection with the Restaurant. In the
event solicitation of labor union representation is made at the Restaurant,
Tenant shall promptly give Landlord notice of same.

                  (e) Tenant will not discriminate in recruitment, hiring,
employment, promotion or termination of any employees at the Restaurant, with
regard to age, race, sex, color, creed, religion, marital status, national
origin, handicap, disability, medical condition, sexual orientation, or any
other basis prohibited by law.

            5.03 Licenses, Permits and Zoning; Compliance with Law. Tenant
shall, at Tenant's sole cost and expense, obtain and keep in full force and
effect all licenses and permits, including restaurant (if any) and sign licenses
as may be required for the operation of the Restaurant, the liquor and bar
licenses and zoning and use permits necessary for the operation of the
Restaurant. Tenant shall comply with any conditions set out in any such licenses
and permits, and shall at all times operate and manage the Restaurant in
accordance with such conditions and any other legal requirements. Tenant shall
comply with all applicable laws, rules, regulations, requirements and ordinances
of any federal, state or municipal authority, including any alcoholic beverage
control board or board of fire underwriters, and the requirements of any
insurance companies covering any of the risks against which the Hotel and the
Premises are insured. Tenant shall comply with any applicable regulation or
order of the Board of Fire Underwriters, Fire Insurance Rating Organization, or
other body having similar functions, and

                                      -8-
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shall not commit or suffer to be done any act or thing which will cause the
insurance risk of the Premises or Hotel to be rendered more hazardous.

            5.04 Limitations on Marketing, Advertising and Promotion. No
advertising or promotional materials of Tenant or its Affiliates may refer to GE
Investments, General Electric Company, or General Electric Pension Trust, or any
of their respective affiliates.

            5.05 Maintenance and Repairs. Tenant shall, throughout the term of
this Lease and at its sole cost and expense, maintain the Premises and its
furniture, fixtures and equipment, in first class condition and repair,
reasonable wear and tear excepted. Tenant shall make or cause to be made such
maintenance, repairs, and corrections (provided that Tenant shall not make or
cause to be made structural repairs and changes, fundamental changes to the
nature of the Restaurant, or enlarge the Restaurant, without Landlord's prior
written approval), at Tenant's sole cost and expense, whether such repairs be
ordinary or extraordinary, foreseen or unforeseen. When used in this Article 5,
the term "repairs" shall include replacements and renewals when necessary to
maintain the Premises and other improvements in good order and condition, and
all such repairs made by Tenant shall be at least equal in quality and
usefulness to the Premises and such other improvements as may from time to time
by located upon the Premises.

                  Landlord and not Tenant shall be responsible to make, during
the Term of this Lease, all repairs necessary to maintain the structural
portions of the Hotel and the Premises, the exterior of the Hotel (excluding
plate glass and doors which are part of the Premises, and Tenant's signs, which
shall be Tenant's obligation) the roof of the Hotel, and the HVAC, plumbing and
electrical systems outside the Premises; provided that the need for such repairs
does not result from any alterations, improvements, misuse, abuse, or other act
or omission by Tenant or any occupant of the premises or Tenant's or such
occupant's agents, employees or contractors or from any failure of Tenant to
perform any of its obligations under this Lease; and provided further that
Tenant shall have given to Landlord at least thirty days' prior written notice
of the necessity for any such repair, and further provided that Tenant is not
then in default of any of its obligations under this Lease.

            5.06 Alterations. Tenant shall not, without on each occasion first
obtaining Landlord's prior written consent, make or permit to be made any
alterations, improvements or additions to the Premises; except that Tenant may,
without the consent of Landlord, make minor, non-structural interior alterations
and improvements to the Premises provided that they do not impair the structural
strength of the Hotel or reduce its value, and provided further that Tenant
shall take or cause to be taken all steps that are required or permitted by law
in order to avoid the imposition of any mechanics liens upon the Premises or the
Hotel, and provided further that the occupants of any adjoining premises are not
disturbed or annoyed by reason thereof. Except as otherwise provided in Section
5.07 hereof, all alterations, improvements, additions, repairs and all other
property attached to or used in connection with the Leased Premises or any part
thereof made or installed on the Leased Premises by or on behalf of Tenant shall
become part of the Leased Premises and the property of Landlord without payment
therefor by Landlord and shall be surrendered to Landlord upon the expiration or
earlier termination of the term of this Lease.

                                      -9-
<PAGE>

            5.07 Tenant's Fixtures. Tenant shall have the right to install trade
fixtures required by Tenant or used by it in its business and, if installed by
Tenant, to remove any or all such trade fixtures from time to time, and Tenant
shall remove all such trade fixtures (whether installed during or before the
term of this Lease or any prior lease) before the expiration or termination of
this Lease. Tenant shall repair and restore any damage or injury to the Premises
caused by the installation and/or removal of any such trade fixtures. In the
event that Tenant fails to remove all such trade fixtures prior to the
expiration or termination of this Lease, Landlord may remove and dispose of them
without notice, obligation or liability to Tenant. Notwithstanding the
foregoing, all furniture, fixtures, equipment, supplies, and leasehold
improvements (including without limitation, kitchen and refrigeration equipment)
which are installed in or upon the Premises shall become part of the Leased
Premises and the property of Landlord without payment therefore by Landlord and
shall be surrendered to Landlord upon the expiration or earlier termination of
the term of this Lease, provided that the furniture, fixtures and equipment and
supplies described on Exhibit "C-1" attached hereto and made a part hereof shall
remain Tenant's property and may be removed by Tenant.

            5.08 Legal Actions.

                  (a) Tenant shall advise Landlord promptly, with confirmation
in writing, of the service upon Tenant of any summons, subpoena, or other like
legal document, including any notice, letter, or other communication setting out
or claiming an actual or alleged potential liability of Landlord. Tenant shall
also transmit to Landlord, with Tenant's recommendations, any communications
from customers that in Tenant's reasonable judgment require Landlord's
attention. Tenant shall not institute any legal proceeding or take any legal
action on behalf of Landlord.

                  (b) Landlord shall advise Tenant promptly, with confirmation
in writing, of the service upon Landlord of any summons, subpoena, or other like
legal document, including any notice, letter, or other communication setting out
or claiming an actual or alleged potential liability of Tenant. Landlord shall
also transmit to Tenant, with Landlord's recommendations, any communications
from customers that in Landlord's reasonable judgment require Tenant's
attention. Landlord shall not institute any legal proceeding or take any legal
action on behalf of Tenant.

            5.09 Cooperation with Hotel - Shared Services. It is recognized that
many of the functions which would normally be provided by the Tenant are
available at the Hotel (e.g. purchasing and receiving, trash removal, cleaning,
human resources, laundry, accounting, insurance, credit card processing, billing
and collections, maintenance and repair, equipment, advertising and promotion,
etc.) and that it is in the best interests of both parties for the Tenant to
avail itself of those resources. Landlord and Tenant shall cooperate with each
other in the sharing of such resources where it is mutually advantageous to do
so, utilizing employees not engaged in the operation of the Restaurant, and
where the parties so agree to do so, the reasonable cost to Landlord of
providing such services shall be borne by the Tenant.

                                      -10-
<PAGE>

            5.10 Utility Services. Tenant shall be solely responsible for and
shall promptly pay all rents and charges for water and sewer services and all
costs and charges for gas, steam, heat, light, electricity, power, telephone,
cable TV, HVAC, trash removal and any other utility or service used or consumed
in or servicing the Premises and all other costs and expenses involved in the
care, management and use thereof. Landlord shall have no liability whatsoever by
reason of any interruption, curtailment or stoppage of such utility services,
unless (and only to the extent) the same is caused by the wrongful and
intentional act of Landlord.

            5.11 Taxes.

                  (a) For the purposes of this Section 5.11, the word "taxes"
shall include taxes, assessments, license and permit fees, water and sewer and
other governmental impositions and charges of every kind and nature whatsoever,
nonrecurring as well as recurring, special or extraordinary as well as ordinary,
foreseen, and unforeseen, and each and every installment thereof, which shall or
may during the term of this Lease be levied, assessed or imposed, or become due
and payable or become liens upon, or arise in connection with the ownership,
use, occupancy or possession of, or any interest in, the Hotel or any part
thereof, or any land, buildings or other improvements therein. The word "taxes"
shall not include any charge, such as water meter charge and sewer rent based
thereon, which is measured by the consumption by the actual user of the item or
service for which the charge is made.

                  (b) For each Lease Year during the term of this Lease, Tenant
shall pay to Landlord as additional rent (hereinafter called the "annual real
estate tax charge"), the amount obtained by multiplying the total of all taxes
attributable to the tax parcels of which the Premises are a part payable during
such Lease Year by Tenant's Proportionate Share (as defined and computed below).
On account of the annual real estate tax charge, Tenant shall pay monthly, in
advance, as additional rent, together with each monthly installment of minimum
annual rent, without demand or setoff, an amount equal to one-twelfth (1/12) of
the annual amount payable estimated by Landlord. Such estimated amount may be
adjusted by Landlord at any time and from time to time during the term hereof.
If Tenant's payment on account of the annual real estate tax charge for any
Lease Year exceeds the actual amount payable by Tenant as its annual real estate
tax charge for such Lease Year and Tenant is not in default hereunder or
otherwise indebted to Landlord, Landlord shall refund such excess to Tenant
within thirty (30) days. In the event Tenant is indebted to Landlord for any
reason whatsoever, Landlord may deduct such amount owed from such overpayment.

                  (c) Landlord shall have the right to bill Tenant for its
annual real estate tax charge at any time after each receipt by Landlord of a
bill, assessment, levy, notice of imposition or other evidence of taxes due or
payable all of which are hereinafter collectively referred to as a "tax bill"
(whether such bill is a final bill, an estimate of annual taxes or represents a
tax bill based upon a final or partial assessment or determination). Tenant
shall pay the balance of its annual real estate tax charge within sixty (60)
days of receipt from Landlord of a written statement setting forth the taxes for
which Landlord has received a tax bill, Tenant's Proportionate Share of taxes,
and Tenant's payments theretofore made on account of such annual

                                      -11-
<PAGE>

real estate tax charge. All subsequent monthly payments on account of the annual
real estate tax charge made by Tenant during such Lease Year after receipt of
such bill and statement shall be applied by Landlord toward payment on account
of Tenant's obligation for the annual real estate tax charge for the next
ensuing Lease Year and shall not reduce Tenant's obligation to pay the balance
due Landlord pursuant to such statement. In making the computations as
aforesaid, a tax bill or photocopy thereof submitted by Landlord to Tenant shall
be evidence of the amount of the taxes included in the computation of the annual
real estate tax charge in question; provided, however, Landlord shall have the
right to bill Tenant for Tenant's share of the annual real estate tax charge for
the last Lease Year in the term hereof whether or not Landlord shall theretofore
have received a tax bill covering the period from the data of the tax bill which
formed the basis of the most recent installment on account of the annual real
estate tax charge billed to Tenant to the expiration of the term hereof. If
Landlord has not received a tax bill for such period, Landlord shall estimate
the amount of such last installment of the annual real estate tax charge on the
basis of information contained in the tax bill most recently received by
Landlord, and/or Tenant's Proportionate Share, subject to adjustment when
Landlord receives a tax bill which includes the period from the date of such tax
bill to the expiration of the term hereof and/or confirms such Tenant's
Proportionate Share. Tenant shall pay such adjusted amount upon billing by
Landlord.

                  (d) Tenant's Proportionate Share shall mean a percentage
computed by multiplying 100% by a fraction, the numerator of which is the total
square feet of floor area of the Premises and the denominator of which is the
total square feet of floor area of the applicable tax parcel of which the
Premises are a part. As the Premises is part of two separate tax parcels,
Tenant's Proportionate Share may be different as to each tax bill. Tenant's
Proportionate Share is 14.28% for the first floor space, and 2.98% for the
second floor space. Tenant's Proportionate Share of taxes shall not include the
floor area within the Third Floor Space. Landlord represents and warrants that
the copies of tax bills previously furnished to Tenant are true and correct
copies of the current tax bills, and the taxes assessed against the parcel(s)
which are covered by such tax bills are not subject to any abatements currently
in effect.

                  (e) If the term hereof commences or terminates (other than by
reason of Tenant's default) on a day other than the first or last day,
respectively, of a Lease Year, Tenant's annual real estate tax charge for such
Lease Year shall be equitably pro-rated.

                  (f) If, after Tenant shall have made the required annual
payment of the annual real estate tax charge, Landlord shall receive a refund of
any portion of the taxes included in the computation of such annual real estate
tax charge, provided Tenant is not than in default hereunder, within forty-five
(45) days after receipt of the refund Landlord shall pay to Tenant that
percentage of the net refund after deducting all costs and expenses (including,
but not limited to, reasonable attorneys' and appraisers' fees) expended or
incurred in obtaining such refund, which the portion of the taxes in question
paid by Tenant bears to the entire amount of such taxes immediately prior to the
refund. Tenant shall not institute any proceedings with respect to the assessed
valuation of the Hotel or any part thereof for the purpose of securing a tax
reduction. In the event the Landlord shall retain any consultant to negotiate
the amount of taxes, tax rate, assessed value and/or other factors influencing
the amount of taxes and/or institute any

                                      -12-
<PAGE>

administrative and/or legal proceedings challenging the tax rate, assessed value
or other factors influencing the amount of taxes, whether or not such action
results in a reduction in the amount of taxes, taxes shall include the portion
of the aggregate of all such reasonable fees, reasonable attorneys' and
appraisers' fees and all disbursements, court costs and other similar items paid
or incurred by Landlord during the applicable Lease Year with respect to such
proceedings.

                  (g) If at any time during the term of this Lease, under the
laws of any one or more jurisdictions in which the Hotel is located, a tax,
imposition, charge, assessment, levy, excise or license fee is levied on this
lease or the value thereof, or levied on, imposed against or measured, computed
or determined, in whole or in part, by rents payable hereunder (minimum,
percentage, taxes and/or additional), including among others, general sales or
gross receipts taxes, or upon Tenant's use or occupancy of the Premises, Tenant
will pay as additional rent (or reimburse Landlord for) such taxes or
impositions.

                  (h) Tenant shall pay all personal property taxes, income
taxes, gross receipt taxes, use and occupancy taxes, license and permit fees,
and other taxes, impositions, levies or charges which are or may be assessed,
levied or imposed upon or in connection with the operation of the Premises,
Tenant's business, Tenant's leasehold interest, or any personal property of any
kind owned or placed in, upon or about the Premises.

                  (i) Tenant shall be solely responsible for and shall pay state
and local realty transfer taxes imposed upon this Lease or any assignment
thereof or any subletting of all or any portion of the Premises, if any.

            5.12 Net Lease. It is the intention of the parties hereto that this
Lease is a "net lease" and that Landlord shall receive the Rent as net income
from the Premises, not diminished by any imposition of any public authority of
any nature whatsoever during the entire term of this Lease notwithstanding any
changes in the method of taxation or raising, levying or assessing any
imposition, or any changes in the name of any imposition.

                                   ARTICLE VI
                          MINIMUM RENT; PERCENTAGE RENT
                               AND ADDITIONAL RENT

            6.01 Minimum Rent.

                  (a) Commencing on the Rent Commencement Date, Tenant shall pay
to Landlord as minimum annual rent ("minimum rent") the sum of Two Hundred Fifty
Thousand Dollars ($250,000.00) per annum for the Initial Term (subject to
increase as provided in Section 4.02), for all space other than the Third Floor
Space. As Minimum rent for the Third Floor Space, Tenant shall pay annually
$31,155, plus electric (2,077 square feet at $15.00 per square foot plus
electric), with no obligation for any proportionate share of real estate taxes
on account of the Third Floor Space. Minimum rent shall be payable in advance,
without demand and without setoff, in equal monthly installments on the first
day of each calendar month during the term of this Lease. If the Rent
Commencement Date shall fall upon a day other than the first

                                      -13-
<PAGE>

day of a calendar month, the minimum rent shall be apportioned pro rata on a per
diem basis for the period between such Rent Commencement Date and the first day
of the following calendar month and such apportioned sum shall be paid on such
Rent Commencement Date.

                  (b) Minimum rent during each Option Period shall be determined
according to Section 2.04 above, and shall be paid as provided in
Section 6.01(a).

                  (c) Promptly after the adjustment in the minimum rent pursuant
to Article 2.04 (if any) is determined for each Option Period, Landlord shall
submit to Tenant a statement setting forth the amount of such adjustment. Since
the actual increase in the minimum rent may not be determined until after the
start of a new Lease Year, until the actual increase in the minimum rent is
determined, Tenant shall make estimated monthly payments of minimum rent during
such Lease Year in an amount based upon Landlord's reasonable estimate of the
monthly installments of minimum rent that will be payable during such Lease
year. Promptly after receipt of a statement from Landlord setting forth the
actual increase in the monthly installment(s) of minimum rent for such Lease
year, the difference between the estimated monthly payments paid by Tenant and
the actual amount minimum rent shall be determined. If the estimated payments by
Tenant exceed the actual amount determined to be owing, the excess shall be
credited against the next installment(s) of minimum rent falling due hereunder.
If the actual amount determined to be owing is greater than Tenant's estimated
payments, the deficiency shall be paid by Tenant together with the next monthly
installment of minimum rent due hereunder.

            6.02 Percentage Rent.

                  (a) It is expressly understood and agreed that Landlord and
Tenant do not consider the minimum rent in itself a fair and adequate rental for
the Leased Premises and Landlord would not have entered into this Lease unless
Tenant had obligated itself to pay Percentage Rent as provided below which
Landlord expects to supplement the minimum rent to provide such fair and
adequate rental return.

                  (b) For each lease year or portion thereof during the term
hereof, Tenant shall pay, in addition to minimum rent, annual percentage rent
("Percentage Rent") equal to six percent (6%) of Gross Revenue in excess of Four
Million Dollars ($4,000,000.00) per Lease Year (the "Breakpoint"). Anything
herein to the contrary notwithstanding, there shall be no abatement,
apportionment or suspension of the Percentage Rent payable hereunder. For any
Lease Year longer than 365 days and for any fractional Lease of less than 365
days, the Breakpoint used in computing Percentage Rent for the applicable period
shall be proportionally increased or reduced, as the case may be, by multiplying
the Breakpoint by a fraction, having as its numerator the number of days in such
Lease Year or fractional Lease Year and having as its denominator the number
365. If the Lease Year or fractional Lease Year for which Percentage Rent is
being computed includes the date February 29, the number "365" wherever
appearing in this subparagraph shall for the purpose of making such computation
be changed to "366".

                                      -14-
<PAGE>

                  (c) Within ten (10) days after the end of each calendar month
during the Term and any extension thereof, Tenant shall submit to Landlord an
accurate, unaudited, written statement signed by Tenant on its behalf by a duly
authorized officer or representative, showing the full amount of Tenant's Gross
Revenue during the preceding calendar month, and for the Lease Year-to-date.
With each quarterly statement, provided Tenant has then exceeded the Breakpoint
on a year-to-date basis, Tenant shall pay to Landlord the Percentage Rent, if
any, accrued and payable.

                  (d) Within ninety (90) days after the end of each Lease Year,
commencing with the First Lease Year, Tenant shall submit to Landlord a complete
statement certified by an independent certified public accountant reasonably
acceptable to Landlord and also certified by Tenant and on its behalf by a duly
authorized officer or representative, showing accurately and in such detail as
reasonably required by Landlord the full amount of Tenant's Gross Revenue during
the immediately preceding Lease Year. At the same time Tenant shall pay to
Landlord the full balance of Percentage Rent payable for said Lease Year, if
any. Any excess of Percentage Rent that Tenant may have paid for such Lease Year
shall be refunded promptly by Landlord to Tenant. Together with such statement
of Gross Revenue, Tenant shall also deliver to Landlord a profit and loss
statement and balance sheet, certified by Tenant, showing the results of the
operation of the Restaurant for the immediately preceding Lease Year.

                  (e) In the operation of the business of Tenant and of any
sub-lessee, licensee or concessionaire upon the Premises, Tenant will use such
system for accurately recording Gross Revenue at the time of sale and reporting
gross receipts as shall be approved in writing by Landlord. Tenant shall keep at
all times during the term hereof, at the Premises or at the general or regional
office of Tenant in New York City, complete and accurate books of account and
records in accordance with accepted accounting practices with respect to all
operations of the business to be conducted in or from the Premises including the
recording of Gross Revenue and the receipt of all merchandise into and the
delivery of all merchandise from the Premises during the term hereof, and shall
retain such books and records, as well as all contracts, vouchers, checks,
inventory records, and other documents and papers in any way relating to the
operation of such business, for at least three (3) years from the end of the
Lease Year to which they are applicable, or, if any audit is required or a
controversy should arise between the parties hereto regarding the rent payable
hereunder, until such audit or controversy is terminated. Such books and records
shall at all reasonable times during the retention period above referred to be
open to the inspection of Landlord or its duly authorized representatives, who
shall have full and free access to the same and the right to copy the same and
to require of Tenant, its agents and employees, such information or explanation
with respect to the same as may be necessary for a proper examination thereof.

                  (f) If it is determined that the actual Gross Revenue for any
period covered by the statement required pursuant to subparagraph (c) above
shall exceed the amount thereof shown in said statement by four percent (4%) or
more, Tenant shall pay all the expenses incurred by Landlord in determining the
actual Gross Revenue for said period. The acceptance by Landlord of payments of
Percentage Rent or reports thereof shall be without prejudice, and shall in no
event constitute a waiver of Landlord's rights to claim a deficiency of

                                      -15-
<PAGE>

such Percentage Rent or to audit Tenant's books and records as set forth in
subparagraph (d) above. If Tenant shall fail to deliver a certified statement as
required by subparagraph (c) above within the said ninety (90) day period,
Landlord shall have the right thereafter to employ an independent certified
public accountant to make such examination of Tenant's books and records as may
be necessary to certify the amount of Tenant's Gross Revenue for the partial
Lease Year or Lease Year, the certification so made shall be binding upon
Tenant, and Tenant shall promptly pay to Landlord the cost thereof, together
with the full balance of Percentage Rent due and payable for the partial Lease
Year or Lease Year.

                  (g) If Tenant fails to continuously operate its business in
accordance with the terms of this Lease or vacates the premises prior to the
expiration of the term hereof, Percentage Rent for the applicable Lease Year
shall be the greater of (i) the Percentage Rent computed in accordance with
Section 6.02, or (ii) the average annual Percentage Rent paid by Tenant from the
commencement of the term to the date in question, or during the three preceding
full Lease Years, whichever is shorter.

