(Stamford, CT) Open End Mortgage Deed, Assignment of Rents and Security Agreement - TSI Realty Co. and GMAC Commercial Mortgage Corp.


                            OPEN END MORTGAGE DEED,

                  ASSIGNMENT OF RENTS AND SECURITY AGREEMENT

     THIS MORTGAGE (herein "Instrument") is made this 12 day of December,
1997, between the Mortgagor/Grantor, TSI REALTY COMPANY, whose address is 1241
East Main Street, Stamford, CT 06902 (herein "Borrower"), and the Mortgagee,
GMAC COMMERCIAL MORTGAGE CORPORATION, a corporation organized and existing under
the laws of California, whose address is 450 Dresher Road, Horsham, PA 19044,
together with its successors, assigns and transferees, (herein "Lender").

     WHEREAS, Borrower is indebted to Lender in the principal sum of TWELVE
MILLION AND 00/100 ($12,000,000) Dollars, which indebtedness is evidenced by
Borrower's note dated of even date herewith (herein the "Note"), providing for
monthly installments of principal and interest, with the balance of the
indebtedness, if not sooner paid, due and payable on January 1, 2013 (the
"Maturity Date").

     TO SECURE TO LENDER (a) the repayment of the indebtedness evidenced by the
Note with interest thereon, and all renewals, extensions and modifications
thereof; (b) the repayment of any future advances with interest thereon, made by
Lender to Borrower pursuant to paragraph 38 hereof (herein "Future Advances");
(c) the performance of the covenants and agreements of Borrower contained in an
Environmental Indemnity Agreement (herein so-called) between Lender, Borrower
and Principal (as defined in the Environmental Indemnity Agreement) dated of
even date herewith; (d) the payment of all other sums, with interest thereon,
advanced in accordance herewith to protect the security of this Instrument; and
(e) the performance of the covenants and agreements of Borrower herein
contained, or contained in any other Loan Document (as hereinafter defined),
Borrower does hereby mortgage, grant, convey and assign to Lender, its
successors, assigns and transferees with mortgage covenants and upon statutory
condition the following described properties located in the City of Stamford,
Fairfield County, State of Connecticut, and more particularly described on
Exhibit "A" attached hereto and incorporated herein by reference for all
purposes (herein "Mortgaged Parcel 1" and "Mortgaged Parcel 2," and
collectively, the "Mortgaged Parcels").

     TOGETHER with all buildings, improvements, and tenements now or hereafter
erected on the Mortgaged Parcels, and all heretofore or hereafter vacated alleys
and streets abutting the Mortgaged Parcels, and all easements, rights,
appurtenances, rents (subject however to the

 
assignment of rents to Lender herein), royalties, mineral, oil and gas rights
and profits, water, water rights, and water stock appurtenant to the Mortgaged
Parcels, and all fixtures, machinery, equipment, engines, boilers, incinerators,
building materials, appliances and goods of every nature whatsoever now or
hereafter located in, or on, or used, or intended to be used in connection with
the Mortgaged Parcels, including, but not limited to, those for the purposes of
supplying or distributing heating, cooling, electricity, gas, water, air and
light; and all elevators, and related machinery and equipment, fire prevention
and extinguishing apparatus, security and access control apparatus, plumbing,
bath tubs, water heaters, water closets, sinks, ranges, stoves, refrigerators,
dishwashers, disposals, washers, dryers, awnings, storm windows, storm doors,
screens, blinds, shades, curtains and curtain rods, mirrors, cabinets, paneling,
rugs, attached floor coverings, furniture, pictures, antennas, trees and plants,
tax refunds, trade names, licenses, permits, Borrower's rights to insurance
proceeds, unearned insurance premiums and chooses in action; all of which,
including replacements and additions thereto, shall be deemed to be and remain a
part of the real Mortgaged Parcels covered by this Instrument; and all of the
foregoing, together with said Mortgaged Parcels (or the leasehold estate in the
event this Instrument is on a leasehold) are herein referred to as the
"Property," (and individually as an "Individual Property");

     TOGETHER with all right, title and interest in, to and under any and all
leases now or hereinafter in existence (as amended or supplemented from time to
time) and covering space in or applicable to the Property (hereinafter referred
to collectively as the "Leases" and singularly as a "Lease"), together with all
rents, earnings, income, profits, benefits and advantages arising from the
Property and from said Leases and all other sums due or to become due under and
pursuant thereto, and together with any and all guarantees of or under any of
said Leases, and together with all rights, powers, privileges, options and other
benefits of Borrower as lessor under the Leases, including, without limitation,
the immediate and continuing right to receive and collect all rents, income,
revenues, issues, profits, condemnation awards, insurance proceeds, moneys and
security payable or receivable under the Leases or pursuant to any of the
provisions thereof, whether as rent or otherwise, the right to accept or reject
any offer made by any tenant pursuant to its Lease to purchase the Property and
any other property subject to the Lease as therein provided and to perform all
other necessary or appropriate acts with respect to such Leases as agent and
attorney-in-fact for Borrower, and the right to make all waivers and agreements,
to give and receive all notices, consents and releases, to take such action upon
the happening of a default under any Lease, including the commencement, conduct
and consummation of proceedings at law or in equity as shall be permitted under
any provision of any Lease or by any law, and to do any and all other things
whatsoever which the Borrower is or may become entitled to do under any such
Lease together with all accounts receivable, contract rights, franchises,
interests, estates or other claims, both at law and in equity, relating to the
Property, to the extent not included in rent earnings and income under any of
the Leases;

     TOGETHER with all right, title and interest in, to and under any and all
reserve, deposit or escrow accounts (the "Accounts") made pursuant to any loan
document made between Borrower and Lender with respect to the Property, together
with all income, profits, benefits and advantages arising therefrom, and
together with all rights, powers, privileges, options and other

                                      -2-

 
benefits of Borrower under the Accounts, and together with the right to do any
and all other things whatsoever which the Borrower is or may become entitled to
do under the Accounts;

     TOGETHER with all agreements, contracts, certificates, guaranties,
warranties, instruments, franchises, permits, licenses, plans, specifications
and other documents, now or hereafter entered into, and all rights therein and
thereto, pertaining to the use, occupancy, construction, management or operation
of the Property and any part thereof and any improvements or respecting any
business or activity conducted on the Property and any part thereof and all
right, title and interest of Borrower therein, including the right to receive
and collect any sums payable to Borrower thereunder and all deposits or other
security or advance payments made by Borrower with respect to any of the
services related to the Property or the operation thereof;

     TOGETHER with any and all proceeds resulting or arising from the foregoing
(collectively, the "Collateral").

     Borrower covenants that Borrower is lawfully seized of the estate hereby
conveyed and has the right to mortgage, grant, convey and assign the Property
(and, if this Instrument is on a leasehold, that the ground lease is in full
force and effect without modification except as noted above and without default
on the part of either lessor or lessee thereunder), that the Property is
unencumbered, and that Borrower will warrant and defend generally the title to
the Property against all claims and demands, subject to any easements and
restrictions listed in a schedule of exceptions to coverage in any title
insurance policy insuring Lender's interest in the Property.

UNIFORM COVENANTS. Borrower and Lender covenant and agree as follows:

1.   PAYMENT OF PRINCIPAL AND INTEREST. Borrower shall promptly pay when due the
principal of and interest on the indebtedness evidenced by the Note, any
prepayment and late charges provided in the Note and all other sums secured by
this Instrument.

2.   FUNDS FOR TAXES, INSURANCE AND OTHER CHARGES. Subject to applicable law or
to a written waiver by Lender, Borrower shall pay to Lender on the day monthly
installments of principal or interest are payable under the Note (or on another
day designated in writing by Lender), until the Note is paid in full, a sum
(herein "Funds") equal to one-twelfth of (a) the yearly taxes and assessments
which may be levied on the Property, (b) the yearly ground rents, if any, (c)
the yearly premium installments for fire and other hazard insurance, rent loss
insurance and such other insurance covering the Property as Lender may require
pursuant to paragraph 5 hereof, (d) the yearly premium installments for mortgage
insurance, if any, and (e) if this Instrument is on a leasehold, the yearly
fixed rents, if any, under the ground lease, all as reasonably estimated
initially and from time to time by Lender on the basis of assessments and bills
and reasonable estimates thereof. Any waiver by Lender of a requirement that
Borrower pay such Funds may be revoked by Lender, in Lender's sole discretion,
at any time upon notice in writing to Borrower. Lender may require Borrower to
pay to Lender, in advance, such other Funds for other taxes, charges, premiums,
assessments and impositions in connection with Borrower or the Property which
Lender shall reasonably deem necessary to protect Lender's interests (herein
"Other Impositions"). Unless otherwise provided 

                                      -3-

 
by applicable law, Lender may require Funds for Other Impositions to be paid by
Borrower in a lump sum or in periodic installments, at Lender's option.

     The Funds shall be held in an institution(s) the deposits or accounts of
which are insured or guaranteed by a Federal or state agency (including Lender
if Lender is such an institution). Lender shall apply the Funds to pay said
rents, taxes, assessments, insurance premiums and Other Impositions so long as
Borrower is not in breach of any covenant or agreement of Borrower in this
Instrument. Lender shall make no charge for so holding and applying the Funds,
analyzing said account or for verifying and compiling said assessments and
bills, unless Lender pays Borrower interest, earnings or profits on the Funds
and applicable law permits Lender to make such a charge. Borrower and Lender may
agree in writing at the time of execution of this instrument that interest on
the Funds shall be paid to Borrower, and unless such agreement is made or
applicable by law requires interest, earnings or profits to be paid, Lender
shall not be required to pay Borrower any interest, earnings or profits on the
Funds. Lender shall give to Borrower, without charge, an annual accounting of
the Funds in Lender's normal format showing credits and debits to the Funds and
the purpose for which each debit to the Funds was made. The Funds are pledged as
additional security for the sums secured by this Instrument.

     If the amount of the Funds held by Lender at the time of the annual
accounting thereof shall exceed the amount deemed necessary by Lender to provide
for the payment of taxes, assessments, insurance premiums, rents and Other
Impositions, as they fall due, such excess shall be credited to Borrower on the
next monthly installment or installments of Funds due. If at any time the amount
of the Funds held by Lender shall be less than the amount deemed necessary by
Lender to pay taxes, assessments, insurance premiums, rents and Other
Impositions, as they fall due, Borrower shall pay to Lender any amount necessary
to make up the deficiency within thirty days after notice from Lender to
Borrower requesting payment thereof.

     Notwithstanding the foregoing, Borrower shall not be required to deposit
monthly escrow payments for insurance premiums with Lender except as hereinafter
provided. Borrower shall make all insurance premium payments prior to that date
on which such payments are due and provide Lender with evidence satisfactory to
Lender that such premium payments have been made, such evidence to be provided
not less than ninety (90) days prior to the date such payments are due. If at
any time during the term of the Loan evidenced by the Note, (i) Borrower fails
to make such premium payments, or to provide evidence to Lender that such
payments have been made, or (ii) Borrower is in default under the terms of the
Note, this Instrument, or any other Loan Document, then Borrower shall
immediately commence paying to Lender monthly escrows in an amount equal to (x)
one-twelfth of the yearly premium installments for fire and other hazard
insurance, rent loss insurance and such other insurance covering the Property as
Lender may require pursuant to paragraph 5 hereof and Borrower shall deliver any
other amounts necessary for Lender to pay such premiums.

