Document:

Exhibit 10.3

                          SECURED REVOLVING CREDIT GRID

                                 PROMISSORY NOTE

$100,000.00                                               GARDEN CITY, NEW YORK
                                                          MAY 1, 2004

FOR  VALUE  RECEIVED,  J. Adam  Holdings,  Inc.,  a  Delaware  corporation  (the
"Maker"),  having its principal office at 585 Stewart Avenue,  Suite 760, Garden
City,  New York 11530  promises to pay to the order of Triple J Associates  (the
"Payee"),  having its principal  office at 410 Elm Street,  West Hempstead,  New
York  11552,  the  principal  sum of ONE  HUNDRED  THOUSAND  and 00/100  DOLLARS
($100,000.00) or so much thereof as shall have been advanced by the Payee to the
Maker.,  together with interest  thereon,  calculated from the date hereof, at a
rate of 9% per annum  (the  "Interest  Rate") on the  unpaid  principal  balance
hereof as follows:

1.  Commencing  on the first  month  subsequent  to any  drawdown  on the Credit
Facility  and on the  first  day of each  month  thereafter  through  and  until
December  31,  2005 (the  "Maturity  Date"),  the  Maker  shall pay to the Payee
interest  only in  arrears at the  Interest  Rate on the  outstanding  principal
balance of this Note for the preceding period. Interest shall be computed on the
basis of a 360-day year  consisting  of twelve  30-day  months.  All amounts due
hereunder,  including  without  limitation,  all  outstanding  principal and all
accrued and unpaid interest, shall be due and payable on the Maturity Date.

2. All  payments  due in  respect of this Note shall be made by the Maker to the
Payee in lawful  currency  of the United  States of America and shall be paid to
the Payee by bank wire transfer,  certified check or bank cashier's  check.  All
payments hereon on account of principal, late payment charges and interest shall
be made to the  Payee,  at the office of the Payee  first  above set forth or at
such  other  office as may be  specified  by the Payee,  for the  account of the
holder  hereof,  unless  otherwise  specified in this Note,  all  payments  made
hereunder  shall  first be applied  to  interest  and the  balance to the unpaid
principal  amount.  If any  payment  of  principal  or  interest  falls due on a
Saturday,  Sunday or public holiday at the place of payment,  then such due date
shall be  extended  to the next  succeeding  full  business  day at the place of
payment and interest shall be payable during such extension.

3.  Payments  under this Note may be prepaid at any time or times in whole or in
part without premium or penalty.  Any such  prepayment(s)  under this Note shall
not be in an amount of less than TEN THOUSAND DOLLARS ($10,000.00).

4. Maker shall pay all expenses,  including reasonable attorney's fees and legal
expenses,  incurred by the Payee in connection with this transaction and be paid
in full on the  Maturity  Date and such  expenses  shall be added to the  unpaid
principal hereof, provided, however, that said amount of all such expenses shall
not exceed Five Thousand DOLLARS ($5,000.00).

5. As  collateral  security for the repayment of the  principal  balance  hereof
together  with  accrued and unpaid  interest  thereon and any other  amounts due
hereunder,  the Maker  hereby  pledges  and  grants  to the  Payee a  continuing
security interest (a) in Two Million  (2,000,000)  shares common stock issued by
the Maker held in the name of the Richard Miller (the "Pledged  Shares") and all
options and other rights,  contractual or otherwise,  in respect thereof and all
dividends, cash, instruments,  investment property and other property (including
but not limited to, any stock dividend and any distribution in connection with a
stock split) from time to time received,  receivable or otherwise distributed in
respect of or in exchange for any or all of the Pledged  Shares and (b) the real
estate (the "Real Estate").

6.  Notwithstanding  anything contained herein for the contrary,  on the date of
sale of the Pledged  Shares and the Real Estate,  Maker shall pay to the Payee a
prepayment  in an amount  equal to 100% of any and all  proceeds  received  as a
result of such sale. ("Mandatory  Prepayment").  Each Mandatory Prepayment shall
be applied by Payee  against the amounts due  hereunder  in such manner as Payee
shall, in its sole discretion, elect.

7. If the entire  principal sum  hereunder is not paid when due,  whether on the
Maturity Date or earlier by reason of acceleration  of the payment hereof,  then
from and after such due date,  interest shall accrue on the unpaid principal sum
at the rate of 5% in excess of the Interest  Rate then in effect but in no event
shall such rate be in excess of the highest  legal rate  permitted by applicable
law.

8. This Note evidences  revolving  credit loans made by the Payee to Maker.  The
date and amount of each such  revolving  credit loan and each payment on account
of  principal  thereon  may be  endorsed  by the Payee  (and the Payee is hereby
authorized to endorse) on the grid attached to and made a part of this Note, and
when so endorsed shall represent  evidence thereof binding upon the Maker in the
absence of manifest  error.  Any failure by the Payee to so endorse  shall in no
way mitigate or discharge  the  obligation  of the Maker to repay any  revolving
credit loan actually made. Revolving credit loans shall be made as the Maker may
request  (in the  manner  hereinafter  set forth) up to an  aggregate  principal
amount outstanding at any one time of One Hundred Thousand Dollars ($100,000).

9. Should the indebtedness  evidenced hereby or any part thereof be collected at
law or in equity,  or in bankruptcy,  receivership or any other court proceeding
(whether at the trial or appellate  level), or should this Note be placed in the
hands of attorneys  for  collection  upon  default,  the Maker agrees to pay, in
addition to the principal,  any late payment charge and interest due and payable
hereunder,   and  all  costs  of   collecting  or  attempting  to  collect  such
indebtedness, including reasonable attorneys' fees and expenses.

10. All parties hereto, whether Maker, principal, surety, guarantor or indorser,
hereby  waive  demand,  notice of demand,  presentment,  notice of  presentment,
notice of dishonor, protest and notice of protest.

11. If any  payment  hereunder  shall not be made by Maker on the date when due,
including any mandatory  payment other than the payment of the principal balance
outstanding  and due on the Maturity Date, the Payee may impose a late charge of
five cents ($0.05) cents for each dollar  ($1.00) paid late to cover the Payee's
additional  costs to  administer  the loan  represented  hereby due to such late
payment.

12. At the option of the Payee,  this Note and the  entire  unpaid  indebtedness
represented  hereby shall become immediately due and payable upon the occurrence
of any one of the following events of default (each an "Event of Default"):

                     (i) The Maker fails to make any payment due hereunder  when
           the same is due and owing  pursuant  to the terms and  conditions  of
           this Note;

                     (ii) If the Maker or either of the guarantors  hereof makes
           an  assignment  for the  benefit  of its or his,  as the case may be,
           creditors,  or commences a case under the federal bankruptcy laws, or
           any state  insolvency  laws, or files any petition or answer  seeking
           for   itself   any    reorganization,    arrangement,    composition,
           readjustment,  liquidation,  dissolution  or similar relief under any
           present  or future  statute,  law or  regulation,  or files an answer
           admitting or not  contesting  the material  allegations of a petition
           against , or his as the case may be, in any such proceeding, or seeks
           or acquiesces in the appointment of any trustee, custodian,  receiver
           or liquidator over its or his, as the case may be, assets; if, within
           sixty (60) days after the commencement of an action against the Maker
           or any guarantor seeking any bankruptcy, reorganization, arrangement,
           composition, readjustment, liquidation, dissolution or similar relief
           under any present or future statute,  such action is not dismissed or
           all orders entered therein or proceedings thereunder affecting its or
           his, as the case may be, assets have not been vacated;

                     (iii) A trustee, receiver, custodian or similar official or
           agent is appointed for the Maker or either of the  guarantors for any
           substantial  part  of  the  Maker's  or  either  of  the  guarantor's
           property, or all or any substantial part of the property of the Maker
           or  either  of the  guarantors  is  condemned,  seized  or  otherwise
           appropriated by any governmental authority; or

                     (iv) The Maker or either of the  guarantors  has  failed to
           perform any of the Maker's obligations set forth in the Note or shall
           have  breached  any of the  Maker's  representations,  warranties  or
           covenants set forth in this Note.

