Unassociated Document

Exhibit 10.18

CONSOLIDATED, AMENDED AND RESTATED

TERM LOAN AGREEMENT

among

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC,

a Delaware limited liability company

as Lead Borrower,

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC,

a Delaware limited liability company

and

FORDHAM PLACE OFFICE LLC

a Delaware limited liability company

as Borrower,

The LENDERS Party Hereto,

as Lenders

and

EUROHYPO AG, NEW YORK BRANCH

as Administrative Agent

Date: As of November 4, 2009

TABLE OF CONTENTS

		Page No.
ARTICLE 1 CERTAIN DEFINITIONS		2

Section 1.1	Certain Definitions	2
Section 1.2	Types of Loans	25

ARTICLE 2 LOAN TERMS		25

Section 2.1	The Commitments, Loans and Notes.	25
Section 2.2	Conversions or Continuations of Loans.	26
Section 2.3	Interest Rate; Late Charge.	26
Section 2.4	Terms of Payment.	27
Section 2.5	Extension of Maturity Date	29
Section 2.6	Reserved	30
Section 2.7	Cash Management.	30
Section 2.8	Payments; Pro Rata Treatment; Etc.	31
Section 2.9	Yield Protection; Etc.	34
Section 2.10	Administrative Fee.	40
Section 2.11	Exit Fee.	40

ARTICLE 3 INSURANCE, CONDEMNATION, AND IMPOUNDS		40

Section 3.1	Insurance.	40
Section 3.2	Use and Application of Net Proceeds.	45
Section 3.3	Casualty and Condemnation.	50

ARTICLE 4 RESERVES; COLLATERAL LETTERS OF CREDIT		51

Section 4.1	Real Estate Tax and Insurance Reserve Fund.	51
Section 4.2	Tenant Improvement/Leasing Reserve Letter of Credit.	52
Section 4.3	Reserved.	53
Section 4.4	Reserve Funds and Security Accounts Generally.	53
Section 4.5	Collateral Letters of Credit	54

ARTICLE 5 ENVIRONMENTAL MATTERS		56

Section 5.1	Certain Definitions	56
Section 5.2	Representations and Warranties on Environmental Matters	57
Section 5.3	Covenants on Environmental Matters.	57
Section 5.4	Allocation of Risks and Indemnity	58
Section 5.5	No Waiver	59

ARTICLE 6 LEASING MATTERS		59

Section 6.1	Representations and Warranties on Leases	59
Section 6.2	Standard Lease Form; Approval Rights	60
Section 6.3	Covenants	60
Section 6.4	Tenant Estoppels	61

ARTICLE 7 REPRESENTATIONS AND WARRANTIES		61

Section 7.1	Organization and Power	61
Section 7.2	Validity of Loan Documents	61
Section 7.3	Liabilities; Litigation.	61
Section 7.4	Taxes and Assessments	62
Section 7.5	Other Agreements; Defaults	62
Section 7.6	Compliance with Law.	62
Section 7.7	Location of Borrower	62
Section 7.8	ERISA	62
Section 7.9	Margin Stock	62
Section 7.10	Tax Filings	62
Section 7.11	Solvency	63
Section 7.12	Full and Accurate Disclosure	63
Section 7.13	Single Purpose Entity	63
Section 7.14	Property Management Agreement	63
Section 7.15	No Conflicts	63
Section 7.16	Title	64
Section 7.17	Use of Project	64
Section 7.18	Flood Zone	64
Section 7.19	Insurance	64
Section 7.20	Certificate of Occupancy; Licenses	64
Section 7.21	Physical Condition	64
Section 7.22	Boundaries	65
Section 7.23	Separate Lots	65
Section 7.24	Survey	65
Section 7.25	Filing and Recording Taxes	65
Section 7.26	Investment Company Act	65
Section 7.27	Foreign Assets Control Regulations, Etc.	65
Section 7.28	Organizational Structure.	66

ARTICLE 8 FINANCIAL REPORTING		66

Section 8.1	Financial Statements.	66
Section 8.2	Accounting Principles	67
Section 8.3	Other Information	67
Section 8.4	Annual Budget	67
Section 8.5	Audits	67

ARTICLE 9 COVENANTS		68

Section 9.1	Due on Sale and Encumbrance; Transfers of Interests	68
Section 9.2	Taxes; Charges	68
Section 9.3	Control; Management	69
Section 9.4	Operation; Maintenance; Inspection	69
Section 9.5	Taxes on Security	69
Section 9.6	Legal Existence; Name, Etc.	70
Section 9.7	Affiliate Transactions	70
Section 9.8	Limitation on Other Debt	70

Section 9.9	Further Assurances	70
Section 9.10	Loan Certificates	71
Section 9.11	Notice of Certain Events	71
Section 9.12	Indemnification	71
Section 9.13	Payment for Labor and Materials	71
Section 9.14	Alterations	72
Section 9.15	Hedge Agreements.	72
Section 9.16	Certain Financial Covenants.	74
Section 9.17	Handicapped Access.	75
Section 9.18	Zoning	75
Section 9.19	ERISA	76
Section 9.20	Books and Records	76
Section 9.21	Foreign Assets Control Regulations	76
Section 9.22	Appraisals	76
Section 9.23	Covenants Regarding the Condominium Declaration	76
Section 9.24	Industrial and Commercial Incentive Program.	79

ARTICLE 10 EVENTS OF DEFAULT		80

Section 10.1	Payments	80
Section 10.2	Insurance	80
Section 10.3	Single Purpose Entity	80
Section 10.4	Taxes	80
Section 10.5	Sale, Encumbrance, Etc.	80
Section 10.6	Representations and Warranties	80
Section 10.7	Other Encumbrances	80
Section 10.8	Various Covenants	80
Section 10.9	Reserved	80
Section 10.10	Financial Covenants	81
Section 10.11	Involuntary Bankruptcy or Other Proceeding	81
Section 10.12	Voluntary Petitions, Etc.	81
Section 10.13	Indebtedness	81
Section 10.14	Dissolution	81
Section 10.15	Judgments	81
Section 10.16	Security	82
Section 10.17	Guarantor Documents	82
Section 10.18	Security Accounts	82
Section 10.19	Reserved	82
Section 10.20	Covenants	82
Section 10.21	Co-Borrower Documents	82

ARTICLE 11 REMEDIES		83

Section 11.1	Remedies - Insolvency Events	83
Section 11.2	Remedies - Other Events	83
Section 11.3	Administrative Agent’s Right to Perform the Obligations	83

iii

ARTICLE 12 MISCELLANEOUS		84

Section 12.1	Notices	84
Section 12.2	Amendments, Waivers, Etc.	84
Section 12.3	Limitation on Interest	85
Section 12.4	Invalid Provisions	85
Section 12.5	Reimbursement of Expenses	85
Section 12.6	Approvals; Third Parties; Conditions	86
Section 12.7	Lenders and Administrative Agent Not in Control; No Partnership	86
Section 12.8	Time of the Essence	87
Section 12.9	Successors and Assigns	87
Section 12.10	Renewal, Extension or Rearrangement	87
Section 12.11	Waivers	87
Section 12.12	Cumulative Rights	87
Section 12.13	Singular and Plural	87
Section 12.14	Phrases	88
Section 12.15	Exhibits and Schedules	88
Section 12.16	Titles of Articles, Sections and Subsections	88
Section 12.17	Promotional Material	88
Section 12.18	Survival	88
Section 12.19	WAIVER OF JURY TRIAL	88
Section 12.20	Remedies of Borrower	89
Section 12.21	Governing Law	89
Section 12.22	Entire Agreement	90
Section 12.23	Counterparts	91
Section 12.24	Assignments and Participations.	91
Section 12.25	Brokers	93
Section 12.26	Right of Set-off.	93
Section 12.27	Limitation on Liability of Administrative Agent’s and the Lenders’ Officers, Employees, etc.	94
Section 12.28	Cooperation with Syndication	94
Section 12.29	Severance of Loan.	94
Section 12.30	Confidentiality	95
Section 12.31	Designation of Lead Borrower as Agent for Borrower.	96

ARTICLE 13 RECOURSE LIABILITY		96

Section 13.1	Recourse Liability	96
Section 13.2	No Waiver of Certain Rights	98

ARTICLE 14 ADMINISTRATIVE AGENT		98

Section 14.1	Appointment, Powers and Immunities	98
Section 14.2	Reliance by Administrative Agent	99
Section 14.3	Defaults.	99
Section 14.4	Rights as a Lender	102
Section 14.5	Standard of Care; Indemnification	102
Section 14.6	Non-Reliance on Administrative Agent and Other Lenders	103
Section 14.7	Failure to Act	103
Section 14.8	Successor Administrative Agent	104
Section 14.9	Consents under Loan Documents	104
Section 14.10	Authorization	106
Section 14.11	Administrative Fee	106
Section 14.12	Defaulting Lenders.	106
Section 14.13	Liability of Administrative Agent	108
Section 14.14	Transfer of Agency Function	109
Section 14.15	Information for Lenders	109
Section 14.16	Pfandbriefe	109
Section 14.17	Restrictions on Transfers by Borrower	109

LIST OF EXHIBITS AND SCHEDULES

EXHIBIT A	-	LEGAL DESCRIPTION OF PROJECT
EXHIBIT B	-	INTENTIONALLY OMITTED
EXHIBIT C	-	FORM OF NOTE
EXHIBIT D	-	FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT E	-	FORM OF HEDGE AGREEMENT PLEDGE
EXHIBIT F	-	FORM OF NOTICE OF CONVERSIONS AND CONTINUATIONS

SCHEDULE 1	-	COMMITMENTS
SCHEDULE 1.1(97)	-	LEASING GUIDELINES
SCHEDULE 2.1	-	ADVANCE CONDITIONS
SCHEDULE 2.4(1)	-	WIRE INSTRUCTIONS
SCHEDULE 2.4(2)	-	AMORTIZATION SCHEDULE
SCHEDULE 7.28	-	ORGANIZATIONAL CHART

LOAN AGREEMENT

This Loan Agreement (this “Agreement”) is entered into as of November 4, 2009 among ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (“Lead Borrower”); FORDHAM PLACE OFFICE LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (“Fordham Office“, hereinafter, jointly and severally with Lead Borrower, and singly and collectively, “Borrower”); each of the lenders that is a signatory hereto identified under the caption “LENDERS” on the signature pages hereof and each lender that becomes a “Lender” after the date hereof pursuant to Section 12.24(2) (individually, a “Lender” and, collectively, the “Lenders”); and EUROHYPO AG, NEW YORK BRANCH, as administrative agent for the Lenders (in such capacity, together with its successors in such capacity, “Administrative Agent”).

R E C I T A L S

A. Lead Borrower and the Fordham Office are the fee owners of that certain tract of land located in the County of Bronx, State of New York and being more fully described in Exhibit A attached hereto (the “Land”). Lead Borrower is the fee owner of the condominium unit designated as the “Retail Unit” in the Condominium Declaration along with an undivided 70% interest in the Common Elements (as defined in the Condominium Declaration) constituting a portion of the improvements currently located on the Land, and Fordham Office is the fee owner of the condominium unit designated as the “Office/Community Unit” in the Condominium Declaration along with an undivided 30% interest in the Common Elements (as defined in the Condominium Declaration) constituting a portion of the improvements currently located on the Land.

B. Borrower has entered into (a) that certain Acquisition and Project Loan Agreement dated as of October 5, 2007 by and among Borrower, Lenders and Administrative Agent pursuant to which the Lenders made a Loan to Borrower in the original principal amount of $19,930,757.00 (the “Original Acquisition and Project Loan Agreement”); and (b) that certain Building Loan Agreement dated as of October 5, 2007 by and among Borrower, Lenders and Administrative Agent pursuant to which the Lenders made a Loan to Borrower in the original principal amount of $75,339,243.00 (the “Original Building Loan Agreement” and, with the Original Acquisition and Project Loan Agreement, collectively, the “Original Loan Agreement”).

C. Pursuant to the Original Loan Agreement, the Lenders have made advances of the loans for the purposes described therein in the amount of $86,061,835.70 and Borrower will, as of the Closing Date, prepay the loan such that the outstanding principal balance as of the Closing Date will be $86,000,000.00.

D. Borrower has represented to the Lenders that the Borrower has completed construction of the Improvements (as defined in the Original Acquisition and Project Loan Agreement) and requested that the Lenders amend, reduce and restate and consolidate the Original Loan Agreement to, among other things, extend the maturity date and reflect that no further amounts will be advanced under the Original Loan Agreement, and the Lenders have indicated their willingness to so amend and restate and consolidate the Original Loan Agreement, on the terms and subject to the conditions set forth herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree that the Original Acquisition and Project Loan Agreement and the Original Building Loan Agreement are hereby amended, restated and consolidated in their entirety as follows:

ARTICLE 1

CERTAIN DEFINITIONS

Section 1.1Certain Definitions. As used herein, the following terms have the meanings indicated:

(1) “Additional Cash Collateral Account” has the meaning assigned to such term in the Cash Management Agreement.

(2) “Additional Costs” has the meaning assigned to such term in Section 2.9(1)(a).

(3) “Additional Interest” means any and all amounts which may become due and payable by Borrower in accordance with the terms and provisions of any Hedge Agreement provided by a Eurohypo Counterparty which is secured by the Mortgage in accordance with Section 9.15 which amounts shall be evid enced by and payable pursuant to the Notes in favor of Eurohypo and/or such Affiliate; provided, however, that Additional Interest shall not include any amounts which may become due and payable pursuant to any Hedge Agreement which is not secured by the Mortgage.

(4) “Adjusted LIBOR Rate” means, for any Interest Period for any LIBOR-based Loan, a rate per annum (rounded upwards to the nearest 1/32 of 1%) determined by Administrative Agent to be equal to the LIBOR Rate for such Interest Period divided by 1 minus the Reserve Requirement (if any) for such Interest Period.

(5) “Adjusted Operating Expenses” means Operating Expenses as determined and adjusted by Administrative Agent in accordance with its then current audit policies and procedures.

(6) “Adjusted Operating Revenues” means Operating Revenues as determined and adjusted by Administrative Agent in accordance with its then current audit policies and procedures.

(7) “Administrative Fee” means the administrative fee agreed to by Borrower and Administrative Agent pursuant to the Fee Letter.

(8) “Advance Date” has the meaning assigned to such term in Section 2.8(6).

(9) “Advanced Amount” has the meaning assigned to such term in Section 14.12(2).

(10) “Affiliate” means with respect to any Person, another Person that directly or indirectly controls, or is under common control with, or is controlled by, such Person and, if such Person is an individual, any member of the immediate family (including parents, spouse, children and siblings) of such individual and any trust whose principal beneficiary is such individual or one or more members of such immediate family and any Person who is controlled by any such member or trust. As used in this definition, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise), provided that, in any event, any Person that owns directly or indirectly securities having 10% or more of the voting power for the election of directors or other governing body of a corporation or 10% or more of the partnership, membership or other ownership interests of any other Person (other than as a limited partner of such other Person) will be deemed to control such corporation or other Person. Notwithstanding the foregoing, no individual shall be an Affiliate solely by reason of his or her being a director, officer, trustee or employee of Borrower.

(11) “Agreement” means this Loan Agreement, as the same may be modified, amended and/or supplemented and in effect from time to time.

(12) “Anti-Terrorism Order” means Executive Order No. 13,224, 66 Fed. Reg. 49,079 (2001), issued by the President of the United States of America (Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism).

(13) “Applicable Lending Office” means, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or of an Affiliate of such Lender) designated for such Type of Loan on the respective signature pages hereof or such other office of such Lender (or of an Affiliate of such Lender) as such Lender may from time to time specify to Administrative Agent and Borrower as the office by which its loans of such Type are to be made and maintained.

(14) “Applicable Margin” means (a) for Base Rate Loans, 1.50% per annum; and (b) for LIBOR-based Loans, 3.50% per annum.

(15) “Appraisal” means an appraisal of the Project prepared by an appraiser satisfactory to Administrative Agent, which appraisal must also (a) satisfy the requirements of Title XI of the Federal Institution Reform, Recovery and Enforcement Act of 1989 and the regulations promulgated thereunder (including the appraiser with respect thereto) and (b) be otherwise in form and substance satisfactory to Administrative Agent.

(16) “Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

(17) “Arranger” means Eurohypo.

(18) “Assignment and Acceptance” means an Assignment and Acceptance, duly executed by the parties thereto, in substantially the form of Exhibit D hereto and consented to by Administrative Agent in accordance with Section 12.24(2).

(19) “Award” means any compensation paid by any Governmental Authority in connection with a Condemnation in respect of all or any part of the Project.

(20) “Bankruptcy Party” has the meaning assigned to such term in Section 10.8.

(21) “Base Rate” means, for any day, a rate per annum equal to the highest of (a) the Federal Funds Rate for such day plus 1/2 of 1%, (b) the Prime Rate for such day or (c) the LIBOR Rate plus 1.50%. Each change in any interest rate provided for herein based upon the Base Rate resulting from a change in the Base Rate shall take effect at the time of such change in the Base Rate.

(22) “Base Rate Loans” means Loans that bear interest at rates based upon the Base Rate.

(23) “Basel II Accord” means the proposals for risk-based capital framework described by the Basel Committee on Banking Regulations and Supervisory Practices in its paper entitled “International Convergence of Capital Measurement and Capital Standards: a Revised Framework – Comprehensive Version” dated June 2006, as amended, modified and supplemented and in effect from time to time or any replacement thereof.

(24) “Bifurcation” has the meaning assigned to such term in Section 12.29(1).

(25) “Borrower” has the meaning assigned to such term in the Preamble. With respect to the definition of “Borrower”, except where the context otherwise provides, (i) any representations contained herein of Borrower shall be applicable to each Borrower, (ii) any affirmative covenants contained herein shall be deemed to be covenants of each Borrower and shall require performance by all Borrowers, (iii) any negative covenants contained herein shall be deemed to be covenants of each Borrower, and shall be breached if any Borrower fails to comply therewith, (iv) the occurrence of any Even t of Default with respect to any Borrower shall be deemed to be an Event of Default hereunder, and (v) any Indebtedness and/or obligations of Borrower shall be deemed to include any Indebtedness and/or obligations of the Borrowers, or any Indebtedness and/or obligations of any one of them.

(26) “Borrower Party” means Borrower, any Guarantor or Managing Member

(27) “Business Day” means (a) any day other than a Saturday, a Sunday, or other day on which commercial banks located in New York City are authorized or required by law to remain closed and (b) in connection with a borrowing of, a payment or prepayment of principal of or interest on, a Conversion of or into, or an Interest Period for, a LIBOR-based Loan or a notice by Lead Borrower with respect to any such borrowing, payment, prepayment or Conversion, the term “Business Day” shall, in addition to the days excluded in subsection (a) above, also exclude a day on which banks are not open for dealings in Dollar deposits in the London interbank market.

(28) “Calculated Debt Service” means, for any period, an amount equal to the outstanding principal balance of the Loans as of the date of calculation multiplied by a loan constant of seven percent (7.0%).

(29) “Cash Management Account” has the meaning assigned to such term in the Cash Management Agreement.

(30) “Cash Management Agreement” means that certain Cash Management and Security Agreement to be executed, dated and delivered by Borrower, Administrative Agent (on behalf of the Lenders) and the Depository Bank subsequent to the Closing Date, as the same may be modified, amended and/or supplemented and in effect from time to time.

(31) “Casualty” has the meaning specified in Section 3.3 hereof.

(32) “Casualty Consultant” has the meaning assigned to such term in Section 3.2(2)(c).

(33) “Casualty Retainage” has the meaning assigned to such term in Section 3.2(2)(d).

(34) “Casualty/Taking Account” has the meaning assigned to such term in the Cash Management Agreement.