            6.03 Gross Revenue. "Gross Revenue" shall mean the gross amount of
all revenue, receipts, sales and income derived directly or indirectly from all
business conducted upon or from the Premises, including but not limited to food
and beverage sales, tobacco sales, room service sales or sales to Condominium
residents generated by food orders from the Restaurant only, all off-site
catering which is conducted upon or from the Premises, or even if conducted
elsewhere, all off-site catering which serves customers located anywhere within
the Philadelphia Metropolitan Area (as defined in Section 8.01(a) below),
amounts received from the sale of goods, wares, and merchandise and for services
rendered, the amount of all catalogue, telephone or Internet sales and orders
taken, received or filled at the Premises, whether such orders be filled from
the Premises or elsewhere and whether received by mail, telephone, electronic
mail, or any other method of communication, telephone revenues, gross receipts
of sublessees, licensees or concessionaires, net of discounts, and the proceeds
of business interruption insurance. There shall be excluded from Gross Revenue
(a) any gratuities paid to Restaurant employees, Hotel room service personnel,
or added to a customer's bill; (b) federal, state and municipal excise, sales,
use or similar taxes collected as part of the sale of services or goods, and any
other taxes collected from patrons; (c) any proceeds from the sale or other
disposition of the Restaurant or its furniture, fixtures, equipment or other
capital assets; (d) any insurance proceeds of any kind, except business
interruption insurance; (e) any condemnation awards; (f) gift certificates at
the time of sale, but the amount thereof shall be included in Gross Revenue at
the time of redemption; (g) any proceeds of financing or refinancing of the
Restaurant; (h) any interest paid with respect to any bank accounts, reserves or
any other deposit or investment of Restaurant funds; (i) credit card
commissions; (3) complimentary items, for which the customer pays no charge; and
(k) uncollected or uncollectible accounts, except to the extent collected. Gross
Revenue shall be determined on an accrual basis and in accordance with the
Uniform System of Accounts or generally accepted accounting principles,
consistently applied.

                                      -16-
<PAGE>

            6.04 Use and Occupancy Tax. Tenant shall remit to Landlord as
additional rent all Use and Occupancy Tax imposed with respect to the Premises
within ten (10) days of notice by Landlord to Tenant.

            6.05 Rent. All minimum rent, Percentage Rent and additional rent and
other fees, charges, costs or expenditures imposed upon Tenant or to be paid by
Tenant pursuant to the terms of this Lease shall be deemed to be rent and are
sometimes collectively referred to as "Rent". All Rent shall be payable without
demand, notice, set-off, deduction, defense or counterclaim.

                                   ARTICLE VII
                                 INDEMNIFICATION

            7.01 Tenant's Indemnity. In addition to but not in lieu of Tenant's
other indemnification obligations under this Lease, Tenant shall indemnify,
protect, defend (with counsel reasonably acceptable to Landlord) and hold
harmless Landlord, its partners and their respective stockholders, directors,
officers, trustees, employees, agents, successors and assigns (each an "Landlord
Party") from and against any and all claims, actions, suits, proceedings, costs
and expenses, including reasonable attorneys' fees and court costs, incurred by
or otherwise asserted against any Landlord Party (a) arising out of or resulting
from any occurrence within the Premises or arising from or relating to Tenant's
use and operation thereof, (b) constituting a breach by Tenant of its
obligations under this Lease; or (c) constituting negligence, fraud,
malfeasance, or willful, reckless or criminal misconduct. The terms of this
Section 7.01 shall survive the expiration or earlier termination of this Lease
whether with or without cause.

            7.02 Landlord's Indemnity. Landlord shall indemnify, defend and hold
harmless Tenant and its directors, officers, employees and agents (each an
"Tenant Party") from and against any and all claims, actions, suits,
proceedings, costs and expenses, including reasonable attorneys' fees and
expenses, arising out of or resulting from the acts or omissions of Landlord
constituting a breach by Landlord of its obligations under this Lease, except
that such indemnification shall not apply (a) in the case of the acts or
omissions of Tenant or its directors, officers, shareholders, employees,
contractors, subcontractors, or agents in violation of this Lease, outside the
scope of Tenant's authority hereunder or constituting negligence, fraud,
malfeasance, or willful, reckless or criminal misconduct; (b) if and to the
extent Tenant and the matter is covered by the insurance under Section 9.01; (c)
any matter for which Tenant has agreed to indemnify Landlord under this Lease
and not otherwise expressly excluded herein from Tenant's indemnity obligation;
or (d) if Tenant shall have failed to maintain the insurance required to be
maintained by Tenant under this Lease.

            7.03 Conditions of Indemnification. The obligations of the parties
under Section 7.01 and Section 7.02 are subject to the following conditions: (a)
the party to be indemnified shall deliver a notice to the indemnifying party
with respect to the matter promptly after the party to be indemnified becomes
actually (and not constructively) aware of the same; and (b) the party to be
indemnified shall not take any actions, including any admission of liability,
which would bar the indemnifying party from enforcing any applicable coverage
under

                                      -17-
<PAGE>

policies of insurance or prejudice any defense and related legal proceedings or
otherwise prevent such indemnifying party from defending itself with respect to
the matter.

                                  ARTICLE VIII
                                 NON-COMPETITION

            8.01 Non-Competition.

                  (a) For the first two Lease Years, neither Tenant nor The
Smith & Wollensky Restaurant Group, Inc. ("Guarantor") nor their respective
Affiliates shall either directly or indirectly, through their nominees or
otherwise, own, lease, operate, manage, franchise, or otherwise have an interest
in a restaurant, or similar facility within the Philadelphia Metropolitan Area,
whether as principal, partner, director, officer, agent, employee, consultant or
otherwise. "Philadelphia Metropolitan Area" shall mean the Counties of
Philadelphia, Montgomery, Bucks, Delaware and Chester in Pennsylvania, and the
Counties of Camden, Gloucester and Burlington in New Jersey.

                  (b) After the first two Lease Years, if Tenant or The Smith &
Wollensky Restaurant Group, Inc., or any of their Affiliates shall directly or
indirectly, through their nominees or otherwise, own, lease, operate, manage,
franchise or otherwise have an interest in a restaurant, or similar facility,
under the trade name "Smith and Wollensky" or variations thereof, whether as
principal, partner, director, officer, agent, employee, consultant, or
otherwise, in the Philadelphia Metropolitan Area, the annual minimum rent from
and after the date of such occurrence shall be increased to be the sum of (i)
the annual minimum rent in effect as of the date of such occurrence, and (ii)
the total Percentage Rent for the immediately preceding twelve (12) month
period.

            8.02 Definition of Affiliate. "Affiliate" shall mean

                  (a) Any person or entity, directly or indirectly, through one
or more intermediaries, controlling, controlled by, or under common control with
Tenant or Guarantor; or

                  (b) Any officer, trustee, director or 10% shareholder of
Tenant or Guarantor.

                                   ARTICLE IX
                                    INSURANCE

            9.01 Waiver of Subrogation. Neither Landlord nor Tenant shall assert
against the other, and each does hereby waive with respect to the other, any
claims for losses, damages,

                                      -18-
<PAGE>

liabilities and expenses (including attorneys' fees and disbursements) incurred
or sustained by or on account of damage or injury to persons or property arising
out of operation and maintenance of the Premises, to the extent the same are
covered from the proceeds recovered by insurers.

            9.02 Investigation of Claims. Tenant shall promptly investigate and
make a full written report to Landlord as to all material accidents or damages
and as to all verbal or written claims for injury relating to the ownership,
operation and maintenance of the Hotel or the Premises and shall cooperate with
Landlord in the preparation of any and all reports required by any insurance
company in connection therewith.

            9.03 Tenant's Insurance.

                  (a) Tenant shall, at its sole cost and expense, maintain in
full force and effect separate insurance policies issued by insurance companies
with an A.M. Best service rating of not less than A-XII, which are licensed in
the state in which the Hotel is located and which are otherwise reasonably
satisfactory to Landlord. Such policies shall provide at least the following
coverages:

                        (i) Workers' Compensation Insurance in an amount in
compliance with applicable statutory limits in the state in which the Hotel is
located for Tenant's employees. Tenant shall provide Landlord with a certificate
evidencing such coverage with the following provisions: (i) coverage for injury,
death or occupational disease of Tenant's employees arising out of or in the
scope of employment; and (ii) Employer's Liability Insurance with a limit of
Five Hundred Thousand Dollars ($500,000) per each accident and per each
employee.

                        (ii) Comprehensive General Liability or Commercial
General Liability Form, including contractual liability as a part of such
Comprehensive General Liability or Commercial General Liability policy and "dram
shop" liability coverage, covering Tenant's property and Tenant's business
operations written on an occurrence basis with a general aggregate with a
minimum limit of Five Million Dollars ($5,000,000) and a products and completed
operations aggregate with a minimum limit of Five Million Dollars ($5,000,000)
and minimum limits of One Million Dollars ($1,000,000) combined single limits
per occurrence for bodily injury, including death, and property damage
liability.

                        (iii) "All Risk" property damage insurance including a
standard extended coverage endorsement, on a full replacement cost basis
(without depreciation), insuring the leasehold improvements, furniture,
fixtures, equipment and personal property located in the Premises, rent
insurance (for a minimum 12 months coverage), boiler and machinery insurance,
and plate glass insurance.

                        (iv) Business automobile liability insurance for all
owned, hired and non-owned vehicles used in operations with minimum limits of
One Million Dollars ($1,000,000) combined single limits per occurrence for
bodily injury and property damage liability.

                                      -19-
<PAGE>

                  (b) All insurance policies required pursuant to this Section
shall provide for thirty (30) days' written notice to Landlord prior to
alteration, cancellation or material change by endorsement of the coverage,
shall be endorsed to waive all rights of subrogation against Landlord, and, with
respect to insurance policies required pursuant to clause (a)(ii) and (a)(iii)
above, shall be endorsed to include Landlord (and such additional parties as
Landlord may from time to time specify) as an insured party and shall be primary
insurance and not excess over or contributory with any other valid, existing and
applicable insurance carried by Landlord, and shall contain a standard mortgagee
endorsement in favor of any mortgagees which may from time to time have a lien
upon the Hotel or any portion thereof. Certificates of all insurance required
under this Section shall be provided by Tenant to Landlord at least thirty (30)
days prior to the expiration date of the then effective insurance policy.

                  (c) If Tenant shall fail, refuse or neglect to obtain such
insurance or maintain it, or to furnish Landlord with satisfactory evidence that
it has done so and satisfactory evidence of payment of the premium of any
policy, within the time required as set forth above, Landlord shall have the
right, at Landlord's option and without regard to any opportunity to cure
provided for elsewhere in this Lease, to purchase such insurance and to pay the
premiums thereon or to pay the premiums on insurance which Tenant should have
paid for. All such payments made by Landlord shall be recoverable by Landlord
from Tenant on demand as additional rent hereunder together with interest at the
Default Rate.

                  (d) If Tenant fails to provide and keep in force insurance as
aforesaid, Landlord shall not be limited in the proof of any damages which
Landlord may claim against Tenant to the amount of the insurance premium or
premiums not paid or incurred and which would have been payable upon such
insurance, but Landlord shall also be entitled to recover as damages for such
breach the uninsured amount of any loss, to the extent of any deficiency in the
insurance required by the provisions of this Lease, and damages, expenses of
suit and costs, including without limitation reasonable cancellation fees,
suffered or incurred during any period when Tenant shall have failed to provide
or keep in force insurance as aforesaid.

                  (e) Tenant may carry any insurance required by this Section
9.03 under a blanket policy, applicable to the Premises for the risks and in the
amounts required pursuant to this Section 9.03, provided that all requirements
of this Section 9.03 shall be complied with in respect of such policy and that
such policy shall provide that the coverage thereunder for the Premises and
occurrences in, on or about the Premises shall not be diminished by occurrences
elsewhere.

            9.04 Landlord's Insurance. Landlord shall provide and maintain
property insurance on the building which comprises the Hotel against such perils
and in such amounts as Landlord reasonably deems adequate; (ii) general
liability insurance, including bodily injury, personal injury and property
damage liability, in connection with the ownership, use and occupancy of the
Restaurant in such amounts as Landlord deems adequate; and (iii) such other or

                                      -20-
<PAGE>

additional insurance as Landlord may deem reasonably appropriate. Landlord may
maintain any insurance permitted or required by this Lease under a blanket
policy.

                                    ARTICLE X
                            TRADE NAME, SERVICE MARKS

            10.01 Trade Name.

                  (a) During the term of this Lease, the Restaurant shall at all
times be known and designated by the trade name "Smith and Wollensky" (the
"Trade Name") (the first floor bar will operate with a variation of Tenant's
choice on that name). As used herein, the term "Trade Name" shall mean and
include any name, trade name, logo, trademark or service mark which may now or
hereafter be used in connection with the Restaurant and bar, and any name, trade
name, logo, trademark or service mark similar thereto (excluding any of
Landlord's names, trade names, logos, trademarks or service marks).

                  (b) During the term of this Lease Landlord shall have the
right to utilize the Trade Name in connection with the Hotel and in advertising
materials and other marketing efforts in connection with the Hotel, subject to
Tenant's prior approval, which approval shall not be unreasonably withheld. It
is expressly understood and agreed that the Trade Name shall at all times be and
remain the sole and exclusive property of Tenant.

            10.02 Landlord's Trade and Service Marks. It is expressly understood
and agreed that all of Hotel trade names (including, without limitation, the
name "The Rittenhouse") shall at all times be and remain the sole and exclusive
property of Landlord. No trade or service mark or trade name of Landlord, or of
any parent, affiliate or successor of Landlord, shall be used in any form, or
under any circumstance, by Tenant or an Affiliate thereof, without Landlord's
prior written consent. Landlord agrees not to unreasonably withhold its consent
to Tenant's use of the name "The Rittenhouse" exclusively in connection with the
Restaurant. In the event of breach by Tenant or an Affiliate thereof of any of
the provisions of this Section 10.02, Landlord shall be entitled to seek
injunctive relief and any other right or remedy available at law or in equity.
The provisions of this Section 10.02 shall survive termination of this Lease.

                                   ARTICLE XI
                            ASSIGNMENTS AND TRANSFERS

            11.01 Assignment by Tenant. Tenant shall not assign or otherwise in
any manner sell or transfer its interest in this Lease, nor sublet all or any
portion of the Premises, whether voluntarily or involuntarily, without the prior
written consent of Landlord, which may be given or withheld by Landlord in its
sole discretion. The sale or transfer or issuance of stock

                                      -21-
<PAGE>

or other equity interests of Tenant resulting in a change in voting control of
Tenant shall be deemed an assignment prohibited by this Section. The issuance of
stock or other equity interests in a public offering made pursuant to a
registration statement in compliance with applicable federal securities laws, on
a recognized national securities exchange, or the public trading of stock or
other equity interests of an entity whose shares or other equity interests are
listed on a recognized national securities exchange, shall not, however, be
deemed an assignment prohibited by this Section. Tenant shall, from time to
time, upon written request of Landlord, furnish Landlord with a list of the
names and addresses of the owners of the membership interests in Tenant. Any
consent granted by Landlord to any assignment or transfer, shall not be deemed a
waiver, in any subsequent case, of the prohibition contained herein. Assignment
by Tenant to a parent, subsidiary or affiliate of Tenant, or to a "Successor
Entity" (as hereinafter defined), shall not require the consent of Landlord,
provided such assignee assumes the obligations of Tenant under this Lease in an
instrument the form and substance of which are reasonably acceptable to
Landlord, and Tenant and Guarantor each remain fully liable to Landlord under
the terms of this Lease and the Guarantor's Guaranty of this Lease,
respectively. However, if the Successor Entity's net worth and credit worthiness
is no less than Tenant's and Guarantor's at the time of assignment, and provided
there is not then outstanding any uncured default by Tenant under this Lease and
there is not then outstanding any uncured default by Guarantor under its
Guaranty, Landlord shall release Tenant and Guarantor from any liability arising
under this Lease from and after the effective date of the assignment to and
assumption by such Successor Entity. The term "Successor Entity" means any
entity resulting from the merger, consolidation or acquisition of all or
substantially all of the assets and business or a majority of the voting stock
and voting control of Guarantor.

            11.02 Assignment by Landlord. Landlord shall have the right to
assign, hypothecate and convey its interest in the Restaurant or Hotel or to
assign or otherwise transfer its interest under this Lease, without the Tenant's
consent. Upon the sale or other transfer of Landlord's interest in the Hotel,
the Landlord named in this Lease shall have no liability for the obligations of
Landlord thereafter arising.

                                   ARTICLE XII
                            MORTGAGES AND FINANCINGS

            12.01 Definitions. As used herein, "Mortgage" shall mean any
mortgage, deed of trust, security Lease, or other instrument creating a lien or
security interest upon the Hotel, any portion thereof, Landlord's interest in
the Hotel or Restaurant, or any other interest therein, and any modification,
supplement, amendment, consolidation, replacement or refinancing thereof, or any
mortgage, deed of trust, security Lease, or other instrument creating a second
lien or security interest upon the Restaurant, or any other interest therein,
from time to time granted by Landlord, and any modification, supplement,
amendment, consolidation, replacement or refinancing thereof. "Mortgagee" shall
mean the holder from time to time of any Mortgage.

                                      -22-
<PAGE>

             12.02 Subordination; Changes.

                  (a) Subject to Section 12.04(b) below, this Lease is and shall
be at all times and in all respects subordinate to each Mortgage and any all
modifications, extensions, renewals, supplements and amendments thereto, and
consolidations or replacements thereof, all automatically and without the
necessity of any further action on the part of Tenant to effectuate such
subordination. From time to time, upon request therefor, Tenant shall execute,
acknowledge and deliver such documents as Mortgagee may reasonably request to
evidence or effectuate such subordination of record. From time to time, Tenant
shall consent to such changes to this Lease as Mortgagee may request provided
that such changes do not materially interfere, in any manner, with the economic
relationship between Landlord and Tenant contemplated by this Lease.

                  (b) A Mortgagee may at any time elect to subordinate its
mortgage to this Lease, without the necessity of obtaining Tenant's consent
thereto, by giving written notice of the same to Tenant.

            12.03 Notice and Right to Cure. Tenant, provided that Landlord or
Mortgagee has notified Tenant in writing of the existence of a Mortgage, shall,
upon providing Landlord with any notice of default or notice of termination
provided for in this Lease, simultaneously provide a copy of such notice to
Mortgagee. Mortgagee shall have the same right as Landlord, but not the
obligation, to remedy, or cause to be remedied, or to commence to remedy any
defaults which are the subject matter of such notice, in addition to the other
rights granted to Mortgagee herein. Tenant shall accept such performance by or
at the instigation of Mortgagee as if such performance had been done by
Landlord. The foregoing provisions notwithstanding, if the default by Landlord
involves a voluntary or involuntary declaration or filing of bankruptcy,
insolvency, or assignment for the benefit of creditors, or any other default not
susceptible of cure by Mortgagee, then Mortgagee or its designee shall have the
right, but not the obligation, to exercise the remedies available to it under
its mortgage or other security instrument, provided that the exercise of such
remedies by Mortgagee is promptly commenced and diligently prosecuted, except to
the extent that Mortgagee may be stayed or enjoined from doing so. Tenant shall
not be entitled to terminate this Lease or to exercise any other remedies
following a default by Landlord unless Tenant shall have given such notice to
Mortgagee and Mortgagee or its designee shall have failed to promptly cure or
promptly commence to cure such default. However, Mortgagee shall have no
obligation to Tenant, to Landlord, or to any other person or entity to exercise
the foregoing right to cure a default by Landlord.

            12.04 Acquisition by Mortgagee; Non-Disturbance.

                  (a) The acquisition by Mortgagee or its designee of Landlord's
estate in the Hotel or Restaurant, whether by foreclosure proceedings,
assignment in lieu of foreclosure, or any other action or proceeding, shall not
constitute a default by Landlord under the provisions of this Lease.

                                      -23-
<PAGE>

                  (b) As to each Mortgagee to which this Lease becomes
subordinate pursuant to Section 12.02 above, such subordination is subject to
the express condition that if the Mortgagee shall acquire Landlord's interest in
the Hotel or Restaurant by foreclosure, assignment in lieu of foreclosure, or
any other action or proceeding that so long as Tenant is not in default under
this Lease beyond any applicable grace periods and Guarantor is not in default
under its Guaranty beyond any applicable grace periods, (i) Tenant will not be
made a party to any action to foreclose the Mortgage or recover possession of
the Hotel, unless required by applicable law as a condition to such proceeding,
(ii) Tenant's possession shall not be disturbed by such Mortgagee and (iii) this
Lease shall not be canceled or terminated by such Mortgagee, and shall continue
in full force and effect upon the acquisition by Mortgagee or its designee of
Landlord's interest ("Mortgagee's Acquisition"), subject to the following:

                  (a) Tenant shall attorn to and recognize Mortgagee or its
designee as Landlord's replacement under this Lease and shall be bound to
Mortgagee or its designee under all of the terms and conditions of this Lease,
as modified hereby, for the balance of the remaining term thereof with the same
force and effect as if Mortgagee or its designee were Landlord under this Lease,
without the execution of any further instruments on the part of Tenant or
Mortgagee or its designee;

                  (b) Except as otherwise provided herein, Mortgagee or its
designee shall be bound to Tenant under all of the terms, covenants and
conditions of this Lease, as modified hereby, for the balance of the remaining
Term hereof, and except as otherwise provided herein, Tenant shall, from and
after the date of Mortgagee's Acquisition, have the same remedies against
Mortgagee or its designee for the breach of a covenant contained in this Lease
which Tenant may have had under the Lease against Landlord, if Mortgagee or its
designee shall not have succeeded to the interests of Landlord; provided,
however, that Mortgagee or its designee shall not be liable for any obligation,
breach, act or omission of Landlord first arising or accruing prior to the date
of Mortgagee's Acquisition, or subject to any defenses, counterclaims, or rights
of set-off which Tenant may have against Landlord, or bound by any payment of
Rent made more than 30 days prior to its due date, or bound by any amendment or
modification of this Lease made without Mortgagee's prior written consent,
provided that Tenant is given written notice of the name and address of the
holder of any Mortgage; and provided, further, however, that Tenant shall not
have any right to terminate or void this Lease on account of any action or
proceeding commenced or maintained by Mortgagee or its designee to acquire
Landlord's interest in the Restaurant or Hotel; and

                  (c) In the event that Mortgagee or its designee shall have
acquired Landlord's interest in the Restaurant and shall have become Landlord's
replacement under the Lease, and thereafter, Mortgagee or its designee shall
sell, assign or transfer the Restaurant or such leasehold interest in the
Restaurant, Tenant shall release Mortgagee or its designee from all obligations
under this Lease or such new Lease which accrue after the date of such
subsequent sale, assignment or transfer, provided that such purchaser, assignee
or transferee shall execute, acknowledge and deliver an instrument providing for
the assumption of such obligations accruing under this Lease or such new Lease.