13. THE MAKER AND THE  GUARANTORS  AGREE THAT ANY ACTION,  SUIT OR PROCEEDING IN
RESPECT OF OR ARISING OUT OF THIS NOTE MAY BE INITIATED  AND  PROSECUTED  IN THE
STATE OR FEDERAL  COURTS,  AS THE CASE MAY BE,  LOCATED IN NEW YORK COUNTY,  NEW
YORK.  THE MAKER AND THE  GUARANTORS  CONSENT  AND  SUBMIT  TO THE  EXERCISE  OF
JURISDICTION  OVER ITS PERSON BY ANY SUCH  COURT  HAVING  JURISDICTION  OVER THE
SUBJECT  MATTER,  WAIVES  PERSONAL  SERVICE OF ANY AND ALL  PROCESS  UPON IT AND
CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO
THE MAKER AT ITS ADDRESS  SET FORTH ABOVE OR TO ANY OTHER  ADDRESS AS MAY APPEAR
IN THE PAYEE'S RECORDS AS THE ADDRESS OF THE MAKER.

14. IN ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS NOTE,
THE PAYEE, THE GUARANTORS,  AND THE MAKER WAIVE TRIAL BY JURY, AND THE MAKER AND
THE GUARANTORS ALSO WAIVE (I) THE RIGHT TO INTERPOSE ANY SET-OFF OR COUNTERCLAIM
OF ANY NATURE OR  DESCRIPTION,  (II) ANY OBJECTION BASED ON FORUM NON CONVENIENS
OR VENUE, AND (III) ANY CLAIM FOR CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES.

15.  After the  occurrence  of a default  hereunder,  the Payee may  accept  any
payments  from the Maker  without  prejudice  to the rights and  remedies of the
Payee provided herein or in the Pledge or Mortgage; and further, the designation
or allocation by the Maker of the disposition or allocation of any payments made
will not be binding upon the Payee which may allocate any and all such  payments
to interest, principal and other fees and charges due hereunder or to any one or
more of them,  in such  amounts,  priorities  and  proportions  as the Payee may
determine in its sole discretion.

16.  Notwithstanding  anything heretofore set forth to the contrary, in no event
shall any  interest  payable  under this Note exceed the maximum  interest  rate
permitted under law and any interest collected  hereunder which may be in excess
of such rate shall be applied to the reduction of principal.

17. The liability of any Maker or guarantor hereunder shall be unconditional and
shall not be in any manner  affected  by any  indulgence  whatsoever  granted or
consented to by the holder hereof,  including, but not limited to, any extension
of time,  renewal,  waiver or other  modification.  Any failure of the holder to
exercise any right  hereunder shall not be construed as a waiver of the right to
exercise  the  same  or any  other  right  at any  time  and  from  time to time
thereafter.  The Payee or any  holder  may  accept  late  payments,  or  partial
payments,  even though marked  "payment in full" or containing  words of similar
import or other  conditions,  without  waiving any of its rights.  No amendment,
modification  or  waiver  of any  provision  of this  Note  nor  consent  to any
departure by the Maker therefrom shall be effective,  irrespective of any course
of  dealing,  unless the same shall be in writing  and signed by the Payee,  and
then such waiver or consent shall be effective only in the specific instance and
for the  specific  purpose  for which  given.  This Note  cannot be  changed  or
terminated  orally or by estoppel or waiver or by any alleged oral  modification
regardless of any claimed partial performance referable thereto.

18. This Note shall be governed by and guarantor in accordance  with the laws of
the State of New York without regard to conflicts of laws principles.

                     IN  WITNESS  WHEREOF,  the  undersigned  has  executed  the
foregoing instrument as of the day and year first above

written.

WITNESS/ATTEST                                  J. Adam Holdings, Inc.

                                                By: /s/ Richard Miller
Print Name:                                     Name:  Richard Miller
                                                Title: PresidentExhibit 10.2

                   CREDIT LINE MORTGAGE AND SECURITY AGREEMENT

           THIS  MORTGAGE is made 1st day of May,  2004 by and between,  J. Adam
Holdings,  Inc.  ("Mortgagor"),  having its chief executive office and principal
place of business at 585 Stewart Avenue,  Suite 760, Garden City, New York 11530
and Triple J Associates.,  having its principal  office at 410 Elm Street,  West
Hempstead, New York 11552 ("Mortgagee").

                              W I T N E S S E T H :

           WHEREAS,  Mortgagor  is  obligated  pursuant  to a a certain  Secured
Revolving Credit Grid Promissory Note from Ferro Foods  Corporation dated May 1,
2004 (the  "Note"),  which Note  provides,  inter alia,  that from time to time,
advances are permitted to be made,  repaid and further  advances made,  provided
that the maximum  amount of advances that are  outstanding at any time shall not
exceed One Hundred Thousand Dollars ($100,000) (the "Maximum Amount") and a copy
of which Note is annexed hereto and made a part hereof as Exhibit A.

           NOW, THEREFORE, to secure the full and prompt payment and performance
of all such amounts under the Note as well as under this Mortgage  (such amounts
being referred to herein as the  "indebtedness")  and in  consideration of other
valuation  consideration,  receipt  of which is hereby  acknowledged,  Mortgagor
hereby  gives,  grants,   bargains,  sells  and  confirms  unto  Mortgagee,  its
successors and assigns forever, the following property,  rights,  privileges and
franchises (collectively, the "Mortgaged Property").

           The real  property  described  in said Exhibit B,  together  with the
buildings,  structures and  improvements  thereon  erected or to be erected (the
"Improvements"),   with  the   appurtenances   thereof  and  thereto  (all,  the
"Premises");

           TOGETHER  with all  leasehold  estate,  right,  title and interest of
Mortgagor in and to all leases or subleases covering the Premises or any portion
thereof (collectively,  the "Leases") now or hereafter existing or entered into,
and all right, title and interest of Mortgagor  thereunder,  including,  without
limitation,  all cash or security  deposits,  advance  rentals,  and deposits or
payments of similar nature;

           TOGETHER  with all right,  title and  interest of Mortgagor in and to
all options to purchase or lease the Premises or any portion thereof or interest
therein, and any greater estate in the Premises owned or hereafter acquired;

           TOGETHER with all interests, estates or other claims, both in law and
in equity, which Mortgagor now has or may hereafter acquire in the Premises;

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           TOGETHER  with  all  easements,  rights-of-way  and  rights  used  in
connection  therewith  or as a means  of  access  thereto,  and  all  tenements,
hereditaments and appurtenances thereof and thereto, and all water rights;

           TOGETHER  with  any and  all of  Mortgagor's  fixtures,  attachments,
equipment,  machinery now or hereafter  located or to be located at the Premises
and attached to, the Premises,  be they deemed personal,  mixed or real property
(the "Fixtures");

           TOGETHER  with all right,  title and  interest of Mortgagor in and to
any streets and roads  abutting the Premises to the center lines  thereof and in
and to any strips or gores of land therein or adjacent to the Premises;

           TOGETHER  with all awards and proceeds of  condemnation  or insurance
for the  Mortgaged  Property or any part thereof to which  Mortgagor is entitled
for any taking of or  casualty to all or any part of the  Mortgaged  Property by
condemnation  or  exercise  of the  right of  eminent  domain or  casualty  (the
"Proceeds").  All such awards and condemnation or insurance  proceeds are hereby
assigned  to  Mortgagee  and  Mortgagee  is hereby  authorized,  subject  to the
provisions contained in this Mortgage,  to apply such awards and condemnation or
insurance proceeds or any part thereof,  after deducting  therefrom any expenses
incurred by Mortgagee in the collection or handling thereof, toward the payment,
in full or in part,  of any amount due under the Note  secured by the  Mortgage,
notwithstanding  the fact that the amount owing  thereon may not then be due and
payable;

           TOGETHER  with all  rents,  issues,  income and  profits  (including,
without  limitation,  any  payment(s)  in  exchange  for  lease  termination  or
cancellation) of the Premises and all the estate,  right,  title and interest of
every  nature  whatsoever  of  Mortgagor  in and to the  same  and  the  leases,
subleases and tenancies concerning the same (the "Rents and Profits");

           TOGETHER  with  all  inventory,   equipment,   machinery,  furniture,
accounts, chattel paper, contracts, contract rights, notes, drafts, acceptances,
general  intangibles,  causes of action  and all other  personal  property,  now
existing,  or hereafter  acquired or arising,  with respect to the  operation of
Premises (the "Personalty").

           TO HAVE AND TO HOLD the Mortgaged  Property,  with the  appurtenances
thereof and thereto, unto Mortgagee,  its successors and assigns forever, to its
and their own proper use and behalf.