     Upon Borrower's breach of any covenant or agreement of Borrower in this
Instrument, Lender may apply, in any amount and in any order as Lender shall
determine in Lender's sole discretion, any Funds held by Lender at the time of
application (i) to pay rents, taxes, assessments, insurance premiums and Other
Impositions which are now or will hereafter become

                                      -4-

 
due, or (ii) as a credit against sums secured by this Instrument. Upon payment
in full of all sums secured by this Instrument, Lender shall promptly refund to
Borrower any Funds held by Lender.

3.   APPLICATION OF PAYMENTS. Unless applicable law provides otherwise, all
payments received by Lender from Borrower under the Note or this Instrument
shall be applied by Lender in the following order of priority: (i) amounts
payable to Lender by Borrower under paragraph 2 hereof; (ii) interest payable on
the Note; (iii) principal of the Note; (iv) interest payable on advances made
pursuant to paragraph 8 hereof; (v) principal of advances made pursuant to
paragraph 8 hereof; (vi) interest payable on any Future Advance, provided that
if more than one Future Advance is outstanding, Lender may apply payments
received among the amounts of interest payable on the Future Advances in such
order as Lender, in Lender's sole discretion, may determine; (vii) principal of
any Future Advance, provided that if more than one Future Advance is
outstanding, Lender may apply payments received among the principal balances of
the Future Advances in such order as Lender, in Lender's sole discretion, may
determine; and (viii) any other sums secured by this Instrument in such order as
Lender, at Lender's option, may determine; provided, however, that Lender may,
at Lender's option, apply any sums payable pursuant to paragraph 8 hereof prior
to interest on and principal of the Note, but such application shall not
otherwise affect the order of priority of application specified in this
paragraph 3.

4.   CHARGES; LIENS. Borrower shall pay all rents, taxes, assessments, premiums,
and Other Impositions attributable to the Property at Lender's option in the
manner provided under paragraph 2 hereof or, if not paid in such manner, by
Borrower making payment, when due, directly to the payee thereof, or in such
other manner as Lender may designate in writing. Borrower shall promptly furnish
to Lender all notices of amounts due under this paragraph 4, and in the event
Borrower shall make payment directly, Borrower shall promptly furnish to Lender
receipts evidencing such payments. Borrower shall promptly discharge any lien,
which has, or may have, priority over or equality with, the lien of this
Instrument, and Borrower shall pay, when due, the claims of all persons
supplying labor or materials to or in connection with the Property. Without
Lender's prior written permission, Borrower shall not allow any lien inferior to
this Instrument to be perfected against the Property.

5.   HAZARD INSURANCE. Borrower shall keep the improvements now existing or
hereafter erected on the Property insured by carriers at all times satisfactory
to Lender against loss by fire, hazards included with the term "extended
coverage", rent loss and such other hazards, casualties, liabilities and
contingencies as Lender (and, if this Instrument is on a leasehold, the ground
lease) shall require and in such amounts and for such periods as Lender shall
require. Borrower shall purchase policies of insurance with respect to the
Property with such insurers, in such amounts and covering such risks as shall be
satisfactory to Lender, including, but not limited to, (i) personal injury and
death; (ii) loss or damage by fire, lightning, hail, windstorm, explosion,
hurricane (to the extent available), and such other hazards, casualties and
contingencies (including at least twelve (12) months rental insurance for each
Individual Property in an amount equal to the gross rentals for such period and
broad form boiler and machinery insurance) as are normally and usually covered
by extended coverage policies in effect where the Property is located and
comprehensive general public liability insurance for each

                                      -5-

 
Individual Property, in an amount not less than $1,000,000.00 per occurrence,
$2,000,000 in the aggregate, together with $5,000,000 excess liability coverage
for each Individual Property, and containing an "Ordinance or Law Coverage" or
"Enforcement" endorsement if any of the improvements or the use of either
Individual Property shall at any time constitute legal nonconforming structures
or uses; provided, that each policy shall provide by way of endorsement, rider
or otherwise that no such insurance policy shall be cancelled, endorsed,
altered, or reissued to effect a change in coverage unless such insurer shall
have first given Lender thirty (30) days prior written notice thereof, such
policy shall be on a replacement cost basis, with a waiver of depreciation, in
an amount not less than that necessary to comply with any coinsurance percentage
stipulated in the policy, but not less than one hundred percent (100%) of the
insurable value (based upon replacement cost) of each Individual Property and
the deductible clause, if any, of the fire and extended coverage policy may not
exceed the lesser of one percent (1%) of the face amount of the policy or
$1,000.00; (iii) loss or damage by flood, if each Individual Property is in an
area designated by the Secretary of Housing and Urban Development as an area
having special flood hazards, in an amount equal to the principal amount of the
Note or the maximum amount available under the Flood Disaster Protection Act of
1973, and regulations issued pursuant thereto, as amended from time to time,
whichever is less, in form complying with the "insurance purchase requirement"
of that Act; and (iv) such other insurance and endorsements, if any, as Lender
may require from time to time, or which is required by the Loan Documents.
Borrower shall cause all insurance (except general public liability insurance)
carried in accordance with this paragraph 5 to be payable to Lender as a
mortgagee and not as a coninsured, and, in the case of all policies of insurance
carried by each lessee for the benefit of Borrower, if any, to cause all such
policies to be payable to Lender as Lender's interest may appear. All premiums
on insurance policies shall be paid, in the manner provided under paragraph 2
hereof, or in such other manner as Lender may designate in writing.

     All insurance policies and renewals thereof shall be in a form acceptable
to Lender and shall include a standard mortgage clause in favor of and in form
acceptable to Lender. Lender shall have the right to hold the policies, and
Borrower shall promptly furnish to Lender all renewal notices and all receipts
of paid premiums. At least thirty (30) days prior to the expiration date of a
policy, Borrower shall deliver to Lender a renewal policy in form satisfactory
to Lender. If this Instrument is on a leasehold, Borrower shall furnish Lender a
duplicate of all policies, renewal notices, renewal policies and receipts of
paid premiums if, by virtue of the ground lease, the originals thereof may not
be supplied by Borrower to Lender.

     In the event of loss, Borrower shall give immediate written notice to the
insurance carrier and to Lender. Borrower hereby authorizes and empowers Lender
as attorney-in-fact for Borrower to make proof of loss, to adjust and compromise
any claim under insurance policies, to appear in and prosecute any action
arising from such insurance policies, to collect and receive insurance proceeds,
and to deduct therefrom Lender's expenses incurred in the collection of such
proceeds; provided however, that nothing contained in this paragraph 5 shall
require Lender to incur any expense or take any action hereunder. Borrower
further authorizes Lender, at Lender's option, (a) to hold the balance of such
proceeds to be used to reimburse Borrower for the cost of reconstruction or
repair of the affected Individual Property or (b) subject to the immediately
following paragraph, to apply such proceeds to the payment of the sums secured
by this

                                      -6-

 
Instrument whether or not then due, in the order of application set forth in
paragraph 3 hereof (subject, however, to the rights of the lessor under the
ground lease if this instrument is on a leasehold).

     Lender shall not exercise Lender's option to apply insurance proceeds to
the payment of the sums secured by this Instrument if all of the following
conditions are met: (i) Borrower is not in breach or default of any covenant or
agreement of this Instrument, the Note or any other Loan Document; (ii) Lender
determines that there will be sufficient funds to restore and repair the
affected Individual Property to the Pre-existing Condition (as hereinafter
defined); (iii) Lender agrees in writing that the rental income of the affected
Individual Property, after restoration and repair of the affected Individual
Property to the Pre-existing Condition, will be sufficient to meet all operating
costs and other expenses, payments for reserves and loan repayment obligations
(including any obligations under any permitted subordinate financing) relating
to the affected Individual Property and maintain a debt service coverage ratio
of at least 1.10 to 1.0; (iv) Lender determines that restoration and repair of
the affected Individual Property to the Pre-existing Condition will be completed
within one year of the date of the loss or casualty to the affected Individual
Property, but in no event later than six months prior to the Maturity Date; (v)
less than fifty percent (50%) of the total floor area of the improvements has
been damaged, destroyed or rendered unusable as a result of such fire or other
casualty; (vi) tenant leases demising in the aggregate at least fifty percent
(50%) of the total rentable space in the affected Individual Property and in
effect as of the date of the occurrence of such fire or other casualty remain in
full force and effect during and after the completion of the restoration and
repair of the affected Individual Property and Borrower furnishes to Lender
evidence satisfactory to Lender that said tenants shall continue to operate
their respective businesses at the affected Individual Property notwithstanding
the occurrence of any such fire or other casualty; and (vii) Lender is
reasonably satisfied that the affected Individual Property can be restored and
repaired as nearly as possible to the condition it was immediately prior to such
casualty and in compliance with all applicable zoning, building and other laws
and codes (the "Pre-existing Condition"). If Lender elects to make the insurance
proceeds available for the restoration and repair of the affected Individual
Property, Borrower agrees that, if any time during the restoration and repair,
the cost of completing such restoration and repair, as determined by Lender,
exceeds the undisbursed insurance proceeds, Borrower shall, immediately upon
demand by Lender, deposit the amount of such excess with Lender, and Lender
shall first disburse such deposit to pay for the costs of such restoration and
repair on the same terms and conditions as the insurance proceeds are disbursed.

     If the insurance proceeds are held by Lender to reimburse Borrower for the
cost of restoration and repair of the affected Individual Property, the affected
Individual Property shall be restored to the equivalent of its original
condition or such other condition as Lender may approve in writing. Lender may,
at Lender's option, condition disbursement of said proceeds on Lender's approval
of such plans and specifications of an architect satisfactory to Lender,
contractor's cost estimates, architect's certificates, waivers of liens, sworn
statements of mechanics and such other evidence of costs, percentage completion
of construction, application of payments; and satisfaction of liens as Lender
may reasonably require. If the insurance proceeds are applied to the payment of
the sums secured by this Instrument, any such application

                                      -7-

 
of proceeds to principal shall not extend or postpone the due dates of the
monthly installments referred to in paragraphs 1 and 2 hereof or change the
amounts of such installments. If the affected Individual Property is sold
pursuant to paragraph 27 hereof or if Lender acquires title to the affected
Individual Property, Lender shall have all of the right, title and interest of
Borrower in and to any insurance policies and unearned premiums thereon and in
and to the proceeds resulting from any damage to the affected Individual
Property prior to such sale or acquisition.

6.   PRESERVATION AND MAINTENANCE OF PROPERTY; LEASEHOLDS. Borrower (a) shall
not commit waste or permit impairment or deterioration of the property, (b)
shall not abandon the Property, (c) shall restore or repair promptly and in a
good and workmanlike manner all or any part of the Property to the equivalent of
its original condition, or such other condition as Lender may approve in
writing, in the event of any damage, injury or loss thereto, whether or not
insurance proceeds are available to cover in whole or in part the costs of such
restoration or repair, (d) shall keep the Property, including improvements,
fixtures, equipment, machinery and appliance thereon in good repair and shall
replace fixtures, equipment, machinery and appliances on the Property when
necessary to keep such items in good repair, (e) shall comply with all laws,
ordinances, regulations and requirements of any governmental body applicable to
the Property, (f) shall provide for professional management of the Property by a
rental property manager satisfactory to Lender unless such requirement shall be
waived by Lender in writing (it being acknowledged and approved by Lender that
the Property is currently managed by Borrower), (g) shall generally operate and
maintain the Property in a manner to ensure maximum rentals, and (h) shall give
notice in writing to Lender of and, unless otherwise directed in writing by
Lender, appear in and defend any action or proceeding purporting to affect the
Property, the security of this Instrument or the rights or powers of Lender.
Neither Borrower nor any tenant or other person shall remove, demolish or alter
any improvement now existing or hereafter erected on the Property or any
fixture, equipment, machinery or appliance in or on the Property except when
incident to the replacement of fixtures, equipment, machinery and appliances
with items of like kind.