                                      -24-
<PAGE>

                  (d) The provisions of this Article 12 shall be self-operative,
and no further instruments of subordination and non-disturbance shall be
necessary to effectuate the same. Tenant agrees, however, whenever requested to
do so by Landlord or a Mortgagee, to execute such instruments confirmatory of
this Article as Landlord or a Mortgagee may reasonably require. The form of
subordination and non-disturbance agreement which Tenant agrees to execute may
contain additional terms not specified herein which are customarily required by
institutional Mortgagees, provided no such additional terms shall materially
interfere in any manner, with the economic relationship between Landlord and
Tenant contemplated by this Lease.

            12.05 Termination. Tenant shall not cancel or terminate this Lease
except in accordance with its terms.

                                  ARTICLE XIII
                                  TERMINATION

            13.01 Termination. In the event of (a) a casualty as a result of
which Landlord elects to terminate this Lease in accordance with Article XV
hereof; or (b) a condemnation as a result of which Landlord elects to terminate
this Lease in accordance with Article XVI hereof; then in any such case Landlord
may terminate this Lease upon not less than thirty (30) days' notice to Tenant
(except in connection with a sale or change in management, such termination
shall be effective upon the date of sale or change even if there is less than
thirty (30) days' notice). Upon such termination, Tenant shall be entitled to be
paid the applicable Termination Fee set forth in Section 13.03 below and Exhibit
"D" attached hereto and made a part hereof.

            13.02 Landlord's Additional Termination Right. In addition to any
other right of termination available to Landlord, if the Restaurant fails at any
time to achieve the operating results set forth in Exhibit "E" attached to this
Agreement, Landlord shall be entitled to terminate this Agreement. Landlord
shall not be obligated to pay any Termination Fee or other compensation to
Tenant if Termination occurs pursuant to this Section 13.02, although the
occurrence of the event described in this paragraph shall not by itself be
deemed a default hereunder for which Tenant may be liable to Landlord for
damages.

            13.03 Termination Fee. In any instance in which Landlord terminates
this Lease pursuant to Section 13.01, Landlord shall pay to Tenant within 60
days after the effective date of such termination the applicable Termination Fee
calculated as provided on Exhibit "D" attached to this Lease and incorporated by
reference herein; provided, that if Tenant has not delivered to Landlord any
financial report or information required to be delivered pursuant to Section
6.02 or Exhibit "D" or has not paid any unpaid rent (including Percentage Rent)
to Landlord, Landlord shall not be obligated to pay the Termination Fee to
Tenant until five (5) business days after receipt of such report, information
and Rent. Notwithstanding anything contained in this Lease, in no event will a
Termination Fee be payable in connection with any termination of this Lease
which takes effect as of the scheduled expiration of the Term (as the same may
be extended pursuant to Section 2.04) of this Lease or upon the occurrence of an
event of default by Tenant, or Landlord, or in connection with a casualty or
condemnation or taking in lieu thereof unless the

                                      -25-
<PAGE>

Lease is terminated by the voluntary election of Landlord pursuant to Article XV
(in the case of casualty) or Article XVI (in the case of condemnation or
taking).

            13.04 Effect of Termination. Upon termination of this Lease for any
reason, Tenant shall deliver the following to Landlord or Landlord's duly
appointed agent as soon as reasonably possible, but in no event later than the
applicable time period specified below:

                  (i) A final accounting, reflecting the balance of Gross
Revenues and Percentage Rent for the Premises as of the date of termination,
with final accounting to be prepared and submitted to Landlord as soon as
reasonably possible, but in no event later than ninety (90) days following the
termination date.

                  (ii) Any balance of monies due to Landlord, but in no event
later than five (5) days following the termination date.

                  (iii) All keys to any locks on the Restaurant then in the
possession of Tenant, but in no event later than one (1) day following the
termination date.

                                   ARTICLE XIV
                                MECHANIC'S LIENS

            14.01 Mechanics' Liens, etc.

                  (a) No Liens. Tenant will not create or permit to be created
or remain, and will discharge, any lien, encumbrance or charge (levied on
account of any tax or any mechanic's, laborer's or materialman's lien) which
might be or become a lien, encumbrance or charge upon the Leased Premises or any
part thereof or interest therein or the income therefrom, and Tenant will not
suffer any other matter or thing whereby the estate, rights and interest of
Landlord in the Leased Premises or any part thereof might be impaired; provided
that any mechanic's, laborer's or materialman's lien may be discharged in
accordance with subsection (b) of this Section.

                  (b) Discharge of Liens. If any mechanic's, laborer's or
materialman's lien shall at any time be filed against the Leased Premises or any
part thereof, Tenant, within thirty (30) days after notice of the filing
thereof, will cause it to be discharged of record by payment, deposit, bond,
order of a court of competent jurisdiction or otherwise. If Tenant shall fail to
cause such lien to be discharged within the period aforesaid, then in addition
to any other right or remedy, Landlord may, after 10 days notice to Tenant
(unless sooner action is required to protect Landlord's interests in which case
Landlord shall give such notice as is reasonable under the circumstances) but
shall not be obligated to, discharge it either by paying the amount claimed to
be due or by procuring the discharge of such lien by deposit or by bonding
proceedings, and in any such event, Landlord shall be entitled, if Landlord so
elects, to compel the prosecution of any action for the foreclosure of such lien
by the lienor and to pay the amount of the judgment in favor of the lienor with
interest, costs and allowances. Any amount so paid

                                      -26-
<PAGE>

by Landlord and all costs and expenses incurred by Landlord in connection
therewith, together with interest thereon, at the rate "prime rate" published
from time to time by The Wall Street Journal, plus four percent (4%) per annum
(or, if less, the maximum rate permitted under applicable law) (the "Default
Rate") from the respective dates of Landlord's making of the payments and
incurring of the costs and expenses, shall constitute additional rent payable by
Tenant under this Lease and shall be paid by Tenant to Landlord on demand.

                  (c) Waiver of Liens. Notwithstanding anything to the contrary
set forth in this Section 16, prior to the making of any material alterations,
additions, improvements or repairs to the Leased Premises, and in any event
within ten (10) days following the execution of any contract for such work,
Tenant shall cause to be filed in the Office of the Prothonotary of Philadelphia
a Waiver of Mechanics' and Materialmen's Liens in form satisfactory to
Landlord's counsel, such waivers to be binding on all subcontractors and
materialmen.

                  (d) No Consent of Landlord Intended. Nothing in this Lease
contained shall be deemed or construed in any way as constituting the consent or
request of Landlord, express or implied by inference or otherwise, to any
contractor, subcontractor, laborer or materialman for the performance of any
labor or the furnishing of any materials for any specific alteration, addition,
improvement or repair to the Leased Premises or any part thereof, nor as giving
Tenant any right, power or authority to contract for or permit the rendering of
any services or the furnishing of any materials that would give rise to the
filing of any lien against the Leased Premises or any part thereof.

                                   ARTICLE XV
                               DAMAGE TO PREMISES

            15.01 Damage to Premises. If the Premises shall be damaged by fire
or other insured casualty, not due to Tenant's negligence, but are not thereby
rendered untenantable in whole or in part, Landlord shall promptly cause such
damage to be repaired, and the minimum annual rent shall not be abated. If by
reason of any such occurrence, the Premises shall be rendered untenantable only
in part, Landlord shall promptly cause the damage to be repaired, and the
minimum annual rent meanwhile shall be abated proportionately as to the portion
of the Premises rendered untenantable. If the Premises shall be rendered wholly
untenantable by reason of such occurrence, the Landlord shall promptly cause
such damage to be repaired, and the minimum rent meanwhile shall be abated in
whole. Landlord's obligations hereunder shall be limited to the building shell
and Tenant shall, in the event Landlord proceeds with restoration of the
building shell, promptly repair, replace and rebuild all other improvements,
furniture, fixtures and equipment now or hereafter erected on the Premises at
least to the extent of the value and as nearly as practicable to the character,
condition and size as existed immediately prior to the occurrence. If Tenant
does not so restore within one hundred twenty (120) days after turnover of the
building shell to Tenant, Landlord may terminate this Lease.

            15.02 Damage to Hotel. In the event that twenty (20%) percent or
more of the floor area of the Hotel shall be damaged or destroyed by fire or
other cause, notwithstanding the

                                      -27-
<PAGE>

fact that the Premises may be unaffected by such fire or other cause, Landlord
shall have the right to be exercised by notice in writing delivered to Tenant
within one hundred twenty (120) days from and after said occurrence to elect to
cancel and terminate this Lease. Upon the giving of such notice to Tenant, the
term of this Lease shall expire on the thirtieth (30th) day after such notice is
given, and Tenant shall vacate the demised Premises and surrender the same to
Landlord.

            15.03 Limitation. Notwithstanding anything herein contained to the
contrary, if the proceeds of Landlord's insurance recovered (or which would have
been recoverable had Landlord carried commercially reasonable property insurance
policies) as a result of the damage shall be insufficient to pay fully for the
cost of replacement of the Premises and/or the building in which it is located,
or, the Premises or said building shall be damaged as a result of a risk which
is not covered by Landlord's insurance, Landlord shall have the right to be
exercised in writing delivered to Tenant within one hundred twenty (120) days
after said occurrence to elect to cancel and terminate this Lease. Upon the
giving of such notice to Tenant, the term of this Lease shall expire on the
thirtieth (30th) day after such notice is given, and Tenant shall vacate the
demised Premises and surrender the same to Landlord. For purposes hereof;
Landlord will be deemed to have carried commercially reasonable property
insurance policies if Landlord maintains such property insurance policies as are
required from time to time by Landlord's first Mortgagee.

            15.04 Time to Restore. If(a) the damage or destruction to the
Premises shall occur during the last year of the Term, or (b) a licensed
architectural or licensed engineer reasonably acceptable to Landlord and Tenant
estimates the restoration of the Premises to be conducted by Landlord cannot,
using reasonably diligent efforts, be completed within nine (9) months from such
damage or destruction, either Landlord or Tenant may terminate this Lease by
giving written notice to the other within 30 days of the casualty (in the case
of clause (a)) or within 30 days after the receipt of the estimate from the
architect or engineer (in the case of clause (b)).

                                   ARTICLE XVI
                                  CONDEMNATION

            16.01 Condemnation.

                  (a) Condemnation of Entire Premises. If all of the Premises is
taken or condemned for a public or quasi-public use, this Lease shall terminate
as of the date title to the condemned real estate vests in the condemnor and the
Rent herein reserved shall be apportioned and paid in full by Tenant to Landlord
to that date and all rent prepaid for periods beyond that date shall forthwith
be repaid by Landlord to Tenant and neither party shall thereafter have any
liability hereunder.

                  (b) Partial Condemnation. If only part of the Premises is
taken or condemned for a public or quasi-public use, Landlord shall restore the
building shell of the Premises and Tenant shall restore all other improvements
upon the Premises to a condition and size as nearly comparable as reasonably
possible to the character, condition and size thereof

                                      -28-
<PAGE>

immediately prior to the taking, and there shall be an equitable abatement of
the Rent according to the value of the Premises before and after the taking. In
the event that the parties are unable to agree upon the amount of such
abatement, either party may submit the issue for arbitration pursuant to the
rules then obtaining of the American Arbitration Association and the
determination or award rendered by the arbitrator/s/ shall be final, conclusive
and binding upon the parties and not subject to appeal, and judgment thereon may
be entered in any court of competent jurisdiction.

                  (c) If a material portion of the Hotel is taken or conveyed as
aforesaid, notwithstanding the fact that the Premises is not so taken or
conveyed, Landlord shall have the option, to be exercised by notice in writing
delivered to Tenant, to terminate this Lease effective, at the option of
Landlord, upon the date title vests in the condemning authority, or upon the
date Landlord is required to deliver possession of the part taken or conveyed.
For purposes of this subparagraph, a "material portion of the Hotel" means 20%
or more of the floor area of the Hotel building is taken or conveyed.

                  (d) Award. Tenant shall have the right to make a claim against
the condemnor for moving and related expenses which are payable to tenants under
Section l-601A of the Eminent Domain Code of Pennsylvania, and the unamortized
cost of leasehold improvements and personal property installed by Tenant at its
expense, except that if Tenant is paid a Termination Fee by Landlord in
accordance with Sections 13.01 and 13.02 above, then that portion of the award
attributable to such unamortized cost shall be paid to (and assigned by Tenant
to) Landlord. Except as aforesaid, Tenant hereby waives all claims against
Landlord and all claims against the condemnor, and Tenant hereby assigns to
Landlord all claims against the condemnor including, without limitation, all
claims for leasehold damages and diminution in the value of Tenant's leasehold
interest. If only part of the Premises is taken or condemned for a public or
quasi-public use, the net proceeds of any condemnation award recovered by reason
of any taking or condemnation of the Premises in excess of the cost of
collecting the award and in excess of any portion thereof attributable to the
then current market value of the Hotel taken or condemned (such excess being
hereinafter called the "net condemnation proceeds") shall be held in trust by
Landlord or any mortgagee of the Premises and released for the purpose of paying
the fair and reasonable cost of restoring the building and other improvements
damaged by reason of the taking or condemnation. Such net condemnation proceeds
shall be released from time to time as the work progresses to Tenant or to
Tenant's contractors. Prior to the commencement of the work, Tenant shall
deliver to Landlord reasonable proof that such net condemnation proceeds are
adequate to pay the cost of such restoration. If such net condemnation proceeds
are not adequate, Tenant shall pay, out of funds other than such net
condemnation proceeds, the amount by which such cost will exceed such net
condemnation proceeds and shall furnish proof to Landlord of the payment of such
excess for work performed before Landlord or any such mortgagee shall release
any part of such net condemnation proceeds. If such net condemnation proceeds
are more than adequate, the amount by which such net condemnation proceeds
exceed the cost of restoration will be retained by Landlord or applied to
repayment of any mortgage secured by the Premises. In the event that the parties
are unable to agree upon the portion of the award attributable to the then
current market value of the land taken or condemned, either party may submit the
issue for arbitration pursuant to the rules then obtaining of the American
Arbitration Association and the

                                      -29-
<PAGE>

determination or award rendered by the arbitrator/s/ shall be final, conclusive
and binding upon the parties and not subject to appeal, and judgment thereon may
be entered in any court of competent jurisdiction.

                  (e) Temporary Taking. If the condemnor should take only the
right to possession for a fixed period of time or for the duration of an
emergency or other temporary condition, then, notwithstanding anything
hereinabove provided, this Lease shall continue in full force and effect without
any abatement of rent, but the amounts payable by the condemnor with respect to
any period of time prior to the expiration or sooner termination of this Lease
shall be paid by the condemnor to Landlord and the condemnor shall be considered
a subtenant of Tenant. If the amounts payable hereunder by the condemnor are
paid in monthly installments, Landlord shall apply the amount of such
installments, or as much thereof as may be necessary for the purpose, toward the
amount of rent due from Tenant as rent for that period, and Tenant shall pay to
Landlord any deficiency between the monthly amount thus paid by the condemnor
and the amount of the rent, while Landlord shall pay over to Tenant any excess
of the amount of the award over the amount of the rent. If the duration of the
temporary taking exceeds six (6) months, either Tenant or Landlord shall have
the right to terminate this Lease within 30 days after the expiration of such
six (6) month period.

                                  ARTICLE XVII
                               DEFAULTS; REMEDIES

            17.01 Defaults. If any of the following shall occur the same shall
be deemed an "event of default":

                  (a) Tenant does not pay in full when due any and all
installments of Rent or any other charge or payment whether or not herein
included as Rent or fails to perform any other monetary obligation of Tenant,
and such default shall continue for a period of five (5) days after written
notice thereof from Landlord to Tenant (provided no such written notice shall be
required more than two times in any twelve month period);

                  (b) Tenant fails to perform or comply with any non-monetary
covenant, agreement or condition herein contained and Tenant shall have failed,
within five (5) days thereafter to begin the correction of the default and to
cure the same within thirty (30) days after Landlord's notice, provided,
however, if such non-monetary default cannot reasonably be cured within such 30
day period, Tenant shall actively, diligently and in good faith proceed with and
continue the correction of the default within a reasonable period of time until
it shall be fully corrected, provided, however, that no such notice from
Landlord shall be required, nor shall Landlord be required to allow any part of
the said notice period, if Tenant shall have failed initially to open the
Restaurant as required by this Lease, or if Tenant shall have temporarily or
permanently ceased operating and using the Premises to the extent and in the
manner required under the terms of this Lease, or upon any violation of Article
11 hereof; or upon the occurrence of an event specified in clauses (d) or (f) of
Section 16.01 hereof, or when so specified elsewhere in this Lease, and provided
further that Landlord shall not be required to give any notice called

                                      -30-
<PAGE>

for by this Section more than two times in any twelve-month period. All grace
periods under this Lease period in this Section 17.01 shall run concurrently
with any applicable grace period provided by statute.

                  (c) Tenant abandons the Premises or removes or attempts to
remove Tenant's property therefrom;

                  (d) The appointment of a receiver, liquidator or trustee of
Tenant or of any of the property of Tenant, or the commencement by Tenant of any
bankruptcy, reorganization, dissolution, arrangement, insolvency, readjustment,
receivership or other proceeding or case under the Federal Bankruptcy Code or
under any similar federal or state statute (each hereinafter called a
"Bankruptcy Proceeding"), or the commencement of any Bankruptcy Proceeding
against Tenant which is not stayed or dismissed within sixty days of its
commencement, or Tenant applies for or consents to the entry of an order for
relief in any Bankruptcy Proceeding;

                  (e) Any assignment for the benefit of creditors made by
Tenant;

                  (f) If any of the events set forth in subsections (d) or (e)
of this Section shall have happened with respect to any general partner of
Tenant if Tenant is a partnership, or to the Guarantor or any other guarantor of
this Lease, if any, or if Guarantor or any other guarantor shall default under
its guaranty;

                  (g) Tenant shall assign this Lease or delegate its duties
hereunder without the prior written consent of Landlord; or

                  (h) any material license held by Tenant and necessary for
operation of the Restaurant (including without limitation, liquor licenses)
shall be terminated or suspended. Notwithstanding the foregoing, in the event of
a suspension of a material license, Tenant may in good faith and with due
diligence by appropriate legal action contest such suspension and will not be in
default pending such contest provided that: (i) Tenant immediately begins such
contest and actively, diligently and in good faith proceeds with such contest
and causes the reinstatement of such license(s) as soon as possible, but not
more than 90 days from the date of suspension; (ii) Landlord shall not be
exposed to any liability, fine, or civil or criminal penalties pending such
contest; and (iii) the Restaurant may legally remain open to the public for
business and does in fact remain open for business to the public during the
pendency of such contest.

            17.02 Remedies. If any of the occurrences described in 17.01 above
shall have occurred or are occurring, then, at the sole option of Landlord,

                  (i) The whole balance of rent and all other sums payable
hereunder for the entire balance of the term of this Lease, herein reserved or
agreed to be paid by Tenant, or any part of such rent, charges and other sums,
shall be taken to be due and

                                      -31-
<PAGE>

payable from Tenant and in arrears as if by the terms of this lease said balance
of rent, charges and other sums and expenses were on that date payable in
advance; and/or

                  (ii) Landlord may terminate this Lease pursuant to by written
notice to Tenant. If Landlord so elects to terminate this Lease, Landlord shall
not be obligated to pay any Termination Fee to Tenant and Landlord, in addition
to Landlord's other remedies, may recover from Tenant a judgment for damages
equal to the sum of the following:

                        (A) the unpaid rent and other sums which became due up
to the time of such termination plus interest from the dates such rent and other
sums were due to the date of the judgment at the Default Rate; plus

                        (B) the then present value at the time of judgment of
the amount by which the unpaid rent and other sums which would have become due
(had this Lease not been terminated) after termination until the date of the
judgment exceeds the amount of loss of such rental and other sums Tenant proves
could have been reasonably avoided; plus

                        (C) the amount (as discounted at the rate of seven
percent per annum) by which the unpaid rent and other sums which would have
become due (had this Lease not been terminated) for the balance of the term
after the date of judgment exceeds the amount of loss of such rental and other
sums that Tenant proves could have been reasonably avoided; plus

                        (D) any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease or which in the ordinary course would be likely to
result therefrom including, without limitation, the cost of repairing the
Premises and reasonable attorneys fees; plus

                        (E) at Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be permitted by applicable law.

                  As used in the foregoing clause (B), the "present value at the
time of judgment" shall be computed by adding to the rent past due or which
would have become due interest at the Default Rate from the dates such rent was
or would have become due to the date of the judgment; and/or

                  (iii) Landlord may terminate Tenant's right of possession and
may re-enter and repossess the Premises by legal proceedings, force or
otherwise, without terminating this Lease. After reentry or retaking or
recovering of the Premises, whether by termination of this Lease or not,
Landlord may, but shall be under no obligation to, make such alterations and
repairs, as Landlord may deem then necessary or advisable and relet the Premises
or any part or parts thereof, either in Landlord's name or otherwise, for a term
or terms which may at Landlord's option be less than or exceed the period which
otherwise would have constituted the balance of the term of this Lease and at
such rent or rents and upon such other

                                      -32-
<PAGE>

terms and conditions as in Landlord's sole discretion may seem advisable and to
such person or persons as may in Landlord's sole discretion seem best; and
whether or not the Premises are relet, Tenant shall be liable for any loss, for
such period as is or would have been the balance of the term of this Lease, of
rent and all other sums payable under this Lease, plus the cost and expenses of
reletting and of redecorating, remodeling or making repairs and alterations to
the Premises for the purpose of reletting, the amount of such liability to be
computed monthly and to be paid by Tenant to Landlord from time to time upon
demand. Landlord shall in no event be liable for, nor shall any damages or other
sums to be paid by Tenant to Landlord be reduced by, failure to relet the
Premises or failure to collect the rent or other sums from any reletting. Tenant
shall not be entitled to any rents or other sums received by Landlord in excess
of those provided for in this Lease. Tenant agrees that Landlord may file suit
to recover any rent and other sums falling due under the terms of this Section
17.02 from time to time and that no suit or recovery of any amount due hereunder
to Landlord shall be any defense to any subsequent action brought for any other
amount due hereunder to Landlord. Tenant, for Tenant and Tenant's successors and
assigns, hereby irrevocably constitutes and appoints Landlord, Tenant's and
their agent to collect the rents due or to become due under all subleases of the
Premises or any parts thereof without in any way affecting Tenant's obligation
to pay any unpaid balance of rent or any other sum due or to become due
hereunder. Notwithstanding any reletting without termination, Landlord may at
any time thereafter elect to terminate this lease for Tenant's previous breach.