THIS  MORTGAGE IS INTENDED TO BE A "CREDIT LINE  MORTGAGE" AS DEFINED IN SECTION
281 OF THE NEW YORK REAL  PROPERTY  LAW,  AS THE SAME MAY BE AMENDED OR MODIFIED
FROM TIME TO TIME.

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           To protect the security of the Mortgage, Mortgagor further covenants,
warrants and agrees with Mortgagee as follows:

                                    ARTICLE 1

                WARRANTIES, COVENANTS AND AGREEMENTS OF MORTGAGOR

           ARTICLE 1.1 Payment of Secured Obligations.  Mortgagor shall pay when
due the principal of, and the interest on the indebtedness and all charges, fees
and other amounts due under the Note shall  otherwise  comply with all the terms
of this Mortgage.

           ARTICLE  1.2  Warranties  and  Representations.  Mortgagor  does  for
itself, its successors and assigns,  covenant with Mortgagee, its successors and
assigns, that at and until the ensealing of these presents, it is well seized of
the Mortgaged Property as a good indefeasible estate in FEE SIMPLE, and has good
right to bargain and sell,  convey,  assign,  transfer  and mortgage the same in
manner  and  form as is  above  written,  and  that  the  same is free  from all
encumbrances whatsoever except as specifically set forth in Exhibit C.

           And furthermore, Mortgagor does by these presents bind itself and its
successors  and  assigns  forever to preserve  its  interest in and title to the
Mortgaged  property  and  to  WARRANT  AND  DEFEND  the  Mortgaged  Property  to
Mortgagee,   its  successors  and  assigns,   against  all  claims  and  demands
whatsoever, except as set forth in Exhibit C.

           ARTICLE 1.3 Rents and Profits.  As additional and collateral security
for the payment of the indebtedness secured hereby and cumulative of any and all
rights and  remedies  herein  provided  for,  Mortgagor  hereby  absolutely  and
presently  assigns to Mortgagee  all existing and future Leases and all existing
and future Rents and Profits.  Mortgagor  hereby  grants to Mortgagee  the sole,
exclusive and immediate  right,  without taking  possession of the Property,  to
demand,  collect (by suit or  otherwise),  receive and give valid and sufficient
receipts for any and all of said Rents and Profits,  for which purpose Mortgagor
does   hereby   irrevocably   make   constitute   and  appoint   Mortgagee   its
attorney-in-fact  with  full  power  to  appoint  substitutes  or a  trustee  to
accomplish such purpose (which power of attorney shall be irrevocable so long as
any  indebtedness  secured hereby is outstanding,  shall be deemed to be coupled
with an interest,  shall survive the  voluntary or  involuntary  dissolution  of
Mortgagor and shall not be affected by any disability or incapacity  suffered by
Mortgagor  subsequent to the date hereof).  Mortgagee shall be without liability
for any loss which may arise from a failure or  inability  to collect  Rents and
Profits,  proceeds or other payments.  However, until the occurrence of an Event
of Default under this  Mortgage,  Mortgagor  shall have a license to collect and
receive the Rents and Profits when due and prepayments thereof for not more than
one month prior to due date thereof.  Upon the occurrence of an Event of Default
which is continuing, Mortgagor's license shall automatically terminate on demand
and notice to Mortgagor and Mortgagee  thereafter,  without taking possession of
the Property,  collect the Rents and Profits  itself or by an agent or receiver.
From and after the termination of such license,  Mortgagor shall be the agent of
Mortgagee  in  collection  of the  Rents  and  Profits  and all of the Rents and

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Profits so collected by  Mortgagor  shall be held in trust by Mortgagor  for the
sole and  exclusive  benefit of Mortgagee and  Mortgagor  shall,  within one (1)
business day after  receipt of any Rents and Profits,  pay the same to Mortgagee
to be applied by Mortgagee as hereinafter  set forth.  Neither the demand for or
collection  of Rents and Profit by  Mortgagee,  nor the exercise of  Mortgagee's
rights as assignee of the Leases,  shall  constitute any assumption by Mortgagee
of any  obligations  under  any  Lease  or  other  agreement  relating  thereto.
Mortgagee  is  obligated  to  account  only for such  Rents and  Profits  as are
actually  collected or received by Mortgagee.  Mortgagor  irrevocably agrees and
consents that the respective  payors of the Rents and Profits shall, upon demand
and notice from Mortgagee of an Event of Default  hereunder,  pay said Rents and
Profits to Mortgagee  without fiabili1y to determine the actual existence of any
Event of Default claimed by Mortgagee.  Mortgagor hereby waives an right,  claim
or demand which  Mortgagor  may now or hereafter  have against any such payor by
reason of such payment of Rents and Profits to  Mortgagee,  and any such payment
shall discharge such payor's  obligation to make such payment to Mortgagor.  All
Rents and Profits  collected or received by Mortgagee  shall be applied  against
all expenses of collection,  including,  without  limitation,  attorneys'  fees,
against costs of operation and management of the Mortgaged  Property and against
the indebtedness  secured hereby, in whatever order or priority as to any of the
items so mentioned as Mortgagee  directs in its sole  subjective  discretion and
without  regard  to the  adequacy  of its  security.  Neither  the  exercise  by
Mortgagee of any rights under this Section nor the  application of any Rents and
Profits  to the  secured  indebtedness  shall  cure or be deemed a waiver of any
Default or Event of Default hereunder. The assignment of Leases and of Rents and
Profits  hereinabove  granted shall continue in full force and effect during any
period of foreclosure or redemption with respect to the Mortgaged Property.

           ARTICLE 1.4 Ground Leases,  Leases or Subleases.  Mortgagor shall pay
when due all rents and other  payments which it may be required to pay and shall
keep, observe and perform all of the covenants,  agreements,  terms,  conditions
and provisions on its part to be kept,  observed and performed  under any ground
lease, lease or sublease which may constitute a portion of or an interest in-the
Premises,  shall require its tenants or subtenants to keep,  observe and perform
all of the covenants, agreements, terms, conditions and provisions on their part
to be kept,  observed or performed  under any and all ground  leases,  leases or
subleases  and shall not  suffer or permit  any  breach or default to occur with
respect to the foregoing. In default thereof,  Mortgagee shall have the right to
perform or to require  performance  of any such  covenants,  agreements,  terms,
conditions or provisions of any such ground lease,  lease or sublease and to add
any expense incurred in connection therewith to the indebtedness secured hereby,
which  expense  shall  bear  interest  from the date of  payment  to the date of
recovery by Mortgagee at the rate of interest  applicable at the relevant  times
on the commercial revolving loan (the "Default Rate"). Any such expense incurred
by  Mortgagee,  with interest  thereon,  shall be  immediately  due and payable.
Mortgagor  shall  not,  without  the  consent  of  Mortgagee,   consent  to  the
modification,  amendment,  cancellation,  termination  or  surrender of any such
ground lease, lease or sublease.

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           No release or forbearance of any of Mortgagor's obligations under any
such ground lease,  lease or sublease,  pursuant to any such ground lease, lease
or sublease,  or otherwise,  shall release Mortgagor from any of its obligations
under the Mortgage.

           ARTICLE 1.5 Required Insurance.  Mortgagor shall, at Mortgagor's sole
cost and  expense,  maintain  or  cause to be  maintained  with  respect  to the
Mortgaged Property, and each part thereof, the following insurance:

                     (a) Insurance against loss or damage to the Improvements by
           fire and any of the risks  covered by insurance of the type now known
           as "fire,  broad form  extended  coverage and vandalism and malicious
           mischief'  perils, in an amount sufficient to prevent the application
           of any co-insurance  contributions in any loss and, in any event, not
           less  than  the  full   replacement  cost  of  the  Improvements  and
           Personality and with no more than $25,000.00 deductible from the loss
           payable  for any  casualty.  The  policies  of  insurance  carried in
           accordance with this  subparagraph (a) shall contain the "Replacement
           Cost Endorsement";

                     (b)  Comprehensive  public liability  insurance  (including
           coverage for elevators and  escalators,  if any, on the Premises and,
           on an  "occurrence  basis"  against  claims  for  11personal  injury"
           including without limitation bodily injury,  death or property damage
           occurring  on, in or about the  Premises and the  adjoining  streets,
           sidewalks and passageways, in the amount of $1,000,000 per occurrence
           and  $5,000,000  in the  aggregate  (or such larger  amount as may be
           required under Mortgagor's general liability umbrella policy);

                     (d)  Boiler  and  machinery   insurance  covering  pressure
           vessels, air tanks, boilers, machinery, pressure piping, heating, air
           conditioning and elevator equipment and escalator equipment, provided
           the  Improvements  contain  equipment of such nature,  and  insurance
           against loss of occupancy or use arising from any such breakdown,  on
           a replacement cost basis;

                     (e) Flood  insurance if any part of the Property is located
           in an area identified by the Federal  Emergency  Management Agency as
           an area having special flood hazards and in which flood insurance has
           been made available under the National Flood Insurance  Program in an
           amount equal to the lesser of (a), the minimum amount required, under
           the terms of  coverage,  to  compensate  for any  damage or loss on a
           replacement basis (or the unpaid balance of the indebtedness  secured
           hereby if replacement  cost coverage is not available for the type of
           building insured);  or (b) the maximum insurance  available under the
           appropriate National Flood Insurance Program.