(35) “Change of Control” means any transaction, transfer, admission, redemption, withdrawal, change in organizational documents or structure, or otherwise, whether directly or indirectly, as a result of which (a)(i) Sponsor, whether directly or indirectly, owns less than 18% of the membership interests in and rights to distributions from Borrower, or (ii) any Person other than Managing Member has the responsibility for managing and administering the day-to day business and affairs of Borrower or (iii) in any other respects, any Person other than Sponsor directly or indirectly Controls Borrower, (b) (i) Spo nsor no longer directly or indirectly owns at least 18% of the membership interests in and rights to distributions from the Managing Member, or (ii) Sponsor no longer directly or indirectly has responsibility for managing and administering the day-to day business and affairs of the Managing Member or (iii) in any other respects, any Person other than Sponsor directly or indirectly Controls the Managing Member, (c)(i) anyone other than Acadia Realty Trust, whether directly or indirectly, owns less than 75% of the partnership interests in Sponsor, or (ii) any Person other than Acadia Realty Trust has the responsibility for managing and administering the day-to day business and affairs of Sponsor or (iii) in any other respects, any Person other than Acadia Realty Trust directly or indirectly Controls Sponsor, or (d) a change in the management control of Acadia Realty Trust such that Kenneth F. Bernstein is no longer the Chief Executive Officer of Acadia Realty Trust or Kenneth F. Bernstein fails to d evote a substantial amount of his business time and attention in any consecutive six (6) month period to the affairs of Acadia Realty Trust; provided, however, such occurrence shall not be an Event of Default if within sixty (60) days of the occurrence thereof the Administrative Agent approves, in the exercise of its reasonable judgment, the replacement or successor management of Acadia Realty Trust. As used in this definition, “Control” of one Person (the “controlled Person”) by another Person (the “controlling Person”) shall mean the possession, directly or indirectly, by the controlling Person of the power or ability to direct or cause the direction of the management or poli cies of the controlled Person, whether through the ability to exercise voting power, by contract or otherwise (“Controlled” and “Controlling” each have the meanings correlative thereto).

(36) “Clearing Account” means an account with the Clearing Bank into which Borrower and Property Manager shall deposit, or cause to be deposited, all rents and other revenue from the Premises, and, upon the effectiveness of the Cash Management Agreement, shall have the meaning assigned to such term in the Cash Management Agreement..

(37) “Clearing Bank” means Bank of America, N.A. and, upon the effectiveness of the Cash Management Agreement, shall have the meaning assigned to such term in the Cash Management Agreement.

(38) “Closing Date” means the date of this Agreement.

(39) “Co-Borrower Documents” means collectively, the Contribution Agreement, the Co-Borrower Guaranty (Acquisitions) and the Co-Borrower Guaranty (Office).

(40) “Co-Borrower Guaranty (Acquisitions)” means the Co-Borrower Guaranty by Lead Borrower in favor of Administrative Agent on the Closing Date, as the same may be modified, supplemented or amended from time to time.

(41) “Co-Borrower Guaranty (Office)” means the Co-Borrower Guaranty by Fordham Office in favor of Administrative Agent on the Closing Date, as the same may be modified, supplemented or amended from time to time.

(42) “Collateral Letter of Credit” means a clean, irrevocable and unconditional standby letter of credit that is (a) issued for the account of an applicant other than Borrower, (b) issued in favor of Administrative Agent (on behalf of the Lenders) in the amount of any cash required pursuant to the terms of this Agreement or any other Loan Document pursuant to which it is being issued, (c) issued by an issuer having a paying office in the City of New York (or, with respect to Bank of America, N.A. only, such other office as is acceptable to Administrative Agent in its reasonable discretion) and having a rat ing with respect thereto of “AA” or better by S&P (or any equivalent rating from Moody’s) or such other issuer as shall be approved by Administrative Agent in its sole and absolute discretion (Bank of America, N.A. is hereby approved by Administrative Agent, provided that the letter of credit is in form and substance acceptable to Administrative Agent in its reasonable discretion), (d) drawable, in whole or in part from time to time, by Administrative Agent upon the presentment to the issuer of a clean sight-draft demanding such payment, (e) an “evergreen” letter of credit that initially has an expiration date of at least one (1) year from the date of deposit and is automatically renewed from year to year or one which does not expire until at least thirty (30) Business Days after the Maturity Date, and (f) freely assignable upon presentation of customary documents by Administrative Agent at no cost and expense to Administrative Agent.

(43) “Commitment” means, as to each Lender, the obligation of such Lender to make a Loan in a principal amount up to but not exceeding the amount set opposite the name of such Lender on Schedule 1 under the caption “Commitment” or, in the case of a Person that becomes a Lender pursuant to an assignment permitted under Section 12.24(2), as specified in the respective instrument of assignment pursuant to which such assignment is affected. The original aggregate principal amount of the Commitments is $86,000,000.00.

(44) “Condemnation” means a temporary or permanent taking by any Governmental Authority as the result or in lieu or in anticipation of the exercise of the right of condemnation or eminent domain, of all or any part of the Project, or any interest therein or right accruing thereto, including any right of access thereto or any change of grade affecting the Project or any part thereof.

(45) “Condemnation Proceeds” has the meaning assigned to such term in Section 3.2(2).

(46) “Condominium” means that certain condominium established pursuant to the Condominium Declaration.

(47) “Condominium Act” means Article 9-B of the Real Property Law of the State of New York (§ 339-d et seq.), and all amendments, modifications or replacements thereof or regulations with respect thereto, now or hereafter enacted or promulgated.

(48) “Condominium Declaration” means that certain Condominium Declaration filed with the Attorney General’s Office of the State of New York and approved by Administrative Agent prior to the Closing Date for the purpose of creating the Condominium.

(49) “Condominium Documents” means the Condominium Declaration, the by-laws of any owner’s association to be established pursuant to the Condominium Declaration to govern the affairs of the Condominium, and any other document, instrument or agreement creating, governing or affecting the Condominium.

(50) “Continue” “Continuation” and “Continued” refer to the continuation pursuant to Section 2.2 of (a) a LIBOR-based Loan from one Interest Period to the next Interest Period or (b) a Base Rate Loan at the Base Rate.

(51) “Contribution Agreement” means the Indemnity, Subrogation and Contribution Agreement among Lead Borrower, Fordham Office and Administrative Agent dated as of October 5, 2007, as the same may be modified, supplemented or amended from time to time.

(52) “Convert” “Conversion” and “Converted” refer to a conversion pursuant to the terms of this Agreement of one Type of Loans into another Type of Loans, which may be accompanied by the transfer by a Lender (at its sole and absolute discretion) of a Loan from one Applicable Lending Office to anoth er.

(53) “Debt” means, for any Person, without duplication: (a) all indebtedness of such Person for borrowed money, for amounts drawn under a letter of credit, or for the deferred purchase price of property for which such Person or its assets is liable, (b) all unfunded amounts under a loan agreement, letter of credit, or other credit facility for which such Person would be liable, if such amounts were advanced under the credit facility, (c) all amounts required to be paid by such Person as a guaranteed payment to partners, members (or other equity holders) or a preferred or special d ividend, including any mandatory redemption of shares or interests, (d) all indebtedness guaranteed by such Person, directly or indirectly, (e) all obligations under leases that constitute capital leases for which such Person is liable, and (f) all obligations of such Person under interest rate swaps, caps, floors, collars and other interest hedge agreements, in each case whether such Person is liable contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which obligations such Person otherwise assures a creditor against loss.

(54) “Debt Service” means, with respect to the applicable period of time, the aggregate interest, fixed principal and other payments due under the Loan for such period.

(55) “Debt Service Coverage Ratio” means, (a) with respect to the period from the Closing Date through and including the first anniversary of the Closing Date, for the period of time for which calculation is being made, the ratio of Net Operating Income to Debt Service, and (b) from the first day after the first anniversary of the Closing Date through and including the original Maturity Date, for the period of time for which calculation is being made, the ratio of Pro Forma Net Operating Income to Calculated Debt Service. The Debt Servi ce Coverage Ratio shall be as determined by Administrative Agent based upon the most recent reports required to have been submitted by Borrower under Section 8.1 (or, if no such reports have been so submitted, such other information as Administrative Agent shall determine in its sole and absolute discretion), which determination shall be conclusive in the absence of manifest error.

(56) “Debt Yield” means, for the period of calculation, the result of (x) Net Operating Income, divided by (y) the outstanding principal balance of the Loans, expressed as a percentage.

(57) “Declarant” means Acadia-PA East Fordham Acquisitions, LLC in its capacity as the declarant named in the Condominium Declaration.

(58) “Default Rate” means a rate per annum equal to 5% plus the Base Rate as in effect from time to time plus the Applicable Margin for Base Rate Loans, provided that, with re spect to principal of a LIBOR-based Loan, the “Default Rate” shall be the greater of (a) 5% plus the interest rate for such Loan as provided in Section 2.3(1)(b) and (b) the rate provided for above in this definition; provided, however, that in no event shall the Default Rate exceed the maximum rate allowed by applicable law.

(59) “Defaulting Lender” has the meaning assigned to such term in Section 14.12(1).

(60) “Deposit Account Control Agreement” means the Deposit Account Control Agreement among Borrower, Administrative Agent and the Clearing Bank pertaining to the Clearing Account, as the same may be modified, amended and/or supplemented and in effect from time to time.

(61) “Depository Bank” has the meaning assigned to such term in the Cash Management Agreement.

(62) “Dollars” and “$” means lawful money of the United States of America.

(63) “Eligible Assignee” means any of (i) a commercial bank organized under the Laws of the United States, or any State thereof, and having (x) total assets in excess of $1,000,000,000 and (y) a combined capital and surplus of at least $250,000,000; (ii) a commercial bank organized under the laws of any other country which is a member of the Organization of Economic Cooperation and Development (“OECD”), or a political subdivision of any such country, and having (x) total assets in excess of $1,000,000,000 and (y) a combined capital and surplus of at least $250,000,000, provided that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of OECD; (iii) a life insurance company organized under the Laws of any State of the United States, or organized under the Laws of any country and licensed as a life insurer by any State within the United States and having admitted assets of at least $1,000,000,000; (iv) a nationally recognized investment banking company or other financial institution in the business of making loans, or an Affiliate thereof (other than any Person which is directly or indirectly a Borrower Party or directly or indirectly an Affiliate of any Borrower Party) organized under the Laws of any State of the United States, and licensed or qualified to conduct such business under the Laws of any such State and having (1) total assets of at least $1,000,000,000 and (2) a net worth of at least $250,000,000; (v) an Approved Fund; (vi) any Affiliate of Eurohypo, any other Person into which, or with which, Eurohypo is merged, consolidated or reorganized, or which is otherwise a successor to Eurohypo by operation of law, or which acquires all or substantially all of the assets of Eurohypo, any other Person which is a successor to the business operations of Eurohypo and engages in substantially the same activities, or any Affiliate of any of the foregoing; or (vii) any other Person reasonably acceptable to Borrower (to the extent Borrower’s consent to an assignment is required for an assignment to a Person other than those identified in clauses (i) through (vi) above, pursuant to Section 12.24(2), and provided that all other applicable conditions to such assignment set forth in Section 12.24(2) have been satisfied, including any applicable consent thereto to be delivered by Administrative Agent.

(64) “Environmental Claim” has the meaning assigned to such term in Article 5.

(65) “Environmental Indemnity” means that certain Environmental Indemnity Agreement by Borrower and Guarantor in favor of Administrative Agent and each of the Lenders, to be executed, dated and delivered to Administrative Agent (on behalf of the Lenders) on October 5, 2007, as the same may be modified, amended and/or supplemented and in effect from time to time.

(66) “Environmental Laws” has the meaning assigned to such term in Article 5.

(67) “Environmental Liens” has the meaning assigned to such term in Article 5.

(68) “Environmental Loss” has the meaning assigned to such term in Article 5.

(69) “Eurohypo” means Eurohypo AG, New York Branch.

(70) “Eurohypo Counterparty” means Eurohypo and or (a) any Affiliate of Eurohypo, (b) any other Person into which, or with which, Eurohypo is merged, consolidated or reorganized, or which is otherwise a successor to Eurohypo by operation of law, or which acquires all or substantially all of the assets of Eurohypo, (c) any other Person which is a successor to the business operations of Eurohypo and engages in substantially the same activities, or (d) any Affiliate of any of the Persons described in clauses (b) and (c) of this definition.

(71) “Event of Default” has the meaning assigned to such term in Article 10.

(72) “Exculpated Party” has the meaning assigned to such term in Section 13.1.

(73) “Extension Period” has the meaning assigned to such term in Section 2.5.

(74) “Extension Notice” has the meaning assigned to such term in Section 2.5(1).

(75) “Federal Bankruptcy Code” shall mean Title 11 of the United States Code entitled “Bankruptcy” as amended from time to time, and any successor statutes and rules and regulations from time to time promulgated thereunder, and any comparable foreign laws relating to bankruptcy, insolvency or creditor’s rights.

(76) “Federal Funds Rate” means, for any day, the rate per annum (rounded upwards to the nearest 1/32 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (a) if the day for which such rate is to be determined is not a Business Day, the Feder al Funds Rate for such day shall be such rate on such transactions on the immediately preceding Business Day as so published on the next succeeding Business Day and (b) if such rate is not so published for any Business Day, the Federal Funds Rate for such Business Day shall be the average rate charged to Eurohypo on such Business Day on such transactions as determined by Administrative Agent, or such other commercial bank as selected by Administrative Agent.

(77) “Fee Letter” means the letter agreement, dated the date hereof, between Borrower and Administrative Agent with respect to certain fees payable by Borrower in connection with the Loans, as the same may be modified or amended from time to time.

(78) “Flood Insurance Acts” has the meaning assigned to such term in Section 3.1(1)(g).

(79) “GAAP” means accounting principles generally accepted in the United States of America.

(80) “Governmental Authority” means any governmental department, commission, board, bureau, agency, regulatory authority, instrumentality, judicial or administrative body, federal, state or local, or foreign having jurisdiction over the matter or matters in question.

(81) “Guarantor” means Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company.

(82) “Guarantor Documents” means collectively, the Guaranty and the Environmental Indemnity.

(83) “Guaranty” means the instruments of guaranty, if any, now or hereafter in effect from a Guarantor to Administrative Agent (on behalf of the Lenders).

(84) “Hazardous Materials” has the meaning assigned to such term in Article 5.

(85) “Hedge Agreement” means any swap/cap agreement between Borrower and one or more financial institutions providing for the transfer or mitigation of interest risks either generally or under specific contingencies, as the same may be modified, amended and/or supplemented and in effect from time to time in accordance with Section 9.15; provided, however, that any such agreement may only be secured by the Liens and Security Documents securing the Loans, if, and only if, the protection is provided by one or more Eurohypo Counterparties and otherwise complies with Section 9.15.

(86) “Hedge Agreement Pledge” means that certain Assignment, Pledge and Security Agreement substantially in the form of Exhibit E attached hereto, to be executed, dated and delivered by Borrower to Administrative Agent (on behalf of the Lenders) in accordance with Section 9.15 and at any other time Borrower elects or is required to enter into a Hedge Agreement, covering Borrower’s right, title and interest in and to any such Hedge Agreement, as the same may be modified, amended and/or supplemented and in effect from time to time.

(87) “Improvements” has the meaning assigned to such term in the Mortgage.

(88) “Indebtedness” has the meaning assigned to such term in the Mortgage.

(89) “Independent Manager” means, in the case of a corporation, limited liability company or limited partnership, a director, member or manager that is a natural person who has no affiliation with any Borrower Party and who is approved by Administrative Agent.

(90) “Insurance Premiums” has the meaning assigned to such term in Section 3.1(2).

(91) “Insurance Proceeds Deficiency” has the meaning assigned to such term in Section 3.2(2).

(92) “Interest Period” means, with respect to any LIBOR-based Loan, each period commencing on the date such LIBOR-based Loan is made or Converted from a Base Rate Loan or (in the event of a Continuation) the last day of the immediately preceding Interest Period for such Loan and ending on the numerically corresponding day in the first calendar month thereafter; provided that (i) each Interest Period that commences on the last Business Day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last Business Day of the appropriate subsequent calendar month; (ii) each Interest Period that would otherwise end on a day that is not a Business Day shall end on the next succeeding Business Day (or, if such next succeeding Business Day falls in the next succeeding calendar month, on the immediately preceding Business Day); (iii) no Interest Period shall have a duration of less than one month and, if the Interest Period for any LIBOR-based Loan would otherwise be a shorter period, such Loan shall bear interest at the Base Rate plus the Applicable Margin for Base Rate Loans; (iv) in no event shall any Interest Period extend beyond the Maturity Date; and (v) there may be no more than one (1) Interest Period in respect of LIBOR based Loans outstanding at any one time.

(93) “Interest Rate Hedge Period” has the meaning assigned to such term in Section 9.15.

(94) “Interest Reserve Account” has the meaning assigned to such term in the Cash Management Agreement.

(95) “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended.

(96) “Land” has the meaning assigned to such term in the Recitals.

(97) “Leasing Guidelines” means the Leasing Guidelines described in Schedule 1.1(97) attached hereto.

(98) “Lender” and “Lenders” have the respective meanings assigned to such terms in the Preamble.

(99) “LIBOR Rate” means, for any Interest Period for any LIBOR-based Loan, the greater of (a) 1.50% and (b) the rate per annum appearing on Reuters Screen LIBOR01 (formerly operated as Page 3750 of the Dow Jones Market Service (Telerate)) (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m. London time on the date two (2) Business Days prior to the first day of such Interest Period as the rate for the offering of Dollar deposits having a term comparable to such Interest Period, provided that if such rate does not appear on such page, or if such page shall cease to be publicly available, or if the information contained on such page, in the reasonable judgment of Administrative Agent shall cease accurately to reflect the rate offered by leading banks in the London interbank market as reported by any publicly available source of similar market data selected by Administrative Agent, the LIBOR Rate for such Interest Period shall be determined from such substitute financial reporting service as Administrative Agent in its discretion shall determine.

(100) “LIBOR-based Loans” means Loans that bear interest at rates based on rates referred to in the definition of “LIBOR Rate.”

(101) “Licenses” has the meaning assigned to such term in Section 7.20.

(102) “Lien” means any interest, or claim thereof, in the Project securing an obligation owed to, or a claim by, any Person other than the owner of the Project, whether such interest is based on common law, statute or contract, including the lien or security interest arising from a deed of trust, mortgage, assignment, encumbrance, pledge, security agreement, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien” shall include reservations, exceptions, encroachments, easements, rights of way, covenants, conditions, restrictions, le ases and other title exceptions and encumbrances affecting the Project.

(103) “Loans” means the loans made by the Lenders to Borrower under this Agreement and all other amounts evidenced or secured by the Loan Documents.

(104) “Loan Documents” means: (a) this Agreement, (b) the Notes, (c) the Guaranty, (d) any letter of credit provided to Administrative Agent in connection with the Loan, (e) the Mortgage, (f) the Subordination of Property Management Agreement, (g) the Environmental Indemnity, (h) Hedge Agreement Pledge, (i) the Cash Management Agreement, (j) Uniform Commercial Code financing statements, (k) the Co-Borrower Documents, (l) such assignments of management agreements, contracts and other rights as may be required under the Commitment or otherwise requested by Administrative Ag ent, (m) all other documents evidencing, securing, governing or otherwise pertaining to the Loans; provided, however, that a Hedge Agreement entered into with any counterparty that is not a Eurohypo Counterparty shall not be a Loan Document, and (n) all amendments, modifications, renewals, substitutions and replacements of any of the foregoing.

(105) “Loan To Value Ratio” means, at any time, the ratio, expressed as a percentage, of (a) $86,000,000.00, to (b) the “as is” value of the Project as determined by an Appraisal satisfactory to Administrative Agent.

(106) “Loan Transactions” has the meaning assigned to such term in Section 2.8(4).

(107) “Loan Year” means the period between the date hereof and October 4, 2010 for the first Loan Year and the period between each succeeding October 5 and October 4 until the Maturity Date.

(108) “Low DSCR Account” has the meaning assigned to such term in the Cash Management Agreement.

(109) “Low DSCR Release Event” means, at any time after the occurrence of a Low DSCR Trigger Event, that (a) the Debt Service Coverage Ratio shall, for two consecutive calendar or fiscal quarters, be at or above: (i) with respect to the period from the Closing Date through and including the first anniversary of the Closing Date, 1.40:1.00; and (ii) from the first day after the first anniversary of the Closing Date through and including the original Maturity Date, 1.30:1.00; or (b) in the event that Borrower exercises the option to extend the term of the Loan pursuant to Section 2.5 hereof, the Pro Forma Debt Service Coverage Ratio shall, for two consecutive calendar or fiscal quarters, be at or above 1.50:1.00.

(110) “Low DSCR Trigger Event” means, at any time prior to the Maturity Date, that: (a) the Debt Service Coverage Ratio for any calendar quarter is less than (i) with respect to the period from the Closing Date through and including the first anniversary of the Closing Date, 1.35:1.00; and (ii) from the first day after the first anniversary of the Closing Date through and including the original Maturity Date, 1.25:1.00; or (b) in the event that Borrower exercises the option to extend the term of the Loan pursuant to Section 2.5 hereof, the Pro Forma Debt Service Coverage Ratio for any calendar quarter during the Extension Period is less than 1.45:1.00.