                  In determining the rent payable by Tenant hereunder subsequent
to default, the Percentage Rent for each year of the unexpired Tern of this
Lease shall be equal to the average of Percentage Rent during the three
preceding Lease Years (or of all preceding Lease Years, if less than three).

                  Whenever Landlord shall have the right to re-enter the
Premises, it shall have the right to remove all persons and property from the
Premises and either treat such property as abandoned or at Landlord's option
store it in a public warehouse or elsewhere at the cost of and for the account
of Tenant, all without service of notice or resort to legal process and without
being deemed guilty of trespass, or becoming liable for any loss or damage which
may be occasioned thereby.

                  Tenant waives the right to any notice to quit or to remove as
may be specified in the Landlord and Tenant Act of Pennsylvania, Act of April 6,
1951, as amended, or any similar or successor provision of law.

                  For the purposes of computing "the whole balance of rent and
all other sums payable hereunder for the entire balance of the term of this
Lease", "the unpaid rent and other sums which would have become due (had this
Lease not been terminated) after termination until the date of the judgment" and
"the unpaid rent and other sums which would have become due (had this Lease not
been terminated) for the balance of the term after the date of judgment", as
such quoted or any similar phrases are used in this Article 17, the amount of
additional rent which would have been due per year under this Lease shall be
such amount as Landlord shall reasonably estimate to be the per annum rate of
additional rent for the calendar year during which this Lease was terminated or
during which rent was accelerated, increasing

                                      -33-
<PAGE>

annually on the first day of each calendar year thereafter at the rate of seven
percent per annum compounded.

                  Notwithstanding anything herein to the contrary, if Tenant
shall fail timely to pay to Landlord any installment of minimum rent, Percentage
Rent, additional Rent or other sum, on the date on which it is due pursuant to
the terms of this Lease, and such payment remains overdue for a period of five
business days after the due date (without regard to any notice or grace
periods), Tenant shall pay to Landlord interest on such late payment from the
due date thereof to the date of receipt of payment by Landlord at the Default
Rate. Nothing in this Section shall be construed to obligate Landlord to accept
any overdue payment nor to limit Landlord's rights and remedies for Tenant's
default as herein set forth. If the charges provided for in this Section shall
exceed the maximum amount which Landlord may charge Tenant in such circumstances
under applicable law, the amount Tenant shall be required to pay under this
Section shall not exceed such maximum amount.

                  In addition to, and not in lieu of any of the foregoing rights
granted to Landlord, if Tenant commits two defaults within any 12 month period,
and if a third default shall occur within the next 12 months following the
second default, which third default remains uncured within any applicable notice
and/or grace period, Landlord may exercise the rights and remedies in the next
two succeeding grammatical paragraphs:

                        (A) WHEN THIS LEASE OR TENANT'S RIGHT OF POSSESSION
SHALL BE TERMINATED BY COVENANT OR CONDITION BROKEN, OR FOR ANY OTHER REASON,
EITHER DURING THE TERM OF THIS LEASE OR ANY EXTENSION OR RENEWAL THEREOF, AND
ALSO WHEN AND AS SOON AS SUCH TERM SHALL HAVE EXPIRED OR BEEN TERMINATED, TENANT
HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY ATTORNEY OF ANY COURT OF RECORD
AS ATTORNEY FOR TENANT AND ANY PERSONS CLAIMING THROUGH OR UNDER TENANT TO
CONFESS JUDGMENT IN EJECTMENT AGAINST TENANT AND ALL PERSONS CLAIMING THROUGH OR
UNDER TENANT FOR THE RECOVERY BY LANDLORD OF POSSESSION OF THE PREMISES, FOR
WHICH THIS LEASE SHALL BE SUFFICIENT WARRANT, WHEREUPON, IF LANDLORD SO DESIRES,
A WRIT OF EXECUTION OR OF POSSESSION MAY ISSUE FORTHWITH, WITHOUT ANY PRIOR WRIT
OR PROCEEDINGS WHATSOEVER, AND PROVIDED THAT IF FOR ANY REASON AFTER SUCH ACTION
SHALL HAVE BEEN COMMENCED THE SAME SHALL BE DETERMINED, CANCELED OR SUSPENDED
AND POSSESSION OF THE PREMISES HEREBY DEMISED REMAIN IN OR BE RESTORED TO TENANT
OR ANY PERSON CLAIMING THROUGH OR UNDER TENANT, LANDLORD SHALL HAVE THE RIGHT,
UPON ANY SUBSEQUENT DEFAULT OR DEFAULTS, OR UPON ANY SUBSEQUENT TERMINATION OR
EXPIRATION OF THIS LEASE OR ANY RENEWAL OR EXTENSION HEREOF, OR OF TENANT'S
RIGHT OF POSSESSION, AS HEREINBEFORE SET FORTH, TO CONFESS JUDGMENT IN EJECTMENT
AS HEREINBEFORE SET FORTH ONE OR MORE ADDITIONAL TIMES TO RECOVER POSSESSION OF
THE SAID PREMISES.

                                      -34-
<PAGE>

                  (B) IN ANY ACTION OF OR FOR EJECTMENT, LANDLORD SHALL FIRST
CAUSE TO BE FILED IN SUCH ACTION AN AFFIDAVIT MADE BY IT OR SOMEONE ACTING FOR
IT SETTING FORTH THE FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, SUCH
AFFIDAVIT SHALL BE CONCLUSIVE EVIDENCE OF SUCH FACTS; AND IF A TRUE COPY OF THIS
LEASE (AND OF THE TRUTH OF THE COPY SUCH AFFIDAVIT SHALL BE SUFFICIENT EVIDENCE)
BE FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A
WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR PRACTICE TO THE CONTRARY
NOTWITHSTANDING. TENANT RELEASES TO LANDLORD, AND TO ANY AND ALL ATTORNEYS WHO
MAY APPEAR FOR TENANT, ALL PROCEDURAL ERRORS IN ANY PROCEEDINGS TAKEN BY
LANDLORD, WHETHER BY VIRTUE OF THE WARRANTS OF ATTORNEY CONTAINED IN THIS LEASE
OR NOT, AND ALL LIABILITY THEREFOR.

                  Landlord shall also have such other rights and remedies
accorded by law or in equity. No right or remedy herein conferred upon or
reserved to Landlord is intended to be exclusive of any other right or remedy
herein or by law provided but each shall be cumulative and in addition to every
other right or remedy given herein or now or hereafter existing at law or in
equity or by statute.

                  No waiver by Landlord of any breach by Tenant of any of
Tenant's obligations, agreements or covenants herein shall be a waiver of any
subsequent breach or of any obligation, agreement or covenant, nor shall any
forbearance by Landlord to seek a remedy for any breach by Tenant be a waiver by
Landlord of any rights and remedies with respect to such or any subsequent
breach.

                  As used in this Article 17, the "term" shall include the term
of this Lease and any renewals or extensions thereof to which Tenant shall have
become bound and "rent" shall include all minimum rent, Percentage Rent and
additional rent.

            17.03 Expenses of Enforcement. If Tenant shall commit a default
under this Lease, Tenant shall pay upon demand all Landlord's costs, charges and
expenses including the fees and out-of-pocket expenses of counsel, agents and
others retained by Landlord incurred in enforcing Tenant's obligations hereunder
or incurred by Landlord in any litigation, negotiation or transaction in which
the Tenant causes the Landlord without the Landlord's fault to become involved
or concerned (provided, however, that as to litigation, Landlord prevails
therein).

            17.04 Landlord May Cure Defaults.

                  (a) If Tenant shall default in:

                        (i) making any payment required to be made by Tenant
under this Lease and such default is not cured within five (5) days after
written notice has been given under Section 17.01(a) above.

                                      -35-
<PAGE>

                        (ii) performing any term, covenant, or condition of this
Lease on the part of Tenant to be performed, Landlord may, at its option (but
shall not be obligated to do so) and for the account of Tenant, make such
payment or expend such sum as may be necessary or desirable to perform and
fulfill such term, covenant, or condition, upon ten (10) days' prior written
notice to Tenant (except that no such notice shall be required in a case of
emergency). However, no such payment or expenditure by Landlord shall be deemed
a waiver of Tenant's default, nor shall the same affect any other remedy of
Landlord by reason of such default.

                  (b) Any and all sums paid or expended by Landlord pursuant to
Section 17.04(a), as well as any other reasonable out of pocket cost or expense
(including, without limitation, reasonable attorneys fees, disbursements and
court costs) incurred by Landlord in instituting, prosecuting, or defending any
action or proceeding instituted by reason of, or relating to, any default by
Tenant under this Lease (provided, however, that, as to such costs and expenses
related to an action or proceeding, Landlord prevails therein), shall:

                        (i) be repaid by Tenant to Landlord as additional rent
under this Lease within 30 days after Landlord's written demand therefor; and

                        (ii) bear interest from the date of Landlord's payment
or expenditure thereof to the date of Tenant's repayment at the Default Rate.

            17.05 Landlord's Default. If Tenant believes that Landlord has
breached or failed to comply with any provision of this Lease applicable to
Landlord, Tenant shall give written notice to Landlord describing the alleged
breach or noncompliance. Landlord will not be deemed in default under this Lease
if Landlord cures the breach or noncompliance within thirty (30) days after
receipt of Tenant's notice or, if the same cannot reasonably be cured within
such thirty (30) day period, if Landlord in good faith commences to cure such
breach or noncompliance within such period and then diligently pursues the cure
to completion. Tenant will also send a copy of such notice to the holder of any
Mortgage in accordance with Section 12.03 above as to which Tenant has been
notified of the name and address of such Mortgagee, and such holder will also
have the right to cure the breach or noncompliance within the period of time
described in Section 12.03.

                                  ARTICLE XVIII
                                  MISCELLANEOUS

            18.01 Access and Information. Landlord and its duly authorized
representatives shall have access to the Restaurant at all reasonable times and
upon reasonable notice during the term of this Lease for the purpose of
inspecting the Restaurant, making repairs or preventing damage, examining,
copying or making extracts from its books and records, showing the Restaurant to
prospective purchasers or mortgagees, and during the last twelve (12) months of
the Term to prospective tenants, or for any other purpose which Landlord may
deem necessary or advisable, and Tenant shall promptly make available to
Landlord and its duly authorized

                                      -36-
<PAGE>

representatives upon request such information concerning the Restaurant, its
use, maintenance, operation, financial condition, or other matters as Landlord
shall reasonably request.

            18.02 Quiet Enjoyment. Tenant upon paying the Rent and other charges
provided for and observing and keeping all covenants, agreements and conditions
of this Lease on its part to be kept, shall quietly have and enjoy the Premises,
during the term of this Lease without hindrance or molestation by Landlord or
anyone claiming by or through Landlord, subject, however, to the exceptions,
reservations and conditions of this Lease.

            18.03 Notices. Any notice required or permitted to be given pursuant
to this Lease shall be in writing and shall be sent by certified or registered
mail, with postage prepaid, or by nationally recognized courier service such as
Federal Express. All notices shall be addressed as follows:

                  If to Landlord:

                  The Rittenhouse Hotel
                  210 West Rittenhouse Square
                  Philadelphia, PA 19103
                  Attention: David G. Marshall, Chairman

                  and to:

                  The Rittenhouse Hotel
                  210 West Rittenhouse Square
                  Philadelphia, PA 19103
                  Attention: David Benton, General Manager

                  with a copy to:

                  Wolf, Block, Schorr and Solis-Cohen LLP
                  1650 Arch Street - 22nd Floor
                  Philadelphia, PA 19103-2097
                  Attn: Alvin H. Dorsky, Esquire

                                      -37-
<PAGE>

                  If to Tenant:

                  S & W of Philadelphia, LLC.
                  do The Smith & Wollensky Restaurant Group, Inc.
                  1114 First Avenue, 6th Floor
                  New York, New York 10021
                  Attn: Jim Dunn

                  with a copy to:

                  Maloney & Porcelli
                  225 Broadway
                  New York, NY 10007-3065
                  Attn: Joseph E. Porcelli, Esquire

Notices shall be deemed effective two business days after being deposited with
the United States mail service or the next business day after being deposited
with such nationally recognized courier service, and may be given on behalf of
either party by its respective counsel. Either party may change its respective
address by giving written notice to the other in accordance with the provisions
of this Section 18.03. The term "business days" wherever used in this Lease
shall mean a weekday, Monday through Friday, excluding national holidays.

            18.04 Waivers. The failure of either party to insist upon a strict
performance of any of the terms or provisions of this Lease or to exercise any
option, right or remedy herein contained, shall not be construed as a waiver or
as a relinquishment for the future of such term, provision, option, right or
remedy, but the same shall continue and remain in full force and effect
throughout the term of this Lease. No waiver by either party of any term or
provision hereof shall be deemed to have been made unless expressed in writing
and signed by such party.

            18.05 Partial Invalidity. In the event that any term or condition of
this Lease shall be or become invalid by virtue of any duly promulgated law,
rule or regulation or under any order, decree or judgment of any court having
jurisdiction, this Lease shall be construed as if such term or condition had not
been inserted herein.

            18.06 Entire Lease. This Lease, together with all other writings
signed by the parties expressly stated to be supplementary hereto and together
with any instruments to be executed and delivered pursuant hereto, constitutes
the entire Lease between the parties, supersedes all prior understandings and
writings, and may be amended only by a writing signed by both parties.

            18.07 Intentionally Omitted.

            18.08 Successors and Assigns. Subject to the prohibition on Tenant's
assignment or delegation of its rights and duties, all of the terms and
provisions of this Lease

                                      -38-
<PAGE>

shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and assigns becoming such in accordance with the
terms of this Lease. Except as provided in Article 12 with respect to Mortgagee,
nothing contained in this Lease shall be deemed-to create any third party
beneficiary or other rights hereunder in favor of any person, firm, corporation
or other entity not a party to this Lease.

            18.09 Consents. In any instance in which either party to this Lease
shall be requested to consent to or approve any matter with respect to which
such party's consent or approval is required by any provisions of this Lease,
such consent or approval shall be given in writing and shall be given or refused
in the sole discretion of such party, unless the provisions of this Lease shall
expressly provide that such consent or approval shall not be unreasonably
withheld or another standard is articulated, and in either event shall not be
unreasonably delayed. The giving of consent in one instance shall not relieve a
party from the obligation of obtaining consent in any other instances.

            18.10 Governing Law. This Lease, and the rights and obligations of
the parties hereto, shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania.

            18.11 Signs. No signs shall be placed, erected, maintained or
painted at any place upon the Leased Premises without the prior written consent
of Landlord. Tenant agrees that all signs installed by Tenant shall comply with
all applicable laws and public regulations, shall be installed at Tenant's cost
and expense, shall be maintained by Tenant in good condition during the term
hereof and shall be removed at the termination of this Lease, and Tenant agrees
to repair any damage caused by the installation and/or removal thereof.

            18.12 Landlord's Right of Entry. Tenant agrees to permit Landlord
and the authorized representatives of Landlord and of the holder of any mortgage
or any prospective mortgagee on reasonable notice to enter the Leased Premises
at all reasonable times for the purpose of inspecting them and making any
necessary repairs thereto and performing any work therein that may be necessary
by reason of Tenant's failure to make such repairs or perform any such work
required of Tenant under this Lease. Nothing herein shall imply any duty upon
the part of Landlord to do any such work which under any provision of this Lease
Tenant may be required to perform and the performance thereof by Landlord shall
not constitute a waiver of Tenant's default in failing to perform it. During the
progress of any work in the Leased Premises Landlord may keep and store in the
Leased Premises all necessary materials, tools and equipment. Landlord shall not
in any event be liable for inconvenience, annoyance, disturbance or other damage
to Tenant by reason of making such repairs or the performance of such work in
the Leased Premises or on account of bringing materials, supplies and equipment
into or through the Leased Premises during the course thereof and the
obligations of Tenant under this Lease shall not thereby be affected in any
manner whatsoever; provided Landlord shall not unreasonably interfere with (and
shall use reasonable efforts to cause Landlord's contractors not to unreasonably
interfere with) Tenant's use and occupancy of the Premises.

                                      -39-
<PAGE>

            18.13 Common Areas. Tenant shall have a right of access through the
entrance to the Hotel and common hallways, elevators and stairways leading to
the Restaurant. Landlord shall not take any action with respect to said common
areas to impair the use of, the quality of, the access to or the visibility of
the Leased Premises from said common areas, but Landlord may repair or renovate
all such common areas.

            18.14 Estoppel Certificates. Tenant agrees, at any time and from
time to time, upon not less than seven (7) business days' prior notice by
Landlord or Mortgagee, to provide a statement in writing certifying that this
Lease is unmodified and in full force and effect (or if there have been
modifications, that the same is in full force and effect as modified, and
stating the modifications), and stating whether or not, to the best knowledge of
the signer of such certificate, there exists any default in the performance of
any obligation contained in this Lease, and if so, specifying each such default
of which the signer has knowledge, it being intended that any such statement
delivered pursuant hereto may be relied upon by Landlord and by any Mortgagee or
prospective Mortgagee to be secured by any mortgage placed or to be placed on
the Building or the Restaurant.

            18.15 Limitation of Liability. The liability of Landlord and its
successors and assigns hereunder shall be limited in all respects to its
interest in the Hotel. Neither Landlord nor its successors or assigns, nor any
agents, partners, officers, trustees, directors, shareholders or principals
(disclosed or undisclosed) of Landlord or its successors or assigns shall have
any personal liability hereunder, and no judgment or decree shall be enforceable
beyond the interests of Landlord and its successors and assigns in the Hotel nor
shall be sought or entered in any action or proceeding brought on account of or
in connection with any default in the keeping, observance or performance of any
covenant, Lease, term or condition hereunder.

            18.16 Binding Effect. Tenant represents and warrants to Landlord
that: (i) this Lease is binding upon and enforceable against Tenant in
accordance with its respective terms; (ii) the performance of Tenant's
obligations under this Lease will not result in a breach of, or constitute a
default under, any agreement to which Tenant is subject or by which Tenant is
bound; (iii) Tenant has full capacity, right, power, and authority to execute,
deliver and perform this Lease, and all required actions and approvals therefor
have been obtained; and (iv) the individual signing this Lease on behalf of
Tenant is duly authorized to sign the same on Tenant's behalf and to bind Tenant
thereto.

            18.17 Headings. The headings of the Articles and Sections herein are
for convenience only and shall not affect the construction hereof.

            18.18 Counterparts. This Lease may be signed in any number of
counterparts, each of which shall be deemed to be an original with the same
effect as if the signatures thereto and hereto were on the same instrument.

            18.19 Waiver of Trial by Jury. TENANT AND LANDLORD HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY
IN RESPECT TO ANY LITIGATION BASED UPON

                                      -40-
<PAGE>

THIS LEASE OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LEASE OR COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION
OF TENANT OR LANDLORD.

            18.20 Adverse Possession. Tenant shall not suffer or permit the
Leased Premises or any portion thereof to be used by the public, as such,
without restriction or in such manner as might reasonably tend to impair
Landlord's title to the Leased Premises or in such manner as might reasonably
make possible a claim or claims of adverse possession by the public, as such, or
of implied dedication of the Leased Premises or any portion thereof

            18.21 Condition of Title and of Premises. Tenant represents that the
Leased Premises, the title thereto, the zoning thereof, the street or streets,
sidewalks, parking areas, curbs and access ways adjoining them, any surface and
subsurface conditions thereof, and the present uses and nonuses thereof, have
been examined by Tenant, and Tenant accepts them in the condition or state in
which they now are, or any of them now is, without representation, covenant or
warranty, express or implied, in fact or in law, by Landlord and without
recourse to Landlord, as to the title thereto, encumbrances thereon,
appurtenances, the nature, condition or usability thereof or the use or uses to
which the Leased Premises or any part thereof may be put.

            18.22 Surrender. Upon the expiration or other cancellation or
termination of the Term (such date, as applicable, being hereinafter referred to
as the "Surrender Date"), Tenant shall immediately vacate and surrender
possession of the Premises to Landlord, broom-clean, together with all
alterations, additions and improvements that may have been made upon the
Premises (other than those which Tenant is permitted or required to remove
pursuant to the provisions of this Lease), in the same order, repair and
condition in which it is required to be kept during the Term hereof. Upon the
expiration or other termination of the Term, Tenant shall (a) remove all
alterations to the Premises which are required to be removed by Tenant upon the
expiration or earlier termination of the Term pursuant to the provisions of this
Lease, and restore the Premises to the condition existing prior to the
installation of such alterations, and (b) remove all of Tenant's trade fixtures,
furniture, equipment and other personal property from the Premises which Tenant
is permitted to remove pursuant to the provisions of this Lease. Tenant shall
immediately repair any damage caused by such removal or, at Landlord's option,
pay Landlord on demand the reasonable cost of repairing any damage to the
Premises or Hotel caused by the removal of any such items. Any of Tenant's
property remaining in the Premises will be conclusively deemed to have been
abandoned by Tenant and may be appropriated, stored, sold, destroyed or
otherwise disposed of by Landlord without further notice to or demand upon
Tenant, and without liability or obligation to account to or compensate Tenant,
and Tenant will pay Landlord on demand all costs incurred by Landlord relating
to such abandoned property.

            18.23 Holdover. If the Tenant or any person claiming through the
Tenant shall retain possession of the Premises or any part thereof after the
expiration or earlier termination of this Lease and if Landlord shall have
expressly consented to such continuation of possession, such possession shall be
(unless the parties hereto shall have agreed in writing otherwise) deemed to be
under a month-to-month tenancy which shall continue until either party shall
notify the other in writing, at least thirty days prior to the end of any
calendar month, that the party

                                      -41-
<PAGE>

giving such notice elects to terminate such tenancy at the end of such calendar
month, in which event such tenancy shall so terminate. Anything contained in the
foregoing provisions of this Section to the contrary notwithstanding, the
minimum rent payable with respect to each such monthly period shall be one-sixth
of the highest per annum minimum rent provided for in Section 3 hereof, and,
except as aforesaid, such month-to-month tenancy with Landlord's express consent
shall be upon the same terms, including, without limitation, additional rents,
and subject to the same conditions, as those which are set forth in this Lease.
If Tenant or any person claiming through Tenant shall retain possession of the
Premises or any part thereof, after the expiration or earlier termination of
this Lease, and if such retention shall be without Landlord's express consent,
Tenant shall pay Landlord (a) for each month or portion thereof during which
such possession continues, an amount equal to the rental to be paid for each
month pursuant to the foregoing provisions of this Section when such possession
is with Landlord's written consent, plus all other sums which would have been
payable hereunder had the term continued during such retention of possession and
(b) all damages sustained by Landlord, whether direct or consequential, by
reason of such retention of possession, including any damages or claims Landlord
may suffer by reason of any claims made by any succeeding occupant founded on
the delay in delivery of possession to such occupant, and any reasonable
attorneys' fees and costs incurred by Landlord in connection with the foregoing.
During any such retention of possession without Landlord's express consent,
Landlord may by written notice to Tenant elect to treat the holdover as a year
to year tenancy but with the same payment obligations as provided above for a
month-to-month tenancy. The provisions of this Section shall not be deemed to
limit or constitute a waiver of any other rights or remedies of Landlord
provided herein or at law or in equity and applicable to unlawful retention of
possession or otherwise. Landlord's acceptance of rent under the provisions of
this Section shall not be deemed consent to the holdover.