                     (f) Such other  insurance  and in such  amounts as may from
           time to time be reasonably  required by Mortgagee against the same or
           other hazards.

                     All  policies  of  insurance  required  by the terms of the
Mortgage  shall contain an endorsement or agreement by the insurer that any loss
shall be  payable  to  Mortgagee  in  accordance  with the terms of such  policy

                                       51
<PAGE>

notwithstanding  any act or negligence of Mortgagor which might otherwise result
in  forfeiture  of said  insurance,  and the  further  agreement  of the insurer
waiving all rights of setoff,  counterclaim or deductions against Mortgagor. All
policies of insurance shall have attached thereto the standard  non-contributory
mortgagee endorsement or lender's loss payable endorsement, as appropriate,  for
the  benefit of  Mortgagee  satisfactory  to  Mortgagee  in form and  substance.
Mortgagor  shall furnish  Mortgagee  with an original  policy of all policies of
required  insurance.  At least thirty (30) days prior to the  expiration of each
such policy,  Mortgagor  shall furnish  Mortgagee with evidence  satisfactory to
Mortgagee of the payment of premium and the  reissuance  of a policy  continuing
insurance in force as required by the Mortgage.

                     Mortgagor  may effect for its own account any insurance not
required under this Section 1.4, but any such

insurance  effected by  Mortgagor on the  Premises,  whether or not so required,
shall be for the mutual  benefit of Mortgagor and Mortgagee and shall be subject
to the other provisions of the Mortgage.

           ARTICLE  1.6  Delivery of  Policies,  Payment of  Premiums.  All such
policies  shall contain a provision  that such policies shall not be canceled or
materially  amended,  which term shall  include  any  reduction  in the scope or
limits of coverage,  without at least thirty (30) days' prior written  notice to
Mortgagee. If Mortgagor fails to provide, maintain, keep in force or deliver and
furnish to  Mortgagee  the  policies of  insurance  required by this  Article 1,
Mortgagee may procure such insurance or single interest insurance for such risks
covering  Mortgagee's  interest,  and Mortgagor  shall pay all premiums  thereon
promptly upon demand by Mortgagee,  and until such payment is made by Mortgagor,
the amount of all such premiums  together  with interest  thereon at the Default
Rate shall be secured by the Mortgage. All policies of insurance shall be issued
by companies and in amounts in each company satisfactory to Mortgagee, and shall
contain loss payee provisions satisfactory to Mortgagee.

           ARTICLE 1.7 Taxes, Utilities and Imposition.  Mortgagor shall pay, or
cause to be paid and discharged,  on or before the last day on which they may be
paid without penalty or interest,  all such duties,  taxes, sewer rents, charges
for water, and all other utilities in the Improvements or on the Premises or any
part thereof, and any assessments and payments, usual or unusual,  extraordinary
or  ordinary,  which shall be imposed upon or become due and payable or become a
lien upon the Premises or any part thereof and the sidewalks or streets in front
thereof  and any vaults  therein  by virtue of any  present or future law of the
United  States or of the State,  County,  City or Town  wherein the Premises are
located (all of the foregoing being herein collectively  called  "Impositions").
In default of any such payment of any Imposition, Mortgagee may pay the same and
the amount so paid by Mortgagee shall, at Mortgagee's option, become immediately
due and payable  with  interest  thereon at the Default Rate and shall be deemed
part of the indebtedness secured by this Mortgage.

                     If at any time there shall be assessed or imposed (i) a tax
or  assessment  on the  Premises in lieu of or in  addition  to the  Impositions
payable by Mortgagor pursuant to this Section or

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<PAGE>

(ii) a license fee, tax or  assessment  imposed on Mortgagee  and measured by or
based in whole or in part upon the amount of the outstanding obligations secured
hereby, then all such taxes,  assessments or fees shall be deemed to be included
within the term  "Impositions"  as defined in this Section,  and Mortgagor shall
pay and  discharge  the same as herein  provided  with respect to the payment of
Impositions  unless such payment is prohibited by law, in which event the amount
of such payment shall become part of the indebtedness secured hereby.

                     Mortgagor  shall pay all mortgage,  recording taxes payable
with respect to the Mortgage or other  mortgage or transfer taxes due on account
of the mortgage or the indebtedness secured by this mortgage.

                     Mortgagor shall exhibit to Mortgagee the original  receipts
or other reasonably  satisfactory  proof of the payment of all Impositions which
may  affect  the  Mortgaged  Property  or any  part  thereof  or the lien of the
Mortgage,  promptly  following  the last date on which each such  Imposition  is
payable hereunder without interest or penalty.

                     Notwithstanding  the  foregoing,  Mortgagor  shall have the
right,  after prior notice to  Mortgagee,  to contest the amount and validity of
any  Imposition  affecting the  Mortgaged  Property by  appropriate  proceedings
conducted in good faith and with due  diligence and to postpone or defer payment
thereof, if and so long as:

                     (a)  Such   proceedings   shall   operate  to  suspend  the
           collection  of  such  Imposition  from  Mortgagor  or  the  Mortgaged
           Property; or

                     (b) Neither the  Mortgaged  Property  nor any part  thereof
           would be in immediate  danger of being forfeited or lost by reason of
           such proceedings, postponement or deferment; and

                     (c) In the case of any  Imposition  affecting the Mortgaged
           Property which might be or become a lien,  encumbrance or charge upon
           or result in any forfeiture or loss of the Mortgaged  Property or any
           part thereof, or which might result in loss or damage to Mortgagor or
           Mortgagee,  Mortgagor, prior to the date such Imposition would become
           delinquent, shall have furnished Mortgagee with security satisfactory
           to Mortgagee, and, if such security is furnished, Mortgagee shall not
           have the right  during  the period of the  contest to pay,  remove or
           discharge the Imposition.

           ARTICLE 1.8 Mechanics' Liens. Mortgagor shall pay when due all claims
and demands of mechanics, materialmen, laborers and other for any work performed
or materials  delivered  for the Premises or  Improvements;  provided,  however,
that,  Mortgagor shall have the right to contest in good faith any such claim or
demand, so long as it does so diligently, by appropriate proceedings and without
prejudice to Mortgagee, and provided that neither the Mortgaged Property nor any
interest  therein would be in any danger of sale, loss or forfeiture as a result
of such  proceeding or contest.  In the event  Mortgagor  shall contest any such

                                       53
<PAGE>

claim or demand,  Mortgagor shall promptly notify  Mortgagee of such contest and
thereafter  shall,  upon  Mortgagee's  request,  promptly  provide a bond,  cash
deposit or other  security  satisfactory  to  Mortgagee  to protect  Mortgagee's
interest and security  should the contest be  unsuccessful.  If Mortgagor  shall
fail to  immediately  discharge  or provide  security  against any such claim or
demand as aforesaid,  Mortgagee  may do so and any and all expenses  incurred by
Mortgagee,  together  with  interest  thereon at the Default  Rate from the date
incurred by Mortgagee  until  actually paid by Mortgagor,  shall be  immediately
paid by  Mortgagor  on demand and shall be secured by this  Mortgage  and by any
other documents  securing all or any part of the  indebtedness  evidenced by the
Note.