(111) “Low DSCR Trigger Period” means the period of time after a Low DSCR Trigger Event until the occurrence of a Low DSCR Release Event.

(112) “Major Lease” means any lease that (a) accounts for five percent (5%) or more of the total gross rental revenue of the Project and/or (b) is for 10,000 rentable square feet or more.

(113) “Majority Lenders” means Lenders holding at least 66⅔% of the aggregate outstanding principal amount of the Loans or, if the Loans shall not have been made, at least 66⅔% of the Commitments.

(114) “Managing Member” means Acadia – P/A Holding Company, LLC, a Delaware limited liability company, as sole member under the organizational documents of Borrower and its successors thereunder as managing member of Borrower as permitted under the Loan Documents.

(115) “Material Adverse Effect” means a material adverse effect, as unilaterally determined by Administrative Agent, in its reasonable judgment and discretion, on (a) the Project or the business, operations, financial condition, prospects, liabilities or capitalization of Borrower, (b) the ability of Borrower to perform its obligations under any of the Loan Documents to which it is a party, including the timely payment of the principal of or interest on the Loans or other amounts payable in connection therewith, (c) the ability of the Guarantor or any Borrower Party to perform its oblig ations under any of the Loan Documents to which it is a party, (d) the validity or enforceability of any of the Loan Documents or (e) the rights and remedies of the Lenders and Administrative Agent under any of the Loan Documents.

(116) “Maturity Date” means the earlier of (a) October 4, 2011, as such date may extended by the Extension Period, or (b) any earlier date on which all of the Loans are required to be paid in full, by acceleration or otherwise, under this Agreement or any of the other Loan Documents.

(117) “Mold” has the meaning assigned to such term in Section 5.1(6).

(118) “Mortgage” means the Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing executed by Borrower in favor of Administrative Agent (on behalf of the Lenders), covering the Project and any amendments, modifications, renewals, substitutions, consolidations, severances and replacements thereof.

(119) Intentionally Omitted.

(120) Intentionally Omitted.

(121) “Net Cash Flow” means, for any period, the amount by which Operating Revenues exceed the sum of (a) Operating Expenses, (b) Debt Service, and (c) any actual payment into impounds, escrows, or reserves required by Administrative Agent, except to the extent included within the definition of Operating Expenses.

(122) “Net Operating Income” means the amount by which Adjusted Operating Revenues exceed Adjusted Operating Expenses.

(123) “Net Proceeds” has the meaning assigned to such term in Section 3.2(2).

(124) “Net Proceeds Deficiency” has the meaning assigned to such term in Section 3.2(2)(f).

(125) “Notes” means the four (4) promissory notes of even date herewith as provided for in Section 2.1(4), and in the Note Consolidation, Severance and Modification A greement of even date herewith between Administrative Agent, and all promissory notes delivered in substitution or exchange therefor, in each case as the same may be consolidated, replaced, severed, modified, amended or extended from time to time.

(126) “Office Component” means the portion of the Improvements belonging to Fordham Office consisting of a 14-story Class A office building containing approximately 151,685 square feet of net leaseable space.

(127) “Operating Expenses” means all reasonable and necessary expenses of operating the Project in the ordinary course of business calculated in accordance with GAAP which are directly associated with and fairly allocable to the Project for the applicable period, including annualized ad valorem real estate taxes and assessments, capital expenditures at an imputed rate of $0.10 per square foot on an annualized basis of gross leasable area at the Project, annualized insurance premiums, regularly scheduled tax impounds paid to Administrative Agent, maintenance costs, management fees and costs in an amount equ al to the greater of the management fees and costs actually paid or an imputed rate of four percent (4%) of Operating Revenues, accounting, legal, and other professional fees, fees relating to environmental and Net Cash Flow and Net Operating Income audits, and other expenses incurred by Administrative Agent and reimbursed by Borrower under this Agreement and the other Loan Documents, deposits to any capital replacement reserves required by Administrative Agent, wages, salaries, and personnel expenses, but excluding Debt Service, capital expenditures, any of the foregoing expenses which are paid from deposits to cash reserves previously included as Operating Expenses, any payment or expense for which Borrower was or is to be reimbursed from proceeds of the Loans or insurance or by any third party, and any non-cash charges such as depreciation and amortization. Any management fee or other expense payable to Borrower or to an Affiliate of Borrower shall be included as an Operating Expense only with Administrative Agent’s prior approval. Operating Expenses shall not include federal, state or local income taxes or legal and other professional fees unrelated to the operation of the Project.

(128) “Operating Revenues” means all cash receipts of Borrower from operation of the Project or otherwise arising in respect of the Project after the date hereof which are properly allocable to the Project for the applicable period (subject to an underwritten market vacancy rate of not less than 8%), including receipts from leases and parking agreements, concession fees and charges and other miscellaneous operating revenues, proceeds from rental or business interruption insurance, withdrawals from cash reserves (except to the extent any operating expenses paid therewith are excluded from Operating Expenses ), in all cases, determined in accordance with GAAP but without taking into account straight-lining of rents and extraordinary revenues (including, but not limited to, lease termination payments) and FAS 141R adjustments, but excluding (a) all rent and other revenues received during the applicable period from tenants that, at any time during the applicable period, are subject to a Bankruptcy Proceeding, unless such Bankruptcy Proceeding has been closed, and the subject tenant has not been discharged from its obligations under the subject lease and/or the rental payments due and/or paid by such tenant to Borrower can not be disgorged from Borrower, (b) rent and other revenues from tenants that have been in default on the payment of rent under their respective leases for more than thirty (30) days, (c) rent and other revenues from tenants under leases which have remaining terms of less than twelve (12) months from the date of calculation, (d) security deposits and earnest money deposits until they are forfeite d by the depositor, (e) advance rentals (i.e. more than thirty (30) days in advance) until they are earned, (f) lump sum lease buy-out payments made by tenants in connection with any surrender, cancellation or termination of their lease, and (d) proceeds from a sale or other disposition.

(129) “Participant” has the meaning assigned to such term in Section 12.24(3).

(130) “Payment Date” means the first Business Day of each calendar month.

(131) “Payor” has the meaning assigned to such term in Section 2.8(6).

(132) “Permitted Encumbrances” has the meaning set forth in the Mortgage.

(133) “Permitted Transfer” shall mean any of the following transfers, provided there is no Change of Control as a result of such transfer:

(a) a transfer by devise or descent or by operation of law upon the death of a member, partner or shareholder of Borrower or any Affiliate of Borrower, so long as Lead Borrower delivers notice to Administrative Agent as soon as practicable thereafter and that Borrower or such Affiliate is promptly reconstituted, if applicable, following the death of such member partner or shareholder;

(b) transfers for estate planning purposes of an individual’s interest in Borrower or any Affiliate of Borrower to the spouse or any lineal descendant of such individual, or to a trust for the benefit of any one or more of such individual, spouse or lineal descendant, so long as Borrower or such Affiliate is reconstituted, if required, following such transfer;

(c) the sale or pledge, in one or a series of transactions, of the stock, limited partnership interests or non-managing membership interests (as the case may be) in Borrower or an Affiliate of Borrower; provided, however, that no such transfers shall result in any sale, transfer, conveyance, mortgage, pledge, or assignment of the legal or beneficial ownership of the Project, and as a condition to each such transfer, Administrative Agent shall receive no less than thirty (30) days prior written notice of such proposed transfer;

(d) a transfer by P/A Associates, LLC (“P/A Associates”) of 100% of its membership interest in Managing Member to Acadia Strategic Opportunity Fund II, LLC (“Fund II”) or an Affiliate of Fund II; and

(e) the sale, transfer, or issuance of stock in Acadia Realty Trust (the “Trust”), in the ordinary course of business, provided such stock is listed on the NYSE or other nationally recognized stock exchange.

(134) “Person” means any individual, corporation, partnership, joint venture, association, joint stock company, trust, trustee, estate, limited liability company, unincorporated organization, real estate investment trust, government or any agency or political subdivision thereof, or any other form of entity.

(135) “Policy” has the meaning assigned to such term in Section 3.1(2).

(136) “Potential Default” means the occurrence of any event or condition which, with the giving of notice, the passage of time, or both, would constitute an Event of Default.

(137) “Prime Rate” means the rate of interest from time to time announced by Eurohypo at its principal office as its prime commercial lending rate, it being understood that such prime commercial rate is a reference rate and does not necessarily represent the lowest or best rate being charged by Eurohypo to any customer.

(138) “Prohibited Person” means any Person:

(a) listed in the Annex to, or otherwise subject to the provisions of, the Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (the “Executive Order”);

(b) that is owned or controlled by, or acting for or on behalf of, any person or entity that is listed to the Annex to, or is otherwise subject to the provisions of, the Executive Order;

(c) with whom any Lender is prohibited from dealing or otherwise engaging in any transaction by any terrorism or money laundering law, including the Executive Order;

(d) who is known to Borrower to commit, threaten or conspire to commit or support “terrorism”, as defined in the Executive Order;

(e) that is named as a “specially designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, http://www.treas.gov.ofac/t11sdn.pdf or at any replacement website or other replacement official publication of such list; or

(f) who is known to Borrower to be an Affiliate of or affiliated with a Person listed above.

(139) “Project” means that certain mixed use retail/office building consisting of approximately 119,446 square feet of retail space and 151,685 square feet of office space, and all related facilities, amenities, fixtures, and personal property owned by Borrower and any improvements now or hereafter located on the real property described in Exhibit A.

(140) “Project Amenities” means those areas or elements of, easements over, interests in or licenses or rights to use, those portions of the Project that are granted to Units in the Condominium Declaration.

(141) “Property Management Agreement” means that certain Property Management Agreement dated as of August 15, 2007 between Property Manager and Lead Borrower with respect to the management of the Project by the Property Manager, together with any management agreements entered into with future Property Managers in accordance with the terms of this Agreement.

(142) “Property Manager” means Acadia – P/A Management Services LLC, which is initially the manager of the Project under the Property Management Agreement, together with any successor property managers appointed for the Project in accordance with the terms of this Agreement.

(143) “Pro Forma Debt Service Coverage Ratio” means the ratio of: (a) Pro Forma Net Operating Income for the full calendar quarter immediately preceding the date of calculation, to (b) the Calculated Debt Service for the full calendar quarter immediately preceding the date of calculation. The Pro Forma Debt Service Coverage Ratio shall be as determined by Administrative Agent based upon the most recent reports required to have been submitted by Borrower under Section 8.1 (or, if no such reports have been so submitted, such other information as Administrative Agent shall determine in its sole and absolute discretion), which determination shall be conclusive in the absence of manifest error.

(144) “Pro Forma Net Operating Income” means, for any period, the amount by which Pro Forma Operating Revenues exceed Adjusted Operating Expenses.

(145) “Pro Forma Operating Revenues” means, for any period, the sum of (a) Adjusted Operating Revenues and (b) pro forma net effective rental income from tenants who have executed leases, but have yet to commence paying rent for the applicable period; provided, however, that the foregoing calculation shall exclude rent and other revenues from tenants under le ases which have remaining terms of less than nine (9) months from the date of calculation.

(146) “Proportionate Share” means, with respect to each Lender, initially the percentage set forth opposite such Lender’s name on Schedule 1.1(146) attached hereto, as such percentage may be modified from time to time pursuant to Assignment and Acceptances and as recorded in Administrative Agent’s register of Lenders for the Loan.

(147) “Proposed Lender” has the meaning assigned to such term in Section 2.9(7).

(148) “Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System of the United States of America (or any successor), as the same may be modified and supplemented and in effect from time to time.

(149) “Regulatory Change” means, with respect to any Lender, any change after the date hereof in Federal, state or foreign law or regulations (including, without limitation, Regulation D) or the adoption or making after such date of any interpretation, directive or request applying to a class of banks including such Lender of or under any Federal, state or foreign law or regulations (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) by any court or governmental or monetary authority charged with the interpretation or administration thereof.

(150) “Rejecting Lender” has the meaning set forth in Section 9.1.

(151) “Related Entity” means, as to any Person, (a) any Affiliate of such Person; (b) any other Person into which, or with which, such Person is merged, consolidated or reorganized, or which is otherwise a successor to such Person by operation of law, or which acquires all or substantially all of the assets of such Person; (c) any other Person which is a successor to the business operations of such Person and engages in substantially the same activities; or (d) an y Affiliate of the Persons described in clauses (b) and (c) of this definition.

(152) “Replacement Lender” has the meaning assigned to such term in Section 14.12(6).

(153) “Requesting Lender” has the meaning assigned to such term in Section 2.9(7).

(154) “Required Payment” has the meaning assigned to such term in Section 2.8(6).

(155) “Reserve Account Collateral” has the meaning assigned to such term in Section 4.4(1).

(156) “Reserve Funds” means, the Tax and Insurance Reserve Fund.

(157) “Reserve Requirement” means, for any Interest Period for any LIBOR-based Loan, the average maximum rate at which reserves (including, without limitation, any marginal, supplemental or emergency reserves) are required to be maintained during such Interest Period under Regulation D by member banks of the Federal Reserve System in New York City with deposits exceeding $1,000,000,000 against “Eurocurrency liabilities” (as such term is used in Regulation D). Without limiting the effect of the foregoing, the Reserve Requirement shall include any other reserves required to b e maintained by such member banks by reason of any Regulatory Change with respect to (i) any category of liabilities that includes deposits by reference to which the LIBOR Rate for any Interest Period for any LIBOR-based Loans is to be determined as provided in the definition of “LIBOR Rate” or (ii) any category of extensions of credit or other assets that includes LIBOR-based Loans.

(158) “Restoration” means the repair and restoration of the Project after a Casualty or Condemnation as nearly as possible to the condition the Project was in immediately prior to such Casualty or Condemnation, with such alterations as may be approved by Administrative Agent.

(159) “Retail Component” means the portion of the Improvements belonging to the Lead Borrower consisting of approximately 119,446 square feet of gross leasable retail area.

(160) “Security Accounts” means, collectively, the Tax and Insurance Reserve Account, the Casualty/Taking Account, the Additional Cash Collateral Account, the Cash Management Account, the Low DSCR Account and the Reserve Funds.

(161) “Security Documents” means collectively, the Mortgage, the Hedge Agreement Pledge, the Deposit Account Control Agreement, the Cash Management Agreement and all Uniform Commercial Code financing statements required by this Agreement, the Mortgage, the Hedge Agreement Pledge, the Deposit Account Control Agreement or the Cash Management Agreement to be filed with respect to the applicable security interests.

(162) “Single Purpose Entity” means a corporation, limited partnership or limited liability company which at all times on and after the date hereof, unless otherwise approved in writing by Administrative Agent:

(a) is organized solely for the purpose of one of the following: (a) acquiring, developing, owning, holding, selling, leasing, transferring, exchanging, managing and operating the Project, entering into this Agreement, refinancing the Project in connection with a permitted repayment of the Loans, and transacting any and all lawful business that is incident, necessary and appropriate to accomplish the foregoing or (b) acting as the sole managing member of Borrower;

(b) is not engaged and will not engage in any business unrelated to (a) the acquisition, development, ownership, management or operation of the Project or (b) acting as the sole managing member of Borrower;

(c) does not have and will not have any assets other than those related to (a) the Project or (b) its membership interest in Borrower;

(d) has not engaged, sought or consented to and will not engage in, seek or consent to any dissolution, winding up, liquidation, consolidation, merger, sale of all or substantially all of its assets, transfer of partnership or membership interests (if such entity is a general partner in a limited partnership or a member in a limited liability company), or any amendment of its articles of incorporation, by-laws, limited partnership certificate, limited partnership agreement, articles of organization, certificate of formation or operating agreement (as applicable) with respect to the matters set forth in this definition;

(e) in the case of Borrower, has and will have, as its only managing member, the Managing Member, which shall be a limited liability company that is a Single Purpose Entity and has at least one (1) Independent Manager;

(f) if such entity is (i) a limited liability company, has articles of organization, a certificate of formation and/or an operating agreement, as applicable, (ii) a limited partnership, has a certificate of limited partnership and limited partnership agreement, or (ii) a corporation, has a certificate of incorporation or articles of incorporation, that in each case provide that such entity shall not, without the unanimous written consent of all of its partners or members (and, in the case of the Managing Member, its Independent Manager(s)): (a) dissolve, merge, liquidate or consolidate itself or any entity in which it has a direct or indirect legal or beneficial ownership interest; (b) sell all or substantially all of its assets or the assets of any other ent ity in which it has a direct or indirect legal or beneficial ownership interest; (c) engage in any other business activity or permit any entity in which it has a direct or indirect legal or beneficial ownership interest to engage in any other business activity, in each case except as permitted pursuant to the Loan Documents, (d) amend its organizational documents with respect to the matters set forth in this definition without the consent of Administrative Agent; and (e) file a bankruptcy or insolvency petition or otherwise institute insolvency proceedings with respect to itself or to any other entity in which it has a direct or indirect legal or beneficial ownership interest or is the direct or indirect general partner or manager;

(g) if such entity is a limited partnership, has as its only general partner a Single Purpose Entity;

(h) is and will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due, and is maintaining and will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations;

(i) has not failed and will not fail to correct any known misunderstanding regarding the separate identity of such entity;

(j) has maintained and will maintain its accounts, books and records separate from any other Person and will file its own tax returns, except to the extent that it is required or permitted to file consolidated tax returns by law;

(k) has not commingled and will not commingle its funds or assets with those of any other Person;

(l) has held and will hold its assets in its own name;

(m) has maintained and will maintain financial statements that properly and accurately show its separate assets and liabilities and do not show the assets or liabilities of any other Person, and has not permitted and will not permit its assets to be listed as assets on the financial statement of any other entity other than an Affiliate (but in such case noting that such entity and the Affiliate are separate entities);

(n) has paid and will pay its own liabilities and expenses, including, but not limited to, the salaries of its own employees (if any), out of its own funds and assets, and has maintained and will maintain a sufficient number of employees or has entered into appropriate alternative arrangements for workforce services in light of its contemplated business operations;

(o) has observed and will observe all corporate, partnership or limited liability company formalities, as applicable;

(p) has not incurred and will not incur any Debt other than (a) with respect to Borrower, the Loans and (b) trade and operational debt which is (i) incurred in the ordinary course of business, (ii) not more than sixty (60) days past due, (iii) with trade creditors, (iv) with respect to Borrower, in the aggregate, in an amount less than $1,000,000.00, (v) not evidenced by a note, and (vi) paid when due. No Debt other than the Loans may be secured (subordinate or pari passu) by the Project;

(q) has not and will not assume or guarantee or become obligated for the debts of any other Person or hold out its credit as being available to satisfy the obligations of any other Person except as permitted pursuant to this Agreement;

(r) has not and will not acquire obligations or securities of its members or shareholders or any other Affiliate;

(s) has allocated and will allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, including, but not limited to, paying for shared office space and services performed by any officer or employee of an Affiliate;

(t) maintains and uses and will maintain and use separate invoices and checks bearing its name. The stationery, invoices, and checks utilized by the Single Purpose Entity or utilized to collect its funds or pay its expenses shall bear its own name and shall not bear the name of any other entity unless such entity is clearly designated as being the Single Purpose Entity’s agent;

(u) except in connection with the Loans, has not pledged and will not pledge its assets for the benefit of any other Person;

(v) has conducted business, held itself out and identified itself and will conduct business, hold itself out and identify itself as a separate and distinct entity under its own name or in a name franchised or licensed to it by a Person other than an Affiliate of Borrower and not as a division or part of any other Person;

(w) has not made and will not make loans to any person or entity or hold evidence of indebtedness issued by another person or entity (other than cash and securities issued by a person or entity that is not an Affiliate or subject to common ownership with such entity);

(x) has not identified and will not identify its partners, members or shareholders, or any Affiliate of any of them, as a division or part of it, and has not identified itself and shall not identify itself as a division of any other Person;

(y) has not entered into or been a party to, and will not enter into or be a party to, any transaction with its partners, members, shareholders or Affiliates except in the ordinary course of its business and on terms which are intrinsically fair, commercially reasonable and are no less favorable to it than would be obtained in a comparable arm’s length transaction with an unrelated third party;

(z) has not and will not have any obligation to indemnify its partners, officers, directors or members, as the case may be, unless such obligation is fully subordinated to the Indebtedness and will not constitute a claim against it in the event that, after payment of the Indebtedness, cash flow is insufficient to pay such obligation;

(aa) if such entity is a corporation, it is required to consider the interests of its creditors in connection with all corporate actions;

(bb) does not and will not have any of its obligations guaranteed by any affiliate.