     If this Instrument is on a leasehold, Borrower (i) shall comply with the
provisions of the ground lease, (ii) shall give immediate written notice to
Lender of any default by lessor under the ground lease or of any notice received
by Borrower from such lessor or any default under the ground lease by Borrower,
(iii) shall exercise any option to renew or extend the ground lease and give
written confirmation thereof to Lender within thirty days after such option
becomes exercisable (iv) shall give immediate written notice to Lender of the
commencement of any remedial proceedings under the ground lease by any party
thereto and, if required by Lender, shall permit Lender as borrower's attorney-
in-fact to control and act for Borrower in any such remedial proceedings and (v)
shall within thirty days after request by Lender obtain from the lessor under
the ground lease and deliver to Lender the lessor's estoppel certificate
required thereunder, if any. Borrower hereby expressly transfers and assigns to
Lender the benefit of all covenants contained in the ground lease, whether or
not such covenants run with the land, but Lender shall have no liability with
respect to such covenants nor any other covenants contained in the ground lease.

                                      -8-

 
     Borrower shall not surrender the leasehold estate and interests herein
conveyed nor terminate or cancel the ground lease creating said estate and
interests, and Borrower shall not, without the express written consent of
Lender, alter or amend said ground lease. Borrower covenants and agrees that
there shall not be a merger of the ground lease, or of the leasehold estate
created thereby, with the fee estate covered by the ground lease by reason of
said leasehold estate or said fee estate, or any part of either, coming into
common ownership, unless Lender shall consent in writing to such merger, if
Borrower shall acquire such fee estate, then this Instrument shall
simultaneously and without further action be spread so as to become a lien on
such fee estate.

7.   USE OF PROPERTY. Unless required by applicable law or unless Lender has
otherwise agreed in writing, Borrower shall not allow changes in the use for
which all or any part of either Individual Property was intended at the time
this Instrument was executed. Borrower shall not subdivide either Individual
Property or initiate or acquiesce in a change in the zoning classification of
either Individual Property without Lender's prior written consent.

8.   PROTECTION OF LENDER'S SECURITY. If Borrower fails to perform the covenants
and agreements contained in this Instrument, or if any action or proceeding is
commenced which affects the Property or title thereto or the interest of Lender
therein, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankruptcy or decedent,
then Lender at Lender's option may make such appearances, disburse such sums and
take such action as Lender deems necessary, in its sole discretion, to protect
Lender's interest, including, but not limited to, (i) disbursement of attorney's
fees, (ii) entry upon the Property to make repairs, (iii) procurement of
satisfactory insurance as provided in paragraph 5 hereof, (iv) if this
Instrument is on a leasehold, exercise of any option to renew or extend the
ground lease on behalf of Borrower and the curing of any default of Borrower in
the terms and conditions of the ground lease, and (v) the payment of any taxes
and/or assessments levied against the Property and then due and payable.

     Any amounts disbursed by Lender pursuant to this paragraph 8, with interest
thereon shall become additional indebtedness of Borrower secured by this
Instrument. Unless Borrower and Lender agree to other terms of payment, such
amounts shall be immediately due and payable and shall bear interest from the
date of disbursement at the rate stated in the Note unless collection from
Borrower of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate which may be
collected from Borrower under applicable law. Borrower hereby covenants and
agrees that Lender shall be subrogated to the lien of any mortgage or other lien
discharged, in whole or in part, by the indebtedness secured hereby. Nothing
contained in this paragraph 8 shall require Lender to incur any expense or take
any action hereunder.

9.   INSPECTION. Lender may make or cause to be made reasonable entries upon and
inspections of the Property including, but not limited to, phase I and/or phase
II environmental audits and inspections which phase II inspections will not
unreasonably disturb Borrower's use of the Property.

                                      -9-

 
10.  BOOKS AND RECORDS. Borrower shall keep and maintain at all times at
Borrower's address stated below, or such other place as Lender may approve in
writing, complete and accurate books of accounts and records adequate to reflect
correctly the results of the operation of the Property and copies of all written
contracts, leases and other instruments which affect the Property. Such books,
records, contracts, leases and other instruments shall be subject to examination
and inspection at any reasonable time by Lender during normal business hours and
upon forty-eight (48) hours prior notice. Upon Lender's request, Borrower shall
furnish to Lender, within ninety (90) days after the end of Borrower's fiscal
year, and within ninety (90) days after the end of each three month quarter of
each fiscal year of Borrower, a balance sheet, a statement of income and
expenses of the Property and a statement of changes in financial position, each
in reasonable detail and certified by Borrower. Borrower shall furnish, together
with the foregoing financial statements and at any other time upon Lender's
request, a rent schedule for the Property, certified by Borrower, showing the
name of each tenant, and for each tenant, the space occupied, the lease
expiration date, the rent payable and the rent paid. In addition to the above
delivery of financial statements and rent schedule, Borrower shall deliver to
Lender updated versions of such financial statements at any other time upon
Lender's request, including monthly balance sheets and monthly statements of
income and expenses of the property, and current financial statements on all
shareholders of Borrower having a twenty-five percent (25%) or greater ownership
interest in Borrower.

11.  CONDEMNATION. Borrower shall promptly notify Lender of any action or
proceeding relating to any condemnation or other taking, whether direct or
indirect, of the Property, or part thereof, and Borrower shall appear in and
prosecute any such action or proceeding unless otherwise directed by Lender in
writing. Borrower authorizes Lender, at Lender's option, as attorney-in-fact for
Borrower, to commence, appear in and prosecute, in Lender's or Borrower's name,
any action or proceeding relating to any condemnation or other taking of the
Property, whether direct or indirect, and to settle or compromise any claim in
connection with such condemnation or other taking. The proceeds of any award,
payment or claim for damages, direct or consequential, in connection with any
condemnation or other taking, whether direct or indirect, of the Property, or
part thereof, or for conveyances in lieu of condemnation, are hereby assigned to
and shall be paid to Lender subject, if this Instrument is on a leasehold, to
the rights of lessor under the ground lease.

     Borrower authorizes Lender to apply such awards, payments, proceeds or
damages, after the deduction of Lender's expenses incurred in the collection of
such amounts, at Lender's option, to restoration or repair of the Property or to
payment of the sums secured by this Instrument, whether or not then due, in the
order of application set forth in paragraph 3 hereof, with the balance, if any,
to Borrower. Unless Borrower and Lender otherwise agree in writing, any
application of proceeds to principal shall not extend or postpone the due date
of the monthly installments referred to in paragraphs 1 and 2 hereof or change
the amount of such installments. Borrower agrees to execute such further
evidence of assignment of any awards, proceeds, damages or claims arising in
connection with such condemnation or taking as Lender may require.

                                      -10-

 
12.  BORROWER AND LIEN NOT RELEASED. From time to time, Lender may, at Lender's
option, without giving notice to or obtaining the consent of Borrower,
Borrower's successors or assigns or of any junior lienholder or guarantors,
without liability on Lender's part and notwithstanding Borrower's breach of any
covenant or agreement of Borrower in this Instrument, extend the time for
payment of said indebtedness or any part thereof, reduce the payments thereon,
release anyone liable on any of said indebtedness, accept a renewal note or
notes therefor, modify the terms and time of payment of said indebtedness,
release from the lien of this Instrument any part of the Property, take or
release other or additional security, reconvey any part of the Property, consent
to any map or plan of the Property, consent to the granting of any easement,
join in any extension or subordination agreement, and agree in writing with
Borrower to modify the rate of interest or period of amortization of the Note or
change the amount of the monthly installments payable thereunder. Any actions
taken by Lender pursuant to the terms of this paragraph 12 shall not affect the
obligation of Borrower or Borrower's successors or assigns to pay the sums
secured by this Instrument and to observe the covenants of Borrower contained
herein, shall not affect the guaranty of any person, corporation, partnership or
other entity for payment of the indebtedness secured hereby, and shall not
affect the lien or priority of lien hereof on the Property. Borrower shall pay
Lender a reasonable service charge, together with such title insurance premiums
and attorney's fees as may be incurred at Lender's option, for any such action
if taken at Borrower's request.

13.  FORBEARANCE BY LENDER NOT A WAIVER. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any right or remedy. The
acceptance by Lender of payment of any sum secured by this Instrument after the
due date of such payment shall not be a waiver of Lender's right to either
require prompt payment when due of all other sums so secured or to declare a
default for failure to make prompt payment. The procurement of insurance or the
payment of taxes of other liens or charges by Lender shall not be a waiver of
Lender's right to accelerate the maturity of the indebtedness secured by this
Instrument, nor shall Lender's receipt of any awards, proceeds or damages under
paragraphs 5 and 11 hereof operate to cure or waive Borrower's default in
payment of sums secured by this Instrument.

14.  ESTOPPEL CERTIFICATE. Borrower shall within ten (10) days of a written
request from Lender furnish Lender with a written statement, duly acknowledged,
setting forth the sums secured by this Instrument and any right of set-off,
counterclaim or other defense which exists against such sums and the obligations
of this Instrument and attaching true, correct and complete copies of the Note,
this Instrument and any other Loan Documents and any and all modifications,
amendments and substitutions thereof.

15.  UNIFORM COMMERCIAL CODE SECURITY AGREEMENT. This Instrument is intended to
be a security agreement pursuant to the Uniform Commercial Code for any of the
items specified above as part of the Property which, under applicable law, may
be subject to a security interest pursuant to the Uniform Commercial Code, and
Borrower hereby grants Lender a security interest in said items. Borrower agrees
that Lender may file this Instrument, or a reproduction thereof, in the real
estate records or other appropriate index, as a financing statement for any of
the items specified above as part of the Property. Any reproduction of this

                                      -11-

 
Instrument or of any other security agreement or financing statement shall be
sufficient as a financing statement. In addition, Borrower agrees to execute and
deliver to Lender, upon Lender's request, any financing statements, as well as
extensions, renewals and amendments thereof, and reproductions of this
Instrument in such form as Lender may require to perfect a security interest
with respect to said items. Borrower shall pay all costs of filing such
financing statements and any extensions, renewals, amendments and releases
thereof, and shall pay all reasonable costs and expenses of any record searches
for financing statements Lender may reasonably require. Without the prior
written consent of Lender, Borrower shall not create or suffer to be created
pursuant to the Uniform Commercial Code any other security interest in said
items, including replacements and additions thereto. Upon Borrower's breach of
any covenant or agreement of Borrower contained in this Instrument, including
the covenants to pay when due all sums secured by this Instrument, Lender shall
have the remedies of a secured party under the Uniform Commercial Code and, at
Lender's option, may also invoke the remedies provided in paragraph 27 of this
Instrument as to such items. In exercising any of said remedies, Lender may
proceed against the items of real property and any items of personal property
specified above as part of the Property separately or together and in any order
whatsoever, without in any way affecting the availability of Lender's remedies
under the Uniform Commercial Code or of the remedies provided in paragraph 27 of
this Instrument.