            18.24 Definitions.

                  (a) "Landlord." The word "Landlord" is used herein to include
the Landlord named above and any subsequent landlord of the Premises, as well as
their respective heirs, personal representatives, successors and assigns, each
of whom shall have the same rights, remedies, powers, authorities and privileges
as he would have had he originally signed this Lease as Landlord, including the
right to proceed in his own name to enter judgment by confession or otherwise,
but any Landlord of the Premises, whether or not named herein, shall have no
liability hereunder after he ceases to hold title to the Premises. Neither
Landlord nor any partner in Landlord nor any partner in any such partner nor any
other person having any direct or indirect interest in Landlord shall have any
personal liability with respect to any of the provisions of this Lease, and if
Landlord is in breach or default with respect to Landlord's obligations or
otherwise under this Lease, Tenant shall look solely to the equity of Landlord
in the Premises for the satisfaction of Tenant's remedies. It is expressly
understood and agreed that Landlord's liability under the terms, covenants,
conditions, warranties and obligations of this Lease shall in no event exceed
the loss of Landlord's equity interest in the Premises.

                  (b) "Tenant." The word "Tenant" is used herein to include each
and every of the entities named above as Tenant as well as its successors and
permitted assigns, each of whom shall be under the same obligations, liabilities
and disabilities and have only such

                                      -42-
<PAGE>

rights, privileges and powers as he would have possessed had he originally
signed this Lease as Tenant. Without limiting the foregoing, it is agreed that
any party who shall hereafter come within the meaning of the word "Tenant"
hereunder shall be deemed to have granted all powers with respect to confessions
of judgment set forth herein as if such party had been a signatory party to this
Lease. Each and every of the persons named above as Tenant shall be bound
jointly and severally by the terms, covenants and agreements contained herein.

                  (c) Any notice required or permitted by the terms of this
Lease may be given by or to any one of the persons named above as Tenant, and
shall have the same force and effect as if given by or to all thereof.

            18.25 Hazardous Materials.

                  (a) For purposes hereof, the following terms shall have the
following meanings:

                        (i) "Environmental Laws" shall mean all statutes,
ordinances, orders, rules and regulations of all federal, state or local
governmental agencies relating to the use, generation, manufacture,
installation, release, discharge, handling, storage or disposal of Hazardous
Materials.

                        (ii) "Hazardous Materials" shall mean and include, but
shall not be limited to, any (i) "hazardous substance", "pollutant" or
"contaminant" (as defined in Sections 101(14) and (33) of the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Sections 9601(14) and (33) or the regulations promulgated pursuant to Section
102 of CERCLA, 42 U.S.C. Section 9602 and found at 40 C.F.R. Part 302),
including any element, compound, mixture, solution, or substance which is or may
be so designated a hazardous substance pursuant to Section 102 of CERCLA; (ii)
all substances which are or may be designated pursuant to Section 311(b)(2)(A)
of the Federal Water Pollution Control Act ("FWPCA") 33 U.S.C.
Section 132l(b)(2)(A), as amended; (iii) any hazardous waste having the
characteristics which are identified under or listed pursuant to Section 3001 of
the Resource Conservation and Recovery Act, 42 U.S.C. Section 6921, as amended
("RCRA") or as having such characteristics which shall subsequently be
considered under RCRA to constitute a hazardous waste; (iv) any substance
containing petroleum, as that term is defined in Section 9001(2)(B) of
RCRA, 42 U.S.C. Section 6991(2)(B) or 40 C.F.R. Part 280 including
without limitation waste oil; (v) any toxic pollutant which is or may be listed
under Section 307(a) of the FWPCA, 33 U.S.C. Section 1317(a); (vi) any
hazardous air pollutant which is or may be listed under Section 112 of the
Clean Air Act, 42 U.S.C. Section 7412, as amended; (vii) any imminently
hazardous chemical substance or mixture with respect to which action has been or
may be taken pursuant to Section 7 of the Toxic Substances Control Act,
15 U.S.C. Sections 2601, 2606, as amended; (viii) any asbestos, asbestos
containing material or urea formaldehyde or material which contains it; and
(ix) all other toxic materials, pollutants, contaminants and hazardous
substances and wastes regulated by any federal or applicable state or
local environmental law.

                                      -43-
<PAGE>

                  (b) Landlord represents and warrants to Tenant that as of the
date hereof, Landlord, to its actual knowledge and without independent
investigation, is not aware of any Hazardous Substances located in the Premises
in violation of Environmental Laws or requiring remediation under applicable
Environmental Laws. Landlord agrees in the event of any release or disposal by
Landlord, its agents, employees, or contractors or in, about, under or on the
Hotel, or any portion thereof, of any Hazardous Materials in violation of
Environmental Laws which poses a risk of contaminating the Premises, Landlord
shall promptly take such remedial actions as may be necessary to clean up the
same in accordance with the requirements of Environmental Laws.

                  (c) Tenant shall not use, store, generate, treat, dispose of,
or release Hazardous Materials in or upon the Premises, except for Hazardous
Materials in minor amounts which are customarily used in the construction,
maintenance and operation of a restaurant and which are contained in a suitable
and safe manner and in compliance with Environmental Laws. Tenant agrees that in
the event of any release or disposal by Tenant, its agents, employees or
contractors, in, about, under or on the Premises or the Hotel, or any portion
thereof, of any Hazardous Materials that poses a risk of contaminating the Hotel
or Premises or any buildings or improvements thereon, Tenant shall take such
remedial actions as may be necessary to clean up the same, and if Tenant fails
to do so, Landlord upon reasonable notice to Tenant shall have the right to
perform such necessary clean up and remedial actions at the expense of Tenant,
including the right to enter upon the Premises in order to do so. Upon the
expiration or earlier termination of this Lease, Tenant shall remove all
Hazardous Materials from the Premises (other than those which are Landlord's
responsibility hereunder) and shall remove all Hazardous Materials from the
Hotel to the extent such Hazardous Materials were generated, treated, stored,
disposed or of released by Tenant, its agents, employees, contractors or
sublessees.

                  (d) Landlord and Tenant each agree to indemnify, hold
harmless, defend and reimburse the other for and release each other from all
cost and expense (including without limitation attorneys' fees), loss and
liability suffered by the indemnified Party by reason of the breach of any of
the representations, warranties, covenants and agreements of the indemnifying
Party of any of the provisions of this Section 18.25.

                  (e) Without limitation of the other provisions which survive
expiration or termination, the provisions of this Section 18.25 shall survive
the expiration or termination of this Lease and no subsequent modification or
termination of the Lease by agreement of the parties, or otherwise, shall be
construed to waive or to modify any provisions of this Section 18.25.

            18.26 Brokers. Tenant and Landlord each represents and warrants to
the other that it has had no dealings, negotiations or consultations with
respect to the premises or this transaction with any broker or finder, and that
no broker or finder called the premises to Tenant's attention for lease or took
any part in any dealings, negotiations or consultations with respect to the
Premises or this Lease. Each party will be responsible for and will indemnify
and save the other harmless from and against all costs, fees (including, without
limitation, attorney's fees),

                                      -44-
<PAGE>

expenses, liabilities and claims incurred or suffered by the indemnified party
arising from a breach by the indemnifying party of the foregoing representations
and warranties.

            18.27 Effect of Submission. The submission by Landlord to Tenant of
this Lease in draft form shall be solely for Tenant's consideration and not for
acceptance and execution. Such submission shall have no binding force or effect,
shall not constitute an option for the leasing of the premises herein described,
and not confer any rights or impose any obligations upon either party. The
submission by Landlord of this Lease for execution by Tenant and the actual
execution and delivery thereof by Tenant to Landlord shall similarly have no
binding force and effect unless and until Landlord shall have executed this
Lease and a duplicate original thereof shall have been given to Tenant or its
representative.

                                      -45-
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
duly executed as of the day and year first above written.

                                        Tenant:

                                        S & W OF PHILADELPHIA, LLC

                                        By: /s/ James Dunn
                                           -------------------------------------
                                           Name:  James Dunn
                                           Title: President

                                        Landlord:
                                        THE RITTENHOUSE DEVELOPMENT
                                        COMPANY, a general partnership

                                        By: The Rittenhouse Corp.

                                        By: /s/ David G. Marshall
                                           -------------------------------------
                                           David G. Marshall, President

                                        JOINDER FOR THE PURPOSE OF AGREEING TO
                                        THOSE TERMS AND PROVISIONS APPLICABLE TO
                                        GUARANTOR:

                                        THE SMITH & WOLLENSKY
                                        RESTAURANT GROUP, INC.

                                        By: /s/ James Dunn
                                           -------------------------------------
                                           Name:  James Dunn
                                           Title: President

                                      -46-
<PAGE>
                                                                     page 1 of 3

                                    EXHIBIT B

PROJECT: SMITH AND WOLLENKSY
NUMBER: #9915

DRAWING LIST

HAVERSON ARCHITECTURE AND DESIGN
A-1.0   FIRST FLOOR PLAN
A-2.0   SECOND FLOOR PLAN
A-3.0   THIRD FLOOR PLAN
PA-1.0  FIRST FLOOR PUBLIC ASSEMBLY PLAN
PA-2.0  SECOND FLOOR PUBLIC ASSEMBLY PLAN
RCP-1.0 FIRST FLOOR REFLECTED CEILING PLAN
RCP-2.0 SECOND FLOOR REFLECTED CEILING PLAN
RCP-3.0 THIRD FLOOR REFLECTED CEILING PLAN
A-4.0   EXTERIOR ELEVATION
A-5.0   EXTERIOR ELEVATION
A-5.1   EXTERIOR SECTIONS AND DETAILS
A-6.0   FIRST FLOOR ELEVATIONS
A-7.0   SECOND FLOOR ELEVATIONS
A-8.0   SECOND FLOOR ELEVATIONS
A-9.0   SECOND FLOOR RESTROOM ELEVATIONS
A-9.1   SECOND FLOOR RESTROOM ELEVATIONS
A-10    STAIR ELEVATIONS
A-10.1  STAIR ELEVATIONS AND DETAILS
A-10.2  STAIR SECTIONS AND DETAILS
A-1.1   WALL SECTIONS
A-12    PLATFORM DETAILS
A-13    BAY PARAPET DETAILS
A-14    BAR PLAN AND ELEVATIONS
A-14.1  BAR SECTION AND DETAILS
A-15    WAINSCOT DETAILS
A-15.1  WAINSCOT DETAILS
A-16    BANQUETTE DETAILS
A-17    WAITSTATION DETAILS
A-18    WINE DISPLAY DETAILS
A-19    COAT HOOK AND UMBRELLA STAND AND MOSAIC DETAIL
A-20    MOULDING PROFILES
A-21    RAILING DETAILS
A-22    DOOR SCHEDULE
A-22.1  DOOR DETAILS
A-23    FINISH SCHEDULE

<PAGE>
                                                                     page 2 of 3

                                    EXHIBIT B

Le MESSURIER CONSTULATANTS, INC.

S1-1    PLAN
                             S1-2 PLAN AND SECTIONS
S1-3    FRAMING PLAN

MGJ ASSOCIATES

M-1     MECHANICAL FIRST FLOOR
M-2     MECHANICAL SECOND FLOOR
M-3     MECHANICAL THIRD FLOOR
M-4     SCHEDULES AND DETAILS
MD-1    FIRST FLOOR DEMOLITION
MD-2    SECOND FLOOR DEMOLITION
MD-3    THIRD FLOOR DEMOLITION
ED-l    FIRST FLOOR DEMOLITION
ED-2    SECOND FLOOR DEMOLITION
ED-3    THIRD FLOOR DEMOLITION
E-l     FIRST FLOOR LIGHTING
E-2     SECOND FLOOR LIGHTING
E-3     THIRD FLOOR LIGHTING
E-4     FIRST FLOOR POWER
E-5     SECOND FLOOR POWER
E-6     THIRD FLOOR POWER
E-7     FIRST FLOOR MEHANICAL PLAN
E-9     THIRD FLOOR MECHANICAL PLAN
E-10    SYMBOLS AND LIGHTING FIXTURE SCHEDULES
E-15    LOWER GARAGE PLAN
E-16    POWER RISER DIAGRAM
E-17    PANEL SCHEDULES
E-18    PANEL SCHEDULES
FA-1    FIRST FLOOR FIRE ALARM PLAN
FA-2    SECOND FLOOR FIRE ALARM PLAN
FA-3    THIRD FLOOR FIRE ALARM PLAN
PD-l    FIRST FLOOR PLUMBING DEMOLITION PLAN
PD-2    SECOND FLOOR PLUMBING DEMOLITION PLAN
PD-3    THIRD FLOOR PLUMBING DEMOLITION PLAN
P-1     FIRST FLOOR PLUMBING PLAN
P-2     SECOND FLOOR PLUMBING PLAN
P-3     SECOND FLOOR KITCHEN PLUMBING PLAN

<PAGE>
                                                                     page 3 of 3

                                    EXHIBIT B

P-4     THIRD FLOOR PLUMBING PLAN
P-5     PLUMBING FIXTURES AND FOOD SERVICE EQUIPMENT SCHEDULES
P-6     PLUMBING DETAILS, NOTES AND SYMBOLS
P-7     PLUMBING DETAILS

MGJ ASSOCIATES CONT'D

P-8     PLUMBING RISER DIAGRAMS
SPD-1   FIRST FLOOR SPRINKLER DEMOLITION PLAN
            SFD-2   SECOND FLOOR SPRINKLER DEMOLITION PLAN
SP-l    FIRST FLOOR SPRINKLER PLAN
SP-2    SECOND FLOOR SPRINKLER PLAN
SP-3    SPRINKLER PLAN THIRD FLOOR
SP-4    SPRINKLER DETAILS

LOSURDO INC.

FS-1    FOOD SERVICE EQUIPMENT PLAN
FS-2    FOOD SERVICE EQUIPMENT PLAN
FS-3    FOOD SERVICE EQUIPMENT SCHEDULE
FS-4    PLUMBING ROUGH-IN PLAN
FS-5    PLUMBING ROUGH-IN PLAN
FS-6    ELECTRICAL ROUGH-IN PLAN
FS-7    ELECTRICAL ROUGH-IN PLAN

<PAGE>

<TABLE>
<CAPTION>
New York Restaurant Group Confidential
CONTINUATION SHEET                                          AIA DOCUMENT G703                                      PAGE 1 OF 5 PAGES
------------------------------------------------------------------------------------------------------------------------------------
AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT, containing                              APPLICATION NO:
Contractor's signed certification is attached.                                                      APPLICATION DATE:
In tabulations below, amounts are stated to the nearest dollar.                                            PERIOD T0: S&W Phil., PA
Use Column I on Contracts where variable retainage for line items may apply.                   ARCHITECTS PROJECT NO:
Smith & Wollensky Phil., PA Rittenhouse Hotel                                  PHILADELPHIA, PA
------------------------------------------------------------------------------------------------------------------------------------
  A               B                        C            D             E         F                  G               H          I
------------------------------------------------------------------------------------------------------------------------------------
ITEM     DESCRIPTION OF WORK            SCHEDULED      WORK COMPLETED        MATERIALS     TOTAL         %       BALANCE   RETAINAGE
 NO.                                      VALUE    ---------------------     PRESENTLY   COMPLETED    (G / C)   TO FINISH    (IF
                                                   FROM PREVIOUS   THIS        STORED    AND STORED              (C - G)   VARIABLE
                                                    APPLICATION   PERIOD      (NOT IN     TO DATE                            RATE)
                                                      (D + E)                 D OR E)   (D + E + F)
------------------------------------------------------------------------------------------------------------------------------------
<C>   <S>                               <C>           <C>     <C>             <C>       <C>             <C>    <C>
      Consultant Fees

      Architectural & Interior Design   $175,000.00           $105,937.5O               $105,937.50     60.54%  $69,062.50
        Travel & Expense Allowance
        Reimbursable                     $12,000.00             $6,016.72                 $6,016.72     50.14%   $5,983.28
      Mechanical Engineer                $36,500.00             $3,612.50                 $3,612.50      9.90%  $32,887.50
        Travel & Expense
        Allowance Reimbursable            $6,000.00               $442.70                   $442.70      7.38%   $5,557.30

      Kitchen Design                     $11,000.00                                                             $11,000.00

      Travel Allowance                    $4,000.00             $1,998.00                 $1,998.00     49.95%   $2,002.00

      Structural Engineer                $10,000.00                                                             $10,000.00
      Expediting Consultant               $5,000.00                                                              $5,000.00

      Contingency                         $7,500.00                                                              $7,500.00

      Pat-Lease Evaluation               $15,000.00             $5,985.42                 $5,985.42     39.90%   $9,014.58

------------------------------------------------------------------------------------------------------------------------------------
               GRAND TOTALS             $282,000.00   $0.00   $123,992.84     $0.00     $123,992.84     $2.18  $158,007.16
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Users may obtain validation of this document by requesting of the license a
completed AIA Document D401 - Certification of Document's Authenticity

AIA DOCUMENT G703 o CONTINUATION SHEET FOR G702 o 1992 EDITION o AIA  o (C) 1992
THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W. WASHINGTON,
D.C. 20006-5232

                                 Page 1 of 5

<PAGE>

<TABLE>
<CAPTION>
New York Restaurant Group Confidential
CONTINUATION SHEET                                          AIA DOCUMENT G703                                      PAGE 2 OF 5 PAGES
------------------------------------------------------------------------------------------------------------------------------------
AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT, containing                              APPLICATION NO:
Contractor's signed certification is attached.                                                      APPLICATION DATE:
In tabulations below, amounts are stated to the nearest dollar.                                            PERIOD T0: S&W Phil., PA
Use Column I on Contracts where variable retainage for line items may apply.                   ARCHITECTS PROJECT NO:
Smith & Wollensky Phil., PA Rittenhouse Hotel
------------------------------------------------------------------------------------------------------------------------------------
  A                   B                 C            D             E            F                  G               H           I
------------------------------------------------------------------------------------------------------------------------------------
ITEM         DESCRIPTION OF WORK    SCHEDULED         WORK COMPLETED        MATERIALS     TOTAL         %       BALANCE    RETAINAGE
 NO.                                  VALUE       ---------------------     PRESENTLY   COMPLETED    (G / C)   TO FINISH      10%
                                                  FROM PREVIOUS   THIS        STORED    AND STORED              (C - G)
                                                   APPLICATION   PERIOD      (NOT IN     TO DATE
                                                     (D + E)                 D OR E)   (D + E + F)
------------------------------------------------------------------------------------------------------------------------------------
<S>       <C>                      <C>                <C>        <C>           <C>         <C>        <C>     <C>           <C>
          Construction

01-000    General Conditions       $104,300.00                                                                $104,300.00

02-000    Site                      $44,450.00                                                                 $44,450.00

02-500    Demolition                $90,000.00                                                                 $90,000.00

04-000    Masonry                   $12,275.00                                                                 $12,275.00

05-000    Metals                    $59,100.00                                                                 $59,100.00

06-000    Rough Carpentry           $20,670.00                                                                 $20,670.00

06-220    Millwork                 $269,950.00                                                                $269,950.00

08-000    Doors & Windows           $49,675.00                                                                 $49,675.00

------------------------------------------------------------------------------------------------------------------------------------
          Page Total               $650,420.00        $0.00      $0.00         $0.00       $0.00      $0.00   $650,420.00
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Users may obtain validation of this document by requesting of the license a
completed AIA Document D401 - Certification of Document's Authenticity

AIA DOCUMENT G703 o CONTINUATION SHEET FOR G702 o 1992 EDITION o AIA o (C) 1992
THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W. WASHINGTON,
D.C. 20006-5[ILLEGIBLE]

                                 Page 2 of 5
<PAGE>

<TABLE>
<CAPTION>
New York Restaurant Group Confidential
CONTINUATION SHEET                                          AIA DOCUMENT G703                                      PAGE 3 OF 5 PAGES
------------------------------------------------------------------------------------------------------------------------------------
AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT, containing                              APPLICATION NO:
Contractor's signed certification is attached.                                                      APPLICATION DATE:
In tabulations below, amounts are stated to the nearest dollar.                                            PERIOD T0: S&W Phil., PA
Use Column I on Contracts where variable retainage for line items may apply.                   ARCHITECTS PROJECT NO:
Smith & Wollensky Phil., PA Rittenhouse Hotel
------------------------------------------------------------------------------------------------------------------------------------
  A               B                        C            D             E         F                  G               H          I
------------------------------------------------------------------------------------------------------------------------------------
ITEM     DESCRIPTION OF WORK            SCHEDULED      WORK COMPLETED        MATERIALS     TOTAL         %       BALANCE   RETAINAGE
 NO.                                      VALUE    ---------------------     PRESENTLY   COMPLETED    (G / C)   TO FINISH    (IF
                                                   FROM PREVIOUS   THIS        STORED    AND STORED              (C - G)   VARIABLE
                                                    APPLICATION   PERIOD      (NOT IN     TO DATE                            RATE)
                                                      (D + E)                 D OR E)   (D + E + F)
------------------------------------------------------------------------------------------------------------------------------------
<S>      <C>                          <C>              <C>     <C>            <C>       <C>            <C>    <C>            <C>
09-250   Gypsum Wallboard               $110,140.00                                                             $110,140.00
         S&WRG Allowance                 $52,000.00                                                              $52,000.00

09-300   Ceramic/Marble                  $56,704.00

09-510   Ceilings                        $21,100.00                                                              $21,100.00

09-550   Flooring                        $83,235.00                                                              $83,235.00

09-900   Paint                           $43,288.00                                                              $43,288.00

09-950   Wallcovers (allowance)          $10,000.00                                                              $10,000.00

10-000   Specialties                     $34,650.00                                                              $34,650.00

11-000   Equipment (dumb waiter)         $20,000.00                                                              $20,000.00