(163) “Site Assessment” means an environmental engineering report for the Project prepared by an engineer engaged by Administrative Agent at Borrower’s expense, and in a manner satisfactory to Administrative Agent, based upon an investigation relating to and making appropriate inquiries concerning the existence of Hazardous Materials on or about the Project, and the past or present discharge, disposal, release or escape of any such substances, all consistent with good customary and commercial practice.

(164) “Special Advance Lender” has the meaning assigned to such term in Section 14.12(1).

(165) “Sponsor” means Acadia Realty Limited Partnership

(166) “State” means the State of New York.

(167) “Stub Interest Period” has the meaning assigned to such term in Section 2.4(1).

(168) “Subordination of Property Management Agreement” means that certain Property Manager’s Consent and Subordination of Property Management Agreement, dated the date hereof, by the Property Manager in favor of Administrative Agent (on behalf of the Lenders), as the same may be modified, amended and/or supplemented and in effect from time to time.

(169) “Syndication” has the meaning assigned to such term to in Section 12.28.

(170) “Tax and Insurance Reserve Account” has the meaning assigned to such term in the Cash Management Agreement.

(171) “Tax and Insurance Reserve Fund” has the meaning assigned to such term in Section 4.1(1).

(172) “Taxes” has the meaning assigned to such term in Section 9.2.

(173) “Terrorism Insurance” has the meaning assigned to such term in Section 3.1(2).

(174) “Terrorism Insurance Cap” has the meaning assigned to such term in Section 3.1(2).

(175) “Terrorism Insurance Required Amount” has the meaning assigned to such term in Section 3.1(2).

(176) “Third-Party Counterparty” has the meaning assigned to such term in Section 9.15(3).

(177) “Third-Party Hedge Agreement” has the meaning assigned to such term in Section 9.15(3).

(178) “Threshold Amount” means $2,000,000.

(179) “TI/LC Letter of Credit” has the meaning assigned to such term in Section 4.2.

(180) “Transfer” has the meaning assigned to such term in Section 9.1.

(181) “Type” has the meaning assigned to such term in Section 2.1.

(182) “Unit” means each unit of the Condominium, together with all rights, interests and easements in and to the Project Amenities that are held by the owner of such unit as a result of the operation of the terms of the Condominium Declaration.

(183) “Unit Annual Assessments” means the assessments allocated to each Unit and collected by Declarant as set forth in the Condominium Declaration.

(184) “Unpaid Amount” has the meaning assigned to such term in Section 14.12(2).

Section 1.2Types of Loans. Loans hereunder are distinguished by “Type”. The “Type< /font>” of a Loan refers to whether such Loan is an Base Rate Loan or a LIBOR-based Loan, each of which constitutes a Type.

ARTICLE 2

LOAN TERMS

Section 2.1The Commitments, Loans and Notes.

(1) Loans. Each Lender severally agrees, on the terms and conditions of this Agreement, to make a term loan to Borrower in Dollars in a principal amount up to but not exceeding the amount of the Commitment of such Lender. The Loans shall be funded in a single advance in the aggregate amount of up to $86,000,000.00 and repaid in accordance with this Agreement. The precondition to effectiveness of this Agreement shall be Borrower’s satisfaction of the conditions described in Schedule 2.1 . Borrower hereby confirms that, notwithstanding the foregoing, the Loans have been fully advanced in the amount of $86,000,000.00 prior to the date hereof and that no actual advance of the Loans to Borrower shall be made on the date hereof or be required during the term of the Loans.

(2) Lending Offices. The Loans of each Lender shall be made and maintained at such Lender’s Applicable Lending Office for Loans of such Type.

(3) Several Obligations. The failure of any Lender to make any Loan to be made by it on the date specified therefor shall not relieve any other Lender of its obligation to make its Loan, but neither any Lender nor Administrative Agent shall be responsible for the failure of any other Lender to make a Loan to be made by such other Lender.

(4) Notes.

(a) Loan Notes. The Loans made by each Lender shall be evidenced by a single promissory note of Borrower substantially in the form of Exhibit C, payable to such Lender in a principal amount equal to the amount of its Commitment as originally in effect and otherwise duly completed.

(b) Endorsements on Notes. The date, amount, Type, interest rate and duration of Interest Period (if applicable) of each Loan made by each Lender to Borrower, and each payment made on account of the principal thereof, shall be recorded by such Lender on its books and, prior to any transfer of the Note held by it, endorsed by such Lender on the schedule attached to such Note or any continuation thereof; provided that the failure of such Lender to make any such recordation or endorsement shall not affect the obli gations of Borrower to make a payment when due of any amount owing hereunder or under such Note in respect of such Loans.

(c) Substitution, Exchange and Subdivision of Notes. No Lender shall be entitled to have its Notes substituted or exchanged for any reason, or subdivided for promissory notes of lesser denominations, except in connection with a permitted assignment of all or any portion of such Lender’s Commitment, Loans and Note pursuant to Sections 12.10 and 12.24 (and, if requested by any Lender, Borrower agrees to so substitute or exchange any Notes and enter into note splitter agreements in connection therewith).

(d) Loss, Theft, Destruction or Mutilation of Notes. In the event of the loss, theft or destruction of any Note, upon Borrower’s receipt of a reasonably satisfactory indemnification agreement executed in favor of Borrower by the holder of such Note, or in the event of the mutilation of any Note, upon the surrender of such mutilated Note by the holder thereof to Borrower, Borrower shall execute and deliver to such holder a new replacement Note in lieu of the lost, stolen, destroyed or mutilated Note.

Section 2.2Conversions or Continuations of Loans.

(1) Subject to Sections 2.8(4), 2.9(2) and 2.9(3), Lead Borrower shall have the right to Convert Loans of one Type into Loans of another Type or Continue Loans of one Type as Loans of the same Type, at any time or from time to time; provided that: (a) Lead Borrower shall give Administrative Agent notice of each such Conversion or Continuation as provided in Section 2.8(5); (b) LIBOR-based Loans may be Converted only on the last day of an Interest Period for such Loans unless Borrower complies with the terms of Section 2.9(5) and (c) subject to Sections 2.9(1) and 2.9(3), any Conversion or Continuation of Loans shall be pro rata among the Lenders. Notwithstanding the foregoing, and without limiting the rights and remedies of Administrative Agent and the Lenders under Article 11, in the event that any Event of Default exists, Administrative Agent may (and at the request of the Majority Lenders shall) suspen d the right of Lead Borrower to Convert any Loan into a LIBOR-based Loan, or to Continue any Loan as a LIBOR-based Loan for so long as such Event of Default exists, in which event all Loans shall be Converted (on the last day(s) of the respective Interest Periods therefor) or Continued, as the case may be, as Base Rate Loans. In connection with any such Conversion, a Lender may (at its sole and absolute discretion) transfer a Loan from one Applicable Lending Office to another.

(2) Notwithstanding anything to the contrary contained in this Agreement, at any time that a Hedge Agreement is in effect, Lead Borrower shall have the right to choose only an Interest Period with respect to the principal amount equal to the notional amount under such Hedge Agreement which is the same as the Interest Rate Hedge Period.

Section 2.3Interest Rate; Late Charge.

(1) Borrower hereby promises to pay to Administrative Agent for account of each Lender interest on the unpaid principal amount of each Loan (which may be Base Rate Loans and/or LIBOR-based Loans) made by such Lender for the period from and including the date of such Loan to but excluding the date such Loan shall be paid in full, at the following rates per annum:

(a) during such periods as such Loan is a Base Rate Loan, the Base Rate plus the Applicable Margin; and

(b) during such periods as such Loan is a LIBOR-based Loan, for each Interest Period relating thereto, the Adjusted LIBOR Rate for such Loan for such Interest Period plus the Applicable Margin.

(2) Accrued interest on each Loan shall be payable (i) monthly in arrears on each Payment Date and (ii) in the case of any Loan, upon the payment or prepayment thereof or the Conversion of such Loan to a Loan of another Type (but only on the principal amount so paid, prepaid or Converted), except that interest payable at the Default Rate shall be payable from time to time on demand.

(3) Notwithstanding anything to the contrary contained herein, after the Maturity Date and during any period when an Event of Default exists, Borrower shall pay to Administrative Agent for the account of each Lender interest at the applicable Default Rate on the outstanding principal amount of any Loan made by such Lender, any interest payments (except a late payment of any Additional Interest which shall be governed by the terms of the Hedge Agreement) thereon not paid when due and on any other amount payable by Borrower hereunder, under the Notes and any other Loan Documents.

(4) Promptly after the determination of any interest rate provided for herein or any change therein, Administrative Agent shall give notice thereof to the Lenders to which such interest is payable and to Lead Borrower, but the failure of Administrative Agent to provide such notice shall not affect Borrower’s obligation for the payment of interest on the Loans.

(5) In addition to any sums due under this Section 2.3, Borrower shall pay to Administrative Agent for the account of the Lenders a late payment premium in the amount of five percent (5.0%) of (i) any payments of principal under the Loans made and payable after the due date thereof, and (ii) any payments of interest or other sums under the Loans made more than five (5) days after the due date thereof, which late payment premium shall be due with any such late payment or upon demand by Administrative Agent. Such late payment charge represents the reasonable estimate of Borrower and the Lenders of a fair average compensation for the loss that may be sustained by the Lenders due to the failure of Borrower to make timely payments. Such late charge shall be paid without prejudice to the right of Administrative Agent and the Lenders to collect any other amounts provided herein or in the other Loan Documents to be paid or to exercise any other rights or remedies under the Loan Documents.

(6) Borrower shall pay Additional Interest under the Notes in accordance with the terms of any Hedge Agreement provided by a Eurohypo Counterparty.

Section 2.4 Terms of Payment.

The Loans shall be payable as follows:

(1) Interest. On the date hereof, Borrower shall make a payment of interest only (covering the period from the date hereof through and including December 1, 2009 (the “Stub Interest Period”), and beginning with the first Business Day of each month thereafter, commencing on January 1, 2010, Borrower shall pay interest in arrears on each Payment Date in accordance with the wire transfer instructions set forth in Schedule 2.4(1) hereto (or such other instructions as Administrative Agent may from time to time provide) until all amounts due under the Loan Documents are paid in full.

(2) Principal Amortization. Borrower shall make payments of interest only for the first twelve (12) months of the term of the Loan. Beginning with the first Payment Date following the first anniversary of the Closing Date and continuing through the Maturity Date (including, if the extension option is exercised, through the Extension Period), Borrower shall make payments of principal in the amounts set forth on Schedule 2.4(2) attached hereto and made a part hereof.

(3) Maturity. On the Maturity Date, Borrower shall pay to Administrative Agent (on behalf of the Lenders) all outstanding principal, accrued and unpaid interest, and any other amounts due under the Loan Documents.

(4) Optional Prepayments. Subject to the provisions of Sections 2.4(6) and 2.9(5), Borrower shall have the right to prepay Loans in whole or in part, without premium or penalty; provided that: (a) Lead Borrower shall give Administrative Agent notice of each such prepayment as provided in Section 2.8(5) (and, upon the date specified in any such notice of prepayment, the amount to be prepaid shall become due and payable hereunder) and (b) partial prepayments shall be in the minimum aggregate principal amounts specified in Section 2.8(4). Loans that are prepaid cannot be reborrowed.

(5) Mandatory Prepayments. If a casualty or condemnation shall occur with respect to the Project, Borrower, upon Borrower’s or Administrative Agent’s receipt of the applicable insurance proceeds or condemnation award, shall prepay the Loan, if required by the provisions of Article 3, on the dates and in the amounts specified therein without premium (but subject to the provisions of Sections 2.4(6) and 2.9(5)). Nothing in this Section 2.4(5) shall be deemed to limit any obligation of Borrower under the Mortgage or any other Security Document, including any obligation to remit to a collateral or similar account maintained by Administrative Agent pursuant to the Mortgage or any of the other Security Documents the proceeds of insurance, condemnation award or other compensation received in respect of any casualty or condemnation. Prepayments pursuant to this Section 2.4(5) shall be applied to the Loans then outst anding pro rata in the order set forth in Section 2.4(6).

(6) Interest and Other Charges on Prepayment. If the Loans are prepaid, in whole or in part, pursuant to Section 2.4(4) or 2.4(5), each such prepayment shall be made on the prepayment date specified in the notice to Administrative Agent pursuant to Section 2.8(5), and (in every case) together with (a) the accrued and unpaid interest (including accrued and unpaid Additional Interest, if applicable) on the principal amount prepaid and (b) any amounts payab le to a Lender pursuant to Section 2.9(5) as a result of such prepayment while an Adjusted LIBOR Rate is in effect; provided, however, that any such prepayment shall be applied first, to the prepayment of any portions of the outstanding principal amount that are Base Rate Loans and, second, to the prepayment of any portions of the outstanding principal amount that are LIBOR-based Loans applying such sums first to LIBOR-based Loans of the shortest maturity so as to minimize breakage costs; provided further, however, that if an Event of Default exists, Administrative Agent may distribute such payment to the Lenders for application in such manner as it or the Majority Lenders, subject to Section 2.8(2), may determine to be appropriate.

(7) Application of Payments. All payments received by Administrative Agent under the Loan Documents shall be applied: first, to any fees and expenses due to Administrative Agent and the Lenders under the Loan Documents; second, to any Default Rate interest or late charges; third, to accrued and unpaid interest; and fourth, to the principal sum and other amounts due under the Loan Documents; provided, however, that, if an Event of Default exists Administrative Agent shall apply such payments in any order or manner as Administrative Agent shall determine.

Section 2.5Extension of Maturity Date. Borrower may, at its option, extend the term of the then outstanding principal amount for a period of three hundred sixty-four (364) days from the original Maturity Date (the applicable period being, the (“Extension Period< /font>”), subject to the satisfaction of the following conditions:

(1) Lead Borrower shall notify (the “Extension Notice”) Administrative Agent of Borrower’s exercise of such option between sixty (60) and one hundred twenty (120) days prior to the original Maturity Date;

(2) No Potential Default or Event of Default exists as of the date of the Extension Notice, as of the original Maturity Date or would result from the extension of the maturity of the Loans for the Extension Period;

(3) The Loan to Value Ratio does not exceed 70%, based on a new Appraisal obtained by Administrative Agent not more than sixty (60) days prior to the original Maturity Date, such Appraisal to be at Borrower’s expense and satisfactory to Administrative Agent in all respects;

(4) The Pro Forma Debt Service Coverage Ratio as of the original Maturity Date shall be equal to or greater than 1.45:1.00;

(5) The Debt Yield as of the original Maturity Date shall not be less than ten percent (10.0%).

(6) The expiration date of any Collateral Letters of Credit, if still outstanding pursuant to the terms of this Agreement or any other Loan Document, shall be extended to a date which is thirty (30) days beyond the end of the Extension Period, or shall otherwise contain evergreen provisions satisfactory to Administrative Agent, in its sole and absolute discretion;

(7) Current financial statements regarding Borrower (dated not earlier than ninety (90) days prior to the Extension Notice) and all other financial statements and other information as may be required under this Agreement and the Loan Documents regarding Borrower and the Project shall have been submitted promptly to Administrative Agent;

(8) In the opinion of Administrative Agent, there shall not have occurred any Material Adverse Effect;

(9) Whether or not the extension becomes effective, Borrower shall pay all out-of-pocket costs and expenses incurred by Administrative Agent and the Lenders in connection with the proposed extension (pre- and post-closing), including appraisal fees and legal fees; all such costs and expenses shall be due and payable upon demand, and any failure to pay such amounts shall constitute a default under this Agreement and the Loan Documents;

(10) Not later than the original Maturity Date, (i) the extension shall have been documented to the Lenders’ satisfaction and consented to by Borrower, Administrative Agent and all the Lenders, including the execution and delivery by the Guarantor of reaffirmations of their respective obligations under the Guaranty and (ii) Administrative Agent shall have been provided with an updated title report and judgment and lien searches, and appropriate title insurance endorsements shall have been issued as required by Administrative Agent; and

(11) Borrower shall pay to Administrative Agent (for the benefit of the Lenders in accordance with their proportionate shares) on the original Maturity Date a non-refundable extension fee equal to one-half percent (0.50%) of an amount equal to the outstanding principal amount at such time.

Any such extension shall be otherwise subject to all of the other terms and provisions of this Agreement and the other Loan Documents.

Section 2.6Reserved.

Section 2.7 Cash Management.

(1) Borrower shall cause all rents from the Project to be deposited into the Clearing Account in accordance with the Deposit Account Control Agreement and the Cash Management Agreement. Without limitation of the foregoing, Borrower shall, and shall cause the Property Manager to, (a) deliver irrevocable written instructions to all tenants under leases to deliver all rents payable thereunder directly to the Clearing Account, and (b) deposit all amounts received by Borrower or the Property Manager constituting rents or other revenue of any kind from the Project into the Clearing Account within one (1) Business Day of receipt thereof. Disbursements from the Clearing Account will be made in accordance with the terms and conditions of this Agreement and the Cash Management Agreement. Administrative Agent shall have sole dominion and control over the Clearing Account and Borrower shall have no rights to make withdrawals therefrom.

(2) Notwithstanding anything to the contrary contained in this Agreement or the other Loan Documents, and provided no Event of Default exists, Borrower’s obligations with respect to the monthly payment of interest and principal (if any) and the deposits to be made into the Security Accounts and any other payment due pursuant to this Agreement or any other Loan Document shall be deemed satisfied to the extent sufficient amounts are deposited in the Cash Management Account and are unconditionally available to Administrative Agent (on behalf of the Lenders) to satisfy such obligations in accordance with the terms of this Agreement and the Cash Management Agreement on the dates each such payment is required, regardless of whether any of such amounts are so a pplied by Administrative Agent.

(3) The insufficiency of funds on deposit in the Clearing Account or the Cash Management Account (or any sub-account thereunder) shall not absolve Borrower of the obligation to make any payments as and when due pursuant to this Agreement and the other Loan Documents, and such obligations shall be separate and independent, and not conditioned on any event or circumstance whatsoever.

Section 2.8 Payments; Pro Rata Treatment; Etc.

(1) Payments Generally.

(a) Payments by Borrower. Except to the extent otherwise provided herein, all payments of principal, interest and other amounts to be made by Borrower under this Agreement and the Notes, and, except to the extent otherwise provided therein, all payments to be made by Borrower under any other Loan Document, shall be made in Dollars, in immediately available funds, without deduction, set-off or counterclaim, to Administrative Agent at an account designated by Administrative Agent by notice to Lead Borrower, not later than 2:00 p.m., New York City time, on the date on which such payment shall become due (each such payment made after such time on such due date to be deemed to have been made on the next succeeding Business Day).

(b) Application of Payments. Subject to the provisions of Section 2.4(7), Lead Borrower shall, at the time of making each payment under this Agreement or any Note for the account of any Lender, s pecify to Administrative Agent (which shall so notify the intended recipient(s) thereof) the Loans or other amounts payable by Borrower hereunder to which such payment is to be applied (and in the event that Lead Borrower fails to so specify, or if an Event of Default has occurred and is continuing, Administrative Agent may distribute such payment to the Lenders for application in such manner as it may determine to be appropriate, subject to Section 2.8(2) and any other agreement among Administrative Agent and the Lenders with respect to such application).

(c) Forwarding of Payments by Administrative Agent. Except as otherwise agreed by Administrative Agent and the Lenders, each payment received by Administrative Agent under this Agreement or any Note for account of any Lender shall be paid by Administrative Agent promptly to such Lender, in immediately available funds, for account of such Lender’s Applicable Lending Office for the Loan or other obligation in respect of which such payment is made.

(d) Extensions to Next Business Day. If the due date of any payment under this Agreement or any Note would otherwise fall on a day that is not a Business Day, such date shall be extended to the next succeeding Business Day, and interest shall be payable for any principal so extended for the period of such extension.

(2) Pro Rata Treatment. Except to the extent otherwise provided herein: (a) except as otherwise provided in Section 2.9(4),Loans shall be allocated pro rata among the Lenders acco rding to the amounts of their respective Commitments (in the case of the making of Loans) or their respective Loans (in the case of Conversions or Continuations of Loans); (b) each payment or prepayment of principal of Loans by Borrower shall be made for account of the Lenders pro rata in accordance with the respective unpaid principal amounts of the Loans held by them; and (c) each payment of interest on Loans by Borrower shall be made for account of the Lenders pro rata in accordance with the amounts of interest on such Loans then due and payable to the respective Lenders.

(3) Computations. Interest on all Loans shall be computed on the basis of a year of 360 days and actual days elapsed (including the first day but excluding the last day) occurring in the period for which payable.