16.  LEASES OF THE PROPERTY. As used in this paragraph 16, the word "lease"
shall mean "sublease" if this Instrument is on a leasehold. Borrower shall
comply with and observe Borrower's obligations as landlord under all leases of
the Property or any part thereof. Borrower will not lease any portion of (a)
Mortgaged Parcel 1 for non-office use or (b) Mortgaged Parcel 2 for non-
commercial use except with the prior written approval of Lender. Borrower may
execute or modify, without Lender's prior written consent, any lease of space at
either Individual Property now existing or hereafter made which affects nor more
than 25% of the gross feasible area of the affected Individual Property and
provided the term of such lease is less than 5 years (an "Exempt Lease"),
provided such lease:

          (i)   is on a standard lease form pre-approved by Lender;

          (ii)  is at a net effective rent (after taking into account any free
                rent, construction allowances or other concessions granted by
                landlord) no less than the current actual rent or fair market
                rent then prevailing for similar properties and leases in the
                market area;

          (iii) contains rent or other concessions which are customary and
                reasonable for similar properties and leases in the market area;

          (iv)  represents a bona fide arm's length transaction;

          (v)   does not permit any use which would violate any provision of any
                existing lease or is otherwise inconsistent with the uses and
                quality of existing tenants;

          (vi)  is provided to Lender within ten (10) days after execution;

                                      -12-

 
          (vii)   as modified or amended does not become a lease which fails to
                  satisfy the criteria for an Exempt Lease pursuant to this
                  paragraph 16;

          (viii)  as modified or amended does not materially modify the
                  financial terms of Borrower's standard form of lease or
                  materially reduce the rights and remedies of the Borrower or
                  Lender under said standard lease;

          (ix)    is subordinate by its terms to this Instrument; provides that
                  the tenant thereunder is required to attorn to Lender, such
                  attornment to be effective upon Lender's acquisition of title
                  to the Property; that the tenant agrees to execute such
                  further evidences of attornment as Lender may from time to
                  time request; that the attornment of the tenant shall not be
                  terminated by foreclosure; that in no event shall Lender, as
                  holder of this Instrument or as successor landlord, be liable
                  to the tenant for any act or omission of any prior landlord or
                  for any liability or obligation of any prior landlord
                  occurring prior to the date that Lender or any subsequent
                  owner acquire title to the Property; and that Lender may, at
                  Lender's option, accept or reject such attornment.

     Borrower shall be required to obtain Lender's consent, which shall not be
unreasonably withheld, for any lease and subleases at the Property other than an
Exempt Lease. The request for approval of each such proposed lease shall be made
to Lender in writing and Borrower shall furnish to Lender (and any loan servicer
specified from time to time by Lender): (i) such biographical and financial
information about the proposed tenant as Lender may require in conjunction with
its review, (ii) a copy of the proposed form of lease, and (iii) a summary of
the material terms of such proposed lease (including, without limitation, rental
terms and the term of the proposed lease and any options).

     Borrower, at Lender's request, shall furnish Lender with executed copies of
all leases hereafter made of all or any part of the Property, and all leases
hereafter entered into will be in form and substance subject to the approval of
Lender. All leases of the Property or a separate agreement in recordable form
and substance satisfactory to Lender shall specifically provide that such leases
are subordinate to this Instrument; that the tenant attorns to Lender, such
attornment to be effective upon Lender's acquisition of title to the Property;
that the tenant agrees to execute such further evidences of attornment as Lender
may from time to time request; that the attornment of the tenant shall not be
terminated by foreclosure; that in no event shall Lender, as holder of this
Instrument or as successor landlord, be liable to the tenant for any act or
omission of any prior landlord or for any Property; and that Lender may, at
Lender's option, accept or reject such attornments. Except as otherwise provided
in this paragraph 16, Borrower shall not, without Lender's written consent,
execute, modify, surrender or terminate, either orally or in writing, any lease
now existing or hereafter made of all or any part of the Property, permit an
assignment or sublease of a lease without Lender's written consent, or request
or consent to the subordination of any lease of all or any part of the Property
to any lien subordinate to this Instrument. If Borrower becomes aware that any
tenant proposes to do, or is doing, any act or thing which may give rise to any
right of set-off against rent, Borrower shall (i) take such steps

                                      -13-

 
as shall be reasonably calculated to prevent the accrual of any right to a set-
off against rent, (ii) notify Lender thereof and of the amount of said set-offs,
and (iii) within ten (10) days after such accrual, reimburse the tenant who
shall have acquired such right to set-off or take such other steps as shall
effectively discharge such set-off and as shall assure that rents thereafter due
shall continue to be payable without set-off or deduction.

     Upon Lender's request, Borrower shall absolutely assign to Lender, by
written instrument satisfactory to Lender, all leases now existing or hereafter
made of all or any part of the Property and all security deposits made by
tenants in connection with such leases of the Property. Upon assignment by
Borrower to Lender of any leases of the Property, Lender shall have all of the
rights and powers possessed by Borrower prior to such assignment and Lender
shall have the right to modify, extend or terminate such existing leases and to
execute new leases, in Lender's sole discretion.

17.  REMEDIES CUMULATIVE. Each remedy provided in this Instrument is distinct
and cumulative to all other rights or remedies under this Instrument or afforded
by law or equity, and may be exercised concurrently, independently, or
successively, in any order whatsoever.

18.  ACCELERATION IN CASE OF BORROWER'S INSOLVENCY. If Borrower shall
voluntarily file a petition under Title 11 of the U.S. Code (the "Act"), as such
Act may from time to time be amended, or under any similar or successor Federal
statute relating to bankruptcy, insolvency, arrangements or reorganizations, or
under any state bankruptcy or insolvency act, or file an answer in any
involuntary proceeding admitting insolvency or inability to pay debts, or if
Borrower shall fail to obtain a vacation or stay of involuntary proceedings
brought for the reorganization, dissolution or liquidation of Borrower, within
one hundred and twenty (120) days of the filing of such involuntary proceeding,
or if Borrower shall be adjudged a bankrupt, or if a trustee or receiver shall
be appointed for Borrower or Borrower's property, or if the Property shall
become subject to the jurisdiction of a Federal bankruptcy court or similar
state court, or if Borrower shall make an assignment for the benefit of
Borrower's creditors, or if there is an attachment, execution or other judicial
seizure of any portion of Borrower's assets and such seizure is not discharged
within ten (10) days, then Lender may, at Lender's option, declare all of the
sums secured by this Instrument to be immediately due and payable without prior
notice to Borrower, and Lender may invoke any remedies permitted by paragraph 27
of this Instrument. Any reasonable attorney's fees and other expenses incurred
by Lender in connection with Borrower's bankruptcy or any of the other aforesaid
events shall be additional indebtedness of Borrower secured by this Instrument
pursuant to paragraph 8 hereof.

19.  TRANSFERS OF THE PROPERTY OR BENEFICIAL INTERESTS IN BORROWER.

     (a) Except as provided in subparagraph (c) of this paragraph 19, upon the
sale or transfer of (i) all or any part of the Property, or any interest
therein, or (ii) beneficial interests in Borrower (if Borrower is not a natural
person or persons but is a corporation, partnership, trust or other legal
entity), Lender may, at Lender's option, declare all of the sums secured by this

                                      -14-

 
Instrument to be immediately due and payable, and Lender may invoke any remedies
permitted by paragraph 27 of this Instrument.

     (b) For purposes of this paragraph 19, a sale or transfer of a beneficial
interest in Borrower shall be deemed to include, but is not limited to:

         (i)   if Borrower or any general partner of Borrower is a corporation
               or limited liability company, the voluntary or involuntary sale,
               conveyance, transfer or pledge of a majority of such
               corporation's or limited liability company's stock (or the stock
               of any corporation directly or indirectly controlling such
               corporation or limited liability company by operation of law or
               otherwise) or the creation or issuance of new stock by which an
               aggregate of more than 49% of such corporation's or limited
               liability company's stock shall be vested in a party or parties
               who are not now stockholders;

         (ii)  if Borrower is a limited liability company, the change, removal
               or resignation of a managing member;

         (iii) if Borrower, or any general partner of Borrower, is a limited
               or general partnership, the change, removal or resignation of a
               general partner or managing partner or the transfer or pledge of
               the partnership interest of any general partner or managing
               partner or any profits or proceeds relating to such partnership
               interest;

         (iv)  if Borrower is a limited partnership, the transfer or pledge of a
               majority of the limited partnership interests which in the
               aggregate constitute more than a 49% interest in Borrower, or any
               profits or proceeds relating to such limited partnership
               interests.

     (c) Notwithstanding the foregoing, the following shall not be deemed a sale
or transfer of a beneficial interest in Borrower for purposes of this paragraph
19:

         (i)   a transfer of less than a 49% interest in Borrower, or any
               partner, shareholder or member of Borrower, by devise, descent or
               by operation of law upon the death of a partner, member or
               stockholder of Borrower;

         (ii)  a transfer of a limited partner, shareholder or non-managing
               member interest in Borrower for estate planning purposes to an
               immediate family member of such limited partner, shareholder or
               member, or a trust for the benefit of an immediate family member;
               or

         (iii) a transfer of a general partner or managing member interest in
               Borrower for estate planning purposes to an immediate family
               member of such partner or member, or a trust for the benefit of
               an immediate family member, subject to obtaining Lender's prior
               written consent, which 

                                      -15-

 
               consent shall not be unreasonably withheld subject to the
               criteria set forth in subparagraph (b) of paragraph 35 of this
               Instrument.

     See paragraph 35 of this Instrument.

20.  NOTICE. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower provided for in this Instrument or in
the Note shall be given by mailing such notice by certified mail addressed to
Borrower at Borrower's address stated above or at such other address as Borrower
may designate by notice to Lender as provided herein, and (b) any notice to
Lender shall be given by certified mail, return receipt requested, to Lender's
address stated herein or to such other address as Lender may designate by notice
to Borrower as provided herein. Any notice provided for in this Instrument or in
the Note shall be deemed to have been given to Borrower or Lender when given in
the manner designated herein.

21.  SUCCESSORS AND ASSIGNS BOUND; JOINT AND SEVERAL LIABILITY; AGENTS;
CAPTIONS. The covenants and agreements herein contained shall bind, and the
rights hereunder shall inure to, the respective successors and assigns of Lender
and Borrower, subject to the provisions of paragraph 19 hereof. All covenants
and agreements of Borrower shall be joint and several. In exercising any rights
hereunder or taking any actions provided for herein, Lender may act through its
employees, agents or independent contractors as authorized by Lender. The
captions and headings of the paragraphs of this Instrument are for convenience
only and are not to be used to interpret or define the provisions hereof.

22.  UNIFORM INSTRUMENT; GOVERNING LAW; SEVERABILITY. This form of instrument
combines uniform covenants for national use and non-uniform covenants with
limited variations by jurisdiction to constitute a uniform security instrument
covering real property and related fixtures and personal property. This
Instrument shall be governed by the law of the jurisdiction in which the
Property is located. In the event that any provision of this Instrument or the
Note conflicts with applicable law, such conflict shall not affect other
provisions of this Instrument or the Note which can be given effect without the
conflicting provisions, and to this end the provisions of this Instrument and
the Note are declared to be severable. In the event that any applicable law
limiting the amount of interest or other charges permitted to be collected from
Borrower is interpreted so that any charge provided for in this Instrument or in
the Note, whether considered separately or together with other charges levied in
connection with this Instrument and the Note, violates such law, and Borrower is
entitled to the benefit of such law, such charge is hereby reduced to the extent
necessary to eliminate such violation. The amounts, if any, previously paid to
Lender in excess of the amounts payable to Lender pursuant to such charges as
reduced shall be applied by Lender to reduce the principal of the indebtedness
evidenced by the Note. For the purposes of determining whether any applicable
law limiting the amount of interest or other charges permitted to be collected
from Borrower has been violated, all indebtedness which is secured by this
Instrument or evidenced by the Note and which constitutes interest, as well as
all other charges levied in connection with such indebtedness which constitute
interest, shall be deemed to be allocated and spread over the stated term of the
Note. Unless otherwise required by applicable law, such allocation and spreading
shall be effected in such a

                                      -16-

 
manner that the rate of interest computed thereby is uniform throughout the
stated term of the Note.