------------------------------------------------------------------------------------------------------------------------------------
                Page TOTALS             $431,117.00    $0.00         $0.00    $0.00           $0.00    $0.00    $374,413.00
------------------------------------------------------------------------------------------------------------------------------------
         Project TOTAL page 1-2-3     $1,363,537.00    $0.00   $123,992.84    $0.00     $123,992.84    $2.18  $1,182,840.16
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Users may obtain validation of this document by requesting of the license a
completed AIA Document D401 - Certification of Document's Authenticity

AIA DOCUMENT G703 o CONTINUATION SHEET FOR G702 o 1992 EDITION o AIA o (C) 1992
THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W. WASHINGTON,
D.C. 20006-5232

                                 Page 3 of 5
<PAGE>

<TABLE>
<CAPTION>
New York Restaurant Group Confidential
CONTINUATION SHEET                                          AIA DOCUMENT G703                                      PAGE 4 OF 5 PAGES
------------------------------------------------------------------------------------------------------------------------------------
AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT, containing                              APPLICATION NO:
Contractor's signed certification is attached.                                                      APPLICATION DATE:
In tabulations below, amounts are stated to the nearest dollar.                                            PERIOD T0: S&W Phil., PA
Use Column I on Contracts where variable retainage for line items may apply.                   ARCHITECTS PROJECT NO:
Smith & Wollensky Phil., PA Rittenhouse Hotel
------------------------------------------------------------------------------------------------------------------------------------
  A                   B                     C          D             E          F                  G               H           I
------------------------------------------------------------------------------------------------------------------------------------
ITEM         DESCRIPTION OF WORK        SCHEDULED       WORK COMPLETED      MATERIALS     TOTAL         %       BALANCE    RETAINAGE
 NO.                                      VALUE     ---------------------   PRESENTLY   COMPLETED    (G / C)   TO FINISH      10%
                                                    FROM PREVIOUS   THIS      STORED    AND STORED              (C - G)
                                                     APPLICATION   PERIOD    (NOT IN     TO DATE
                                                       (D + E)               D OR E)   (D + E + F)
------------------------------------------------------------------------------------------------------------------------------------
<S>       <C>                        <C>               <C>     <C>             <C>     <C>            <C>     <C>            <C>
15-320    Sprinklers                    $16,750.00                                                               $16,750.00

15-400    Plumbing                      $52,500.00                                                               $52,500.00

15-500    HVAC                          $30,093.00                                                               $30,093.00

16-000    Electrical                   $124,750.00                                                              $124,750.00

          Contingency                   $65,000.00                                                               $65,000.00

          Overhead & Fee (5%)           $68,531.50                                                               $68,531.50
          Permits & Insurance           $14,391.62                                                               $14,391.62

          ----------------------------------------
          Construction Totals Only   $1,453,553.12                                                            $1,453,553.12
------------------------------------------------------------------------------------------------------------------------------------
          Page Totals                  $372,016.12     $0.00         $0.00     $0.00         $0.00    $0.00     $372,016.12
------------------------------------------------------------------------------------------------------------------------------------
          Grand Totals Pages 1-4     $1,735,553.12     $0.00   $123,992.84     $0.00   $123,992.84    $2.18   $1,554,856.28
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Users may obtain validation of this document by requesting of the license a
completed AIA Document D401 - Certification of Document's Authenticity

AIA DOCUMENT G703 o CONTINUATION SHEET FOR G702 o 1992 EDITION o AIA o (C) 1992
THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W. WASHINGTON,
D.C. 20006-5232

                                 Page 4 of 5
<PAGE>

<TABLE>
<CAPTION>
New York Restaurant Group Confidential
CONTINUATION SHEET                                          AIA DOCUMENT G703                                      PAGE 5 OF 5 PAGES
------------------------------------------------------------------------------------------------------------------------------------
AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT, containing                              APPLICATION NO:
Contractor's signed certification is attached.                                                      APPLICATION DATE:
In tabulations below, amounts are stated to the nearest dollar.                                            PERIOD T0: S&W Phil., PA
Use Column I on Contracts where variable retainage for line items may apply.                   ARCHITECTS PROJECT NO:
Smith & Wollensky Phil., PA Rittenhouse Hotel
------------------------------------------------------------------------------------------------------------------------------------
  A               B                        C            D             E         F                  G               H          I
------------------------------------------------------------------------------------------------------------------------------------
ITEM     DESCRIPTION OF WORK            SCHEDULED      WORK COMPLETED        MATERIALS     TOTAL         %       BALANCE   RETAINAGE
 NO.                                      VALUE    ---------------------     PRESENTLY   COMPLETED    (G / C)   TO FINISH    (IF
                                                   FROM PREVIOUS   THIS        STORED    AND STORED              (C - G)   VARIABLE
                                                    APPLICATION   PERIOD      (NOT IN     TO DATE                            RATE)
                                                      (D + E)                 D OR E)   (D + E + F)
------------------------------------------------------------------------------------------------------------------------------------
<C>  <S>                             <C>              <C>    <C>              <C>     <C>             <C>     <C>            <C>
     FF&E

     Kitchen Equipment (A)              $88,000.00                                                               $88,000.00
     Bar Equipment (A)                  $12,000.00                                                               $12,000.00
     Office Furniture                    $2,000.00                                                                $2,000.00
     POS systems & Computers            $71,250.00                                                               $71,250.00
     Chairs and Tables                  $60,000.00                                                               $60,000.00
     Banquette                          $10,000.00                                                               $10,000.00
     Decor, Antiques & Blackboards      $65,000.00                                                               $65,000.00
     Blinds, Draperies & Signage        $25,000.00                                                               $25,000.00
     Telephone                          $20,000.00                                                               $20,000.00
     Wine Cabinets                      $25,000.00                                                               $25,000.00
     Sound System & T.V.                 $1,000.00                                                                $1,000.00

     Owner Hardware Supplies/keying     $15,000.00                                                               $15,000.00
     Owner Lighting Supplied            $35,000.00                                                               $35,000.00
     Smallwares                        $110,000.00                                                              $110,000.00
     Canopy                             $33,000.00                                                               $33,000.00

     Misc. Legal Expenses               $15,000.00                                                               $15,000.00

     Contingency                        $45,000.00                                                               $45,000.00

------------------------------------------------------------------------------------------------------------------------------------
                PAGE TOTALS            $632,250.00    $0.00        $0.00      $0.00         $0.00     $0.00     $632,250.00
------------------------------------------------------------------------------------------------------------------------------------
     PROJECT GRAND TOTALS            $2,367,803.12    $0.00  $123,992.84      $0.00   $123,992.84     $2.18   $2,187,106.28
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Users may obtain validation of this document by requesting of the license a
completed AIA Document D401 - Certification of Document's Authenticity

AIA DOCUMENT G703 o CONTINUATION SHEET FOR G702 o 1992 EDITION o AIA o (C) 1992
THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W. WASHINGTON,
D.C. 20006-5232

                                 Page 5 of 5
<PAGE>

                                   EXHIBIT C-1

Philadelphia, PA Smith & Wollensky Project

FF&E Exclusions:

o     All Artifacts and Antiques

o     All Computer and P0S Equipment

o     Signature Chairs/Stools

o     Signature Blackboards

o     Signature Lighting and Specialty Fixtures

o     All Rented/Leased Equipment to Returned to Vendors

o     Espresso Machines

o     Signature Hardware and Signage

o     All Smallwares

<PAGE>

                                   EXHIBIT "D"

                         Termination Fee (Section 13.03)

      A. The applicable Termination Fee shall be if payable by reason of a
termination under Section 13.01(a) or 13.01(b), Tenant's Adjusted Book Value, as
calculated pursuant to Paragraph D. below.

      B. The term "Tenant's Adjusted Book Value", as used herein, shall be the
depreciated book value reflected on Tenant's financial records (but not its
Federal tax returns) of any equipment and leasehold improvements (excluding
items listed on Exhibit C-I and movable trade fixtures) which Tenant may have
installed on or made to the Premises at Tenant's expense (excluding any sums
paid for by Landlord) and which are not removed by Tenant upon such termination,
which book value shall be determined by generally accepted accounting
principles, adjusted as necessary to exclude any adjustments related to asset
write-up in connection with changes of ownership. Notwithstanding the foregoing,
if any portion of the Premises or improvements thereon shall have been damaged
in whole or in part or destroyed by fire or taken by condemnation and not
restored, any net fire insurance proceeds or condemnation award received by
Tenant and not utilized for restoration shall be deducted from Tenant's Adjusted
Book Value. Within 15 days after Tenant's receipt of Landlord's termination
notice, Tenant shall furnish to Landlord a computation of the Adjusted Book
Value which shall include substantiating back-up information in reasonable
detail supporting the computation. Thereafter, Tenant shall provide Landlord or
its representatives with sufficient access to its books and records as
reasonably required by Landlord for the purpose of verifying the Adjusted Book
Value.

<PAGE>

                                   EXHIBIT "E"

                   Operating Results Standard (Section 13.02)

      Landlord shall be entitled to terminate the Lease pursuant to Section
13.02 if the operation of the Restaurant fails to achieve Gross Revenue as
follows (the "Gross Sales Minimum"):

            (i) Three Million Five Hundred Thousand Dollars ($3,500,000) for the
first Lease Year;

            (ii) Four Million Dollars ($4,000,000) for the second Lease Year;

            (iii) Four Million Five Hundred Thousand Dollars ($4,500,000) for
the third Lease Year; and

            (iv) For each Lease Year thereafter, commencing with the fourth
Lease Year, $4,500,000, multiplied by a fraction, having as its numerator the
Index for the month which is the first day of the applicable Lease Year, and
having as its denominator the Index as of the first day of the third Lease Year,
but in no event less than the Gross Sales Minimum for the immediately preceding
Lease Year.

                  All of the foregoing Gross Sales Minimum figures are based
upon a Lease Year of 365 days. For any Lease Year longer than 365 days or for
any fractional Lease Year of less than 365 days, the Gross Sales Minimum for the
applicable period shall be increased or reduced, as the case may be, by
multiplying the applicable above-stated Gross Sales Minimum by a fraction,
having as its numerator the number of days in such Lease Year or fractional
Lease Year, and having as its denominator the number 365. If the Lease Year or
fractional Lease Year for which the Gross Sales Minimum is being computed
includes the date February 29, the number "365" whenever appearing in this
paragraph shall for purposes of such computation be changed to "366".
<PAGE>

                                GUARANTY OF LEASE

            THIS GUARANTY OF LEASE (this "Guaranty"), made and entered into as
of the 18th day of February, 2000, by THE SMITH & WOLLENSKY RESTAURANT GROUP,
INC., a New York Corporation, (the "Guarantor"), whose address is 1114 First
Avenue, 6th Floor, New York, New York 10021, to and for the benefit of
RITTENHOUSE DEVELOPMENT COMPANY, a Delaware partnership ("Landlord"), whose
address is The Rittenhouse, 210 Rittenhouse Square, Philadelphia, PA 19103, is
based upon the following:

            A. S & W of Philadelphia, LLC ("Tenant"), is an affiliate of and
wholly owned, directly or indirectly, by Guarantor.

            B. Tenant and Landlord are entering into a certain Agreement of
Lease dated as of the date hereof (the "Lease") for certain premises to be
operated as a Smith & Wollensky restaurant in The Rittenhouse, a luxury hotel
and condominium located at 210 Rittenhouse Square, Philadelphia, and owned by
Landlord.

            C. Landlord has agreed to enter into the Lease in consideration of,
among other things, the covenants and obligations made and assumed by Guarantor
as herein set forth.

            D. Guarantor has a direct financial interest in Tenant and will
benefit directly from the Lease.

            NOW, THEREFORE, in consideration of the foregoing recitals, the sum
of $10.00, and other good and valuable consideration, the adequacy, value, and
receipt of which consideration are hereby acknowledged by the Guarantor, and
intending to be legally bound hereby, the Guarantor hereby irrevocably and
unconditionally covenants and agrees as follows:

            1. Guarantor represents and warrants that (a) the recitals set forth
above are true and accurate, (b) as of the date hereof, Tenant is a wholly owned
subsidiary (directly or indirectly) of Guarantor, (c) this Guaranty was duly
authorized and executed by Guarantor and is a legal, valid and binding
instrument, (d) Guarantor and Tenant each was duly formed and is validly
existing in good standing under the law of the jurisdiction of its formation,
and (e) Guarantor was formerly known as The New York Restaurant Group, Inc., and
has changed its name to The Smith & Wollensky Group, Inc., but Guarantor is the
same corporation and owns all of the same assets and properties that were owned
by the entity previously known as The New York Restaurant Group, Inc.

            2. Guarantor hereby irrevocably and unconditionally guarantees to
Landlord, its successors and assigns, and does hereby become surety to Landlord
and Landlord's successors and assigns for and with respect to the full and
punctual payment, performance and observance by the lessee and/or tenant, its
successors and assigns of all of the provisions of the Lease, whether now
existing or hereafter arising (including, without limitation, those provisions
relating

<PAGE>

to the payment of rent, additional rent, or other sums of money by Tenant, its
successors and assigns) and any subsequent amendments, extensions, renewals or
modifications of the Lease, to be performed by the lessee and/or tenant, its
successors and assigns (collectively called the "Obligations"). Guarantor hereby
waives notice of any breach or default by Tenant or of the continuance thereof
and any other notice to or demand upon Guarantor which Landlord or any successor
or assign of Landlord might otherwise be required to give or make in connection
with this Guaranty or any matter relating to this Guaranty, including, without
limitation, notice of acceptance of this Guaranty and of any notice of intention
to act in reliance hereon.

            3. This Guaranty is continuing, direct and immediate and may be
enforced directly against Guarantor without prior resort by Landlord or any
successor or assign of Landlord to any right of dispossess or any other remedy
Landlord or any successor or assign of Landlord may have against Tenant under
the Lease or otherwise or against any other person or entity or against any
security or collateral and without the necessity of any suit or proceeding of
any nature whatsoever by Landlord against Tenant or any other person or entity.
Guarantor hereby covenants and agrees to and with Landlord, its successors and
assigns, that if default shall at any time be made by Tenant, its successors and
assigns, in the payment of any such rent, additional rent, or other sums or
charges payable by Tenant under the Lease or in the performance of any of the
covenants, terms, conditions or agreements contained in the Lease, Guarantor
will forthwith pay such rent or other sums or charges to Landlord, its
successors and assigns, and any arrears thereof, and will forthwith faithfully
perform and fulfill all of such covenants, terms, conditions and agreements, and
will forthwith pay to Landlord all damages and all costs and expenses that may
arise in consequence of any default by Tenant, its successors and assigns, under
the Lease (including, without limitation, all attorneys' fees incurred by
Landlord or caused by any such default and/or by the enforcement of this
Guaranty).

            4. This Guaranty is an absolute and unconditional guaranty of
payment and performance and is a surety agreement. The obligations of Guarantor
under this Guaranty shall be unconditional and irrevocable, irrespective of, and
Guarantor shall not set up or assert any defense by reason of (a) the existence
of any security given to secure the Obligations, (b) any defense that may arise
by reason of the incapacity or lack of authority of Tenant or Guarantor or, (c)
any defense that may arise by reason of the bankruptcy, insolvency,
reorganization or liquidation of Tenant or by reason of failure of Landlord or
any successor or assign of Landlord to file or enforce a claim against the
estate of Tenant, or any successor or assign of Tenant, in any creditors,
receivership, bankruptcy, insolvency, reorganization, liquidation or other
similar proceeding, or (d) any other circumstances, occurrences or conditions,
whether similar or dissimilar to any of the foregoing, which might otherwise
constitute a legal or equitable defense, discharge or release of a guarantor or
surety without also being a defense, discharge or release of the Tenant.

            5. Any act or forbearance of Landlord or any successor or assign of
Landlord, consisting of a waiver or modification of any of the provisions of the
Lease, or the giving of any consent or approval to any matter or thing relating
to or arising under or out of the Lease or occupancy of the premises leased to
Tenant under the Lease, or the granting of any extensions of time or indulgences
or postponements to Tenant, its successors or assigns, may be

                                      -2-
<PAGE>

done without notice to or consent of Guarantor and shall apply also to Guarantor
as any extension, postponement or indulgence applies to Tenant. Except as
provided herein, none of the foregoing shall in any way release Guarantor from
or affect or impair Guarantor's obligations under this Guaranty, nor shall
Guarantor set up or assert any defense by reason thereof.

            6. The obligations of Guarantor under this Guaranty shall not be
released or decreased or increased by Landlord's or any successor or assign of
Landlord's receipt or application or release in whole or in part of any
security, if any, given for the performance or observance of the provisions of
the Lease or any of them, nor of any modification, supplement, extension or
renewal of the Lease, nor shall Guarantor set up or assert any defense by reason
thereof.

            7. The validity of this Guaranty and the liability of Guarantor
under this Guaranty shall in no way be affected or limited by and Guarantor
shall not set up or assert any defense by reason of (a) the release or discharge
of Tenant, or any successor or assign of Tenant, in any creditors, receivership,
bankruptcy, insolvency, reorganization, liquidation or other similar
proceedings, (b) the impairment, limitation or modification of the liability of
Tenant or any successor or assign of Tenant or the estate of Tenant or any
successor or assign of Tenant in any such proceedings, or of any remedy for the
enforcement of Tenant's or any successor or assign of Tenant's liability under
the Lease, resulting from the operation of any present or future provision of
any present or future federal or state bankruptcy act or other present or future
similar statute or from the decision of any court or other tribunal based upon
such act or other statute; (c) the rejection or disaffirmance of the Lease, in
any such proceedings; (d) the assignment or transfer of the Lease, or subletting
of all or any part of the premises leased under the Lease, or the sale or
transfer of any stock of Tenant or any change in the ownership or control of
such stock of Tenant; (e) the assertion or lack of assertion by Landlord against
Tenant, or any successor or assign of Tenant, of any of the rights or remedies
of Landlord pursuant to the Lease or otherwise; or (f) any liquidation or
dissolution of Tenant or any successor or assign of Tenant. Guarantor agrees
that Landlord or any successor or assign of Landlord may at any time and from
time to time, with or without consideration, agree to release Tenant or any
successor or assign of Tenant from its obligations under the Lease, without
notice to, or consent from, the Guarantor; any such action shall not in any way
affect or diminish the liability of the Guarantor under this Guaranty.

            8. Until all of the provisions of the Lease on Tenant's and its
successors' or assigns' parts to be performed or observed (including, without
limitation, those relating to the payment of rent or other sums of money) demand
for the performance of which has been made upon Guarantor pursuant to the
provisions of this Guaranty are fully performed and observed, (a) Guarantor
shall have no right of subrogation against Tenant or any of them by reason of
any payments or acts of performance by Guarantor in compliance with the
obligations of Guarantor under this Guaranty or otherwise; (b) Guarantor waives
any right to enforce any right or assert any remedy which Guarantor now or
hereafter shall have against Tenant or its successors or assigns by reason of
any one or more payments or acts of performance in compliance with the
obligations of Guarantor under this Guaranty or otherwise; and (c) Guarantor,
effective upon receipt of written notice of a claim on this Guaranty,
subordinates any present or future, liquidated or unliquidated, liability,
indebtedness or obligation of Tenant or any successor or

                                      -3-
<PAGE>

assign of Tenant to Guarantor to each of the Obligations, irrespective of the
respective dates of the incurring, accrual or maturity thereof.

            9. This Guaranty shall apply to the Lease as same hereafter may be
modified, amended or supplemented and to all extensions or renewals thereof and
to any holdover following the term of the Lease or any extension or renewal
thereof. For the purposes of this Guaranty, except to the extent terminated by
mutual agreement of Tenant and Landlord, the Obligations shall survive the
expiration or sooner termination of the Lease to the extent provided in the
Lease or under applicable law (including, without limitation, by reason of a
breach or default by Tenant) until all sums of money so remaining due Landlord
or any of its successors or assigns and all damages due Landlord or any of its
successors or assigns under or by virtue of the Lease have been indefeasibly
paid in full to Landlord or any successor or assign of Landlord and until all
such sums as so paid in full to Landlord or any successor or assign of Landlord
are not subject to rescission or repayment in connection with any bankruptcy,
insolvency or reorganization or other financial rehabilitation of Tenant or any
successor or assign of Tenant. Except as provided herein, Guarantor shall remain
bound to perform Guarantor's obligations under this Guaranty notwithstanding
such expiration or sooner termination of the Lease until all of such obligations
of Guarantor have been fully performed and discharged.

            10. This Guaranty may not be changed, modified or terminated orally
or in any manner other than by an agreement in writing signed by Guarantor and
Landlord.

            11. The validity, construction and enforcement of this Guaranty
shall be governed by the law of the Commonwealth of Pennsylvania. If any
provision of this Guaranty or its application to any person or circumstance is
invalid or unenforceable to any extent, the remainder of this Guaranty, or the
applicability of such provision to other persons or circumstances, shall not be
affected thereby. Each provision of this Guaranty shall be valid and enforceable
to the fullest extent permitted by law and shall be deemed to be separate from
such invalid or unenforceable provisions.

            12. All of Landlord's rights and remedies under the Lease or under
this Guaranty or at law or in equity or otherwise are distinct, separate and
cumulative, and no such right or remedy is in exclusion of or a waiver of or
shall prejudice Landlord's right to exercise, whether before or after the
exercise thereof, any of the others. In addition, none of the provisions of this
Guaranty shall be construed to limit any other rights or remedies which Landlord
may have at law, in equity or otherwise. None of the waivers by Guarantor made
in this Guaranty shall be construed to preclude or limit any other waiver or
consent by Guarantor.

            13. (a) Guarantor consents to jurisdiction and venue in any suit,
action or proceeding in connection with this Guaranty in any state and/or
federal courts, sitting with the Commonwealth of Pennsylvania. Guarantor and
Landlord each hereby consents to process being served in any suit, action or
proceeding in connection with this Guaranty by serving a copy thereof by prepaid
registered or certified mail, return receipt requested, or by overnight service
of a major courier company, addressed to Guarantor or Landlord, as applicable,
at the address set forth at the heading of this Guaranty. Guarantor hereby
irrevocably waives, to the fullest extent

                                      -4-
<PAGE>

permitted by applicable law, all claim of error or insufficiency by reason of
any such service of process pursuant to the terms hereof and agrees that such
service (i) shall be deemed in every respect to be effective service of process
upon Guarantor or Landlord, as applicable in any such suit, action or proceeding
and (ii) shall, to the fullest extent permitted by applicable law, be taken and
held to be valid personal service upon and personal delivery to Guarantor or
Landlord, as applicable.