(4) Minimum Amounts. Except for (a) mandatory prepayments made pursuant to Section 2.4(5) and (b) Conversions or prepayments made pursuant to Section 2.9(4), each borrowing, Conversion, Continuation and partial prepayment of principal (collectively, “Loan Transactions”) of Loans shall be in an aggregate amount at least equal to $1,000,000 (Loan Transactions of or into Loans of different Types or Interest Periods at the same time hereunder shall be deemed separate Loan Transactions for purposes of the foregoing, one for each Type or Interest Period); provided that if any Loans or borrowings would otherwise be in a lesser principal amount for any period, such Loans shall be Base Rate Loans during such period. Notwithstanding the foregoing, the minimum amount of $1,000,000 shall not apply to Conversions of lesser amounts into a tranche of Loans that has (or will have upon such Conversion) an aggregate principal amount exceeding such minimum amount and one Interest Period.

(5) Certain Notices. Notices by Lead Borrower to Administrative Agent regarding Loan Transactions and the selection of Types of Loans and/or of the duration of Interest Periods shall be irrevocable and shall be effective only if received by Administrative Agent not later than 12:00 noon, New York City time, on the number of Business Days prior to the date of the proposed Loan Transaction or the first day of such Interest Period specified below:

Notice	Number of Business Days Prior
Optional Prepayment	3
Conversions into, Continuations as, or borrowings in Base Rate Loans	3
Conversions into, Continuations as, borrowings in or changes in duration of Interest Period for, LIBOR-based Loans (subject to Section 2.4(6)	3

Each such notice of a Loan Transaction shall specify the amount (subject to Section 2.8(4)), Type, and Interest Period of such proposed Loan Transaction, and the date (which shall be a Business Day) of such proposed Loan Transaction. Notices for Conversions and Continuations shall be in the form of Exhibit F. Each such notice specifying the duration of an Interest Period shall specify the portion of the Loans to which such Interest Period is to relate. Administrative Agent shall promptly notify the Lenders of the contents of each such notice. If Lead Borrower fails to select (i) the Type of Loan or (ii) the duration of any Interest Period for any LIBOR-based Loan within the time period (i.e., three (3) Business Days prior to the first day of the next applicable Interest Period) and otherwise as provided in this Section 2.8(5), such Loan (if outstan ding as a LIBOR Loan) will be automatically Continued as an LIBOR-based Loan with an Interest Period of one (1) month on the last day of the current Interest Period for such Loan (based on a LIBOR-based Rate determined two (2) Business Days prior to the first day of the next Interest Period) or, if outstanding as an Base Rate Loan, will remain as a Base Rate Loan.

(6) Non-Receipt of Funds by Administrative Agent. Unless Administrative Agent shall have been notified by a Lender or Lead Borrower (in either case, and along with Borrower, the “Payor”) prior to the date on which the Payor is to make payment to Administrative Agent of (in the case of a Lender) the proceeds of a Loan to be made by such Lender hereunder or (in the case of Borrower) a payment to Administrative Agent for account of any Lender hereunder (in either case, such payment b eing herein called the “Required Payment”), which notice shall be effective upon receipt, that the Payor does not intend to make the Required Payment to Administrative Agent, Administrative Agent may assume that the Required Payment has been made and may, in reliance upon such assumption (but shall not be required to), make the amount thereof available to the intended recipient(s) on such date; and, if the Payor has not in fact made the Required Payment to Administrative Agent, the recipient(s) of such payment shall, on demand, repay to Administrative Agent the amount so made available together with interest thereon in respect of each day during the period commencing on the date (the “Advance Date”) such amount was so made available by Administrative Agent until the date Administrative Agent recovers such amount at a rate per annum equal to (a) the Federal Funds Rate for such day in the case of payments returned to Administrative Agent by any of the Lenders or (b) the applicable interest rate due hereunder with respect to payments returned by Borrower to Administrative Agent and, if such recipient(s) shall fail promptly to make such payment, Administrative Agent shall be entitled to recover such amount, on demand, from the Payor, together with interest as aforesaid; provided that if neither the recipient(s) nor the Payor shall return the Required Payment to Administrative Agent within three (3) Business Days of the Advance Date, then, retroactively to the Advance Date, the Payor and the recipient(s) shall each be obligated to pay interest on the Required Payment as follows:

(a) if the Required Payment shall represent a payment to be made by Borrower to the Lenders, Borrower and the recipient(s) shall each be obligated retroactively to the Advance Date to pay interest in respect of the Required Payment at the Default Rate (without duplication of the obligation of Borrower under Section 2.3 60;to pay interest on the Required Payment at the Default Rate), it being understood that the return by the recipient(s) of the Required Payment to Administrative Agent shall not limit such obligation of Borrower under Section 2.3 to pay interest at the Default Rate in respect of the Required Payment, and

(b) if the Required Payment shall represent proceeds of a Loan to be made by the Lenders to Borrower, the Payor and Borrower shall each be obligated retroactively to the Advance Date to pay interest in respect of the Required Payment pursuant to whichever of the rates specified in Section 2.3 is applicable to the Typ e of such Loan, it being understood that the return by Borrower of the Required Payment to Administrative Agent shall not limit any claim Borrower may have against the Payor in respect of such Required Payment.

(7) Sharing of Payments, Etc.

(a) Right of Set-off. Borrower agrees that, in addition to (and without limitation of) any right of set-off, banker’s lien or counterclaim a Lender may otherwise have, (subject, as among the Lenders, to Section 12.26), each Lender shall be entitled, at its option (to the fullest extent permitted by law), to set off and apply any deposit (general or special, time or demand, provisional or final), or other indebtedness, held by it for the credit or account of Borrower at any of its offices, in Dollars or in any other currency, against any principal of or interest on any of such Lender’s Loans or any other amount payable to such Lender hereunder, that is not paid when due (regardless of whether such deposit or other indebtedness is then due to Borrower), in which case it shall promptly notify Borrower and Administrative Agent thereof, provided that such Lender’s failure to give such notice shall not affect the validity thereof.

(b) Sharing. If any Lender shall obtain from Borrower payment of any principal of or interest on any Loan owing to it or payment of any other amount under this Agreement or any other Loan Document through the exercise (subject, as among the Lenders, to Section 12.26) of any right of set-off, banker’s lien or counterclaim or similar right or otherwise (other than from Administrative Agent as provided herein), and, as a result of such payment, such Lender shall have received a greater percentage of the principal of or interest on the Loans or such other amounts then due hereunder or thereunder by Borrower to such Lender than the percentage received by any other Lender, it shall promptly purchase from such other Lenders participations in (or, if and to the extent specified by such Lender, direct interests in) the Loans or such other amounts, respectively, owing to such other Lenders (or in interest due thereon, as the case may be) in such amounts, and make such other adjustments from time to time as shall be equitable, to the end that all the Lenders shall share the benefit of such excess payment (net of any expenses that may be incurred by such Lender in obtaining or preserving such excess payment) p ro rata in accordance with the unpaid principal of and/or interest on the Loans or such other amounts, respectively, owing to each of the Lenders. To such end all the Lenders shall make appropriate adjustments among themselves (by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise be restored.

(c) Consent by Borrower. Borrower agrees that any Lender so purchasing such a participation (or direct interest) may exercise (subject, as among the Lenders, to Section 12.26) all rights of set-off, b anker’s lien, counterclaim or similar rights with respect to such participation as fully as if such Lender were a direct holder of Loans or other amounts (as the case may be) owing to such Lender in the amount of such participation.

(d) Rights of Lenders; Bankruptcy. Nothing contained herein shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such right with respect to any other indebtedness or obligation of Borrower. If, under any applicable bankruptcy, insolvency or other similar law, any Lender receives a secured claim in lieu of a set-off to which this Section 2.8(7) applies, such Lender shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights of the Lenders entitled under this Section 2.8(7) to share in the benefits of any recovery on such secured claim.

Section 2.9Yield Protection; Etc.

(1) Additional Costs.

(a) Costs of Making or Maintaining LIBOR-based Loans. Borrower shall pay directly to each Lender from time to time such amounts as such Lender may determine to be necessary to compensate such Lender for any costs that such Lender determines are attributable to its making or maintaining of any LIBOR-based Loans or its obligation to make any LIBOR-based Loans hereunder, or any reduction in any amount receivable by such Lender hereunder in respect of any of such Loans or such obligation (such increases in costs and reductions in amounts receivable being herein called “Additional Costs”), resulting from any Regulatory Change that:

(i)

shall subject any Lender (or its Applicable Lending Office for any of such Loans) to any tax, duty or other charge in respect of such Loans or its Note or changes the basis of taxation of any amounts payable to such Lender under this Agreement or its Note in respect of any of such Loans (excluding changes in the rate of tax on the overall net income of such Lender or of such Applicable Lending Office by the jurisdiction in which such Lender has its principal office or such Applicable Lending Office); or

(ii)

imposes or modifies any reserve, special deposit or similar requirements (other than the Reserve Requirement used in the determination of the Adjusted LIBOR Rate for any Interest Period for such Loan) relating to any extensions of credit or other assets of, or any deposits with or other liabilities of, such Lender (including, without limitation, any of such Loans or any deposits referred to in the definition of “LIBOR Rate”), or any commitment of such Lender (including, without limitation, the Commitment of such Lender hereunder); or

(iii)

imposes any other condition affecting this Agreement or its Note (or any of such extensions of credit or liabilities) or its Commitment.

If any Lender requests compensation from Lead Borrower under this paragraph (a), Borrower may, by notice to such Lender (with a copy to Administrative Agent), suspend the obligation of such Lender thereafter to make or Continue LIBOR-based Loans, or to Convert Loans into LIBOR-based Loans, until the Regulatory Change giving rise to such request ceases to be in effect (in which case the provisions of Section 2.9(4) shall be applicable), provided that such suspension shall not affect the right of such Lender to receive the compensation so requested.

(b) Costs Attributable to Regulatory Change or Risk-Based Capital Guidelines. Without limiting the effect of the foregoing provisions of this Section 2.9(1) (but without duplication), Borrow er shall pay directly to each Lender from time to time on request such amounts as such Lender may determine to be necessary to compensate such Lender (or, without duplication, the bank holding company of which such Lender is a subsidiary) for any costs that it determines are attributable to the maintenance by such Lender (or any Applicable Lending Office or such bank holding company), pursuant to any law or regulation or any interpretation, directive or request (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) of any court or governmental or monetary authority (i) following any Regulatory Change or (ii) implementing any risk-based capital guideline or other requirement (whether or not having the force of law and whether or not the failure to comply therewith would be unlawful) hereafter issued by any government or governmental or supervisory authority implementing at the national level the Basel II Accord, of capital in respect of its Commitme nt or Loans (such compensation to include, without limitation, an amount equal to any reduction of the rate of return on assets or equity of such Lender (or any Applicable Lending Office or such bank holding company) to a level below that which such Lender (or any Applicable Lending Office or such bank holding company) could have achieved but for such law, regulation, interpretation, directive or request.

(c) Notification and Certification. Each Lender shall notify Lead Borrower of any event occurring after the date hereof entitling such Lender to compensation under paragraph (a) or (b) of this Section 2.9(1) as promptly as practicable, but in any event within sixty (60) days, after such Lender obtains actual knowledge thereof; provided that (i) if any Lender fails to give such notice within sixty (60) days after it obtains actual knowledge of such an event, such Lender shall, with respect to compensation payable pursuant to this Section 2.9(1) in respect of any costs resulting from such event, only be entitled to payment under this Section 2.9(1) for costs incurred from and after the date forty-five (45) days prior to the date that such Lender does give such notice and (ii) each Lender will designate a different Applicable Lending Office for the Loans of such Lender affected by such event if such designation will avoid the need for, or reduce the amount of, such compensation and will not, in the sole opinion of such Lender, be disadvantageous to such Lender, except that such Lender shall have no obligation to designate an Applicable Lending Office located in the United States of America. Each Lender will furnish to Lead Borrower a certificate setting forth the basis and amou nt of each request by such Lender for compensation under paragraph (a) or (b) of this Section 2.9(1). Determinations and allocations by any Lender for purposes of this Section 2.9(1) of the effect of any Regulatory Change p ursuant to paragraph (a) of this Section 2.9(1), or of the effect of capital maintained pursuant to paragraph (b) of this Section 2.9(1), on its costs or rate of return of maintaining Loans or its obligation to make Loans, or on amounts re ceivable by it in respect of Loans, and of the amounts required to compensate such Lender under this Section 2.9(1), shall be conclusive, provided that such determinations and allocations are made on a reasonable basis.

(2) Limitation on Types of Loans. Anything herein to the contrary notwithstanding, if, on or prior to the determination of the LIBOR Rate for any Interest Period for any LIBOR-based Loan:

(a) Administrative Agent determines, which determination shall be conclusive, that quotations of interest rates for the relevant deposits referred to in the definition of LIBOR Rate are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for LIBOR-based Loans as provided herein; or

(b) Any Lender determines, which determination shall be conclusive, and notifies Administrative Agent that the relevant rates of interest referred to in the definition of LIBOR Rate upon the basis of which the rate of interest for LIBOR-based Loans for such Interest Period is to be determined are not likely adequately to cover the cost to such Lenders of making or maintaining LIBOR-based Loans for such Interest Period;

then Administrative Agent shall give Lead Borrower and each Lender prompt notice thereof and, so long as such condition remains in effect, the Lenders shall be under no obligation to make additional LIBOR-based Loans, to Continue LIBOR-based Loans or to Convert Loans of any other Type into LIBOR-based Loans, and Borrower shall, on the last day(s) of the then current Interest Period(s) for the outstanding LIBOR-based Loans, either prepay such Loans or such Loans shall be automatically Converted into Base Rate Loans.

(3) Illegality. Notwithstanding any other provision of this Agreement, in the event that it becomes unlawful for any Lender or its Applicable Lending Office to honor its obligation to make or maintain LIBOR-based Loans hereunder (and, in the sole opinion of such Lender, the designation of a different Applicable Lending Office would either not avoid such unlawfulness or would be disadvantageous to such Lender), then such Lender shall promptly notify Lead Borrower thereof (with a copy to Administrative Agent) and such Lender’s obligation to make or Continue, or to Convert Loans of any other Type into, LIBOR-based Loans shall be suspended until such time as such Lender may again make and maintain LIBOR-based Loans (in which case the provisions of Section 2.9(4) shall be applicable).

(4) Treatment of Affected Loans. If the obligation of any Lender to make LIBOR-based Loans or to Continue, or to Convert Base Rate Loans into, LIBOR-based Loans shall be suspended pursuant to Section 2.9(1) or 2.9(3), such Lender’s Loans shall be automatically Converted into Base Rate Loans on the last day(s) of the then current Interest Period(s) for Loans (or, in the case of a Conversion resulting from a circumstance described in Section 2.9(3), on such earlier date as such Lender may specify to Lead Borrower with a copy to Administrative Agent) and, unless and until such Lender gives notice as provided below that the circumstances specified in Section 2.9(1) or 2.9(3) that gave rise to such Conversion no longer exist:

(a) to the extent that such Lender’s Loans have been so Converted, all payments and prepayments of principal that would otherwise be applied to such Lender’s Loans shall be applied instead to its Base Rate Loans; and

(b) all Loans that would otherwise be made or Continued by such Lender as LIBOR-based Loans shall be made or Continued instead as Base Rate Loans, and all Loans of such Lender that would otherwise be Converted into LIBOR-based Loans shall remain as Base Rate Loans.

If such Lender gives notice to Lead Borrower with a copy to Administrative Agent that the circumstances specified in Section 2.9(1) or 2.9(3) that gave rise to the Conversion of such Lender’s Loans pursuant to this Section 2.9(4) no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when LIBOR-based Loans made by other Lenders are outstanding, such Lender’s Base Rate Loans shall be automatically Converted, on the first day(s) of the next succeeding Interest Period(s) for such outstanding LIBOR-based Loans, to the extent necessary so that, after giving effect thereto, all Base Rate Loans and LIBOR-based Loans are allocated among the Lenders ratably (as to principal amounts, Types and Interest Periods) in accordance with their respective Commitments.

(5) Compensation. Borrower shall pay to Administrative Agent for account of each Lender, upon the request of such Lender through Administrative Agent, such amount or amounts as shall be sufficient (in the reasonable opinion of such Lender) to compensate it for any loss, cost or expense that such Lender determines is attributable to:

(a) any payment, prepayment or Conversion of a LIBOR-based Loan made by such Lender for any reason (including, without limitation, the acceleration of the Loans pursuant to Administrative Agent’s or the Lenders’ rights referred to in Article 11) on a date other than the last day of the Interest Period for such Loan; or

(b) any failure by Borrower for any reason to borrow a LIBOR-based Loan from such Lender on the date for such borrowing specified in the relevant notice of borrowing given to Administrative Agent in accordance with the terms of this Agreement.

Without limiting the effect of the preceding sentence, such compensation shall include an amount equal to the excess, if any, of (i) the amount of interest that otherwise would have accrued on the principal amount so paid, prepaid, Converted or not borrowed for the period from the date of such payment, prepayment, Conversion or failure to borrow to the last day of the then current Interest Period for such Loan (or, in the case of a failure to borrow, the Interest Period for such Loan that would have commenced on the date specified for such borrowing) at the applicable rate of interest for such Loan provided for herein over (ii) the amount of interest that otherwise would have accrued on such principal amount at a rate per annum equal to the interest component of the amount such Lender would have bid in the London i nterbank market for Dollar deposits of leading banks in amounts comparable to such principal amount and with maturities comparable to such period (as reasonably determined by such Lender), or if such Lender shall cease to make such bids, the equivalent rate, as reasonably determined by such Lender, derived from Page 3750 of the Dow Jones Markets (Telerate) Service or other publicly available source as described in the definition of LIBOR Rate.

(6) U.S. Taxes.

(a) Gross-up for Deduction or Withholding of U.S. Taxes. Borrower agrees to pay to each Lender that is not a U.S. Person such additional amounts as are necessary in order that the net payment of any amount due to such non-U.S. Person hereunder after deduction for or withholding in respect of any U.S. Taxes imposed with respect to such payment (or in lieu thereof, payment of such U.S. Taxes by such non-U.S. Person), will not be less than the amount stated herein to be then due and payable, provided that the foregoing obligation to pay such additional amounts shall not apply:

(i)

to any payment to any Lender hereunder unless such Lender is, on the date hereof (or on the date it becomes a Lender hereunder as provided in Section 12.24(2)) and on the date of any change in the Applicable Lending Office of such Lender, either entitled to submit a Form W-8BEN (relating to such Lender and entitling it to a complete exemption from withholding on all interest to be received by it hereunder in respect of the Loans) or Form W-8ECI (rela ting to all interest to be received by such Lender hereunder in respect of the Loans), or

(ii)

to any U.S. Taxes imposed solely by reason of the failure by such non-U.S. Person to comply with applicable certification, information, documentation or other reporting requirements concerning the nationality, residence, identity or connections with the United States of America of such non-U.S. Person if such compliance is required by statute or regulation of the United States of America as a precondition to relief or exemption from such U.S. Taxes.

For the purposes hereof, (A) “U.S. Person” means a citizen, national or resident of the United States of America, a corporation, limited liability company, partnership or other entity created or organized in or under any laws of the United States of America or any State thereof, or any estate or trust that is subject to Federal income taxation regardless of the source of its income, (B) “U.S. Taxes” means any present or future tax, assessment or other charge or levy imposed by or on behalf of the Unite d States of America or any taxing authority thereof or therein, (C) “Form W-8BEN” means Form W-8BEN of the Department of the Treasury of the United States of America and (D) “Form W-8ECI” means Form W-8ECI of the Department of the Treasury of the United States of America. Each of the Forms referred to in the foregoing clauses (C) and (D) shall include such successor and related forms as may from time to time be adopted by the relevant taxing authorities of the United States of America to document a claim to which such Form relates.

(b) Evidence of Deduction, Etc. Within thirty (30) days after paying any amount to Administrative Agent or any Lender from which it is required by law to make any deduction or withholding, and within thirty (30) days after it is required by law to remit such deduction or withholding to any relevant taxing or other authority, Borrower shall deliver to Administrative Agent for delivery to such non-U.S. Person evidence satisfactory to such Person of such deduction, withholding or payment (as the case may be).