23.  WAIVER OF STATUTE OF LIMITATIONS. Borrower hereby waives the right to
assert any statute of limitations as a bar to the enforcement of the lien of
this instrument or to any action brought to enforce the Note or any other
obligation secured by this Instrument.

24.  WAIVER OF MARSHALLING. Notwithstanding the existence of any other security
interest in the Property held by Lender or by any other party, Lender shall have
the right to determine the order in which any or all of the Property shall be
subjected to the remedies provided herein. Lender shall have the right to
determine the order in which any or all portions of the indebtedness secured
hereby are satisfied from the proceeds realized upon the exercise of the
remedies provided herein. Borrower, any party who consents to this Instrument
and any party who now or hereafter acquires a security interest in the Property
and who has actual or constructive notice hereof hereby waives any and all right
to require the marshalling of assets in connection with the exercise of any of
the remedies permitted by applicable law or provided herein.

25.  INTENTIONALLY OMITTED.

26.  ASSIGNMENT OF RENTS; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION. As part
of the consideration for the indebtedness evidenced by the Note, Borrower hereby
absolutely and unconditionally assigns and transfers to Lender all the rents and
revenues of the Property, including those now due, past due, or to become due by
virtue of any lease or other agreement for the occupancy or use of all or any
part of the Property, regardless of to whom the rents and revenues of the
Property are payable. Borrower hereby authorizes Lender or Lender's agents to
collect the aforesaid rents and revenues and hereby directs each tenant of the
Property to pay such rents to Lender or Lender's agents; provided, however, that
prior to written notice given by Lender to Borrower of the breach by Borrower of
any covenant or agreement of Borrower in this Instrument or any other Loan
Document, Borrower shall collect and receive all rents and revenues of the
Property as trustee for the benefit of Lender and Borrower, to apply the rents
and revenues so collected to the sums secured by this instrument in the order
provided in paragraph 3 hereof with the balance, so long as no such breach has
occurred, to the account of Borrower, it being intended by Borrower and Lender
that this assignment of rents constitutes an absolute assignment and not an
assignment for additional security only. Upon delivery of written notice by
Lender to Borrower of the breach by Borrower of any covenant or agreement of
Borrower in this Instrument, and without the necessity of Lender entering upon
and taking and maintaining full control of the Property in person, by agent or
by a court-appointed receiver, Lender shall immediately be entitled to
possession of all rents and revenues of the Property as specified in this
paragraph 26 as the same become due and payable, including, but not limited to,
rents then due and unpaid, and all such rents shall immediately upon delivery of
such notice be held by Borrower as trustee for the benefit of Lender only;
provided, however, that the written notice by Lender to Borrower of the breach
by Borrower shall contain a statement that Lender exercises its rights to such
rents. Borrower agrees that commencing upon delivery of such written notice of
Borrower's breach by Lender to

                                      -17-

 
Borrower, each tenant of the Property shall make such rents payable to and pay
such rents to Lender or Lender's agents on Lender's written demand to each
tenant therefor, delivered to each tenant personally, by mail or by delivering
such demand to each retail store, without any liability on the part of said
tenant to inquire further as to the existence of a default by Borrower.

     Borrower hereby covenants that Borrower has not executed any prior
assignment of said rents, that Borrower has not performed, and will not perform,
any acts or has not executed, and will not execute, any instrument which would
prevent Lender from exercising its rights under this paragraph 26, and that at
the time of execution of this Instrument there has been no anticipation or
prepayment of any of the rents of the Property for more than one month prior to
the due dates of such rents. Borrower covenants that Borrower will not hereafter
collect or accept payment of any rents of the Property more than one month prior
to the due dates of such rents. Borrower further covenants that Borrower will
execute and deliver to Lender such further assignments of rents and revenues of
the Property as Lender may from time to time request.

     Upon Borrower's breach of any covenant or agreement of Borrower in this
Instrument, or upon Borrower's breach of any material covenant of Borrower as
landlord or lessor under any lease, Lender shall be entitled to the appointment
of a receiver for the Property, without notice to Borrower or any other person
or entity and Lender may in person, by agent or by a court-appointed receiver,
regardless of the adequacy of Lender's security, enter upon and take and
maintain full control of the Property in order to perform all acts necessary and
appropriate for the operation and maintenance thereof including, but not limited
to, the execution, cancellation or modification of leases, the collection of all
rents and revenues of the Property, the enforcement or fulfillment of any terms,
condition or provision of any lease, the making of repairs to the Property and
the execution or termination of contracts providing for the management or
maintenance of the Property, all on such terms as are deemed best to protect the
security of this Instrument. In the event Lender elects to seek the appointment
of a receiver for the Property upon Borrower's breach of any covenant or
agreement of Borrower in this Instrument, Borrower hereby expressly consents to
the appointment of such receiver. Lender or the receiver shall be entitled to
receive a reasonable fee for so managing the Property.

     All rents and revenues collected subsequent to delivery of written notice
by Lender to Borrower of the breach by Borrower of any covenant or agreement of
Borrower in this Instrument shall be applied first to the costs, if any, of
taking control of and managing the Property and collecting the rents, including,
but not limited to, attorney's fees, receiver's fees, premiums on receiver's
bonds, costs of repairs to the Property, premiums on insurance polices, taxes,
assessments and other charges on the Property, and the costs of discharging any
obligation or liability of Borrower as lessor or landlord of the Property and
then to the sums secured by this Instrument. Lender or the receiver shall have
access to the books and records used in the operation and maintenance of the
Property and shall be liable to account only for those rents actually received.
Lender shall not be liable to Borrower, anyone claiming under or through
Borrower or anyone having an interest in the Property by reason of anything done
or left undone by Lender under this paragraph 26.

                                      -18-

 
     If the rents of the Property are not sufficient to meet the costs, if any,
of taking control of and managing the Property and collecting the rents, any
funds expended by Lender for such purposes shall become indebtedness of Borrower
to Lender secured by this Instrument pursuant to paragraph 8 hereof. Unless
Lender and Borrower agree in writing to other terms of payment, such amounts
shall be payable upon notice from Lender to Borrower requesting payment thereof
and shall bear interest from the date of disbursement at the rate stated in the
Note unless payment of interest at such rate would be contrary to applicable
law, in which event such amounts shall bear interest at the highest rate which
may be collected from Borrower under applicable law.

     Any entering upon and taking and maintaining of control of the Property by
Lender or the receiver and any application of rents as provided herein shall not
cure or waive any default hereunder or invalidate any other right or remedy of
Lender under applicable law or provided herein. This assignment of rents of the
Property shall terminate at such time as this Instrument ceases to secure
indebtedness held by Lender.

NON-UNIFORM COVENANTS. Borrower and Lender further covenant and agree as
follows:

27.  ACCELERATION UPON DEFAULT; ADDITIONAL REMEDIES. Upon Borrower's breach of
any representation, covenant or agreement of Borrower in this Instrument, the
Note, the Environmental Indemnity Agreement, or any other Loan Document,
including, but not limited to, the covenants to pay when due any sums secured by
this Instrument, Lender, at Lender's option, may declare all of the sums secured
by this Instrument to be immediately due and payable without further demand, and
may invoke the power of sale and any other remedies permitted by applicable law
or provided herein. Borrower acknowledges that the power of sale herein granted
may be exercised by Lender without prior judicial hearing. Borrower has the
right to bring an action to assert the non-existence of a breach or any other
defense of Borrower to acceleration and sale. Lender shall be entitled to
collect all costs and expenses incurred in pursuing such remedies, including,
but not limited to, attorney's fees and costs of documentary evidence, abstracts
and title reports.

     Notwithstanding the foregoing, Lender shall not invoke any remedy provided
hereunder, under the Loan Documents, at law or in equity upon Borrower's breach
of a non-monetary representation, covenant, or agreement of Borrower in this
Instrument, the Note, the Environmental Indemnity Agreement or any other Loan
Document, other than a breach of paragraphs 5, 19, 32(k), 32(l) or 32(n) of this
Instrument, or paragraph 2 of the Environmental Indemnity Agreement, provided
Borrower shall have, on or before the date that is ten (10) days after
Borrower's receipt of notice thereof, cured such default or, if such default
cannot be cured within such ten (10) day period, Borrower shall have commenced
to cure within such ten (10) day period and is taking all actions required to
diligently cure such default and such default is cured on or before the date
that is thirty (30) days after Borrower's receipt of a notice to cure such
default.

     In the event that one or more of the events of default as above provided
shall occur, the remedies available to Lender shall include, but not necessarily
be limited to, any one or more of the following:

                                      -19-

 
     (a) Lender may declare the entire unpaid balance of the Note, together with
all accrued interest thereon, immediately due and payable without notice.

     (b) Lender may take immediate possession of the Property or any part
thereof (which Borrower agrees to surrender to Lender) 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 Property, all the
rents, issues and profits therefrom, including those past due as well as those
thereafter accruing, with the right in Lender to cancel any lease, sublease or
tenancy for any cause which would entitle Borrower 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 and a commission of [five
percent (5%)] upon the gross amounts of rents collected, to apply the residue to
the payment of any sums which are unpaid hereunder or under the Note. 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 Property as
provided elsewhere herein.

     (c) Lender may apply to any court of competent jurisdiction for the
appointment of a receiver or similar official to manage and operate the
Property, or any part thereof, and to apply the net rents, issues, and profits
therefrom to the payment of the interest and the principal of the Note and any
other obligations of Borrower to Lender hereunder. In the event of such
application, Borrower consents to the appointment of such receiver or similar
official and agrees that such receiver or similar official may be appointed
without notice to Borrower, without regard to the adequacy of any security for
the debt and without regard to the solvency of Borrower or any other person,
firm or corporation who or which may be liable for the payment of the Note or
any other obligation of Borrower hereunder.

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

         (i)   Either personally or by means of a court appointed receiver, to
               take possession of all or any of the Collateral and exclude
               therefrom Borrower and all others claiming under Borrower, 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 Borrower in
               respect to the Collateral or any part thereof. In the event
               Lender demands or attempts to take possession of the Collateral
               in the exercise of any rights under any of the instruments which
               secure the Note, Borrower promises and agrees to promptly turn
               over and deliver complete possession thereof to Lender;

         (ii)  Without notice to or demand upon Borrower, to make such payments
               and do such acts as Lender may deem necessary to protect its
               security interest in the Collateral, including without
               limitation, paying, purchasing, contesting or compromising any
               encumbrance, charge or lien which is prior to or superior to the
               security interest granted hereunder, and in

                                      -20-

 
               exercising any such powers or authority to pay all expenses
               incurred in connection therewith;

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

         (iv)  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 Lender may determine.
               Lender 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,
               Lender shall give Borrower 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 Borrower at the address hereinafter set forth for notice.

     (e) Lender shall have the right to foreclose the Instrument and in an
action or proceeding to foreclosure the Instrument, the Property may be
foreclosed in parts or as an entirety.

     Additional Provisions. Borrower expressly agrees as follows:
     ---------------------                                        

     (f) All remedies available to Lender with respect to the Instrument shall
be cumulative and may be pursued concurrently or successively.  No delay by
Lender 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.

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

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

     Remedies Not Exclusive. Lender 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 Instrument or the Note or under
any other agreement of Borrower or any laws now or hereafter in force,
notwithstanding that some of 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 Instrument nor its enforcement shall prejudice or in any manner affect
Lender's right to realize

                                      -21-

 
upon or enforce any other security now or hereafter held by Lender, it being
agreed that Lender shall be entitled to enforce the Instrument and any other
security now or hereafter held by Lender in such order and manner as Lender may
in its absolute discretion determine. No remedy herein conferred upon or
reserved to Lender 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 Lender 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 Lender and it may pursue
inconsistent remedies.