           ARTICLE 1.8 Maintenance,  Repairs, Alterations.  Mortgagor shall keep
the Mortgaged Property or cause the same to be kept in good condition and repair
and  fully  protected  from  the  elements  to the  reasonable  satisfaction  of
Mortgagee.  Mortgagor shall not commit or permit any waste thereon and shall not
do or permit any act by which the Mortgaged Property shall become less valuable.
Mortgagor shall not remove,  demolish or substantially or structurally alter any
building,  structure  or other  Improvement  without  the  prior  permission  of
Mortgagee,  which shall not be unreasonably withheld or delayed, except (x) such
alterations  as  may  be  required  by  laws,  ordinances  or  regulations,  (y)
non-structural  alterations  costing  less than  $3,500,000  per project and (z)
erection or installation of shelves, bins, machinery and equipment of all kinds,
plumbing and wiring. Any removals of shelves,  bins, machinery and equipment and
other items from the Mortgaged  Property  shall be subject to the  provisions of
the Note. Mortgagor shall promptly restore in like manner any Improvements which
may be damaged or destroyed  thereon and shall pay when due all claims for labor
performed and materials furnished therefor; and Mortgagor shall use and operate,
and shall  require its lessees or  licensees  to use or operate,  the  Mortgaged
Property  in  compliance  with all  applicable  laws,  ordinances,  regulations,
covenants, conditions, and restrictions, and with all applicable requirements of
any ground lease,  lease or sublease now or hereafter  affecting the Premises or
any part  thereof.  Mortgagee  and its  representative  shall have access to the
Premises and Mortgaged  Property at all  reasonable  times to determine  whether
Mortgagor is complying with its obligations under this Mortgage.

           ARTICLE 1.8 Condemnation.  Should the Mortgaged  Property or any part
thereof or  interest  therein be taken or damaged by reason of any public use or
improvement or condemnation proceeding, or by alteration in grade of any street,
or in any other manner ("Condemnation"),  or should Mortgagor receive any notice
or other  information  regarding  a  Condemnation,  Mortgagor  shall give prompt
notice thereof to Mortgagee.

                     (a) Mortgagee shall be entitled to all compensation, awards
           and  other   payments  or  relief   granted  in  connection   with  a
           Condemnation unless the Mortgaged Property is encumbered by either or
           both of the Prior Mortgages in which case Mortgagee shall be entitled
           to all  compensation,  awards and other payments or relief granted in
           connection  with a  Condemnation  that  is in  excess  of the  amount
           thereof that is applied to the debts  secured by the Prior  Mortgages
           and/or   used  for   restoration   or  repair  as  a  result  of  the
           Condemnation,  in  either  case,  pursuant  to the  Prior  Mortgages.

                                       54
<PAGE>

           Mortgagor shall be entitled,  at its option,  to commence,  appear in
           and prosecute in its own name any action or  proceedings  relating to
           the  Condemnation.  Mortgagor  shall  not be  entitled  to  make  any
           compromise or settlement in connection  with a  Condemnation  without
           the  prior  consent  of  the  Mortgagee,   such  consent  not  to  be
           unreasonably  withheld or  delayed.  All such  compensation,  awards,
           payments,   and  relief,  and  proceeds  awarded  to  Mortgagor  (the
           "Proceeds") are hereby assigned to Mortgagee and Mortgagor  agrees to
           execute such  further  assignments  of the Proceeds as Mortgagee  may
           require.

                     (b) If any portion of the Mortgaged Property is so taken or
           damaged,  Mortgagee  shall have the  option in its sole and  absolute
           discretion to apply all the Proceeds,  after deducting  therefrom all
           costs and expenses including reasonable  attorneys' fees, incurred by
           it in connection  with the Proceeds,  upon any  indebtedness  secured
           hereby, or to apply all the Proceeds,  after such deductions,  to the
           restoration  of  the  Mortgaged  Properly  upon  such  conditions  as
           Mortgagee may determine.

                     (c) Any amounts received by Mortgagee hereunder (after such
           deductions) shall, if retained by Mortgagee, be applied in payment of
           any accrued  interest and then in  reduction of the then  outstanding
           principal of the indebtedness  secured hereby,  notwithstanding  that
           the same may not then be due and  payable.  Any  amount so applied to
           principal  shall  be  applied  to  the  payment  of  installments  of
           principal  due pursuant to the Note in the inverse order of their due
           dates and then to amounts due under the commercial revolving loan and
           shall not affect Mortgagor's obligations to continue to make payments
           not prepaid pursuant to the foregoing.

                     (d)  Mortgagor  shall  provide to  Mortgagee  copies of all
           correspondence  and other  submissions  to or from the holders of the
           Prior Mortgages relating to a Condemnation.

           ARTICLE  1.9  Actions by  Mortgagee  to  Preserve  Security,  etc. If
Mortgagor  fails  to make  any  payment  or to do any  act as and in the  manner
provided  for in the  Mortgage or the Note,  Mortgagee,  in its own  discretion,
without  obligation  so to do and upon ten (10) days'  notice to or demand  upon
Mortgagor  (except  in an  emergency,  in which  case,  no  notice  or demand is
required of Mortgagee) and without releasing Mortgagor from any obligation,  may
make or do the same in such  manner  and to such  extent as  Mortgagee  may deem
necessary to protect the security  hereof.  Mortgagor  shall pay upon demand all
expenses incurred or paid by Mortgagee  (including  reasonable  attorneys' fees,
appraisers'  fees and court,  costs) on account of the  exercise  -of any of the
aforesaid  rights or privileges or on account of any litigation  which may arise
in  connection  with the  Mortgage  or the Note or on  account  of any  attempt,
without  litigation,  to  enforce  the  terms of the  Mortgage  or Note.  If the
Mortgaged  Property or any part thereof shall be advertised for foreclosure sale
and not sold, Mortgagor shall pay all costs in connection therewith.

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<PAGE>

                     If  Mortgagee  is  called  upon to pay any sums of money to
protect or sustain the Lien of this Mortgage  after ten (10) days' notice to and
failure of the  Mortgagor  to do so, all such monies  advanced or due  hereunder
shall become immediately due and payable,  together with interest thereon at the
Default Rate from the date of such advance to the date of the actual  receipt of
payment thereof by Mortgagee.

                     Mortgagor  agrees that if  Mortgagee  shall  obtain a money
judgment,  in  accordance  with the terms  and  conditions  of the  indebtedness
secured  hereby and/or the Mortgage,  then interest  thereon at the Default Rate
shall  accrue and be due and  payable on said  money  judgment  from the date of
entry thereof, until the said judgment is paid in full.

                     If the  Mortgage is placed in the hands of an attorney  for
the collection of any sum payable  hereunder,  Mortgagor agrees to Pay all costs
of  collection,  including,  without  limitation,  reasonable  attorneys'  fees,
appraisers'  fees,  costs and expenses,  incurred by  Mortgagee,  either with or
without the institution of any action or proceeding,  and in addition all costs,
disbursements  and  allowances  provided  by law.  All such costs of  collection
incurred pursuant to this Section shall be deemed to be part of the indebtedness
secured by the Mortgage.

           ARTICLE 1.10  Survival of  Warranties.  Mortgagor  shall  satisfy and
perform fully and faithfully the obligations of Mortgagor  contained in the Note
and each agreement of Mortgagor  incorporated by reference  therein or herein or
issued by Mortgagor  pursuant to the Note, and any  modification or amendment of
any of the  foregoing.  Copies  of the  same  are on file in the  office  of the
Mortgagor. All representations,  warranties and covenants of Mortgagor contained
therein or  incorporated  by reference  shall survive the closing and funding of
the  loan  evidenced  by the  Note  and  shall  remain  continuing  obligations,
warranties and  representations of Mortgagor during any time when any portion of
the obligations secured by the Mortgage remains outstanding.

           ARTICLE  1.11  Additional  Security.  If  Mortgagee at any time holds
additional  security for any of the obligations  secured hereby,  it may enforce
the sale  thereof or  otherwise  realize  upon the same,  at its option,  either
before or  concurrently  with or after a foreclosure or sale  hereunder  without
being deemed to have made an election thereby or of having accepted the security
provided  hereby or the  proceeds  hereof  or such  additional  security  or the
proceeds thereof in full settlement of the Note.

           ARTICLE   1.12   Inspections,   etc.   Mortgagee,   or  its   agents,
representatives or workers,  are authorized to enter at any reasonable time upon
or in any part of the  Premises  for the purpose of  inspecting  the same or the
Mortgaged  Property  and for the  purpose  of  performing  any of the acts it is
authorized  to  perform  under the terms of the  Mortgage.  Mortgagor  agrees to
permit the maintenance in a prominent place on the Premises during the period of
any construction of any Improvements of a financing sign by Mortgagee.