(7) Replacement of Lenders. If any Lender requests compensation pursuant to Section 2.9(1) or 2.9(6), or any Lender’s obligation to Continue Loans of any Type, or to Convert Loans of any Type into the other Type of Loan, shall be suspended pursuant to Section 2.9(2) or 2.9(3) (any such Lender requesting such compensation, or whose obligations are so suspended, being herein called a “Requesting Lender”), Lead Borrower, upon three (3) Business Days notice, may require that such Requesting Lender transfer all of its right, title and interest under this Agreement and such Requesting Lender’s Note to any bank or other financial institution (a “Proposed Lender”) identified by Lead Borrower that is satisfactory to Administrative Agent (i) if such Proposed Lender agrees to assume all of the obligations of such Requesting Lender hereunder, and to purchase all of such Requesting Lender’s Loans hereunder for consideration equal to the aggregate outstanding principal amount of such Requesting Lender’s Loans, together with interest thereon to the date of such purchase (to the extent not paid by Borrower), and satisfactory arrangements are made for payment to such Requesting Lender of all other amounts accrued and payable hereunder to such Requesting Lender as of the date of such transfer (including any fees accrued hereunder and any amounts that would be payable under Section 2.9(5) as if all of such Requesting Lender’s Loans were being prepaid in full on such date) and (ii) if such Requesting Lender has requested compensation pursuant to Section 2.9(1) or 2.9(6), such Proposed Lender’s aggregate requested compensation, if any, pursuant to Section 2.9 (1) or 2.9(6) with respect to such Requesting Lender’s Loans is lower than that of the Requesting Lender. Subject to the provisions of Section 12.24(2), such Proposed Lender shall be a “Lender” for all purposes hereunder. Without prejudice to th e survival of any other agreement of Borrower hereunder, the agreements of Borrower contained in Sections 2.9(1), 2.9(6) and 12.5 (without duplication of any payments made to such Requesting Lender by Borrower or the Proposed Lender) shall survive for the benefit of such Requesting Lender under this Section 2.9(7) with respect to the time prior to such replacement.

Section 2.10 Administrative Fee.

Until payment in full of all obligations under this Agreement and the other Loan Documents, Borrower shall pay to Administrative Agent, for its sole account (except as agreed in writing between Administrative Agent and any Lender(s)), the Administrative Fee in accordance with the Fee Letter.

Section 2.11 Exit Fee.

With respect to any repayment or prepayment of principal under the Loans made on or prior to the original Maturity Date for any reason whatsoever (whether such repayment or prepayment of the Loans is made voluntarily or involuntarily or as a result of the occurrence of an Event of Default pursuant to which the Administrative Agent has accelerated the obligations of the Borrower under the Loan Documents or otherwise), Borrower shall pay to Administrative Agent (for the account of the Lenders in accordance with their pro rata shares), in addition to all other amounts that may be due hereunder, an amount equal to one quarter of one percent (0.25%) of the amount so repaid or prepaid under the Loans (the “Exit Fee”).

ARTICLE 3

INSURANCE, CONDEMNATION, AND IMPOUNDS

Section 3.1 Insurance. < /div>

(1) Borrower shall obtain and maintain, or cause to be maintained, Policies for Borrower and the Project providing at least the following coverages:

(a) comprehensive all-risk insurance on the Improvements and the personal property, in each case (i) in an amount equal to 100% of the “Full Replacement Cost,” which for purposes of this Agreement shall mean actual replacement value (exclusive of costs of excavations, foundations, underground utilities and footings) with a waiver of depreciation, (ii) containing an agreed amount endorsement with respect to the improvements and personal property waiving all co insurance provisions; (iii) providing for no deductible in excess of $50,000; (iv) providing for repairs and alteration coverage; and (v) providing coverage for contingent liability from Operation of Building Laws, Demolition Costs an d Increased Cost of Construction Endorsements together with an “Ordinance or Law Coverage” or “Enforcement” endorsement if any of the Improvements or the use of the Project shall at any time constitute legal non-conforming structures or uses. The Full Replacement Cost shall be redetermined from time to time (but not more frequently than once in any twenty-four (24) calendar months) at the request of Administrative Agent by an appraiser or contractor designated by Borrower and reasonably approved by Administrative Agent, or by an engineer or appraiser in the regular employ of the insurer. The cost of such appraisal shall be paid by Administrative Agent unless an Event of Default shall have occurred and be continuing, in which case such cost shall be paid by Borrower. After the first appraisal, additional appraisals may be based on construction cost indices customarily employed in the trade. No omission on the part of Administrative Agent to r equest any such ascertainment shall relieve Borrower of any of its obligations under this Section 3.1(1)(a);

(b) commercial general liability insurance against claims for personal injury, bodily injury, death or property damage (including liabilities as a result of repairs and alterations) occurring upon, in or about the Project, such insurance (i) to be on the so called “occurrence” form with a combined single limit of not less than $1,000,000 per occurrence and $2,000,000 general aggregate; (ii) to continue at not less than the aforesaid limit until required to be changed by Lender in writing by reason of changed economic conditions making such protection inadequate; and (iii) to cover at least the following hazards: (A) premises and operations; (B) products and completed operations on an “if any” basis and for a period of not less than five (5) years after the completion of construction of the applicable Improvements; (C) independent contractors; (D) blanket contractual liability for all “insured contracts” as defined in the standard general liability policy; and (E) contractual liability covering the indemnities contained in Sections 5.4, 11.3 and 14.5 hereof, to the extent the same is available and falls within the definition of “insured contracts”;

(c) business income/loss of rents insurance (i) with loss payable to Administrative Agent (for the benefit of the Lenders); (ii) covering all risks required to be covered by the insurance provided for in Section 3.1(1)(a) hereof; (iii) in an amount equal to 100% of the projected gross income from the Project (on an actual loss sustained basis) for a period continuing until the Restoration of the Project is completed; the amount of such business income/loss of rents insurance shall be determined prior to the date hereof and at least once each year thereafter based on the greater of (x) Borrower’s reasonable estimate of the gross income from the Project, and (y) the highest gross income received during the term of the Notes for any full calendar year prior to the date the amount of such insurance is being determined (or such lesser period as may have expired from the date of substantial completion of the applicable Improvements to the date the amount of such insurance is being determined), in each case for the succeeding eighteen (18) month period and (D) containing an extended period of indemnity endorsement which provides that after the physical loss to the improvements and the personal property has been repaired, the continued loss of income will be insured until such income either returns to the same level it was at prior to the loss, or the expiration of twenty-four (24) months from the date that the Project is repaired or replaced and operations are resumed, whichever first occurs, and notwithstanding that the policy may expire prior to the end of such period. All insurance proceeds payable to Administrative Agent (for the benefit of the Lenders) pursuant to this Section 3.1(1)(c) shall be held by Administrative Agent and shall be applied to the obligations secured hereunder from time to time due and payable hereunder and under the Notes and this Agreement; provided, however, that nothing herein contained shall be deemed to relieve Borrower of its obligations to pay the obligations secured hereunder on the respective dates of payment provided for in the Notes and this Agreement except to the extent such amounts are actually paid out of the proceeds of such business income/loss of rents insurance;

(d) when required by Administrative Agent or at the discretion of Borrower, at all times during which structural construction, repairs or alterations are being made with respect to the Improvements in connection with any Casualty or Condemnation Event, the insurance provided for in Section 3.1(1)(a) shall be written in a so called builder’s risk completed value form or equivalent coverage as part of the “all-risk” insurance (1) on a non reporting basis, (2) against all risks insured against pursuant to Section 3.1(1)(a), (3) shall include permission to occupy the Project, and (4) shall contain an agreed amount endorsement waiving co insurance provisions and shall also include coverage for:

(i)

loss suffered with respect to materials, equipment, machinery, and supplies whether on-site, in transit, or stored off-site and with respect to temporary structures, hoists, sidewalks, retaining walls, and underground property;

(ii)

soft costs, plans, specifications, blueprints and models in connection with any restoration following a casualty;

(iii)

demolition and increased cost of construction, including, without limitation, increased costs arising out of changes in applicable law and codes;

(iv)

operation of building laws;

(v)

collapse, transit and testing; and

(vi)

delayed opening coverage on an actual loss sustained basis with extended period of indemnity endorsement consistent with Section 3.1(1)(c).

(e) workers’ compensation insurance, as required by any Governmental Authority or legal requirement, subject to the statutory limits of the state of New York;

(f) comprehensive boiler and machinery insurance, if applicable, in amounts as shall be reasonably required by Administrative Agent on terms consistent with the commercial property insurance policy required under Section 3.1(1)(a);

(g) if any portion of the Improvements is at any time located in an area identified by the Secretary of Housing and Urban Development or any successor thereto as an area having special flood hazards pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973 or the National Flood Insurance Reform Act of 1994, as each may be amended, or any successor law (the “Flood Insurance Acts”), flood hazard insurance in an amount not less than the greater of (A) the maximum limit of coverage available with respect to the Project, under Policies issued pursuant to the Flood Insurance Acts, subject only to customary deductibles under such Policies, and (B) the maximum limit of coverage available with respect to the Project, under Policies issued by private insurance carriers;

(h) earthquake insurance (based on probable maximum loss) in amounts and in form and substance satisfactory to Administrative Agent, provided that the insurance pursuant to this Section 3.1(1)(h) hereof shall be on terms consistent with the all risk insurance policy required under Section 3.1(1)(a) hereof;

(i) umbrella liability insurance in an amount not less than $100,000,000 per occurrence on terms consistent with the commercial general liability insurance policy required under Section 3.1(1)(b) hereof;

(j) secured creditor’s environmental insurance, insuring against unknown environmental hazards and conditions in amounts and in form and substance satisfactory to Administrative Agent, which shall name the Administrative Agent as a loss payee or additional insured, as applicable; and

(k) such other insurance and in such amounts as Administrative Agent from time to time may request against such other insurable hazards which at the time are available on commercially reasonable terms for properties located in or around the region where the Project is located and are customarily required by institutional lenders with respect to projects similar to the Project.

(2) All insurance provided in compliance with Section 3.1(1)(a) hereof shall be obtained under valid and enforceable policies (the “Policies” or in the singular, the “Policy”), in such forms and, from time to time after the date hereof, in such amounts as may be satisfactory to Administrative Agent, issued by financially sound and responsible insurance companies permitted to do business in the state of New York and reasonably approved by Administrative Agent. The insurance companies must have a claims paying ability/financial strength rating of “AX” (or its equivalent) or better by A.M. Best. No Policy shall contain an exclusion from coverage under such Policy for loss or damage incurred as a result of an act of terrorism or similar acts of sabotage, provided that Borrower may obtain separate Terrorism Insurance coverage subject to and in accordance with the terms of this Section 3.1(2). Borrower will be required to maintain insurance against terrorism, terrorist acts or similar acts of sabotage (“Terrorism Insurance”) with coverage amounts of not less than an amount equal to the full replacement cost of the improvements and the personal property (the “Terrorism Insurance Required Amount”). Notwithstanding the foregoing sentence, Borrower shall not be obligated to expend in any fiscal year on Insurance Premiums for Terrorism Insurance more than two (2.0) times the then-current annual premium paid by Borrower for the comprehensive all-risk insurance required under subsection 3.1(1)(a) hereof (the “Terrorism Insurance Cap”) and if the cost of the Terrorism Insurance Required Amount exceeds the Terrorism Insurance Cap, Borrower shall purchase the maximum amount of Terrorism Insurance available with funds equal to the Terrorism Insurance Cap; provided, however, the Terrorism Insurance Cap shall not apply or restrict the amount of terrorism coverage required to be obtained and maintained by this subsection (x) with respect to the Project if (a) owners and/or operators of mixed-use retail/office buildings in the same class as the Project in Bronx, New York are generally obtaining terrorism insurance, (b) lenders financing such mixed-use retail/office properties in the same class as the Project in Bronx, New York are generally requiring terrorism insurance as a condition of financing, or (c) Borrower or Sponsor or any Affiliate of Borrower or Sponsor, is obtaining terrorism insurance on any other properties in Bronx, New York of which any of the foregoing Persons own or operate. Not less than fifteen (15) days prior to the expiration dates of the Policies theretofore furnished to Lender pursuant to Section 3.1(1) hereof, Lead Borrower shall deliver to Administrative Agent insurance certificates showing payment of all premiums (the “Insurance Premiums”) for such Policies, which certificates shall be in form and substance reasonably satisfactory to Administrative Agent. Within sixty (60) days following the expiration dates of the Policies, Lead Borrower shall deliver to Administrative Agent certified copies of such Policies marked “premium paid” or accompanied by evidence satisfactory to Administrative Agent of payment of the Insurance Premiums.

(3) Borrower shall not obtain (a) any umbrella or blanket liability or casualty Policy unless, in each case, such Policy is approved in advance in writing by Administrative Agent, and Lenders’ interest is included therein as provided in this Agreement, or (b) separate insurance concurrent in form or contributing in the event of loss with that required in Section 3.1(1) to be furnished by, or which may be required to be furnished by, Borrow er. In the event Borrower obtains separate insurance or an umbrella or a blanket policy, Lead Borrower shall notify Administrative Agent of the same and shall cause certified copies of each Policy to be delivered as required in Section 3.1(1).

(4) All Policies provided for or contemplated by Section 3.1(1) hereof, except for the Policy referenced in Section 3.1(1)(e), shall name Administrative Agent (for the benefit of the Lenders) as additional insured under liability policies and as mortgagee/loss payee under property policies, as their respective interests may appear, and in the case of property, boiler and machinery, and flood insurance, shall contain a so called New York standard non-contributing mortgagee clause in favor of Administrative Agent providing that the loss thereunder shall be payable to Administrative Agent in accordance with the terms of this Agreement and shall otherwise be in form, substance and content reasonably acceptable to Administrative Agent.

(5) All Policies provided for in Section 3.1(1)(a) hereof shall contain clauses or endorsements to the effect that:

(i)

no willful act or negligence of Borrower, or anyone acting for Borrower, or failure to comply with the provisions of any Policy which might otherwise result in a forfeiture of the insurance or any part thereof, shall in any way affect the validity or enforceability of the insurance insofar as Administrative Agent is concerned;

(ii)

the Policy shall not be materially changed (other than to increase the coverage provided thereby) or cancelled without at least thirty (30) days’ written notice (or ten (10) days’ written notice, in the case of non-payment of premium) to Administrative Agent and any other party named therein as an insured;

(iii)

each Policy shall provide that the issuers thereof shall give written notice to Administrative Agent if the Policy has not been renewed fifteen (15) days prior to its expiration; and

(iv)

Administrative Agent shall not be liable for any insurance premiums thereon or subject to any assessments thereunder.

(6) If at any time Administrative Agent is not in receipt of written evidence that all insurance required hereunder is in full force and effect, Administrative Agent shall have the right, on five (5) Business Days’ notice to Lead Borrower to take such action as Administrative Agent deems necessary to protect its interest in the Project, including, without limitation, the obtaining of such insurance coverage as Administrative Agent in its reasonable discretion deems appropriate, and all expenses incurred by Administrative Agent in connection with such action or in obtaining such insurance and keeping it in effect shall be paid by Borrower to Administrative Agent upon demand and until paid shall be secured by the Mortgage and shall bear interest at the Def ault Rate.

(7) In the event of a foreclosure of the Mortgage, or other transfer of title to the Project in extinguishment in whole or in part of the Loans all right, title and interest of Borrower in and to the Policies then in force and all proceeds payable thereunder shall thereupon vest in the purchaser at such foreclosure or Administrative Agent for the benefit of the Lenders or other transferee in the event of such other transfer of title.

(8) Lead Borrower shall give immediate written notice of any loss in excess of $100,000 to the insurance carrier and to Administrative Agent. In connection with losses in excess of $100,000, but less than or equal to $2,000,000, Borrower and Administrative Agent shall cooperate in all matters related to the loss including, without limitation, making proof of loss, adjusting and compromising any claim under the insurance policies, appearing in and prosecuting any action arising from such insurance policies, and collecting and receiving insurance proceeds. In connection with losses in excess of $2,000,000, Borrower hereby irrevocably authorizes and empowers Administrative Agent, as attorney in fact for Borrower coupled with an interest, 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 Administrative Agent’s expenses incurred in the collection of such proceeds. Nothing contained in this Section 3.1(8), however, shall require Administrative Agent or any Lender to incur any expense or take any action hereunder.

Section 3.2 Use and Application of Net Proceeds.

The following provisions shall apply in connection with the Restoration of the Project:

(1) If the Net Proceeds shall be less than the Threshold Amount and the costs of completing the Restoration shall be less than Threshold Amount, the Net Proceeds will be disbursed by Administrative Agent to Borrower upon receipt, provided that (a) no Event of Default and/or Low DSCR Trigger Event has occurred and is continuing and (b) Borrower delivers to Administrative Agent a written undertaking to expeditiously commence and to satisfactorily complete with due diligence the Restoration in accordance with the terms of this Agreement.

(2) If the Net Proceeds are equal to or greater than Threshold Amount or the costs of completing the Restoration is equal to or greater than Threshold Amount Administrative Agent shall make the Net Proceeds available for the Restoration in accordance with the provisions of this Section 3.2. The term “Net Proceeds” shall mean: (i) the net amount of all insurance proceeds received by Administrative Agent pursuant to Section 3.1(1)(a), (d), (f), (g) and (h) as a result of such damage or destruction, after deduction of its reasonable costs and expenses (including, but not limited to, reasonable counsel fees), if any, in collecting same (“Insurance Proceeds”), or (ii) the net amount of the Award, after deduction of its reasonable costs and expenses (including, but not limited to, reasonable counsel fees), if any, in collecting same ( “Condemnation Proceeds”), whichever the case may be.

(a) The Net Proceeds shall be made available to Borrower for Restoration provided that each of the following conditions are met:

(i)

no Event of Default shall have occurred and be continuing; except for the Casualty or Condemnation Event;

(ii)

(1) in the event the Net Proceeds are Insurance Proceeds, less than fifty percent (50%) of the total floor area of the improvements on the Project has been damaged, destroyed or rendered unusable as a result of such Casualty or (2) in the event the Net Proceeds are Condemnation Proceeds, less than ten percent (10%) of the land constituting the Project is taken, and such land is located along the perimeter or periphery of the Project, and no portion of the improvements is located on such land;

(iii)

Leases demising in the aggregate a percentage amount equal to or greater than sixty percent (60%) of the total rentable space in the Project which has been demised under executed and delivered leases in effect as of the date of the occurrence of such fire or other casualty or taking, whichever the case may be, shall remain in full force and effect during and after the completion of the Restoration, subject to an appropriate rent abatement (covered by loss of rental insurance), notwithstanding the occurrence of any such Casualty or Condemnation, whichever the case may be;

(iv)

Borrower shall commence the Restoration as soon as reasonably practicable (but in no event later than forty-five (45) days after such Casualty or Condemnation, whichever the case may be, occurs) and shall diligently pursue the same to satisfactory completion in compliance with all applicable laws, including, without limitation, all applicable Environmental Laws;

(v)

Administrative Agent shall be reasonably satisfied that any operating deficits, including all scheduled payments of principal and interest under the Notes, which will be incurred with respect to the Project as a result of the occurrence of any such Casualty or Condemnation, whichever the case may be, will be covered out of (1) the Net Proceeds, (2) the insurance coverage referred to in (iii), if applicable, or (3) by other funds of Borrower;

(vi)

Administrative Agent shall be reasonably satisfied that the Restoration will be substantially completed in accordance with applicable laws so that the tenants can legally and physically occupy their space on or before the earliest to occur of (1) three (3) months prior to the Maturity Date, (2) twelve (12) months after the occurrence of such Casualty or Condemnation, or (3) such time as may be required under applicable law, in order to repair and restore the Project to the condition it was in immediately prior to such Casualty or Condemnation or (4) the expiration of the insurance coverage referred to in Section 3.1(1)(c);

(vii)

the Project and the use thereof after the Restoration will be in compliance with and permitted under all applicable laws;

(viii)

Administrative Agent shall be satisfied that the Debt Service Coverage Ratio after the completion of the Restoration shall be equal to or greater than the Debt Service Coverage Ratio immediately prior to the Casualty or Condemnation, as applicable;

(ix)

such Casualty or Condemnation, as applicable, does not result in the total and permanent (following the Restoration) loss of access to the Project or the related improvements;

(x)

Borrower shall deliver, or cause to be delivered, to Administrative Agent a signed detailed budget approved in writing by Borrower’s architect or engineer stating the entire cost of completing the Restoration, which budget shall be acceptable to Administrative Agent;

(xi)

the Net Proceeds together with any cash or letter of credit deposited by Borrower with Administrative Agent are sufficient in Administrative Agent’s reasonable discretion to cover the cost of the Restoration; and

(xii)

the Property Management Agreement in effect as of the date of the occurrence of such Casualty or Condemnation, whichever the case may be, shall (1) remain in full force and effect during the Restoration and shall not otherwise terminate as a result of the Casualty or Condemnation or the Restoration or (2) if terminated, shall have been replaced with a replacement Property Management Agreement with a qualified Property Manager, prior to the opening or reopening of the Project or any portion thereof for business with the public.