                  (b) Nothing herein shall affect the right of Landlord or any
successor or assign of Landlord to serve process in any manner permitted by law
or affect the right of Landlord or any of them to bring proceedings against
Guarantor in the courts of any jurisdiction or jurisdictions where permitted by
law.

                  (c) All notices to or demands upon Guarantor or Landlord, as
applicable, under this Guaranty shall be made to the same address and in the
same manner as process may be served pursuant to Paragraph 13(a) above.

            14. Guarantor represents and warrants that it has read and examined
the Lease and this Guaranty and fully understands all of the terms and
conditions thereof and hereof.

            15. No delay or omission by Landlord or any successor or assign of
Landlord in exercising any right or remedy hereunder shall operate as a waiver
thereof. No waiver of any rights and remedies hereunder shall be deemed made by
Landlord or any successor or assign of Landlord unless in writing and duly
signed by it. Any such written waiver shall apply only to the particular
instance specified therein and shall not impair the further exercise of such
right or remedy or of any other right or remedy, and no single or partial
exercise of any right or remedy under this Guaranty shall preclude any other or
further exercise thereof or any other remedy.

            16. The provisions of this Guaranty shall inure to the benefit of
Landlord and Landlord's successors and assigns, and shall bind Guarantor and its
successors and assigns.

            17. Unless otherwise clearly expressed, whenever used herein the
singular shall include the plural, the plural shall include the singular, and
the use of any gender shall include all genders.

                                      -5-
<PAGE>

            IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the
date first above written.

                                           THE SMITH & WOLLENSKY
                                           RESTAURANT GROUP, INC.

                                           By: /s/ James Dunn
                                               ---------------------------------
                                               Name: James Dunn
                                                     ---------------------------
                                               Its:  President
                                                     ---------------------------

                                      -6-<PAGE>

                                                                   Exhibit 10.12

      RESTAURANT MANAGEMENT AGREEMENT made as of the 18th day of April, 1996 by
and between 37 EAST 50TH STREET CORPORATION, a domestic corporation with offices
at 37 East 50th Street, New York, New York ("NEWCO") and RESTAURANT GROUP
MANAGEMENT SERVICES, L.L.C., a domestic limited liability company with offices
at 1114 First Avenue, New York, New York ("MANAGEMENT COMPANY").

                                   WITNESSETH

      WHEREAS, NEWCO is the owner of the Restaurant located at 37 East 50th
Street, New York, New York, and doing business as GLOUCESTER CAFE ("the
Restaurant"); and,

      WHEREAS, the MANAGEMENT COMPANY is a New York Limited Liability Company
the principals of which are experienced in the business of Restaurant design and
administration and,

      WHEREAS, upon the terms and conditions herein set forth, NEWCO wishes to
retain the MANAGEMENT COMPANY to provide administrative, managerial and
operating services in connection with the operation of the Restaurant and,

      WHEREAS, the parties wish to set forth their agreement with respect to
such retention,

<PAGE>

      NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, it is agreed as follows:

      1. HIRING OF THE MANAGEMENT COMPANY. NEWCO hereby retains the MANAGEMENT
COMPANY to provide new restaurant concept design, construction, administrative,
managerial and operating services in connection with the operation of the
Restaurant, and in connection with operation of banquet services at the
Restaurant, and off the premises. The MANAGEMENT COMPANY shall render such
services upon the terms and conditions hereafter set forth. NEWCO acknowledges
that the MANAGEMENT COMPANY renders similar services to other Restaurants, which
Restaurants may be competitive with the Restaurant, and agrees that, except as
hereinafter provided in Section 9, it may continue to render such services to
those entities and accept similar employment with other entities. The MANAGEMENT
COMPANY acknowledges that it is the essence of this agreement that the
Restaurant will be constructed and operated as a first-class Manhattan
Restaurant, with white tablecloth service during the term of this agreement.
MANAGEMENT COMPANY acknowledges and agrees that, while all business decisions
will be made in its sole discretion, NEWCO has entered into this agreement in
reliance on the belief that the MANAGEMENT COMPANY will make business decisions
and exercise business judgment in good faith and without personal bias or
conflict of interest between the objectives of MANAGEMENT COMPANY and its
principals on the one hand, and NEWCO, its principals and shareholders on the
other.

                                        2
<PAGE>

      2. ADDITIONAL SERVICES BY THE MANAGEMENT CO. The administrative
services rendered by the MANAGEMENT COMPANY shall include the maintenance of
all bookkeeping and accounting records as are necessary to prepare and file
timely all tax withholding forms for all Restaurant employees and all sales
and tax records and returns for the Restaurant and pay timely to the
appropriate tax authorities all taxes required to be reported on such forms
or returns. In addition, the MANAGEMENT COMPANY shall perform at the expense
of the NEWCO, the following: comply with all governmental health and safety
regulations, including the maintenance of all necessary business, food and
beverage licenses; maintain all reasonably required fire, theft, accident and
other insurance policies and renewals thereof; purchase all supplies and
equipment, food, food products and beverages to be used in the operation of
the Restaurant; supervise, manage, hire and discharge Restaurant personnel,
all of whom shall be deemed to be employees of NEWCO; supervise the making of
all necessary repairs, decorations and alterations to the Restaurant;
implement promotional and advertising programs; provide menu and wine list
content and pricing; manage collections, cash receipts and deposit
arrangements and make payments for those items chargeable under this
Agreement out of the account referred to in, and as otherwise provided, in
Section 5 hereof; prepare financial budgets and information; generally act as
liaison between NEWCO and the employees of the Restaurant, and continue such
operating policies so as to maintain the Restaurant as a first-class
Manhattan Restaurant. The MANAGEMENT COMPANY will make all discount and bulk
purchase arrangements which it has with third parties available to the
Restaurant on the same basis and furnish the Restaurant with appropriate
vouchers and backup information to support the charges to NEWCO. These
discount and bulk purchase arrangements shall include advertising and public
relations. NEWCO acknowledges that the MANAGEMENT COMPANY shall be

                                        3
<PAGE>

permitted to advertise the Restaurant, and utilize public relations with the
Restaurant in joint campaigns with other Restaurants with which the MANAGEMENT
COMPANY is involved, or shall become involved.

      Without limiting the generality of the foregoing, the MANAGEMENT COMPANY
shall:

            a. Within thirty (30) business days after the end of each calendar
month commencing with the effective date of this agreement, furnish to NEWCO a
monthly report of income, sales, expenses, cash flow, and balance sheet changes,
including inventory. Comparable quarterly reports will be delivered within
thirty (30) business days of the end of each calendar quarter. A weekly sales
report will also be furnished within seven (7) business days after the end of
each week.

            b. Furnish to NEWCO an annual financial statement of Restaurant
operations prepared (at the sole cost and expense of NEWCO) by a firm of
certified public accountants chosen by the MANAGEMENT COMPANY. The entire cost
of all expenses of the business of NEWCO (other than salaries of the MANAGEMENT
COMPANY employees) including, without limitation, the cost of business licenses,
taxes, insurance premiums, food, beverages, payroll servicing, salaries of
employees at the Restaurant, office supplies, advertising, and legal and outside
accounting fees for services rendered to NEWCO shall be paid by NEWCO.

      3. COMPENSATION.

            a. As partial compensation for the MANAGEMENT COMPANY'S services
hereunder, in addition to the compensation set forth in Section 4 hereof, NEWCO
shall pay to the

                                        4
<PAGE>

MANAGEMENT COMPANY an amount equal to three (3) per cent of all Restaurant
Sales (as hereinafter defined) with respect to each month (or portion hereof at
the beginning and end of the term of this Agreement). Such amount shall be paid
within seven (7) days after the end of each calendar month and, until adjusted
by the parties as hereafter provided, the amount paid shall equal three (3) per
cent of the Restaurant Sales for the immediately preceding month.

      b. If at the close of any calendar year (but not later than 90 days
thereafter) it is determined that the aggregate of the monthly payments for the
fiscal year has either exceeded or fallen short of three (3) per cent of
Restaurant Sales for such fiscal year, then the MANAGEMENT COMPANY and the NEWCO
shall promptly adjust the amount owing not later than 90 days after such
calendar year.

      c. For the purposes of this paragraph, the parties shall be bound by the
certified financial statement of the certified public accountants retained by
the MANAGEMENT COMPANY as accountants for the Restaurant.

      d. The term "Restaurant Sales" shall mean all monies received by NEWCO or
for their account from the operation of the Restaurant, including, but not
limited to, banquet services, on and off premises catering, and sale of
merchandise in the ordinary course of business, in cash, by credit card or
otherwise, but less, as to all the foregoing, bona fide refunds to customers,
uncollected amounts, gratuities and tips in fact paid out by the Restaurant to
employees of the Restaurant, and taxes imposed and paid by the Restaurant on
customer checks.

                                        5
<PAGE>

      e. NEWCO agrees to provide to MANAGEMENT COMPANY copies of NEWCO federal
and state tax returns, on an annual basis and NEWCO agrees to indemnify and hold
MANAGEMENT COMPANY harmless with respect to any liability to the MANAGEMENT
COMPANY based on errors and omissions in such returns.

      4. ADDITIONAL COMPENSATION.

            a. As additional compensation for its management services hereunder,
MANAGEMENT COMPANY shall be paid by NEWCO a sum equal to the lessor of (i)50% of
the operating cash flow of NEWCO and (ii) cash flow of NEWCO minus the sums
retained by NEWCO from operating cash flow under Article 4(b). Said additional
compensation shall be payable quarterly, but adjusted on an annualized basis.
For the purposes of this Article 4, any difference between the compensation paid
to the MANAGEMENT COMPANY under this Article 4(a), in any calendar year prior to
2001 and 50% of the operating cash flow for said year shall be defined as
"Shortfall".

            b. MANAGEMENT COMPANY guarantees that, during the periods below set
forth, and notwithstanding whether or not, for any such period, NEWCO has
realized a positive operating cash flow sufficient to do so, NEWCO will receive
or retain the greater of 50% of operating cash flow, or the amounts set forth
below, such payments to be paid, pro-rata, on a monthly basis before the tenth
(10th) day of each month.:

             Calendar 1996                         50% of operating cash flow,
                                                   but not less than zero
             Calendar 1997                         $144,000
             Calendar 1998                         $240,000
             Calendar 1999                         $300,000

                                        6
<PAGE>

            Calendar 2000                          $360,000
            Calendar 2001                          $360,000
            Calendar 2002                          $360,000
            Calendar 2003                          $360,000
            Calendar 2004                          $480,000
            To end of term
            of this agreement                      $480,000

      In any year that Restaurant sales reach $7,000,000, the guaranteed
payments shall be in the amount of the greater of $300,000 or the amounts set
forth above.

            c. For the purposes of this article, operating cash flow shall equal
Restaurant Sales, minus cost of goods sold, compensation paid under Article 3(a)
hereof, and actual operating expenses as calculated and prepared for reporting
purposes under generally accepted accounting principles and as adjusted to
exclude the following:

                  1. The initial cash paid by the MANAGEMENT COMPANY under
Article 9(a), (b) and (c) hereof.

                  2. Any additional cash infusions by the MANAGEMENT COMPANY or
by NEWCO.

                  3. The principal amount of any debt financing for any other
cash flow items outside the normal course of business (e.g., insurance proceeds
other than business interruption). The intention of the parties for calculation
of operating cash flow is set forth on the document entitled "GLOUCESTER HOUSE
ILLUSTRATIVE INCOME STATEMENT" attached hereto and Schedule "A".

                                        7
<PAGE>

            d. In any calendar year prior to 2001 for which (1) the operating
cash flow of NEWCO exceeds twice the guaranteed payments for such year as
specified in Article 4(6), above, and (2) there is an outstanding Shortfall for
any prior year or years of this Agreement, whether the year immediately or
otherwise, said excess amount shall be applied first toward satisfaction of such
Shortfall, and any balance thereafter remaining shall be shared by NEWCO and
MANAGEMENT COMPANY as otherwise provided in this article 4.

      5. BANK ACCOUNTS. NEWCO shall establish a bank account at a bank of their
choice. One (1) person designated by the MANAGEMENT COMPANY and one (1)
designated by NEWCO who might be changed from time to time by the MANAGEMENT
COMPANY and NEWCO, shall be the authorized signatories for the account. Persons
designated as signatories by the MANAGEMENT COMPANY and NEWCO shall not have the
authority to sign a check for an amount in excess of $20,000; rather, same
shall only be authorized by Peter Skeadas, for NEWCO, and Mark Levine, for the
MANAGEMENT COMPANY. All monies received from the operation of the Restaurant,
and any and all expenses paid by the MANAGEMENT COMPANY on account of the
operation of the Restaurant, shall pass through this account. NEWCO agrees to
sign all checks presented to it by the MANAGEMENT COMPANY within forty-eight
(48) hours of receipt of same.

      6. INSURANCE. The MANAGEMENT COMPANY shall seek insurance coverage for
fire, public liability, automobile, theft, casualty and property damage,
comprehensive dishonesty, disappearance and destruction, and workmen's
compensation insurance, as required by the lease for the premises, and as
reasonably necessary in the sole discretion of the MANAGEMENT COMPANY.
MANAGEMENT COMPANY shall arrange for NEWCO coverage during the term

                                        8
<PAGE>

of this Agreement naming NEWCO and the MANAGEMENT COMPANY as insureds as their
interests shall appear under such policies. MANAGEMENT COMPANY shall not be
required to arrange for coverage which cannot be generally obtained at
commercially reasonable rates unless required by the lease for the premises. The
MANAGEMENT COMPANY shall advise and assist in the review and renewal of such
insurance and, to the extent possible, make available to NEWCO bulk rates for
such insurance coverage as are available to the MANAGEMENT COMPANY.

      7. INDEMNITY. NEWCO agrees:

            A. To the extent an insurance carrier does not assume the defense in
respect of any claim, action or proceeding against the MANAGEMENT COMPANY or
NEWCO for actions allegedly within the scope of this Agreement, to defend
promptly and diligently, at the expense of NEWCO any claim, action or proceeding
brought against the MANAGEMENT COMPANY, or its employees or agents, or NEWCO
jointly or severally arising out of or connected with any of the foregoing, and
to hold harmless and fully indemnify the MANAGEMENT COMPANY, its employees or
agents, from any judgment, loss or settlement on account thereof to the extent
not covered by insurance, regardless of the jurisdiction in which any such
claims, actions or proceedings may be brought, and whether brought against the
MANAGEMENT COMPANY alone or the MANAGEMENT COMPANY and NEWCO.

            B. To the extent not covered by insurance, to indemnify and hold the
MANAGEMENT COMPANY, its employees and agents, free and harmless from any
liability finally determined pursuant to paragraph (A) above for injury to
persons or damage to property

                                        9
<PAGE>

by reason of any cause whatsoever, either in and about the Restaurant, as a
result of the performance of this Agreement by the MANAGEMENT COMPANY, its
agents or employees, irrespective of whether negligence on the part of the
MANAGEMENT COMPANY is alleged.

            C. Notwithstanding the foregoing, NEWCO shall not be liable to
indemnify and hold the MANAGEMENT COMPANY harmless, and the MANAGEMENT COMPANY
hereby indemnifies and holds NEWCO free and harmless, from any liability which
results from the gross negligence, fraud, or willful misconduct of the
MANAGEMENT COMPANY, its agents or employees.

            D. If, as part of this indemnification, it shall be necessary for
the MANAGEMENT COMPANY to retain counsel, same shall be at the expense of NEWCO.

            E. This indemnification shall be unlimited, and shall include
attorneys' fees and related costs and expenses.

      8. STATE LIQUOR AUTHORITY.

            a. NEWCO and MANAGEMENT COMPANY agree to cooperate in notifying the
New York State Liquor Authority ("NYSLA") of the arrangement entered into
herein. Additionally, the parties agree, at the expense of NEWCO, if required by
the New York State Liquor Authority, to make any application as may be required
by the New York State Liquor Authority as a result of the NYSLA's having been
notified of the terms of this agreement.

            b. The parties acknowledge that it may be necessary, in connection
with the addition of the banquet area to the premises, to file an application
with the New York State

                                       10
<PAGE>

Liquor Authority for permission to make alterations. The parties each agree to
cooperate with such application.

      9. PURCHASE OF RIGHT TO MANAGE. In consideration of NEWCO granting to
MANAGEMENT COMPANY the within managing agreement, the MANAGEMENT COMPANY shall
make payments to NEWCO as follows:

            a. Upon the execution of this agreement, the sum of $250,000; to be
held in escrow by Sargent & Sargent, the attorneys for NEWCO subject to the
terms hereinafter set forth;

            b. The sum of $750,000, on and after the Commencement Date (as
defined in Article 10) and before the Restaurant is opened to the public by the
MANAGEMENT COMPANY, in such installments and amounts as are reasonably needed to
meet the objectives of this Agreement.

            c. The sum of no more than $500,000, at any time during the term of
the agreement, if, in the reasonable judgment of the MANAGEMENT COMPANY, such
additional sum is required to accomplish the objectives set forth in
subparagraph (d) and (e) hereof.

            d. The sums set forth in paragraphs (a), (b), and (c), above shall
be utilized, in the reasonable discretion of the MANAGEMENT COMPANY, for the
renovation of the premises; as an infusion of operating capital; and for the
creation of a wine inventory, of a value on the commencement date of no more
than $200,000, it being the intent of the parties that the premises be open to
the public on or about August 1, 1996 as a steak and seafood American
Restaurant. Ambiance, decor, menu style, wine list and naming of the Restaurant
shall be in the sole discretion

                                       11
<PAGE>

of the MANAGEMENT COMPANY, subject only to its exercise of its exercise of its
reasonable business judgment. NEWCO acknowledges that any name used in the
operation of the Restaurant shall remain the sole and exclusive property of the
MANAGEMENT COMPANY but that the MANAGEMENT COMPANY and its affiliates and
related companies will not use the name, during the time this agreement is in
effect, in any other Restaurant in the five boroughs of New York City or within
a circle having a five mile radius and a center of the Restaurant. NEWCO agrees
to seek all consents necessary under its leases to permit the name chosen by the
MANAGEMENT COMPANY to be utilized. If such consent cannot be obtained, this
agreement may be canceled at any time prior to the commencement date and all
monies paid hereunder refunded to the MANAGEMENT COMPANY.

            Subject to the foregoing paragraph, the MANAGEMENT COMPANY shall
have the right to use the name or names utilized at the Restaurant elsewhere
without liability to NEWCO, and NEWCO acknowledges that it has no rights
whatsoever to the name or names.

            e. The sums deposited in escrow pursuant to subparagraph (a) hereof,
shall be released into the regular account of NEWCO, to be utilized as operation
capital upon written notice by the attorneys and the accountants for the
MANAGEMENT COMPANY, upon their review of the books and records of NEWCO, and
upon their review of any other relevant documentation, all of which NEWCO agrees
to make available to the attorneys and accountants for the MANAGEMENT COMPANY,
that:

                  1. The lease to the premises has been assigned to NEWCO, with
landlord's consent.

                                       12
<PAGE>

                  2. NEWCO is a newly formed corporation, in existence only
since April 10, 1996, at the earliest, and formed solely for the purposes of the
Agreement;

                  3. NEWCO has no debts whatsoever to any third party including,
but not limited to, the landlord at the premises, except for commitments to
David Anton, Media Resources International, Ltd., and The Guest Informant. Such
agreements do not include obligations of either more than $100,000 in cash or
more than $200,000 in "in kind" payments, all of which involve future work to
be done by these entities or persons, and not work done in the past;

                  4. The Restaurant, and the furniture, fixtures and equipment
at the premises, are free and clear of liens, encumbrances and chattel mortgages
of any kind or description;

                  5. The premises are in compliance with all rules, regulations
and licensing requirements of all state, federal and local authorities including
obtaining a temporary retail permit from the New York State Liquor Authority, if
necessary;

                  6. They have received certification by NEWCO that, in its
reasonable opinion, the premises have been opened to the public by the
MANAGEMENT COMPANY;

                  7. NEWCO represents and warrants that the statements set forth
in Article 9(e), 1, 2, 3, 4, and 5, are true as of the date of this Agreement,
shall be true as of the commencement date, as defined in Article 10 hereof; and
shall deliver, on the commencement date, an opinion letter of its attorneys with
respect to the truth of Paragraphs 1, 2, and 4,; and of its accountants with
respect to Paragraph 3.

            f. NEWCO represents and warrants that items (1), (2), and (3) of
paragraph (e) shall be true as of May 1, 1996. If these representations and
warranties are not true, in the

                                       13
<PAGE>

reasonable opinion of the attorneys and accountants for the MANAGEMENT COMPANY,
and after ten (10) days notice to NEWCO any condition complained of has not been
cured, the MANAGEMENT COMPANY shall have the right to cancel this agreement; the
deposit under subparagraph (a) hereof shall be released to it, and the parties
shall have no further rights each to the other.

            g. Nothing herein contained shall be construed to give any ownership
rights in the Restaurant to the MANAGEMENT COMPANY All assets of the Restaurant
shall remain the property of NEWCO.

      10. TERM.

      A. The management of the Restaurant by the MANAGEMENT COMPANY shall
commence the date NEWCO closes the premises to the public (the "Commencement
Date"), and shall continue so long as NEWCO occupies the premises for the
operation of a Restaurant. NEWCO represents that the operating lease to the
premises expires on 2011; that the ground lease expires in 2015; and that upon
the expiration of the fixed term of the operating lease, it will make best
efforts further to renew its lease for the Restaurant premises. MANAGEMENT
COMPANY acknowledges that it has received and reviewed a copy of the operating
lease. NEWCO represents that it will continue to operate the Restaurant unless
MANAGEMENT COMPANY consents to a cessation of restaurant operations.

      The parties acknowledge that it is their intention that the following
transpire:

                                       14
<PAGE>

            a. That NEWCO close the premises to the public within 20 days of the
date of this agreement, and book no banquets from the date of this agreement, to
take place more than 20 days hence;

            b. That from the date NEWCO closes to the public, the MANAGEMENT
COMPANY shall assume the management of the premises, and begin the process of
capitalizing, designing, building and staffing the Restaurant, the parties
intending that the Restaurant re-open within 90 days of the Commencement Date.
During the period following the Commencement Date but prior to re-opening,
MANAGEMENT COMPANY will provide NEWCO with reasonable reports on its progress
including, but not limited to, providing proof of disbursement of funds toward
the opening of the Restaurant, that is toward designing, constructing,
furnishing the Restaurant and providing inventory.