     See paragraph 34 of this Instrument.

28.  RELEASE. Upon payment of all sums secured by this Instrument, Lender shall
release this Instrument. Borrower shall pay Lender's $100 for the release of
this Instrument.

29.  ATTORNEY'S FEES. As used in this Instrument and in the Note, "attorney's
fees" shall include reasonable attorney's fees, if any, which may be awarded by
an appellate court.

30.  NONRECOURSE LOAN. Subject to the qualifications below in this paragraph,
the Borrower shall be liable for payment and performance of all of the
obligations, covenants and agreements of the Borrower under the Note, this
Instrument, the Assignment of Leases and Rents (herein so-called), dated of even
date herewith, executed by Borrower to Lender, the Environmental Indemnity
Agreement dated of even date herewith, executed by Borrower and Lender, and all
other instruments and documents evidencing, securing or governing the terms of
the loan (the "Loan") evidenced by the Note (collectively, the "Loan
Documents"), to the full extent (but only to the extent) of all of the Property
and any other items, property or amounts which are collateral or security for
the Loan. If a default occurs in the timely and proper payment of any portion of
such indebtedness or in the timely performance of any obligations, agreements or
covenants, except as set forth below in this paragraph, neither Borrower, nor
any partner of Borrower, nor any partner, stockholder, director or officer of
any partner of Borrower, shall be personally liable for the repayment of any of
the principal of, interest on, or prepayment fees or late charges, or other
charges or fees due in connection with the Loan, the performance of any
covenants of Borrower under the Note, this Instrument or any of the other Loan
Documents or for any deficiency judgment which Lender may obtain after default
by Borrower. Notwithstanding the foregoing provisions of this paragraph or any
other agreement, the Borrower shall be fully and personally liable for any and
all: (1) liabilities, costs, losses, damages, expenses or claims (including,
without limitation, any reduction in the value of the Property or any other
items, property or amounts which are collateral or security for the Loan)
suffered or incurred by Lender by reason of or in connection with (a) any fraud
or misrepresentation by the Borrower in connection with the Loan, including but
not limited to any misrepresentation of the Borrower contained in any Loan
Document, (b) any failure to pay taxes, insurance premiums (except to the extent
that such taxes and insurance premiums are then held by the Lender),
assessments, charges for labor or materials or other charges that can create
liens on any portion of the Property, (c) any misapplication of (i) proceeds of
insurance covering any portion of the Property, or (ii) proceeds of the sale or
condemnation of any portion of the Property, (d) any

                                      -22-

 
rentals, income, profits, issues and products received by or on behalf of the
Borrower subsequent to the date on which the Lender gives written notice that a
default has occurred under the Loan and not applied to the payment of principal
or interest due under the Note or the payment of operating expenses (excluding
any operator's, manager's or developer's fee paid to the Borrower or any
affiliate of the Borrower) of the Property, (e) any failure to maintain, repair
or restore the Property in accordance with any Loan Document to the extent not
covered by insurance proceeds made available to the Lender, (f) any failure by
Borrower to deliver to the Lender all unearned advance rentals and security
deposits paid by tenants of the Property received by or on behalf of the
Borrower, and not refunded to or forfeited by such tenants, (g) any failure by
the Borrower to return to, or reimburse the Lender for, all personality taken
from the Property by or on behalf of the Borrower, except in accordance with the
provisions of this instrument, and (h) any and all indemnities given by the
Borrower to the Lender set forth in the Environmental Indemnity Agreement or any
other Loan Document in connection with any environmental matter relating to the
Property; and (2) court costs and all attorneys' fees provided for in any Loan
Document. Furthermore, no limitation of liability or recourse provided above in
this paragraph shall (x) apply to the extent that the Lender's rights of
recourse to the Property are suspended, reduced or impaired by or as a result of
any act, omission or misrepresentation of the Borrower or any other party now or
hereafter liable for any part of the Loan and accrued interest thereon, or by or
as a result of any case, action, suit or proceeding to which the Borrower or any
such other party, voluntarily becomes a party; or (y) constitute a waiver,
forfeiture, abrogation or limitation of or on any right accorded by any law
establishing a debtor relief proceeding, including, but not limited to, Title
11, U.S. Code, which right provides for the assertion in such debtor relief
proceeding of a deficiency arising by reason of the insufficiency of collateral
notwithstanding an agreement of the Lender not to assert such deficiency.

31.  REPRESENTATIONS OF BORROWER. The Borrower hereby represents and warrants
to Lender the following:

     (a) Borrower is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware.  There are no proceedings or
actions pending, threatened or contemplated for the liquidation, termination or
dissolution of Borrower.

     (b) Borrower has heretofore delivered to Lender a true, correct, and
complete list of each and every lease affecting the Property, together with all
extensions and amendments thereof (the "Existing Leases"); Borrower has
delivered to Lender a true, correct, and complete copy of each of the Existing
Leases; and there are no other leases, assignments, modifications, extensions,
renewals, or other agreements of any kind whatsoever (written or oral)
outstanding with respect to the leases or the Property.

     (c) Unless otherwise specified in the Rent Schedule Certification:

         (i)   the Existing Leases are in full force and effect;

         (ii)  Borrower has not given any notice of default to any tenant under
               an Existing Lease (an "Existing Tenant") which remains uninsured;

                                      -23-

 
         (iii) no Existing Tenant has any set off, claim or defense to the
               enforcement of any Existing Lease;

         (iv)  no Existing Tenant is in arrears in the payment of rent,
               additional rent or any other charges whatsoever due under any
               Existing Lease; or, to the knowledge of Borrower, is materially
               in default in the performance of any other obligations of such
               Existing Tenant under the applicable Existing Lease; and

         (v)   Borrower has completed all work or alterations required of the
               landlord or lessor under each Existing Lease; and all of the
               other obligations of landlord or lessor under the Existing Leases
               have been performed.

     (d) Borrower has delivered to Lender a true, correct, and complete rent
roll (the "Rent Roll") of annual and monthly rents payable by all Existing
Tenants, including all percentage rents, if any, expiration dates of the
Existing Leases, and the amount of security deposit being held by Borrower under
each Existing Lease, if any; and Borrower has not granted any Existing Tenant
any rent concessions (whether in form of cash contributions, work agreements,
assumption of an Existing Tenant's other obligations, or otherwise) or
extensions of time whatsoever not reflected in such Rent Roll.

     (e) There are no legal proceedings commenced (or, to the best of the
knowledge of the Borrower, threatened) against Borrower by any Existing Tenant;
no rental in excess of one month's rent has been prepaid under any of the
Existing Leases; each of the Leases is valid and binding on the parties thereto
in accordance with its terms; and the execution of this Instrument and the other
Loan Documents will not constitute an event of default under any of the Existing
Leases.

     (f) Borrower currently holds the security deposits (if any) specified in
the Existing Leases and has not given any credit, refund, or set off against
such security deposits to any person.

     (g) There are no residential units in the Property, and no portion of the
Property is an apartment or other unit subject to any form of rent control,
stabilization or regulation; and no person presently occupies any part of the
Property for dwelling purposes.

     (h) Except for Borrower, there are no persons or entities occupying space
in the Property as tenants other than the persons or entities specifically named
in the Existing Leases.

     (i) Except as specifically listed in the schedule of exceptions to coverage
in the title policy insuring Lender's interest in the Property, Borrower is now
in possession of the Property; Borrower's possession of the Property is
peaceable and undisturbed; Borrower does not know any facts by reason of which
any claim to the Property, or any part thereof, might arise or be set up adverse
to Borrower; and the Property is free and clear of (i) any lien for taxes
(except real property taxes not yet due and payable for the calendar year in
which this Instrument is being executed), and (ii) any easements, rights-of-way,
restrictions, encumbrances, liens or other

                                      -24-

 
exceptions to title by mortgage, decree, judgment, agreement, instrument, or, to
the knowledge of Borrower, proceeding in any court.

     (j) All charges for labor, materials or other work of any kind furnished in
connection with the construction, improvement, renovation or rehabilitation of
the Property or any portion thereof have been paid in full, and no unreleased
affidavit claiming a lien against the Property, or any portion thereof, for the
supplying of labor, materials or services for the construction of improvements
on the Property has been executed or recorded in the mechanic's lien or other
appropriate records in the county in which the Property is located.

     (k) The Property and the current and contemplated uses of the Property are
in compliance with all applicable federal, state and municipal laws, rules,
regulations and ordinances, applicable restrictions, zoning ordinances, building
codes and regulations, building lines and easements, including, without
limitation, federal and state environmental protection law and the Americans
with Disabilities Act of 1990, the Fair Housing Amendments Act of 1988, all
state and local laws or ordinances related to handicapped access, and any
statute, rule, regulation, ordinance, or order of governmental bodies or
regulatory agencies, or any order or decree of any court adopted or enacted with
respect thereto (collectively, "Applicable Laws"); no governmental authority
having jurisdiction over any aspect of the Property has made a claim or
determination that there is any such violation; the Property is not included in
any area identified by the Secretary of Housing and Urban Development pursuant
to the Flood Disaster Protection Act of 1973, as amended, as an area having
special flood hazards; and all permits, licenses and the like which are
necessary for the operation of the Property have been issued and are in full
force and effect.

     (l) There have been no material adverse changes, financial or otherwise, in
the condition of Borrower from that disclosed to Lender in the loan application
submitted to Lender by Borrower, or in any supporting data submitted in
connection with the Loan, and all of the information contained therein was true
and correct when submitted and is now substantially and materially true and
correct on the date hereof.

     (m) There is no claim, litigation or condemnation proceeding pending, or,
to the knowledge of the Borrower, threatened, against the Property or Borrower,
which would affect the Property or Borrower's ability to perform its obligations
in the connection with the Loan.

     (n) Borrower does not own any real property or assets other than the
Property and does not operate any business other than the management and
operation of the Property.

     (o) No proceedings in bankruptcy or insolvency has ever been instituted by
or against Borrower or any affiliate thereof, and no such proceeding is now
pending or contemplated.

     (p) Borrower is, and if there are any general partners or members of
Borrower, such partners or members are, solvent pursuant to the laws of the
United States, as reflected by the entries in Borrower's books and records and
as reflected by the actual facts.

                                      -25-

 
     (q) The Loan Documents have been duly authorized, executed and delivered by
Borrower and constitute valid and binding obligations of Borrower, enforceable
against Borrower in accordance with their respective terms. No approval,
consent, order or authorization of any governmental authority and no
designation, registration, declaration or filing with any governmental authority
is required in connection with the execution and delivery of the Note, this
Instrument or any other Loan Document.

     (r) The execution and delivery of the Loan Documents will not violate or
contravene in any way the articles of incorporation or bylaws or partnership
agreement, articles of organization or operating agreement as the case may be,
of Borrower or any indenture, agreement or Instrument to which Borrower is a
party or by which it or its property may be bound, or be in conflict with,
result in a breach of or constitute a default under any such indenture,
agreement or other instrument, result in the creation or imposition of any lien,
charge or encumbrance of any nature whatsoever upon any of the property or
assets of Borrower, except as contemplated by the provisions of such Loan
Documents, and no action or approval with respect thereto by any third person is
required.

     (s) No part of the Property is all or a part of Borrower's homestead.

     (t) The Property is served by all utilities required for the current or
contemplated use thereof.  All utility service is provided by public utilities
and the Property has accepted or is equipped to accept such utility service.

     (u) All public roads and streets necessary for service of and access to the
Property for the current or contemplated use thereof have been completed, are
serviceable and all-weather and are physically and legally open for use by the
public.

     (v) The Property is serviced by public water and sewer systems.