(b) The Net Proceeds shall be held by Administrative Agent in an interest bearing account (with interest to be available to Borrower to the same extent as Net Proceeds are made available pursuant to the terms of this Section 3.2) and, until disbursed in accordance with the provisions of this Section 3.2, shall constitute additional security for the Loans and other obligations under the Loan Documents. The Net Proceeds shall be disbursed by Administrative Agent to, or as directed by, Lead Borrower from time to time during the course of the Restoration, upon receipt of evidence reasonably satisfactory to Administrative Agent that (A) all materials installed and work and labor performed (except to the extent that they are to be paid for out of the requested disbursement) in connection with the Restoration have been paid for in full (less Casualty Retainage), and (B) there exist no notices of pendency, stop orders, mechanic’s or materialman’s liens or notices of intention to file same, or any other Liens or encumbrances of any nature whatsoever on the Project which have not either been fully bonded to the reasonable satisfaction of Administrative Agent and discharged of record or in the alternative fully insured to the reasonable satisfaction of Administrative Agent by the title company issuing the title insurance policy.

(c) All plans and specifications required in connection with the Restoration, the cost of which is greater than the Threshold Amount, shall be subject to prior review and acceptance (which shall not be unreasonably withheld, conditioned or delayed) in all material respects by Administrative Agent and by an independent consulting engineer selected by Administrative Agent (the “Casualty Consultant”). Administrative Agent shall have the use of the plans and specifications and all permits, li censes and approvals required or obtained in connection with the Restoration. The identity of the contractors, subcontractors and materialmen engaged in the Restoration the cost of which is greater than the Threshold Amount, as well as the contracts under which they have been engaged, shall be subject to prior review and acceptance by Administrative Agent and the Casualty Consultant. All costs and expenses incurred by Administrative Agent in connection with making the Net Proceeds available for the Restoration including, without limitation, reasonable counsel fees and disbursements and the Casualty Consultant’s fees, shall be paid by Borrower.

(d) In no event shall Administrative Agent be obligated to make disbursements of the Net Proceeds in excess of an amount equal to the costs actually incurred from time to time for work in place as part of the Restoration, as certified by the Casualty Consultant, minus the Casualty Retainage. The term “Casualty Retainage” shall mean an amount equal to ten percent (10%) of the costs actually incurred for work in place as part of the Restoration, as certified by the Casualty Consultant, until the Restoration has been completed. The Casualty Retain age shall in no event, and notwithstanding anything to the contrary set forth above in this Section 3.2(2), be less than the amount actually held back by Borrower from contractors, subcontractors and materialmen engaged in the Restoration (but shall not be duplicative of such amounts actually held back by Borrower). The Casualty Retainage shall not be released until the Casualty Consultant certifies to Administrative Agent that the Restoration has been completed in accordance with the provisions of this Se ction 3.2 and that all approvals necessary for the re-occupancy and use of the Project have been obtained from all appropriate Governmental Authorities, and Administrative Agent receives evidence satisfactory to Administrative Agent that the costs of the Restoration have been paid in full or will be paid in full out of the Casualty Retainage; provided, however, that Administrative Agent will release the portion of the Casualty Retainage being held with respect to any contractor, subcontractor or materialman engaged in the Restoration as of the date upon which the Casualty Consultant certifies to Administrative Agent that the contractor, subcontractor or materialman has satisfactorily completed all work and has supplied all materials in accordanc e with the provisions of the contractor’s, subcontractor’s or materialman’s contract, the contractor, subcontractor or materialman delivers the lien waivers and evidence of payment in full of all sums due to the contractor, subcontractor or materialman as may be reasonably requested by Administrative Agent or by the title company issuing the title insurance policy for the Project, and receives an endorsement to such title insurance policy insuring the continued priority of the Lien of the Mortgage and evidence of payment of any premium payable for such endorsement. If required by Administrative Agent, the release of any such portion of the Casualty Retainage shall be approved by the surety company, if any, which has issued a payment or performance bond with respect to the contractor, subcontractor or materialman.

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

(f) If at any time the Net Proceeds or the undisbursed balance thereof shall not, in the opinion of Administrative Agent in consultation with the Casualty Consultant, if any, be sufficient to pay in full the balance of the costs which are estimated by the Casualty Consultant to be incurred in connection with the completion of the Restoration, Borrower shall deposit the deficiency (the “Net Proceeds Deficiency”), either in cash or a letter of credit, with Administrative Agent before any further disbursement of the Net Proceeds shall be made. & #160;The Net Proceeds Deficiency deposited with Administrative Agent shall be held by Administrative Agent in the Casualty/Taking Account in accordance with the Cash Management Agreement and shall be disbursed for costs actually incurred in connection with the Restoration on the same conditions applicable to the disbursement of the Net Proceeds, and until so disbursed pursuant to Section 3.2 hereof shall constitute additional security for the Loans and other obligations under the Loan Documents.

(g) The excess, if any, of the Net Proceeds and the remaining balance, if any, of the Net Proceeds Deficiency deposited with Administrative Agent after the Casualty Consultant certifies to Administrative Agent that the Restoration has been completed in accordance with the provisions of Section 3.2, hereof and the receipt by Ad ministrative Agent of evidence satisfactory to Administrative Agent that all costs incurred in connection with the Restoration have been paid in full, shall be remitted by Administrative Agent to Lead Borrower, provided no Event of Default shall have occurred and shall be continuing.

(3) All Net Proceeds not required (i) to be made available for the Restoration or (ii) to be returned to Lead Borrower as excess Net Proceeds pursuant to Section 3.2(2)(g) hereof may be retained and applied by Administrative Agent toward the payment of the Loans (without any prepayment premium) whether or not then due and payable in such order, priority and proportions as Administrative Agent in its sole and absolute discretion shall deem proper, or, at the sole and absolute discretion of Administrative Agent, the same may be paid, either in whole or in part, to Lead Borrower for such purposes as Administrative Agent shall approve, in its sole and absolute discretion. If Administrative Agent shall receive and retain Net Proceeds, the Lien of the Mortgage shall be reduced only by the amount thereof received and retained by Administrative Agent and actually applied by Administrative Agent in reduction of the Loans.

Section 3.3 Casualty and Condemnation.

(a) If the Project shall be damaged or destroyed, in whole or in part, by fire or other casualty (a “Casualty”), Borrower shall give prompt notice of such damage to Administrative Agent and shall promptly commence and diligently prosecute the completion of the Restoration of the Project as nearly as possible to the condition the Project was in immediately prior to such Casualty, with such alterations as may be reasonably approved by Administrative Agent and otherwise in accordance with Section 3.2 hereof. Borrower shall pay all costs of such Restoration whether or not such costs are covered by insurance (provided that, if Net Proceeds are required to be made available to Borrower for Restoration pursuant to the terms of Section 3.2 hereof, they are made available to Borrower for Restorati on). Administrative Agent may, but shall not be obligated to, make proof of loss if not made promptly by Borrower.

(b) Lead Borrower shall promptly give Administrative Agent notice of the actual or threatened commencement of any proceeding for the Condemnation of all or any part of the Project and shall deliver to Administrative Agent copies of any and all papers served in connection with such proceedings. Administrative Agent may participate in any such proceedings, and Borrower shall, from time to time, deliver to Administrative Agent all instruments reasonably requested by it to permit such participation. Borrower shall, at its expense, diligently prosecute any such proceedings, and shall consult with Administrative Agent, its attorneys and experts, and cooperate with them in the carrying on or defense of any such proceedings. Notwithstanding any taking by any public or quasi public authority through Condemnation or otherwise (including, but not limited to, any transfer made in lieu of or in anticipation of the exercise of such taking), Borrower shall continue to pay the Loans at the time and in the manner provided for its payment in the Notes and in this Agreement and the Loans shall not be reduced until any Award shall have been actually received and applied by Administrative Agent, after the deduction of expenses of collection, to the reduction or discharge of the Loans. Administrative Agent and the Lenders shall not be limited to the interest paid on the Award by the condemning authority but shall be entitled to receive out of the Award interest at the rate or rates provided herein or in the Notes. If the Project or any portion thereof is taken by a condemning authority, Borrower shall, promptly commence and diligently prosecute the Restoration of the Proj ect and otherwise comply with the provisions of Section 3.2 hereof. If the Project is sold, through foreclosure or otherwise, prior to the receipt by Administrative Agent of the Award, Administrative Agent shall have the right, whether or not a deficiency judgment on the Notes shall have been sought, recovered or denied, to receive the Award, or a portion thereof sufficient to pay the Loans.

ARTICLE 4

RESERVES; COLLATERAL LETTERS OF CREDIT

Section 4.1Real Estate Tax and Insurance Reserve Fund.

(1) Deposits. On the Closing Date, Borrower shall deposit with Administrative Agent the amount of $213,645.46, which amount shall be held by Administrative Agent and disbursed by Administrative Agent in accordance with the terms of Section 4.1(2) (with such disbursements that would have been made by Depository Bank to be made directly by Administrative Agent) until such time as the Cash Management Agreement has been entered into, at which time Administrative Agent shall deposit any remaining amounts held by it and not disbursed pursuant hereto into the Tax and Insurance Reserve Account. On each Payment Date, Borrower shall deposit with Administrative Agent, for deposit in the Tax and Insurance Reserve Account, (i) a monthly amount, as determined by Administrative Agent, which will be sufficient to accumulate with Administrative Agent thirty (30) days prior to each due date therefor sufficient funds to pay all real estate taxes which Administrative Agent estimates will be payable during the next ensuing twelve (12) months, and (ii) a monthly amount, as determined by Administrative Agent, which will be sufficient to accumulate with Administrative Agent thirty (30) days p rior to the expiration of the insurance policies sufficient funds to pay all premiums which Administrative Agent estimates will be payable for the renewal of the coverage afforded by the insurance policies during the next ensuing twelve (12) months (said amounts in clauses (i) and (ii) above, together with the amount set forth in the first sentence of this Section 4.1(1), being, collect ively, the “Tax and Insurance Reserve Fund”). If at any time Administrative Agent reasonably determines that the Tax and Insurance Reserve Fund is not or will not be sufficient to pay real estate taxes and insurance premiums by the dates set forth in clauses (i) and (ii) above, Administrative Agent shall notify Lead Borrower of such determination and Borrower shall increase its monthly payments to Administrative Agent by the amount that Administrative Agent estimates is sufficient to make up the deficiency thirty (30) days prior to delinquency of the real estate taxes and/or thirty (30) days prior to expi ration of the insurance policies, as the case may be. Notwithstanding the foregoing, and provided that no Event of Default has occurred and is continuing, if Borrower has an umbrella insurance policy that: (x) provides acceptable coverage for the Project, (y) is in full force and effect, and (z) is acceptable to Administrative Agent in its sole discretion, then Borrower shall not be required to make the deposits set forth in clause (ii) above with respect to the renewal of insurance policies.

(2) Disbursements. Borrower shall furnish Administrative Agent with (i) bills for the charges for which such deposits are required and (ii) a disbursement request (in a form reasonably satisfactory to Administrative Agent), executed by an authorized officer of Borrower, at least thirty (30) days prior to the date on which the charges first become payable. Provided that no Event of Default exists, Administrative Agent will direct the Depository Bank to apply the Tax and Insurance Reserve Fund to payments of insurance premiums and real estate taxes requ ired to be made by Borrower pursuant to Sections 3.1 and 9.2, respectively, and under the Mortgage but not, in any event, earlier than ten (10) days prior to the due dates thereof. In making any payment relating to the Tax and Insurance Reserve Fund, the Depository Bank may do so according to any bill, statement or estimate procured from the appropriate public o ffice (with respect to real estate taxes) or insurer or agent (with respect to insurance premiums), without inquiry into the accuracy of such bill, statement or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien or title or claim thereof unless said bill, statement or estimate is obviously incorrect. If the amount of the Tax and Insurance Reserve Fund shall exceed the amounts due for real estate taxes and insurance premiums pursuant to Sections 3.1 and 9.2, respectively, Administrative Agent shall, in its sole and absolute discretion, return any excess to Lead Borrower or credit such excess against future payments to be made to the Tax and Insurance Reserve Fund. Provided that on the date that said real estate taxes are due and payable, no Event of Default exists and sufficient funds are on deposit in the Tax and Insurance Reserve Fund to pay real estate taxes, Borrower shall not be liable to pay and shall not be charged with any late charges, interest and/or penalties imposed by or payable to any Governmental Authority as a result of the Depository Bank’s failure to pay real estate taxes prior to the date that same become delinquent.

Section 4.2Tenant Improvement/Leasing Reserve Letter of Credit.

Borrower shall provide to Administrative Agent for the benefit of the Lenders an unconditional, irrevocable standby letter of credit (the “TI/LC Letter of Credit”) in the amount of $4,610,000.00 to be used for the payment of future tenant improvements and leasing commissions, which TI/LC Letter of Credit conforms with the requirements of a Collateral Letter of Credit (except that the TI/LC Letter of Credit delivered on the Closing Date only shall not be required to include an “evergreen” automatic renewal provision). The amount of the TI/LC Letter of Credit shall be reduced, upon the written request of Borrower made not more than once per calen dar month, in connection with the payment by Borrower of amounts for tenant improvements and leasing commissions for newly executed leases entered into at the Project which have been approved by Administrative Agent or are deemed approved pursuant to Section 6.2 hereof. Reductions to the TI/LC Letter of Credit shall be calculated using a tenant improvement allowance equal to the lesser of actual tenant improvement costs or $20.00 per net leasable square foot and reductions for leasing commissions shall be calculated using a leasing commissions allowance equal to the lesser of actual leasing commissions or $26.58 per net leasable square foot. The TI/LC Letter of Credit shall be subject to each of the terms and conditions set forth in Section 4.5 with respect to a Collateral Letter of Credit subject to the following additional terms:

(1) The TI/LC Letter of Credit delivered on the Closing Date shall have an expiry date no earlier than February 1, 2010. At least thirty (30) days prior to the expiration date of such TI/LC Letter of Credit and each renewal and extension thereof Borrower shall deliver to Administrative Agent either (i) a replacement, extension or renewal TI/LC Letter of Credit, in accordance with the terms hereof, or (ii) notice that such replacement, extension or renewal TI/LC Letter of Credit shall not be delivered.

(2) Following a draw by Administrative Agent on the TI/LC Letter of Credit solely because of the failure to furnish Administrative Agent with a replacement or renewal of the TI/LC Letter of Credit, Administrative Agent will deposit such proceeds in the Additional Cash Collateral Account as security for the purposes for which such TI/LC Letter of Credit was delivered. Administrative Agent shall be entitled to draw upon such deposited proceeds to the same extent it would have been entitled to make a draw under the TI/LC Letter of Credit and such deposited proceeds shall be subject to disbursement to Borrower on the same basis as reductions to the TI/LC Letter of Credit are calculated, as described above. Administrative Agent shall direct th e Depository Bank to disburse the full remaining amount of such proceeds to Borrower provided (i) Borrower delivers to Administrative Agent a replacement TI/LC Letter of Credit acceptable to Administrative Agent in its sole discretion, (ii) there exists no Event of Default or Potential Default, and (iii) Borrower pays all of Administrative Agent’s fees and expenses in connection with such draw and disbursement.

(3) In the event that Borrower fails to deliver to Administrative Agent a replacement, extension or renewal TI/LC Letter of Credit in accordance with the terms hereof, and Administrative Agent does not draw on the TI/LC Letter of Credit prior to its expiry date then Borrower shall furnish such replacement, extension or renewal TI/LC Letter of Credit or Additional Cash Collateral in the required amount of such TI/LC Letter of Credit no later than ten (10) days after the expiry date of such TI/LC Letter of Credit.

Section 4.3Reserved.

Section 4.4Reserve Funds and Security Accounts Generally.

(1) Grant of Security Interest. Borrower hereby grants a perfected first priority security interest in favor of Administrative Agent for the ratable benefit of the Lenders in each Reserve Fund and Security Account established by or for it hereunder and all financial assets and other property and sums at any time held, deposited or invested therein, and all security entitlements and investment property relating thereto, together with any interest or other earnings thereon, and all proceeds thereof, whether accounts, general intangibles, chattel paper, deposit accounts, instruments, documents or securities (collectively, “ ;Reserve Account Collateral”), together with all rights of a secured party with respect thereto (even if no further documentation is requested by Administrative Agent or the Lenders or executed by Borrower).

(a) Borrower covenants and agrees:

(A) to do all acts that may be reasonably necessary to maintain, preserve and protect Reserved Account Collateral;

(B) to pay promptly when due all material taxes, assessments, charges, encumbrances and liens now or hereafter imposed upon or affecting any Reserved Account Collateral;

(C) to appear in and defend any action or proceeding which may materially and adversely affect Borrower’s title to or Administrative Agent’s interest in the Reserved Account Collateral;

(D) following the creation of each Reserve Fund and Security Account established by or for Borrower and the initial funding thereof, other than to Administrative Agent pursuant to this Agreement or the Cash Management Agreement, not to transfer, assign, sell, surrender, encumber, mortgage, hypothecate, or otherwise dispose of any of the Reserve Account Collateral or rights or interests therein, and to keep the Reserve Account Collateral free of all levies and security interests or other liens or charges except the security interest in favor of Administrative Agent granted hereunder;

(E) to account fully for and promptly deliver to Administrative Agent, in the form received, all documents, chattel paper, instruments and agreements constituting the Reserve Account Collateral hereunder, endorsed to Administrative Agent or in blank, as requested by Administrative Agent, and accompanied by such powers as appropriate and until so delivered all such documents, instruments, agreements and proceeds shall be held by Borrower in trust for Administrative Agent, separate from all other property of Borrower; and

(F) from time to time upon request by Administrative Agent, to furnish such further assurances of Borrower’s title with respect to the Reserve Account Collateral, execute such written agreements, or do such other acts, all as may be reasonably necessary to effectuate the purposes of this agreement or as may be required by law, or in order to perfect or continue the first-priority lien and security interest of Administrative Agent in the Reserve Account Collateral.

(2) Rights on Event of Default. Upon the occurrence and during the continuance of an Event of Default, Administrative Agent, at its option, may withdraw the Reserve Funds and the other funds in the Security Accounts and apply such funds to the items for which the Reserve Funds were established or to payment of the Loans in such order, proportion and priority as Administrative Agent may determine in its sole and absolute discretion. Administrative Agent’s right to withdraw and apply such funds shall be in addition to all other rights and remedies provided to Administrative Agent on behalf of the Lenders under the Loan Documents.

(3) Prohibition Against Further Encumbrance. Borrower shall not, without the prior consent of Administrative Agent, further pledge, assign or grant any security interest in the Reserve Funds or the Security Accounts or permit any Lien to attach thereto, or any levy to be made thereon, or any Uniform Commercial Code financing statements, except those naming Administrative Agent on behalf of the Lenders as the secured party, to be filed with respect thereto.

(4) Release of Reserve Funds. Any amount remaining in the Reserve Funds and the Security Accounts after the Loans have been paid in full shall be promptly returned to Borrower.

Section 4.5Collateral Letters of Credit. With respect to any Collateral Letter of Credit which Borrower may furnish or cause to be furnished to Administrative Agent in accordance with the terms of this Agreement or any of the other Loan Documents:

(1) Administrative Agent will be entitled, among other things, to make one or more draws by presentment thereof to the issuing bank accompanied only by Administrative Agent’s clean sight-draft, it being intended that the issuing bank shall have no right to inquire as to Administrative Agent’s right to draw upon such Collateral Letter of Credit;

(2) Administrative Agent shall be entitled, among other things, to draw upon each Collateral Letter of Credit, in whole, or in part from time to time, upon the occurrence and during the continuance of any Event of Default or under the other circumstances under which a draw shall be permitted under the Loan Documents or the Collateral Letter of Credit;

(3) Administrative Agent shall have the right to draw upon any Collateral Letter of Credit within thirty (30) days prior to the expiration date of such Collateral Letter of Credit and each renewal and extension thereof unless, at least thirty (30) days prior to such expiration date of such Collateral Letter of Credit and each renewal and extension thereof, Borrower shall have furnished a replacement, extension or renewal Collateral Letter of Credit, acceptable to Administrative Agent, it being the intent hereof that at no time shall the unexpired term of any Collateral Letter of Credit be less than thirty (30) days. If Administrative Agent draws upon a Collateral Letter of Credit pursuant t o the terms of this subsection (3), then Administrative Agent shall hold the proceeds thereof in the Additional Cash Collateral Account as additional collateral for the Obligations, to be applied in accordance with subsections (4) and (5) below.