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<PAGE>

           ARTICLE 1.13 Liens.  Mortgagor shall pay and promptly  discharge,  at
Mortgagor's  cost and expense,  all liens,  encumbrances and charges (other than
this Mortgage or any prior mortgage  referred to in Exhibit B upon the Mortgaged
Property  or any  part  thereof  or  interest  therein,  except  as  hereinafter
otherwise provided.  Mortgagor shall have the right to contest in good faith the
validity of any such lien, encumbrance or charge, provided Mortgagor shall first
deposit with  Mortgagee a bond or other  security  satisfactory  to Mortgagee in
such  amounts  as  Mortgagee  shall  reasonably  require,  but not more than one
hundred  twenty-five  percent  (125%) of the amount of the claim,  and  provided
further that Mortgagor shall thereafter  diligently  proceed to cause such lien,
encumbrance or charge to be removed and  discharged.  If Mortgagor shall fail to
discharge any such lien,  encumbrance or charge,  then, in addition to any other
right or remedy of  Mortgagee,  Mortgagee  may, but shall not be  obligated  to,
discharge  the same,  either by  paying  the  amount  claimed  to be due,  or by
procuring  the discharge of such lien,  encumbrance,  or charge by depositing in
court a bond for the amount claimed or otherwise giving security for such claim,
or in such  manner  as is or may be  prescribed  by law.  Any  amount so paid by
Mortgagee shall, at Mortgagee's option,  become immediately due and payable with
interest  thereon  at  the  Default  Rate  and  shall  be  deemed  part  of  the
indebtedness secured by the Mortgage. Impositions that are liens are governed by
the provisions of Section 1.9 and not by this Section.

           ARTICLE  1.14  Subordinate  Mortgages.  Mortgagor  shall not  create,
assume or suffer to exist in  respect  of the  Mortgaged  Property,  or any part
thereof,  any mortgage or lien (other than the  Mortgage),  without  Mortgagee's
prior written consent, which consent shall not be unreasonably withheld.

           ARTICLE 1.15  Continued  Occupancy.  If at any time the then existing
use or occupancy of any part of the Mortgaged  Property  shall,  pursuant to any
zoning or other law, ordinance or regulation,  be permitted only so long as such
use or occupancy  shall  continue,  Mortgagor  shall promptly  advise  Mortgagee
thereof and shall not cause or permit such use or occupancy  to be  discontinued
without the prior consent of Mortgagee.

           ARTICLE 1.16 Transfer. Except to the extent provided in Section 4.13,
Mortgagor  shall not sell,  lease,  encumber or  otherwise  transfer  any of its
interest or ownership in the Mortgaged  property  without the written consent of
Mortgagee,  which  consent  may be  withheld in  Mortgagee's  sole and  absolute
discretion.

                                    ARTICLE 2
                               SECURITY AGREEMENT

           ARTICLE 2.1 Creation of Security Interest. Mortgagor hereby grants to
Mortgagee a security interest as contemplated by the Uniform  Commercial Code as
in effect in New York, in the Fixtures, Proceeds, Rents, Profits, and Personalty
(collectively, the "Collateral") located on or at the Mortgaged Property, now or
hereafter  used in the  operation  of the  Mortgaged  Property,  whether  or not
located on or at the Mortgaged  Property,  and all  accessions  and  accessories
thereto,  substitutes and replacements therefor and any interest now existing or

                                       57
<PAGE>

hereafter  arising  with  respect  thereto  for  the  purpose  of  securing  all
obligations of Mortgagor set forth in the Mortgage.

                                    ARTICLE 3
                              DEFAULTS AND REMEDIES

           ARTICLE 3.1 Events of Default. Any one or more of the following shall
constitute an Event of Default under the Mortgage, and the Note.

                     (a) The  occurrence  of any Event of Default under the Note
           or any  other  instrument  given by or  agreement  made by  Mortgagor
           pursuant to or in connection with the Note.

                     (b) Failure of  Mortgagor  to pay,  when due or, if no time
           for payment is specified,  within thirty (30) days after rendition of
           an bill or statement therefor,  the amount of any costs,  expenses or
           fees  (including  attorneys'  fees) of Mortgagee,  as required by any
           provision  of the Mortgage  with any interest  thereon as provided in
           the Mortgage.

                     (c)  Failure to pay any  Imposition  or  insurance  premium
           required  hereunder  when the  same  shall  be due or to  exhibit  to
           Mortgagee,  within ten (10) days after written demand therefor, proof
           of payment of any Imposition or insurance premium required hereunder.

                     (d) The  actual or  threatened  alteration,  demolition  or
           removal of any of the Improvements in contravention of the provisions
           of this Mortgage without the prior consent of Mortgagee.

                     (e) Damage to any of the  Improvements or Collateral in any
           manner,  to the extent of more than $50,000  which is not replaced by
           Mortgagor  within a  reasonable  period  of time  after  such  damage
           (including  a reasonable  period of time for  Mortgagor to obtain any
           insurance proceeds on account of such damage).

                     (f) Failure to maintain the  Improvements and Collateral in
           good repair in accordance with Section 1.12 hereof.

                     (g)  Failure to comply  with any  requirements  or order or
           notice of violation or ordinance issued by any governmental authority
           claiming  jurisdiction  over the Mortgaged  Property  within the time
           specified in such order, notice, law, ordinance, or regulation as the
           same may be extended or stayed, or, if not so specified, within three
           (3) months from the issuance thereof.

                     (h) The passage of any law deducting from the value of land
           for the purposes of taxation any lien thereon, or changing in any way
           the  taxation of mortgages or debts  -secured  thereby,  if Mortgagor
           cannot or does not pay the same.

                                       58
<PAGE>

                     (i) Failure of Mortgagor  for thirty (30) days after notice
           to  substantially  comply with or perform,  or any material breach or
           violation by Mortgagor  of, any warranty,  representation,  covenant,
           agreement, prohibition, restriction or condition contained herein, in
           the Note, or in any other  instrument  given by or agreement  made by
           Mortgagor pursuant to or in connection with the Note.

                     (j) The  institution of any bankruptcy,  reorganization  or
           insolvency  proceedings  against  Mortgagor  or  other  owner  of the
           Mortgaged  Property  or the  appointment  of a receiver  or a similar
           official with respect to any part of the Mortgaged Property or all or
           a substantial  part of the  properties of Mortgagor or other owner of
           the  Mortgaged  Property  and a  failure  to  have  such  proceedings
           dismissed or such appointment  vacated within a period of ninety (90)
           days.

                     (k)   The   institution   of  any   voluntary   bankruptcy,
           reorganization or insolvency  proceedings by Mortgagor or other owner
           of the  Mortgaged  Property,  or the  appointment  of a receiver or a
           similar  official with respect to any part of the Mortgaged  Property
           or all or a substantial  part of the properties of Mortgagor or other
           owner of the Mortgaged Property.

                     (l) Any sale,  assignment,  transfer,  conveyance  or other
           change in the legal or equitable title to the Mortgaged Property,  or
           any portion thereof  (including the execution of any contract of sale
           relating  thereto but excluding  leases which are governed by Section
           4.13),  whether  voluntarily or involuntarily by operation of law and
           whether  or not of record or for  consideration  without  Mortgagee's
           written consent,  which consent may be given or withheld by Mortgagee
           in its sole and absolute discretion.

                     (m)  The  creation  of  any  lien  or  encumbrance  on  the
           Mortgaged  Property,   including,   without  limitation,  any  junior
           financing on the Mortgaged  Property but not including  easements for
           utilities  or  rights  of way that do not  materially  and  adversely
           impact on the value of the Mortgaged Property.

                     (n) The occurrence of any default or Event of Default under
           any other encumbrance  affecting the Mortgaged  Property,  including,
           specifically, but not limited to, any prior mortgage on the Mortgaged
           Property, or any part thereof.

                     (o) The dissolution or liquidation of Mortgagor.

           ARTICLE 3.2 Acceleration Upon Default,  Additional  Remedies.  In the
event that one or more of the Events of Default as above  provided  shall  occur
and be continuing,  the remedies  available to Mortgagee shall include,  but not
necessarily be limited to, any one or more of the following:

                     (a) Mortgagee may declare the entire unpaid  balance of the
           indebtedness  secured  hereby due and  payable in full in  accordance
           with the Note.