     (w) The Property is free from damage caused by fire or other casualty.

     (x) All liquid and solid waste disposal, septic and sewer systems located
on the Property are in a good and safe condition and repair and in compliance
with all Applicable Laws.

32.  BORROWER'S ADDITIONAL COVENANTS. Borrower hereby covenants, agrees and
undertakes to:

     (a) fulfill and perform all of Borrower's obligations as landlord or lessor
under any lease; will promptly send Lender copies of any notices of default
received from the tenant under any lease; and will enforce (short of terminating
such lease) the performance by the tenant of the tenant's obligations under any
lease;

     (b) not make, enter into, execute, cancel, amend or modify any lease
without the prior written consent of Lender (other than an Exempt Lease);

                                      -26-

 
     (c) not approve any assignment of a lease, of any sublease or underlease,
without the prior written consent of Lender (other than an Exempt Lease);

     (d) not cancel or modify any guaranty of a lease, or release any security
deposit or letter of credit constituting security under a lease, without the
prior written consent of Lender;

     (e) not accept prepayment of any installment of rent from any tenants of
the Property for a period of more than one (1) month in advance;

     (f) not further assign the whole (or any part of) the leases or the rents;

     (g) not undertake or commence any alterations of any improvements on the
Property the cost of which is in excess of five percent (5%) of the then
original principal amount of the Note, without the prior written consent of
Lender;

     (h) from time to time, at the request of Lender, (i) promptly correct any
defect, error or omission which may be discovered in the contents of this
Instrument or in any other Loan Document or in the execution or acknowledgment
thereof; (ii) execute, acknowledge, deliver and record and/or file such further
documents or instruments (including, without limitation, further mortgages,
security agreements, financing statements, continuation statements, assignments
of rents or leases and environmental indemnity agreements) and perform such
further acts and provide such further assurances as may be necessary, desirable
or proper, in Lender's opinion, to carry out more effectively the purposes of
this Instrument and such other instruments and to subject to the liens and
security interests hereof and thereof any property intended by the terms hereof
or thereof to be covered hereby or thereby, including specifically, but without
limitation, any renewals, additions, substitutions, replacements, or
appurtenances to the Property; provided that such documents or instruments do
not materially increase Borrower's liability under the Loan Documents; and (iii)
execute, acknowledge, deliver, procure, and file and/or record any document or
instrument (including specifically, but without limitation, any financial
statement) deemed advisable by Lender to protect the liens and the security
interests herein granted against the rights or interests of third persons;
provided that such documents or instruments do not materially increase
Borrower's liability under the Loan Documents. Borrower will pay all reasonable
costs connected with any of the foregoing in this subparagraph (h);

     (i) continuously maintain Borrower's existence and right to do business in
the State of Connecticut;

     (j) at any time any law shall be enacted imposing or authorizing the
imposition of any tax upon this Instrument, or upon any rights, titles, liens,
or security interests created hereby, or upon the obligations secured hereby or
any part thereof, immediately pay all such taxes; provided that, if such law is
enacted makes it unlawful for Borrower to pay such tax, Borrower shall not pay
nor be obligated to pay such tax, and in the alternative, Borrower may, in the
event of the enactment of such a law, and must, if it is unlawful for Borrower
to pay such taxes, prepay the obligations secured hereby in full within sixty
(60) days after demand therefor by Lender;

                                      -27-

 
     (k) not execute or deliver any deed of trust, mortgage or pledge of any
type covering all or any portion of the Property;

     (l) not acquire any real property or assets (other than the Property) or
operate any business other than the management and operation of the Property
during the term of the Loan;

     (m) not permit any drilling or exploration for or extraction, removal or
production of any mineral, natural element, compound or substance from the
surface or subsurface of the Property regardless of the depth thereof or the
method of mining or extraction thereof;

     (n) not change its name, identity, structure or employer identification
number during the term of the Loan;

     (o) pay on demand all reasonable and bona fide out-of-pocket costs, fees
and expenses and other expenditures, including, but not limited to, reasonable
attorneys' fees and expenses, paid or incurred by Lender to third parties
incident to this instrument or any other Loan Document (including, but not
limited to, reasonable attorneys' fees and expenses in connection with the
negotiation, preparation and execution hereof and of any other Loan Document and
any amendment hereto or thereto, any release hereof, any consent, approval or
waiver hereunder or under any other Loan Document, the making of any advance
under the Note and any suit to which Lender is a party involving this Instrument
or the Property) or incident to the enforcement of the obligations secured
hereby or the exercise of any right or remedy of Lender under any Loan Document;
and

     (p) maintain and keep the Property in compliance with all Applicable Laws.

33.  RESERVES.

     (a)  CAPITAL IMPROVEMENTS RESERVE.

          (i) Commencing on the first day a monthly installment of principal and
interest is due and payable under the Note and continuing on the first calendar
day of each calendar month thereafter, Borrower shall deliver to Lender,
together with the regular installments of principal and interest an amount (a
"CIR Payment") equal to $2,925.00 of which $1,360.00 is allocated to Mortgaged
Parcel 1 ("Parcel 1 CIR Funds") and $1,565.00 is allocated to Mortgaged Parcel 2
("Parcel 2 CIR Funds"). Each CIR Payment shall be deemed "Other Impositions" and
"Funds" as defined in paragraph 2 of this Instrument. The CIR Payments will be
placed in interest bearing deposits or accounts in the name of Lender or
Lender's loan servicer at the same financial institution(s) as the other Funds
(the "Other Impositions Account"), shall be held in accordance with the terms of
paragraph 2 of this Instrument, and may be drawn on by Borrower for deferred
maintenance and/or ongoing capital improvement expenditures in connection with
the Property, pursuant to the terms set forth below in subparagraph 33(a)(ii).
At Lender's discretion, the CIR Payments may be increased to reflect any
increase in the "Consumer Price Index" published by the Bureau of Labor
Statistics of the U.S. Department of Labor, All Items, U.S. city average, all
urban consumers (presently denominated "CPI-U"), or a successor or substitute
index appropriately adjusted (the "CPI"). In the event Lender shall elect not to

                                      -28-

 
increase the CIR Payment for any given year by the CPI, Lender, at its sole
discretion, may during any subsequent year elect to increase the CIR Payment by
the aggregate amount of CPI increases which Lender otherwise was entitled to
make during the previous years in which it did not elect to make such increases.

          (ii)   So long as Borrower (x) is not in default under any of the
terms of the Note, this instrument or any of the other Loan Documents, and (y)
no situation exists which with the passage of time or the giving of notice or
both would constitute a default under the Note, this Instrument or any of the
other Loan Documents, Borrower, subject to the following provisions of this
subparagraph (ii) and upon ten (10) days' prior written notice to Lender and
Lender's loan servicer (which notice shall include a brief statement of the
purpose for which the advance is to be used), shall be entitled to draw on the
CIR Payments on deposit in the Other Impositions Account solely for the payment
of deferred maintenance and/or ongoing capital improvement expenditures for the
Property. Borrower may not make any drawing on the Other Impositions Account (1)
for less than $500 and (2) without the prior consent of Lender. Lender reserves
the right to require such information as Lender may reasonably require, and to
withhold consent in the event that Lender deems it necessary to do so. Without
limiting the foregoing, Lender may request, in connection with a request by
Borrower for a drawing on the Other Impositions Account, that Borrower furnish
written evidence reasonably satisfactory to Lender that the amount requested by
Borrower is for work performed, services or materials furnished, and bills paid
or payable with respect to the deferred maintenance and/or ongoing capital
improvement expenditures (including, but not limited to, contracts and invoices
for work performed or materials supplied and mechanics' and materialmen' lien
releases and waivers from such parties performing such work or supplying such
materials). Lender also reserves the right to make any disbursement or portion
thereof from the Other Impositions Account directly to the party performing such
work or supplying such materials. Lender or Lender's servicing agent, as the
case may be, shall be entitled to charge Borrower a reasonable processing fee
for administering and reviewing Borrower's draw requests. In addition, Lender
shall be reimbursed by Borrower for any costs incurred by Lender or Lender's
servicing agent in inspecting the Property in connection with Borrower's draw
requests. Any such processing fees and inspection costs shall be deducted by
Lender from the Funds on deposit or account or, at Lender's option, shall be
paid to Lender by Borrower within ten (10) days of Lender's written demand.

          (iii)  Notwithstanding anything to the contrary contained herein,
Borrower may only make drawings (a) for Mortgaged Parcel 1 from funds available
in Parcel 1 CIR Funds; and (b) for Mortgaged Parcel 2, from funds available in
Parcel 2 CIR Funds.

          (iv)   Each CIR Payment is pledged as additional security for the sums
secured by this Instrument and any of the other Loan Documents. Borrower hereby
grants to Lender a lien and security interest in each CIR Payment and the
deposit or other accounts in which such payments are placed.

     (b)  TENANT IMPROVEMENTS/LEASING COMMISSION RESERVE.

                                      -29-

 
          (i)  Commencing on the first day a monthly installment of principal
and interest is due and payable under the Note and continuing on the first
calendar day of each calendar month thereafter, Borrower shall deliver to
Lender, together with the regular installments of principal and interest an
amount (a "TI/LC Payment") equal to $5,200.00 of which $4,427.00 is allocated to
Mortgaged Parcel 1 ("Parcel 1 TI/LC Funds") and $773.00 is allocated to
Mortgaged Parcel 2 ("Parcel 2 TI/LC Funds"). Each TI/LC Payment shall be deemed
"Other Impositions" and "Funds" as defined in paragraph 2 of this Instrument.
The TI/LC Payments will be placed in the Other Impositions Account, shall be
held in accordance with the terms of paragraph 2 of this Instrument, and may be
drawn on by Borrower for tenant improvement and/or leasing commission
expenditures in connection with the Property, pursuant to the terms set forth
below in subparagraph 33(b)(ii). Interest earned on the Funds on deposit in the
Other Impositions Account shall be credited to the Other Impositions Account. At
Lender's discretion, the TI/LC Payments may be increased to reflect any increase
in the "Consumer Price Index" published by the Bureau of Labor Statistics of the
U.S. Department of Labor, All Items, U.S. city average, all urban consumers
(presently denominated "CPI-U"), or a successor or substitute index
appropriately adjusted (the "CPI"). In the event Lender shall elect not to
increase the TI/LC Payment for any given year by the CPI, Lender, at its sole
discretion, may during any subsequent year elect to increase the TI/LC Payment
by the aggregate amount of CPI increases which Lender otherwise was entitled to
make during the previous years in which it did not elect to make such increases.

          (ii) So long as Borrower (x) is not in default under any of the terms
of the Note, this Instrument or any of the other Loan Documents, and (y) no
situation exists which with the passage of time or the giving of notice or both
would constitute a default under the Note, this Instrument or any of the other
Loan Documents, Borrower, subject to the following provisions of this
subparagraph (ii) and upon ten (10) days' prior written notice to Lender and
Lender's loan servicer (which notice shall include a brief statement of the
purpose for which the advance is to be used), shall be entitled to draw on the
TI/LC Payments on deposit in the Other Impositions Account solely for the
payment of tenant improvement and/or commissions incurred in connection with the
leasing and/or releasing of any tenant space at the Property. Borrower may not
make any drawing on the Other Impositions Account (1) for less than $500 and (2)
without the prior consent of Lender. Lender reserves the right to require such
information as Lender may reasonably require, and to withhold consent in the
event that Lender deems it necessary to do so. Without limiting the foregoing,
Lender may request, in connection with a request by Borrower for a drawing on
the Other Impositions Account, that Borrower furnish written evidence reasonably
satisfactory to Lender that the amount requested by Borrower is for work
performed, services or materials furnished, and bills paid or payable with
respect to such tenant improvements and/or commissions (including, but not
limited to, contracts and invoices for work performed or materials supplied and
mechanics' and materialmen' lien releases and waivers from such parties
performing such work or supplying such materials). Lender also reserves the
right to make any disbursement or portion thereof from the Other Impositions
Account directly to the party performing such work or supplying such materials.
Lender or Lender's servicing agent, as the case may be, shall be entitled to
charge Borrower a reasonable processing fee for administering and reviewing
Borrower's draw requests. In addition, Lender shall be reimbursed by Borrower
for any costs incurred by Lender or Lender's servicing agent in inspecting the

                                      -30-

 
Property in connection with Borrower's draw requests.  Any such processing fees
and inspection costs shall be deducted by Lender from the Funds on deposit or
account or, at Lender's option, shall be paid to Lender by Borrower within ten
(10) days of Lender's written demand.