            Should the MANAGEMENT COMPANY not reopen the Restaurant to the
public within 180 days of the Commencement Date, unless because of forces beyond
its control, the sums held in escrow under Article 9 (a) together with all other
property situated at the Restaurant will be released to NEWCO as liquidated
damages hereunder; MANAGEMENT COMPANY shall surrender the premises and its
contents; all sums expended through such time by the MANAGEMENT COMPANY will be
forfeited and, except for the provisions of subsection B.a.5 of this Article 10,
which shall survive as if termination had occurred in accordance with that
section, this Agreement shall become null and void.

                                       15
<PAGE>

      B. Except as provided for in subsection A of this Article 10 and in
Articles 12 and 13, this agreement may only be terminated as follows:

            a. At the election of NEWCO, upon thirty (30) days notice to the
MANAGEMENT COMPANY of default, which default remains uncured, and which the
MANAGEMENT COMPANY does not commence diligent effort to cure, or "for cause",
which shall be limited to the following grounds:

                  1. The repeated failure or refusal by the MANAGEMENT COMPANY,
after written notice thereof, substantially to perform its duties and
responsibilities under this agreement.

                  2. Any willful or gross negligent act which materially injures
the reputation, business or any business relationship of the Restaurant, or of
NEWCO, or of any principals of NEWCO.

                  3. Any act of moral turpitude or violation of law which
materially effect the reputation of the Restaurant, NEWCO, or any principals of
NEWCO.

                  4. Any act of willful malfeasance, fraud, bad faith or
reckless disregard of the interests of NEWCO or its shareholders.

                  5. The failure of the MANAGEMENT COMPANY to make the
guaranteed payments under Article 4 hereof.

                  Upon any such termination under this Article B.a., the
MANAGEMENT COMPANY, shall immediately return control of the premises to NEWCO,
and guarantee that on such date of surrender, the Restaurant:

                                       16
<PAGE>

                  i. Shall have no debts whatsoever to any third party,
including, but not limited to, the landlord at the premises;

                  ii. And the furniture, fixtures and equipment at the premises
will be free and clear of liens, encumbrances and chattel mortgages of any kind
and description;

                  iii. Will be in compliance with all rules, regulations and
licensing requirements of all state, federal and local authorities.

            b. At the election of the MANAGEMENT COMPANY, upon the following
grounds:

                  (i) Upon 60 days notice, provided that at the end of the
notice period the MANAGEMENT COMPANY will have managed the Restaurant open to
the public for no less than 3 years, so long as no uninsurable cataclysmic
physical disaster of a level that would justify lease termination, or
extraordinary financial disaster of a magnitude equivalent to the stock market
crash of 1929, shall have occurred during such three year period in such a
manner as to directly affect NEWCO, MANAGEMENT COMPANY or any GUARANTOR
hereunder to such a degree as would reasonably render such guarantee impossible
to perform, and expended, pursuant to Article 9, no less than $1,500,000, it
being understood and agreed that upon the MANAGEMENT COMPANY electing to so
terminate, it will forthwith return control of the premises to NEWCO and, on
such date the Restaurant:

            1. Will have no debts whatsoever to any third party, including, but
not limited to, the landlord at the premises and the furniture, fixtures and
equipment at the premises will be free and clear of liens, encumbrances and
chattel mortgages of any kind or description.

                                       17
<PAGE>

            2. Will be in compliance with all rules, regulations and licensing
requirements of all state, federal and local authorities.

            MANAGEMENT COMPANY hereby agrees to indemnify, defend and hold NEWCO
and its principals and guarantors, if any, harmless from any liability for any
of the foregoing, including costs of defense.

                  (ii) Upon the election of the MANAGEMENT COMPANY to terminate
the agreement as set forth in the foregoing paragraph (i), all wine inventory on
the premises on the date of control is returned to NEWCO shall become the
property of MANAGEMENT COMPANY. The parties agree to cooperate with all filings
required by all relevant agencies to effectuate the intent of this subparagraph.
Notwithstanding the foregoing, if the wine inventory shall have a value in
excess of $200,000, utilizing prices paid for such wine when purchased by NEWCO,
only $200,000 of such wine shall become the MANAGEMENT COMPANY property, the
identity of such wines being at the sole discretion of the MANAGEMENT COMPANY.

                  Upon any termination of this agreement as set forth in
subparagraph B of Article 10, all wine inventory on the premises on the date
control is returned to NEWCO shall become the property of MANAGEMENT COMPANY.
The parties agree to cooperate with all filings required by all relevant
agencies to effectuate the intent of this subparagraph. If the wine inventory
shall have a value in excess of $200,000, utilizing prices paid for such wine
when purchased by NEWCO, only $200,000 of such wine shall become the MANAGEMENT
COMPANY'S property, the identity of such wines being at the sole discretion of
the MANAGEMENT COMPANY, the balance of such wine to be divided 50/50 between the
parties.

                                       18
<PAGE>

      11. Guarantee. For good and valuable consideration, sufficiency of which
is hereby acknowledged by the NEW YORK RESTAURANT GROUP, L.L.C., (the
"RESTAURANT GROUP"), the RESTAURANT GROUP hereby guarantees the performance by
the MANAGEMENT COMPANY of the provisions of this agreement in all respects.

      For good and valuable consideration sufficiency of which is hereby
acknowledged, LOFT INTERNATIONAL RESTAURANT CORP., Peter Skeadas and Louis
Pappas hereby guarantee the performance by NEWCO of the provisions of this
Agreement in all respects, provided, however, that the guarantees of PETER
SKEADAS, and LOUIS PAPPAS shall be guarantees of collection, and not of payment,
and subject, without limitation, to the prior exhaustion of all remedies against
the following parties in the following order of priority: (1) The proceeds of
any applicable insurance, either of NEWCO, LOFT INTERNATIONAL RESTAURANT CORP.,
or of any joint obligor's applicable insurance; (2) any and all assets of any
joint obligor; (3) any and all assets of NEWCO, including the lease; and (4) any
and all assets of LOFT INTERNATIONAL RESTAURANT CORP. The Guarantee of Peter
Skeadas and Louis Pappas shall expire three years from the Commencement Date.

      In any event the guarantee of NEWCO's guarantors hereunder, as qualified
above, shall be limited in gross amount to the lesser of the amount of any
applicable claim, or the aggregate amounts actually expended by MANAGEMENT
COMPANY pursuant to Article 9.

      To evidence the obligations of NEWCO under this agreement, NEWCO shall
deliver to MANAGEMENT COMPANY, prior to the Commencement Date:

      1. UCC-l Franchising Statements, covering all fixtures and equipment at
the premises, and all replacement fixtures.

                                       19
<PAGE>

      2. An assignment of the lease to the premises to MANAGEMENT COMPANY, in
recordable form. Same will be held in escrow by the attorneys for the Management
Company pursuant to an escrow receipt consistent with this agreement.

      12. Sale of the Premises.

            a. Should NEWCO receive a bona fide offer to sell the Restaurant, or
to sell all of the outstanding shares of stock of NEWCO or to sublet the
premises or sell a majority interest in itself; the following shall transpire:

                  i. NEWCO shall give MANAGEMENT COMPANY written notice of the
terms of any such offer.

                  ii. The MANAGEMENT COMPANY shall have a sixty (60) day period
within which to purchase the Restaurant or sublet the Restaurant or purchase the
majority interest upon the same terms and conditions as set forth in the
third-party offer.

                  iii. If the MANAGEMENT COMPANY decides not to purchase the
Restaurant or sublet the premises or sell the majority interest, or does not
reply to NEWCO'S notice, NEWCO shall be free to sell the Restaurant, except that
any sale shall include an obligation on the part of the purchaser to assume the
obligations under this Agreement.

                  iv. Any internal share transfers among Louis Pappas, Peter
Skeadas, Gus Karayiannis and their families shall not be considered bona-fide
offers to sell for the purpose of this paragraph.

      13. Option to Purchase. MANAGEMENT COMPANY shall have an option to
purchase all of the assets of NEWCO, subject to the following terms, conditions,
and counter-option of NEWCO:

                                       20
<PAGE>

      a. Price.

         Date of Exercise                               Price in Cash
         ----------------                               -------------

         7/1/97-6/30/2001                               $ 7,500,000
         7/1/01 - 6/30/02                               $ 8,500,000
         7/1/02 - 6/30/03                               $ 9,500,000
         7/1/03 - 6/30/04                               $10,500,000

      b. Method of Exercise. Should the MANAGEMENT COMPANY desire to exercise
its purchase option hereunder, it shall present to NEWCO at any time on or
before 6/30/2004, a written notice of election to purchase the assets of NEWCO
pursuant to the provisions of this Article 13 together with an earnest money
deposit by way of a cashier's or certified check, or other good funds, for an
amount equal to 10% of the applicable purchase price as set forth in
subparagraph (a).

      c. Upon receipt of such notice and earnest money deposit NEWCO shall have
a period of sixty (60) days to preempt MANAGEMENT COMPANY'S purchase option by
presenting to MANAGEMENT COMPANY a written notice of election to repurchase
MANAGEMENT COMPANY'S right to manage under this Agreement, and a cashier's or
certified check or other good funds in the amount of 20% of the applicable
purchase price (based upon the date of the notice of exercise presented by a
MANAGEMENT COMPANY), said amount to constitute a refund of MANAGEMENT COMPANY'S
deposit together with a 10% earnest money deposit of NEWCO.

      d. Closing. A closing shall take place within ninety (90) calendar days
following the later of (1) the expiration of the period set forth in subsection
(c), above, if NEWCO shall not have exercised its counter-option as therein set
forth, or (2) sixty (60) days following the

                                       21
<PAGE>

presentation by NEWCO of a notice of exercise of its counter-option pursuant to
subsection (c), above.

      At the closing the purchaser shall remit by cashier's or certified check
or other good funds the balance of the purchase price, and the Seller shall
deliver, (i) if NEWCO, a Bill of Sale and such other documents reasonably
necessary and sufficient to duly convey and transfer title to all of the assets
of NEWCO (excluding any cash amounts on hand representing NEWCO's share of
operating cash flow or excluded from operating cash flow by definition) or, (ii)
if MANAGEMENT COMPANY, a general and specific release of all claims referencing
this agreement and the right to manage provided for herein, together with such
other document or documents as may reasonably be required to extinguish the
contractual relationship among NEWCO, MANAGEMENT COMPANY and all guarantors
hereunder.

      e. Upon closing and the payment of the consideration provided for
hereunder, subject to collection, this contract shall become null and void and
neither party shall thereafter have any claim or cause of action based upon the
provisions of this contract against the other, or against any guarantor of
either party.

      f. In the event that it should reasonably become necessary at any time
hereafter for any party hereto, including any guarantor, to execute any further
document or instrument to effectuate the purposes of this Article 13, then such
party agrees promptly to do so upon request. This provision shall survive the
closing of any sale under this Article 13.

      14. Liens and Encumbrances. During the term of this agreement, neither
NEWCO nor the MANAGEMENT COMPANY will create any debt for NEWCO; place any liens
and

                                       22
<PAGE>

encumbrances on NEWCO or on the assets of the Restaurant; or create any other
diminution of the value or operating cash flow of the Restaurant without a prior
consent of the other party.

      15. Loans to NEWCO. The MANAGEMENT COMPANY may, but shall not be required
to, make available to NEWCO additional funds, in the nature of loans to the
corporation, upon terms as may be agreed upon by the parties, but in any event
only after expending the sums required to be invested in pursuant to Article 9.

      16. House Account. On the Commencement Date, the MANAGEMENT COMPANY shall
establish a house account entitled "Louis Pappas, Peter Skeadas and Gus
Karayiannis". MANAGEMENT COMPANY shall grant to Pappas, Skeadas and Karayiannis
an annual credit on such house account in the amount of $10,000.00. Any amounts
over $10,000.00 shall carry a 50% discount.

      17. Applicable Law. This Agreement shall be interpreted according to the
laws of New York State.

      18. Notices. Notices provided for hereunder shall be deemed given when
either hand-delivered or mailed by certified mail, return receipt requested,
duly marked "Deliver to Addressee Only" to the parties and addresses as set
forth below (or to such other revised addresses and addresses as either party
may furnish by a like notice, similarly given):

                                       23
<PAGE>

                   As to NEWCO:
                   Peter Skeadas
                   c/o Sargent & Sargent
                   830 Post Road East
                   Westport, CT 06880

                   As to MANAGEMENT COMPANY:
                   Restaurant Management Group
                   c/o Maloney & Porcelli
                   225 Broadway
                   New York, NY 10007

      IN WITNESS WHEREOF, the parties hereto have set their hands and seals the
day and year first above written.

                                              37 EAST 50TH STREET CORPORATION

                                          BY: /s/ [ILLEGIBLE]
                                              --------------------------------

                                              RESTAURANT GROUP
                                              MANAGEMENT SERVICES, L.L.C.

                                          BY: /s/ [ILLEGIBLE]
                                              --------------------------------

                                              NEW YORK RESTAURANT GROUP, L.L.C.

                                          BY: /s/ [ILLEGIBLE]
                                              --------------------------------

                                              LOFT INTERNATIONAL REST. CORP.

                                          BY: /s/ [ILLEGIBLE]
                                              --------------------------------

                                       24
<PAGE>

                                              /s/ Louis Pappas
                                              --------------------------------
                                              LOUIS PAPPAS

                                              /s/ Peter Skeadas
                                              --------------------------------
                                              PETER SKEADAS

                                       25
<PAGE>

                    -----------------------------
SCHEDULE A          GLOUCESTER HOUSE                          -----------------
                    ILLUSTRATIVE INCOME STATEMENT             AVERAGE 300 SEATS
                    -----------------------------             -----------------

<TABLE>
<CAPTION>
                                        -------------------------------------------------------------------------------------------
                                            YEAR 1                  YEAR 2                YEAR 3                 YEAR 4
                                        -------------------------------------------------------------------------------------------
<S>                                       <C>         <C>         <C>         <C>       <C>          <C>        <C>         <C>
TOTAL SALES                               5,457,500   100.00%     6,495,425   100.00%   6,994,800    100.00%    8,460,478   120.95%
COST OF SALES                             1,746,400    32.00%     1,948,628    30.00%   1,993,518     28.50%    2,411,236    34.47%
                                        -------------------------------------------------------------------------------------------
GROSS PROFIT                              3,711,100    68.00%     4,546,798    70.00%   5,001,282     71.50%    6,049,242    86.48%
MISCELLANEOUS INCOME                         15,000     0.27%        20,000     0.31%      25,000      0.36%       25,000     0.36%
                                        -------------------------------------------------------------------------------------------
OPERATING INCOME                          3,726,100    68.27%     4,566,798    70.31%   5,016,282     71.86%    6,074,242    86.84%
                                        -------------------------------------------------------------------------------------------
PAYROLL                                   1,900,000    34.81%     2,180,000    33.56%   2,289,000     32.72%    2,403,450    34.36%
PAYROLL TAXES                               204,250     3.74%       234,350     3.61%     246,068      3.52%      258,371     3.69%
EMPLOYEE BENEFITS                           261,000     6.61%       414,200     6.38%     434,910      6.22%      456,656     6.53%
MANAGEMENT FEE @ 3%                         163,725     3.00%       194,863     3.00%     209,844      3.00%      253,814     3.63%
                                        -------------------------------------------------------------------------------------------
TOTAL SALES                               2,628,975    48.17%     3,023,413    46.55%   3,179,822     45.46%    3,372,291    48.21%
                                        -------------------------------------------------------------------------------------------
OTHER EXPENSES:
RENT                                        281,000     5.15%       292,000     4.50%     304,000      4.35%      304,000     4.35%
WATER                                        35,000     0.64%        36,050     0.56%      37,132      0.53%       38,245     0.55%
HEAT, LIGHT AND POWER                       142,000     2.60%       146,260     2.25%     150,648      2.15%      155,167     2.22%
TELEPHONE                                    20,000     0.37%        20,600     0.32%      21,218      0.30%       21,855     0.31%
[ILLEGIBLE]                                  54,000     0.99%        55,620     0.86%      57,289      0.82%       59,007     0.84%
OFFICE EXPENSES                              50,000     0.92%        65,000     1.00%      66,950      0.96%       68,959     0.99%
[ILLEGIBLE]                                   5,000     0.09%         6,000     0.09%       6,180      0.09%        6,365     0.09%
TRAVEL AND ENTERTAINMENT                     30,000     0.55%        35,000     0.54%      35,000      0.50%       35,000     0.50%
[ILLEGIBLE]                                   1,000     0.02%         1,500     0.02%       1,500      0.02%        1,500     0.02%
[ILLEGIBLE] - MACH. $ EQUIPMENT              35,000     0.64%        35,000     0.54%      35,000      0.50%       35,000     0.50%
PROFESSIONAL FEES                            25,000     0.45%        25,000     0.38%      25,000      0.36%       25,000     0.36%
SECURITY                                      3,000     0.05%         3,090     0.05%       3,183      0.05%        3,278     0.05%
CONSULTANTS FEES                             10,000     0.18%        10,000     0.15%      10,000      0.14%       10,000     0.14%
MISCELLANEOUS INCOME                          7,500     0.14%         7,500     0.12%      75,000      0.11%        7,500     0.11%
OPERATING SUPPLIES                          218,300     4.00%       259,817     4.00%     279,792      4.00%      338,419     4.84%
DECORATING                                   30,000     0.55%        40,000     0.62%      41,200      0.59%       42,436     0.61%
PUBLIC RELATIONS                            111,000     2.03%       123,000     1.89%     128,640      1.84%      151,800     2.17%
INSURANCE                                   100,000     1.83%       115,000     1.77%     120,000      1.72%      120,000     1.72%
EXPENSES                                     10,000     0.18%        10,000     0.15%      10,000      0.14%       10,000     0.14%
REPAIRS AND MAINTENANCE                      75,000     1.37%       125,000     1.92%     128,750      1.84%      132,613     1.90%
ADVERTISING                                 250,000     4.58%       250,000     3.85%     250,000      3.57%      250,000     3.57%
FEES & SUBSCRIPTIONS                          1,500     0.03%         1,500     0.02%       1,500      0.02%        1,500     0.02%
REAL ESTATE TAXES                            92,000     1.69%        97,000     1.49%     102,000      1.46%      102,000     1.46%
CREDIT CARD CHARGES                         147,353     2.70%       175,376     2.70%     188,860      2.70%      228,433     3.27%
COMMERCIAL RENT TAX                          18,265     0.33%        18,980     0.29%      19,760      0.28%       19,760     0.28%
                                        -------------------------------------------------------------------------------------------
TOTAL OTHER EXPENSES                      1,751,918    32.10%     1,954,293    30.09%   2,031,100     29.04%    2,167,837    30.99%
                                        -------------------------------------------------------------------------------------------
TOTAL EXPENSES                            4,380,893    80.27%     4,977,706    76.63%   5,210,922     74.50%    5,540,128    79.20%
                                        -------------------------------------------------------------------------------------------
NET INCOME BEFORE DEPRECIATION,
BANQUET PROFITS & TAXES                    (654,793)  (12.00%)     (410,909)   (6.33%)   (184,640)    (2.64%)     534,114     7.64%
BANQUET PROFITS                             260,000     4.76%       300,000     4.62%     400,000      5.72%      400,000     5.72%
                                        -------------------------------------------------------------------------------------------
NET INCOME BEFORE DEPRECIATION,
TAXES                                      (394,793)   (7.23%)     (110,909)   (1.71%)    215,360      3.08%      934,114    13.35%
DEPRECIATION                               (100,000)   (1.83%)     (100,000)   (1.54%)   (100,000)    (1.43%)    (100,000)   (1.43%)
                                        -------------------------------------------------------------------------------------------
INCOME BEFORE TAXES                        (494,793)   (9.07%)     (210,909)   (3.25%)    115,360      1.65%      834,114    11.92%
                                        -------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                                  ------------------------------
                                                   STATEMENT OF CASH FLOW
                                                   (PREPARED IN ACCORDANCE GAAP)
                                                  ------------------------------

<TABLE>
<S>                                                      <C>                <C>                   <C>                <C>
----------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
----------------------------------------------
   NET INCOME--FROM SCHEDULE A                           (494,793)          (210,909)             115,360               834,000
----------------------------------------------
ADJUSTMENTS TO RECONCILE NET INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
----------------------------------------------
   DEPRECIATION AND AMORTIZATION                          100,000            100,000              100,000               100,000
   CHANGES IN OPERATING ASSETS AND LIABILITIES:                                                                           2,000
     (INCREASE) DECREASE IN ACCOUNTS RECEIVABLE            10,000             (5,000)               2,000               (24,000)
     (INCREASE) DECREASE IN INVENTORY                     (15,000)           (20,000)              28,000                (2,000)
     (INCREASE) DECREASE IN PREPAID EXPENSES              (25,000)             5,000                8,500            [ILLEGIBLE]
     (INCREASE) DECREASE IN OTHER ASSETS                      793             (1,091)               1,140            [ILLEGIBLE]
     INCREASE (DECREASE) IN ACCOUNTS PAYABLE
     AND ACCRUED EXPENSES                                  50,000             25,000               (5,000)           [ILLEGIBLE]
                                                       ------------------------------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES                (374,000)          (107,000)             250,000               890,000

CASH USED TO PURCHASE PROPERTY & EQUIPMENT                      0            (25,000)             (20,000)              (25,000)
                                                       ------------------------------------------------------------------------
NET INCREASE (DECREASE)
     IN CASH -- GAAP                                     (374,000)          (132,000)             230,000               865,000
                                                       ------------------------------------------------------------------------
----------------------------------------------
     OTHER CASH CHANGES
----------------------------------------------
GUARANTEED PAYMENT                                              0           (144,000)            (240,000)             (300,000)
                                                       ------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AFTER
     GUARANTEED PAYMENT                                  (374,000)          (276,000)             (10,000)              565,000
MANAGEMENT COMPANY LOAN                                         0            150,000
MANAGEMENT COMPANY ADDITIONAL FUNDING                     374,000            126,000
                                                       ------------------------------------------------------------------------
     CASH BALANCE                                               0                  0              (10,000)              565,000
                                                       ------------------------------------------------------------------------

----------------------------------------------
CASH AVAILABLE FOR DISTRIBUTION
----------------------------------------------
NET INCREASE (DECREASE)
     IN CASH -- GAAP                                     (374,000)          (132,000)             230,000               865,000
                                                       ------------------------------------------------------------------------
CASH TO NEWCO                                                   0            144,000              240,000               300,000
CASH TO MANAGEMENT COMPANY                                      0                  0                    0               300,000
PAYMENT OF LOAN TO MANAGEMENT COMPANY                           0                  0                    0               150,000
PAYMENT OF SHORTFALL                                            0                  0                    0               115,000
SHORTFALL                                                       0                  0              115,000
</TABLE>

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"}]]