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<PAGE>

                     (b)  Mortgagee  may  take   immediate   possession  of  the
           Mortgaged  Property or any part thereof  (which  Mortgagor  agrees to
           surrender to Mortgagee) and manage, control or lease the same to such
           person  or  persons  and at such  rental as it may deem  proper;  and
           collect, with or without taking possession of the Mortgaged Property,
           all the Rents and Profits therefrom, including those past due as well
           as those thereafter  accruing,  with the right in Mortgagee to cancel
           any lease,  sublease or tenancy  for any cause  which  would  entitle
           Mortgagor  to  cancel  the  same;  to  make  such   expenditures  for
           maintenance, repairs and costs of operation as it may deem advisable;
           and  after  deducting  the  cost  thereof  including  the  fee  of  a
           third-party property manager if one is engaged by Mortgagee, to apply
           the  residue  to the  payment  of any sums  which  are  unpaid on the
           indebtedness  secured  hereby.  The taking of  possession  and/or the
           collection of rents under this paragraph shall not prevent concurrent
           or later proceedings for the foreclosure of the Mortgaged Property as
           provided elsewhere herein.

                     (c)   Mortgagee   may  apply  to  any  court  of  competent
           jurisdiction for the appointment of a receiver or similar official to
           manage and operate the Mortgaged Property,  or any part thereof,  and
           to apply the not Rents and  Profits  therefrom  to the payment of the
           interest and principal of the Indebtedness due under the Note and any
           other obligations of Mortgagor to Mortgagee  hereunder.  In the event
           of such  application,  Mortgagor  consents to the appointment of such
           receiver or similar official and agrees that such receiver or similar
           official may be appointed without notice to Mortgagor, without regard
           to the adequacy of any  security  for the debt and without  regard to
           the solvency of Mortgagor or any other  person,  firm or  corporation
           who or  which  may be  liable  for the  payment  of the  indebtedness
           secured hereby.

                     (d)  Mortgagee  may  exercise  any or  all of the  remedies
           available to a secured party under the Connecticut Uniform Commercial
           Code, including, but not limited to:

                               (1)  Either  personally  or by  means  of a court
                     appointed receiver, to take possession of all or any of the
                     Collateral and exclude  therefrom  Mortgagor and all others
                     claiming under  Mortgagor,  and thereafter to hold,  store,
                     use, operate,  manage,  maintain and control, make repairs,
                     replacements,  alterations,  additions and  improvements to
                     and  exercise all rights and powers of Mortgagor in respect
                     to  the  Collateral  or  any  part  thereof  In  the  event
                     Mortgagee  demands or  attempts to take  possession  of the
                     Collateral  in the  exercise of any rights under any of the
                     instruments which secure the Note,  Mortgagor  promises and
                     agrees  to  promptly   turn  over  and   deliver   complete
                     possession thereof to Mortgagee;

                               (2) Without  notice to or demand upon  Mortgagor,
                     to make such  payments  and do such acts as  Mortgagee  may
                     deem  necessary  to protect  its  security  interest in the
                     Collateral,    including   without   limitation,    paying,

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<PAGE>

                     purchasing,  contesting or  compromising  any  encumbrance,
                     charge  or  lien  which  is  prior  to or  superior  to the
                     security interest granted hereunder,  and in exercising any
                     such powers or authority  to pay all  expenses  incurred in
                     connection therewith;

                               (3)  To  require   Mortgagor   to  assemble   the
                     Collateral or any portion thereof at a place  designated by
                     Mortgagee and  reasonably  convenient to both parties,  and
                     promptly to deliver such  Collateral  to  Mortgagee,  or an
                     agent or representative  designated by it.  Mortgagee,  and
                     its  agents  and  representatives,  shall have the right to
                     enter upon any or all of Mortgagor's  premises and property
                     to exercise Mortgagee's rights hereunder;

                               (4) To sell,  lease or  otherwise  dispose of the
                     Collateral  at public  sale,  with or  without  having  the
                     Collateral at the place of sale, and upon such terms and in
                     such manner as Mortgagee may determine.  Mortgagee may be a
                     Purchaser at any such sale,  and unless the  Collateral are
                     perishable or threaten to decline  speedily in value or are
                     of  a  type  customarily  sold  on  a  recognized   market,
                     Mortgagee  shall  give  Mortgagor  at least ten (10)  days'
                     prior  written  notice of the time and place of any  public
                     sale  of  the  Collateral  or  other  intended  disposition
                     thereof.  Such  notice  may be mailed to  Mortgagor  at the
                     address hereinafter set forth for notices.

                               (5)  Mortgagee  shall have the right to foreclose
                     the Mortgage and in an action or proceeding to  foreclosure
                     the Mortgage,  the Mortgaged  Property may be foreclosed in
                     parts or as an entirety.

           ARTICLE 3.3  Additional  Provisions.  Mortgagor  expressly  agrees as
follows:

                     (a) All remedies available to Mortgagee with respect to the
           Mortgage  shall be  cumulative  and may be  pursued  concurrently  or
           successively.  No delay by  Mortgagee in  exercising  any such remedy
           shall  operate as a waiver  thereof or preclude the exercise  thereof
           during the continuance of that or any subsequent default.

                     (b) The  obtaining  of a  judgment  or  decree on the Note,
           shall not in any  manner  affect  the lien of the  Mortgage  upon the
           Mortgaged  Property,  and the debt  represented  by said  judgment or
           decree shall be secured  hereby to the same extent as the Note is now
           secured.

                     (c) The only limitation upon the foregoing agreements as to
           the exercise of  Mortgagee's  remedies is that there shall be but one
           full and complete satisfaction of the indebtedness secured hereby.

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<PAGE>

           ARTICLE 3.4 Remedies Not  Exclusive.  Mortgagee  shall be entitled to
enforce  payment  of any  indebtedness  secured  hereby and  performance  of all
obligations  contained  herein and to exercise  all rights and powers  under the
Mortgage or under any other  agreement of Mortgagor or any laws now or hereafter
in  force,  notwithstanding  that  some  or  all of the  said  indebtedness  and
obligations secured hereby may now or hereafter be otherwise secured, whether by
mortgage,  deed of trust,  pledge,  lien,  assignment or otherwise.  Neither the
acceptance of the Mortgage nor its enforcement  shall prejudice or in any manner
affect  Mortgagee's  right to realize upon or enforce any other  security now or
hereafter held by Mortgagee, it being agreed that Mortgagee shall be entitled to
enforce the Mortgage and any other  security now or hereafter  held by Mortgagee
in such order and manner as Mortgagee may in its absolute discretion  determine.
No remedy  herein  conferred  upon or  reserved to  Mortgagee  is intended to be
exclusive of any other remedy herein or by law provided or  permitted,  but each
shall be  cumulative  and  shall be in  addition  to every  other  remedy  given
hereunder or now or hereafter existing at law or in equity or by statute.  Every
power or remedy given to Mortgagee or to which it otherwise  may be entitled may
be exercised,  concurrently or independently,  from time to time and as often as
may be deemed expedient by Mortgagee and it may pursue inconsistent remedies.

                                    ARTICLE 4
                                  MISCELLANEOUS

           ARTICLE  4.1  Successors  and  Assigns.  In the  event  title  to the
Mortgaged  Property  or  any  portion  thereof  becomes  vested  in  other  than
Mortgagor,  Mortgagee may, without notice to Mortgagor, deal with such successor
or  successors  in interest  with  reference to the Mortgage and the debt hereby
secured in the same manner as with  Mortgagor,  and such action  shall in no way
affect the liability of Mortgagor  hereunder or under the  indebtedness  secured
hereby or the lien or priority of the  Mortgage  with respect to any part of the
Mortgaged  Property.  All  provisions of the Mortgage  shall be binding upon and
inure  to the  benefit  of the  parties  thereto  and  their  respective  heirs,
executors,  administrators,  successors and assigns,  except as otherwise herein
expressly provided.