         (iii) Notwithstanding anything to the contrary contained herein,
Borrower may only make drawings (a) for Mortgaged Parcel 1 from funds available
in Parcel 1 TI/LC Funds; and (b) for Mortgaged Parcel 2, from funds available in
Parcel 2 TI/LC Funds.

         (iv)  Each TI/LC Payment is pledged as additional security for the sums
secured by this Instrument and any of the other Loan Documents. Borrower hereby
grants to Lender a lien and security interest in each TI/LC Payment and the
deposit or other accounts in which such payments are placed.

34.  FORECLOSURE. Connecticut law requires judicial foreclosure.

35.  ASSUMABILITY.

     (a) So long as (i) Borrower is not in default under any of the terms of the
Note, this Instrument or any other Loan Document, and (ii) no situation exists
which with the passage of time or the giving of notice or both would constitute
a default under the Note, this Instrument or any other Loan Document, in the
event Borrower desires to transfer all of the Property to another party (the
"Transferee") and have the Transferee assume all of Borrower's obligations under
the Note, this instrument and all of the other Loan Documents (collectively, the
"Transfer and Assumption"), Borrower, subject to the terms of this paragraph,
may make a written application to Lender for Lender's consent to the Transfer
and Assumption, subject to the conditions set forth in subparagraph (b) of this
paragraph 35. Together with such written application (and afterwards if
requested by Lender), Borrower will submit to Lender true, correct and complete
copies of any and all information and documents of any kind requested by Lender
concerning the Property, Transferee and/or Borrower, together with a review fee
required by Lender in the amount of one thousand five hundred and 00/100
($1,500.00) (the "Review Fee").

     (b) Lender shall not unreasonably withhold its consent to a Transfer and
Assumption provided and upon the condition that:

         (i)   Lender receives an opinion from counsel acceptable to Lender that
               (x) such Transfer and Assumption shall not affect, in any way,
               the enforceability of the Loan Documents or the lien status, and
               (y) that the Transferee complies in all respects with the
               provisions of paragraph 32(n) and paragraph 32(l) of this
               instrument and such other conditions concerning the
               organizational structure of the Transferee as were required by
               Lender at the time of the making of the Loan;

         (ii)  Borrower has submitted to Lender true, correct and complete
               copies of any and all information and documents of any kind
               requested by Lender concerning the Property, Transferee and/or
               Borrower;

                                      -31-

 
         (iii) the Transferee, in Lender's sole judgment, has sufficient
               experience in managing assets similar in size and type to the
               Property;

         (iv)  in Lender's sole judgment, the Transferee and the partners,
               members or shareholders of the Transferee are financially sound
               or have sufficient financial resources to manage the Property for
               the term of the Loan;

         (v)   the Loan has been placed, or Lender plans to place the Loan, in
               an offering of Securities (as defined in paragraph 37) and Lender
               receives written confirmation from the rating agencies that the
               Transfer and Assumption will not result in any downgrade,
               qualification or withdrawal of the ratings assigned to the pool
               and assets in which the Loan has been placed; and

         (vi)  Borrower has paid the Review Fee required by Lender.

     (c) If Lender consents to the Transfer and Assumption, the Transferee
and/or Borrower as the case may be, shall deliver the following to Lender:

         (i)   Borrower shall deliver to Lender an assumption fee in the amount
               of one percent (1%) of the then unpaid principal balance of the
               Loan;

         (ii)  Borrower and Transferee shall execute and deliver to Lender any
               and all documents required by Lender, in form and substance
               required by Lender, in Lender's sole discretion (the "Assumption
               Documents");

         (iii) Borrower shall cause to be delivered to Lender, an endorsement
               to the mortgagee policy of title insurance then insuring the lien
               created by this instrument in form and substance acceptable to
               Lender, in Lender's sole discretion (the "Endorsement"); and

         (iv)  Borrower shall deliver to Lender a payment in the amount of all
               costs incurred by Lender in connection with the Transfer and
               Assumption, including but not limited to, Lender's attorneys fees
               and expenses, all recording fees for the Assumption Documents,
               and all fees payable to the title company for the delivery to
               Lender of the Endorsement.

     (d) Notwithstanding anything contained in this paragraph to the contrary,
(x) under no circumstances may the Property and Loan be transferred and assumed
by any party under the terms of this paragraph more than once during the entire
term of the Loan and (y) except based on Lender's written agreement to the
Transfer and Assumption and Borrower's and Transferee's compliance with all of
the terms and provisions of this paragraph, the terms and provisions of this
paragraph shall in no way amend or modify the terms and provisions contained in
paragraph 19 of this instrument.

36.  WAIVER OF JURY TRIAL. BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT THE BORROWER MAY 

                                      -32-

 
HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER OR IN CONJUNCTION WITH THE NOTE, THIS INSTRUMENT, ANY OTHER LOAN
DOCUMENT, ANY OTHER AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY.

     BORROWER HEREBY ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS INSTRUMENT
IS A PART IS A COMMERCIAL TRANSACTION, AND HEREBY WAIVES ITS RIGHT TO NOTICE AND
HEARING UNDER CHAPTER 903a OF THE CONNECTICUT GENERAL STATUTES, OR AS OTHERWISE
ALLOWED BY ANY STATE OR FEDERAL LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH
THE LENDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE.

37.  TRANSFER OF LOAN. Lender may, at any time, sell, transfer or assign the
Note, this Instrument and the Loan Documents, or any part thereof, and any or
all servicing rights with respect thereto, or grant participations therein or
issue mortgage pass-through certificates or other securities evidencing a
beneficial interest in a rated or unrated public offering or private placement
(the "Securities"). Lender may forward to each purchaser, transferee, assignee,
servicer, participant, investor in such Securities or any rating agency rating
such Securities (singularly, an "Investor," and collectively, the "Investors")
and each prospective Investor, all documents and information which Lender now
has or may hereafter acquire relating to the Loan and to Borrower, any
guarantor, any indemnitors and/or the Property, whether furnished by Borrower,
any guarantor, any indemnitors or otherwise, as Lender determines necessary or
desirable. Borrower shall furnish and Borrower consents to Lender furnishing to
such Investors or such prospective Investors or rating agency any and all
information concerning the Property, the leases, the financial condition of
Borrower, any guarantor and any indemnitor as may be requested by Lender, any
Investor or any prospective Investor or rating agency in connection with any
sale, transfer or participation interest.

38.  RELEASE OF INDIVIDUAL PROPERTY.

     (a) So long as no default exists under any of the terms of the Note, this
instrument or any other Loan Document, (ii) no situation exists which with the
passage of time or the giving of notice or both would constitute a default under
the Note, this Instrument or any other Loan Document, and (iii) Borrower
complies with the provisions of this paragraph 38, commencing January 1, 2006,
but not prior thereto, Borrower may make written application for Lender's
consent to release one Individual Property from the lien of this Instrument (the
"Release of Collateral").

     (b) Lender shall consent to the Release of Collateral provided and upon the
condition that:

         (i)   If the Loan has been placed, or if Lender plans to place the
               Loan, in an offering of Securities (as defined in paragraph 37),
               Lender receives written confirmation from the rating agencies
               that the Release of Collateral will 

                                      -33-

 
               not result in any downgrade, qualification or withdrawal of the
               ratings assigned to the pool and assets in which the Loan has
               been placed;

         (ii)  The purchase and sale agreement, if any, for the acquisition of
               the Property contains a provision pursuant to which the purchaser
               agrees not to commence an involuntary bankruptcy proceeding
               against Borrower in connection with any claim under the purchase
               and sale agreement;

         (iii)  Borrower shall prepay the principal balance of the Note by an
               amount equal to 125% of the then outstanding principal balance
               remaining under the allocated loan amount ("Allocated Loan
               Amount") for the individual Property being released.  As of the
               date hereof, for purposes of this paragraph 38(b), the Allocated
               Loan Amount for Mortgaged Parcel 1 is TEN MILLION AND 00/100
               ($10,000,000.00) DOLLARS, and the allocated loan amount for
               Mortgaged Parcel 2 is TWO MILLION AND 00/100 ($2,000,000.00)
               DOLLARS.

         (iv)  Borrower shall deliver to Lender a payment in the amount of the
               Yield Maintenance Premium due under the Note.

         (v)   If Borrower shall continue to own an Individual Property that
               will continue to be collateral for the Loan, Borrower shall not
               violate any single-purpose bankruptcy-remoteness criteria imposed
               by the rating agencies;

         (vi)  Borrower shall deliver to Lender a payment in the amount of all
               costs incurred by Lender in connection with the Release of
               Collateral, including but not limited to, Lender's reasonable
               attorneys' fees and expenses, all recording fees for the release
               documents; and

         (vii) If Borrower shall continue to own an Individual Property
               encumbered by the Loan, Borrower shall execute such documents
               reasonably required by Lender confirming Borrower's continuing
               obligations under the Loan and documents executed in connection
               therewith.

     (c) Lender shall execute and deliver such documents as are reasonably
necessary and appropriate to effect the release of the affected Individual
Property simultaneously with the payments by Borrower required under this
paragraph 38, provided that all of the other conditions to such release set
forth above have been satisfied.

39.  FUTURE ADVANCES. Upon request of Borrower, Lender, at Lender's option so
long as this instrument secures indebtedness held by Lender, may make Future
Advances to Borrower. Such Future Advances, with interest thereon, shall be
secured by this instrument when evidenced by promissory notes stating that said
notes are secured hereby. At no time shall the principal amount of the
indebtedness secured by this instrument exceed the original amount of the Note

                                      -34-

 
(US $12,000,000) nor shall the maturity of Future Advances secured hereby extend
beyond the time of repayment of the Note.

     This instrument may be executed in any number of duplicate originals and
each duplicate original shall be deemed to be an original.

     Lender is specifically permitted, at its option and in its discretion, to
make additional advances under this instrument as contemplated by Section 49-
2(c) of the Connecticut General Statutes.

     NOW THEREFORE, if the Note secured hereby, and any modifications,
extensions or renewals thereof, shall be well and truly paid according to its
tenor, and if all agreements and provisions contained in such Note and herein
and in the other Loan Documents are fully kept and performed, and all
obligations are fully satisfied then this instrument shall become null and void;
otherwise to remain in full force and effect.

     IN WITNESS WHEREOF, Borrower has executed this Instrument or has caused the
same to be executed by its representatives thereunto duly authorized.

WITNESS:                                        BORROWER:
 
 
_______________________________                 TSI REALTY COMPANY
Name:__________________________
 
                                                By:____________________________
_______________________________                 Print:_________________________
Name:__________________________                 Title:_________________________

                                      -35-

 
OMITTED EXHIBITS


Exhibit A:          Property Description
Exhibit B:          Copy of Promissory Note