           ARTICLE 4.2 Notices.  All notices,  demands,  requests,  permissions,
consents or  approvals  ("Notices")  given by either  party  hereto to the other
party shall be in writing and, if sent by telecopier  or facsimile  transmission
followed by a hard copy sent by regular mail. All notices,  demands and requests
by  Mortgagee to  Mortgagor  shall be deemed given (a) if sent by United  States
registered or certified mail, postage prepaid,  return receipt requested,  three
business days after being postmarked, (b) if sent by overnight delivery service,
when  received at the  applicable  address or when delivery is refused or (c) if
sent by telecopier or facsimile transmission,  when receipt of such transmission
is acknowledged, addressed as follows:

           If to Mortgagee:

           Triple J Associates
           410 Elm Street

                                       62
<PAGE>

           West Hempstead, New York 1152

           If to Mortgagor:

           J. Adam Holdings, Inc. 585 Stewart Avenue

           Suite 760
           Garden City,  New York 11530

           Copy to:

           Cyruli, Shanks and Zizmor, LLP
           420 Lexington Avenue

           Suite 2020
           New York, New York  11201

           Attention:Paul Goodman, Esq.

Mortgagor or Mortgagee  may change the address to which  notices are to be given
by notice to the other as provided herein.

                      Mortgagor  shall  deliver  to  Mortgagee,   promptly  upon
receipt of same, copies of all notices, certificates,  documents and instruments
received  by it  which  materially  affect  any part of the  Mortgaged  Property
covered  hereby,  including,  notices  from any  lessor,  lessee,  sublessee  or
mortgagee  claiming  that  Mortgagor is in default under any terms of any lease,
sublease or mortgage.

           ARTICLE  4.3  Modifications  in  Writing.  This  Mortgage  may not be
changed,  terminated  or  modified  orally  or in any  other  manner  than by an
instrument in writing signed by the party against whom enforcement is sought.

           ARTICLE 4.4  Captions.  The captions or headings at the  beginning of
each Section hereof are for the convenience of the parties and are not a part of
the Mortgage.

           ARTICLE 4.5 Invalidity of Certain Provisions.  If any term, clause or
provision of the Mortgage  shall be adjudged to be invalid,  the validity of the
remainder  shall not be  affected  thereby,  and each  such  term,  clause,  and
provision shall be valid and enforceable to the fullest extent permitted by law.
If the lien of the Mortgage is adjudged to be invalid or unenforceable as to any
part of the debt, or if the lien is invalid or  unenforceable  as to any part of
the  Mortgaged  Property,  the  unsecured  portion of the debt as  determined by
Mortgagee  may at  Mortgagee's  option be declared  due and payable and shall be
completely paid prior to the payment of the secured portion of the debt, and all
payments made on the debt,  whether voluntary or otherwise,  shall be considered
to have been first paid on and  applied to the full  payment of that  portion of
-the debt which is not secured or fully secured by the lien of the Mortgage.

                                       63
<PAGE>

           ARTICLE 4.6 Governing Law and Construction of Clauses.  This Mortgage
shall be governed and construed by the laws of the State of New York.

           ARTICLE 4.7 Terms. The words  "Mortgagor" and  "Mortgagee,"  together
with any pronoun or pronouns in connection therewith (and the possessive form of
any such pronoun or pronouns),  shall include the singular,  plural,  masculine,
feminine and neuter,  as the context may require.  Whenever  used,  the singular
number shall  include the plural,  the plural the  singular,  and the use of any
gender shall include all genders, as the context may require. Any list of one or
more items preceded by the word  "including"  shall not be deemed limited to the
stated items but shall be without limitation.

           ARTICLE 4.8 Counting of Days. The term  "days"when  used herein shall
mean  calendar  days.  If any time period ends on a Saturday,  Sunday or holiday
officially  recognized by the state within which the Real Estate is located, the
period  shall be deemed to end on the next  succeeding  business  day.  The term
"business  day" when used herein shall mean a weekday,  Monday  through  Friday,
except a legal  holiday or a day on which banking  institutions  in the State in
which the Real Estate is located are authorized by law to be closed.

           ARTICLE 4.9 No Merger.  It is the desire and intention of the parties
hereto that this  Mortgage  and the lien hereof do not merge in fee simple title
to the  Premises.  It is hereby  understood  and agreed  that  should  Mortgagee
acquire any additional or other interests in or to the Premises or the ownership
thereof,  then, unless a contrary intent is manifested by Mortgagee as evidenced
by an  appropriate  document  duly  recorded,  this Mortgage and the lien hereof
shall not merge in such  other or  additional  interests  in or to the  Premises
toward the end that this Mortgage may be foreclosed as if owned by a stranger to
said other or additional interests.

           ARTICLE  4.10  Counterparts.  This  Mortgage  may be  executed in any
number of counterparts,  each of which shall be effective only upon delivery and
thereafter  shall be deemed an  original,  and all of which shall be taken to be
one and the same  instrument,  for the same effect as if all parties  hereto had
signed the same  signature  page.  Any  signature  page of this  Mortgage may be
detached  from any  counterpart  of this  Mortgage  without  impairing the legal
effect of any signatures  thereon and may be attached to another  counterpart of
this  Mortgage  identical  in form hereto but having  attached to it one or more
additional signature pages.

           ARTICLE 4.11 Prejudgment  Remedies.  MORTGAGOR  ACKNOWLEDGES THAT (A)
THE  TRANSACTION  OF WHICH THIS MORTGAGE IS A PART IS A COMMERCIAL  TRANSACTION,
AND NOT A CONSUMER  TRANSACTION  AND TO THE EXTENT  PERMITTED  BY LAW WAIVES ANY
RIGHT TO A NOTICE AND HEARING OR TO SEEK  MORTGAGEE TO POST A BOND UNDER CHAPTER
903a OF THE CONNECTICUT GENERAL STATUTES OR OTHER STATUTE OR STATUTES -AFFECTING
PREJUDGMENT  REMEDIES  AND  AUTHORIZES  HOLDER'S  ATTORNEY TO ISSUE A WRIT FOR A
PREJUDGMENT REMEDY WITHOUT COURT ORDER, PROVIDED THE COMPLAINT SHALL SET FORTH A

                                       64
<PAGE>

COPY OF THIS WAIVER,  AND FURTHER  WAIVES ANY RIGHT TO A TRIAL BY JURY OF ANY OR
ALL ISSUES ARISING IN ANY ACTION OR PROCEEDING  BETWEEN  MORTGAGEE AND MORTGAGOR
OR THEIR  SUCCESSORS,  UNDER  OR  CONNECTED  WITH  THIS  MORTGAGE  OR ANY OF ITS
PROVISIONS,  AND (B) THE  OBLIGATION  EVIDENCED BY THIS  MORTGAGE IS AN EXEMPTED
TRANSACTION UNDER THE TRUTH-IN-LENDING ACT, 15 U.S.C. ss.1601 ET SEQ.

           ARTICLE 4.12 Credit Line Mortgage.  This Mortgage is intended to be a
"credit line  mortgage" as defined in Section 281 of the New York Real  Property
Law (as the same may be amended or modified  from time to time  "Section  281").
Accordingly, this Mortgage shall secure not only the original indebtedness under
the Note but also the  indebtedness  created by future  advances  made under the
Note within  twenty (20) years from the date of the recording of the Mortgage to
the same extent and with the same  priority  of lien as if such future  advances
had been made at the time the Mortgage was  recorded,  regardless of whether any
advance shall be made under the Note on the date hereof and/or any  indebtedness
shall be  outstanding at any time that any advance shall be made under the Note.
Further,  the total amount of indebtedness  that may be secured by this Mortgage
may  increase or  decrease at any time and from time to time,  but the amount so
secured at any one time shall not exceed the  Mortgage  Amount plus (a) interest
and any other  charges or fees which may accrue  thereon  pursuant  to the Note,
this Mortgage or any of the other Documents and/or (b) any disbursements made by
Mortgagee to protect the security of this Mortgage with interest  thereon at the
Default Rate. The foregoing is intended to be an express provision under Section
281.

                     NOW, THEREFORE, if the indebtedness secured hereby shall be
well and truly paid according to its tenor, and if

all  agreements and  provisions  contained in the Note, or any other  instrument
given by or agreement  made by Mortgagor  pursuant to or in connection  with the
Note are fully kept and  performed,  then this  Mortgage  shall  become null and
void; otherwise to remain in full force and effect.

                     IN WITNESS WHEREOF, Mortgagor has hereunto set or caused to
be set its hand as of the day and year first

hereinbefore written.

Signed and Delivered
in the presence of.

J. Adam Holdings, Inc

By: /s/ Richard Miller
    ----------------------
    Name:  Richard Miller
    Title: President

                                       65

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