(4) Administrative Agent shall also be entitled to draw upon a Collateral Letter of Credit if Administrative Agent believes that its rights to draw on such Collateral Letter of Credit could be in jeopardy. Without limiting the foregoing, Administrative Agent shall also be entitled to draw on a Collateral Letter of Credit if the credit rating or financial condition of the issuing bank is no longer meets the minimum rating contained in the definition of Collateral Letter of Credit. Following a draw by Administrative Agent on a Collateral Letter of Credit solely because of the deterioration of the creditworthiness of the issuing bank, Administrative Agent will deposit such proceeds in the Additional Cash Collateral Account as security for th e purposes for which such Letter of Credit was delivered and Administrative Agent shall be entitled to draw upon such proceeds to the same extent it would have been entitled to make a draw under the applicable Letter of Credit. Administrative Agent shall direct the Depository Bank to disburse such proceeds to Borrower provided (i) Borrower delivers to Administrative Agent a replacement Collateral Letter of Credit within ten (10) days of Administrative Agent’s draw, (ii) there exists no Event of Default or Potential Default, and (iii) Borrower pays all of Administrative Agent’s fees and expenses in connection with such draw and disbursement.

(5) No draw by Administrative Agent on any Collateral Letter of Credit shall cure or be deemed to cure any Event of Default or limit in any respect any of Administrative Agent’s or the Lenders’ remedies under the Loan Documents, it being understood that Administrative Agent’s and the Lenders’ rights and remedies hereunder shall be cumulative and Administrative Agent and the Lenders shall have no obligations to apply the proceeds of any draw to missed installments or other amounts then due and unpaid under the Loans. Proceeds of any draw upon a Collateral Letter of Credit (after reimbursement of any costs and expenses, including attorneys’ fees and reimbursements, incurred by Administrative Agent in connection with such draw) may be applied by Administrative Agent to the payment of the Loans in such manner as Administrative Agent may determine. No delay or omission of Administrative Agent or the Lenders in exercising any right to draw on a Collateral Letter of Credit shall impair any such right, or shall be construed as a waiver of, or acquiescence in, any Event of Default.

(6) Administrative Agent shall, upon request, release its rights in any Collateral Letters of Credit and surrender such Collateral Letters of Credit to the issuing bank upon the payment in full of all Loans.

ARTICLE 5

ENVIRONMENTAL MATTERS

Section 5.1Certain Definitions. As used herein, the following terms have the meanings indicated:

(1) “Environmental Claim” means, with respect to any Person, any written request for information by a Governmental Authority, or any written notice, notification, claim, administrative, regulatory or judicial action, suit, judgment, demand or other written communication by any Person or Governmental Authority alleging or asserting liability with respect to Borrower or the Project, whether for damages, contribution, indemnification, cost recovery, compensation, injunctive relief, investigatory, response, remediation, damages to natural resources, personal injuries, fines or penalties arising out of, based o n or resulting from (i) the presence, use or release into the environment of any Hazardous Materials originating at or from, or otherwise affecting, the Project, (ii) any fact, circumstance, condition or occurrence forming the basis of any violation, or alleged violation, of any Environmental Law by Borrower or otherwise affecting the health, safety or environmental condition of the Project or (iii) any alleged injury or threat of injury to the environment by Borrower or otherwise affecting the Project.

(2) “Environmental Laws” means any federal, state or local law (whether imposed by statute, or administrative or judicial order, or common law), now or hereafter enacted and applicable to the Project, governing health, safety, industrial hygiene, the environment or natural resources, or Hazardous Materials, including, such laws governing or regulating the use, generation, storage, removal, recovery, treatment, handling, transport, disposal, control, discharge of, or exposure to, Hazardous Materials.

(3) “Environmental Liens” has the meaning assigned to such term in Section 5.3(4).

(4) “Environmental Loss” means any losses, damages, costs, fees, expenses, claims, suits, judgments, awards, liabilities (including but not limited to strict liabilities), obligations, debts, diminutions in value, fines, penalties, charges, costs of remediation (whether or not performed voluntarily), amounts paid in settlement, foreseeable and unforeseeable consequential damages, litigation costs, reasonable attorneys’ fees and expenses, engineers’ fees, environmental consultants’ fees, and investigation costs (including but not limited to costs for sampling, testing and analysis of soil, water, air, building materials, and other materials and substances whether solid, liquid or gas), of whatever kind or nature, and whether or not incurred in connection with any judicial or administrative proceedings, actions, claims, suits, judgments or awards relating to Hazardous Materials, Environmental Claims, Environmental Liens and violation of Environmental Laws.

(5) “Hazardous Materials” means (a) petroleum or chemical products, whether in liquid, solid, or gaseous form, or any fraction or by-product thereof, (b) asbestos or asbestos-containing materials, (c) polychlorinated biphenyls (pcbs), (d) radon gas, (e) underground storage tanks, (f) any explosive or radioactive substances, (g) lead or lead-based paint, (h) Mold, or (i) any other substance, material, waste or mixture which is or shall be listed, defined, or otherwise determined by any Governmental Authority to be hazardous, toxic, dangerous or otherwise regulated, co ntrolled or giving rise to liability under any Environmental Laws.

(6) “Mold” means any microbial or fungus contamination or infestation in any Project of a type that could reasonably be anticipated (after due inquiry and investigation) to pose a risk to human health or the environment or could reasonably be anticipated (after due inquiry and investigation) to negatively impact the value of the affected Property in any material respect.

Section 5.2Representations and Warranties on Environmental Matters. Borrower represents and warrants to Administrative Agent and the Lenders that, to Borrower’s knowledge, except as set forth in the Site Assessment, (1) no Hazardous Material is now or was formerly used, stored, generated, manufactured, installed, treated, discharged, disposed of or otherwise present at or abou t the Project or any property adjacent to the Project (except for cleaning and other products currently used in connection with the routine maintenance or repair of the Project and de minimus quantities used by tenants in the normal course of business in full compliance with Environmental Laws), (2) all permits, licenses, approvals and filings required by Environmental Laws have been obtained, and the use, operation and condition of the Project do not, and did not previously, violate any Environmental Laws, (3) no civil, criminal or administrative action, suit, claim, hearing, investigation or proceeding has been brought or been threatened, nor have any settlements been reached by or with any parties or any Liens imposed in connection with the Project concerning Hazardous Materials or Environmental Laws and (4) no underground storage tanks exist at the Project.

Section 5.3 Covenants on Environmental Matters.

(1) Borrower shall (a) comply strictly and in all respects with applicable Environmental Laws; (b) notify Administrative Agent immediately upon Borrower’s discovery of any spill, discharge, release or presence of any Hazardous Material at, upon, under, within, contiguous to or otherwise affecting the Project; (c) promptly remove such Hazardous Materials and remediate the Project in full compliance with Environmental Laws and as reasonably recommended to preserve the value and/or use of the Project, in accordance with the reasonable recommendations and specifications of an independent environmental consultant approved by Administrative Agent; and (d) promptly forward to Administrative Agent copies of all orders, notices, permits, appli cations or other communications and reports in connection with any spill, discharge, release or the presence of any Hazardous Material or any other matters relating to the Environmental Laws or any similar laws or regulations, as they may affect the Project or Borrower.

(2) Borrower shall not cause, shall prohibit any other Person within the control of Borrower from causing, and shall use prudent, commercially reasonable efforts to prohibit other Persons (including tenants) from causing (a) any spill, discharge or release, or the use, storage, generation, manufacture, installation, or disposal, of any Hazardous Materials at, upon, under, within or about the Project or the transportation of any Hazardous Materials to or from the Project (except for cleaning and other products used in connection with the routine maintenance or repair of the Project in full compliance with Environmental Laws), (b) any underground storage tanks to be installed at the Project, or (c) any activity that requires a permit or other auth orization under Environmental Laws to be conducted at the Project.

(3) Lead Borrower shall provide to Administrative Agent, at Borrower’s expense promptly upon the written request of Administrative Agent from time to time, a Site Assessment or, if required by Administrative Agent, an update to any existing Site Assessment, to assess the presence or absence of any Hazardous Materials and the potential costs in connection with abatement, cleanup or removal of any Hazardous Materials found on, under, at or within the Project. Borrower shall pay the cost of no more than one such Site Assessment or update in any twelve (12)-month period, unless Administrative Agent’s request for a Site Assessment is based on information provided under Section 5.3(1), a reasonable suspicion of Hazardous Materials at or near the Project, a breach of representations under Section 5.2, or an Event of Default, in which case any such Site Assessment or update shall be at Borrower’s expense.

(4) Environmental Notices. Lead Borrower shall promptly provide notice to Administrative Agent of:

(a) all Environmental Claims asserted or threatened against Borrower or any other party occupying the Project or any portion thereof or against the Project which become known to Borrower;

(b) the discovery by Borrower of any occurrence or condition on the Project or on any real property adjoining or in the vicinity of the Project which could reasonably be expected to lead to an Environmental Claim against Borrower, Administrative Agent or any of the Lenders;

(d) any Lien or other encumbrance imposed pursuant to any Environmental Law “Environmental Liens”.

In connection therewith, Lead Borrower shall transmit to Administrative Agent copies of any citations, orders, notices or other written communications received from any Person and any notices, reports or other written communications submitted to any Governmental Authority with respect to the matters described above.

Section 5.4Allocation of Risks and Indemnity. As between Borrower, Administrative Agent and the Lenders, all risk of loss associated with non-compliance with Environmental Laws, or with the presence of any Hazardo us Material at, upon, within, contiguous to or otherwise affecting the Project, shall lie solely with Borrower. Accordingly, Borrower shall bear all risks and costs associated with any Environmental Loss, damage or liability therefrom, including all costs of removal of Hazardous Materials or other remediation required hereunder or by law. Borrower shall indemnify, defend and hold Administrative Agent and the Lenders harmless from and against all loss, liabilities, damages, claims, costs and expenses (including reasonable costs of defense) arising out of or associated, in any way, with the non-compliance with Environmental Laws, or the existence of Hazardous Materials in, on, or about the Project, or a breach of any representation, warranty or covenant contained in this Article 5, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law, including those arising from the joint, concurrent, or comparative negligence of Administrative Agent and the Lenders; provided, however, Borrower shall not be liable under such indemnification to the extent such loss, liability, damage, claim, cost or expense results solely from Administrative Agent’s or any Lender’s gross negligence or willful misconduct. Borrower’s obligations under this Section 5.4 shall arise upon the discovery of the presence of any Hazardous Material, whether or not any Governmental Authority has taken or threatened any action in connection with the presence of any Hazardous Material, and whether or not the existence of any such Hazardous Material or potential liability on account thereof is disclosed in the Site Assessment and shall continue notwithstanding the repayment of the Loans or any transfer or sale of any right, title and interest in the Project (by foreclosure, deed in lieu of foreclosure or otherwise).

Section 5.5No Waiver. Notwithstanding any provision in this Article 5 or elsewhere in the Loan Documents, or any rights or remedies granted by the Loan Documents, Administrative Agent and the Lenders do not waive and expressly reserve all rights and benefits now or hereafter accruing to Administrative Agent and/or any Lenders under the “security interest” or “secured creditor” exception under applicable Environmental Laws, as the same may be amended. No action taken by Administrative Agent and/or any Lender pursuant to the Loan Documents shall be deemed or construed to be a waiver or relinquishment of any such rights or benefits under the “security interest exception.”

ARTICLE 6

LEASING MATTERS

Section 6.1Representations and Warranties on Leases. Borrower represents and warrants to Administrative Agent and the Lenders with respect to leases of the Project that: (1) to Borrower 217;s knowledge, the rent roll delivered to Administrative Agent is true and correct, and the leases are valid and in and full force and effect; (2) the leases (including amendments) are in writing, and there are no oral agreements with respect thereto; (3) the copies of the leases delivered to Administrative Agent are true and complete; (4) to Borrower’s knowledge, neither the landlord nor any tenant is in default under any of the leases; (5) Borrower has no knowledge of any notice of termination or default with respect to any lease; (6) Borrower has not assigned or pledged any of the leases, the rents or any interests therein except to Administrative Agent (on behalf of the Lenders); (7) no tenant or other party has an option to purchase all or any portion of the Project; (8) no tenant has the right to terminate its lease prior to expiration of the stated term of such lease except in the case of a casualty or condemnation of the Project to the extent permitted pursuant to the terms and conditions of such lease; and (9) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits not in excess of an amount equal to two month ’s rent). To the extent that any part of the Land is located in the State of New York, reference is hereby made to Section 291-f of the Real Property Law of the State of New York for purposes of obtaining for Administrative Agent and the Lender the benefits of said Section in connection herewith.

Section 6.2Standard Lease Form; Approval Rights. All leases and other rental arrangements shall in all respects be approved by Administrative Agent and shall be on a standard lease form, to the extent possible, using commercially reasonable efforts, for the Office Component, approved by Administrative Agent with no material modifications (except as approved by Administrative Agent in writing). Such lease form shall provide (a) that the lease is subordinate to the Mortgage, (b) that the tenant shall attorn to Administrative Agent (on behalf of the L enders) following an Event of Default and (c) that any cancellation, surrender, or amendment of such lease without the prior written consent of Administrative Agent shall be voidable by Administrative Agent. Borrower shall hold, in trust, all tenant security deposits in a segregated account, and, to the extent required by applicable law, shall not commingle any such funds with any other funds of Borrower. Within ten (10) days after Administrative Agent’s request, Borrower shall furnish to Administrative Agent a statement of all tenant security deposits, and copies of all leases not previously delivered to Administrative Agent, certified by Borrower as being true and correct. Notwithstanding anything contained in the Loan Documents, Administrative Agent’s approval shall not be required for future leases or lease extensions if the following conditions are satisfied: (1) there exists no Potential Default or Event of Default; (2) the lease is on the standar d lease form approved by Administrative Agent with no modifications except for commercially reasonable changes agreed to in the ordinary course of Borrower’s business, but in any event there shall be no modifications to the subordination, attornment, estoppel and landlord liability clause without the prior written consent of Administrative Agent; (3) the lease does not conflict with any restrictive covenant affecting the Project or any other lease for space in the Project; (4) the lease is not a Major Lease; (5) the lease shall provide for rental rates and landlord concessions comparable to existing local market rates as shall be established pursuant to the Leasing Guidelines; (6) the lease is with a third party not an Affiliate of Borrower, Sponsor or Guarantor; (7) the lease shall not contain any options for renewal or expansion by the tenant at rental rates which are below reasonable comparable market levels at the time the lease is executed; (8) the lease shall be to a tenant which Borrower, in its professional and commercially reasonable judgment, has determined is creditworthy and (9) the lease is for a term of not more than ten (10) years (exclusive of renewal options which, together with the initial lease term shall not exceed fifteen (15) years).

Section 6.3Covenants. Borrower (1) shall perform the obligations which Borrower is required to perform under the leases, including the performance of any tenant improvement work with respect thereto; (2) shall enforce the obligations to be performed by the tenants; (3) shall promptly furnish to Administrative Agent any notice of default or termination received by Borrower from any tenant, and any notice of default or termination given by Borrower to any tenant; (4) shall not collect any rents for more than thirty (30) days in advance of the time when the same shall become due, except for bona fide security deposits not in excess of an amount equal to two month’s rent; (5) shall not enter into any ground lease or master lease of any part of the Project; (6) shall not further assign or encumber any lease; (7) shall not, except with Administrative Agent’s prior written consent, cancel or accept surrender or termination of any Major Lease; (8) shall not, except with Administrative Agent’s prior written consent, modify or amend any Major Lease (except for minor modifications and amendments entered into in the ordinary course of business, consistent with prudent property management practices, not affecting the economic terms of the lease); and (9) shall use its best efforts to lease the Improvements; any action in violation of clauses (5), (6), (7), and (8) of this Section 6.3 shall be void at the election of Administrative Agent.

Section 6.4Tenant Estoppels. At Administrative Agent’s request, Borrower shall, within thirty (30) days, obtain and furnish to Administrative Agent, (1) written estoppels in form and substance reasonably satisfactory to Administrative Agent, executed by tenants under leases in the Project and confirming the term, rent, and other provisions and matters relating to the leases and (2) written subordination and attornment agreements, in form and substance satisfactory to Administrative Agent, executed by tenants under leases in the Project, whereby, among o ther things, such tenants subordinate their interest in the Project to the Loan Documents and agree to attorn to Administrative Agent (on behalf of the Lenders) and its successors and assigns upon foreclosure or other transfer of the Project after an Event of Default.

ARTICLE 7

REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Administrative Agent and the Lenders that:

Section 7.1Organization and Power. Borrower and each Borrower Party is duly organized, validly existing and in good standing under the laws of the state of its formation or existence, and is in compliance with legal requirements applicable to doing business in the State. Borrower is not a “foreign person” within the meaning of § 1445(f)(3) of the Internal Revenue Code. Lead Borrower’s U.S. taxpayer identification number is 20-1577239 and Fordham Office’s U.S. taxpayer identification number is 26-1094416.

Section 7.2Validity of Loan Documents. The execution, delivery and performance by Borrower and each Borrower Party of the Loan Documents: (1) are duly authorized and do not require the consent or approval of any other party or Governmental Authority which has not been obtained; and (2) will not violate any law or result in the imposition of any Lien upon the assets of any such party, except as contemplated by the Loan Documents. The Loan Documents constitute the legal, valid and binding obligations of Borrower and each Borrower Party, enf orceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency, or similar laws generally affecting the enforcement of creditors’ rights.

Section 7.3 Liabilities; Litigation.

(1) The financial statements delivered by Borrower and each Borrower Party are true and correct with no material change since the date of preparation. Except as disclosed in such financial statements, there are no liabilities (fixed or contingent) affecting the Project, Borrower or any Borrower Party. Except as disclosed in such financial statements, there is no litigation, administrative proceeding, investigation or other legal action (including any proceeding under any state or federal bankruptcy or insolvency law) pending or, to the knowledge of Borrower, threatened, against the Project, Borrower or any Borrower Party which if adversely determined could have a Material Adverse Effect.

(2) Neither Borrower nor any Borrower Party is contemplating either the filing of a petition by it under state or federal bankruptcy or insolvency laws or the liquidation of all or a major portion of its assets or property, and neither Borrower nor any Borrower Party has knowledge of any Person contemplating the filing of any such petition against it.

Section 7.4Taxes and Assessments. The Project is comprised of one or more parcels, each of which constitutes a separate tax lot and none of which constitutes a portion of any other tax lot. There are no pending or, to Borrower’s best knowledge, proposed, special or other assessments for public improvements or otherwise affecting the Project, nor are there any contemplated improvements to the Project that may result in such special or other assessments.

Section 7.5Other Agreements; Defaults. Neither Borrower nor any Borrower Party is a party to or in violation of any agreement or instrument or subject to any court order, injunction, permit, or restriction which might have a Material Adverse Effect.

Section 7.6 Compliance with Law.

(1) Borrower and each Borrower Party have all requisite licenses, permits, franchises, qualifications, certificates of occupancy or other governmental authorizations to own, lease and operate the Project and carry on its business, and the Project is in compliance with all applicable legal requirements and is free of structural defects, and all building systems contained therein are in good working order, subject to ordinary wear and tear. The Project does not constitute, in whole or in part, a legally non-conforming use under applicable legal requirements;

(2) No condemnation has been commenced or, to Borrower’s knowledge, is contemplated with respect to all or any portion of the Project or for the relocation of roadways providing access to the Project; and

(3) The Project has adequate rights of access to public ways and is served by adequate water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary or convenient to the full use and enjoyment of the Project are located in the public right-of-way abutting the Project, and all such utilities are connected so as to serve the Project without passing over other property, except to the extent such other property is subject to a perpetual easement for such utility benefiting the Project. All roads necessary for the full utilization of the Project for its current purpose have been completed and dedicated to public use and accepted by all Governmental Authorities.

Section 7.7Location of Borrower. Borrower’s principal place of business and chief executive offices are located at the address stated in Section 12.1.

Section 7.8ERISA. Borrower has no employees and has not established any pension plan for employees which would cause Borrower to be subject to the Employee Retirement Income Security Act of 1974, as amended.

Section 7.9Margin Stock. No part of proceeds of the Loans will be used for purchasing or acquiring any “margin stock” within the meaning of Regulations T, U or X of the Board of Governors of the Federal Reserve System.

Section 7.10Tax Filings. Borrower and each Borrower Party have filed (or have obtained effective extensions for filing) all federal, state and local tax returns required to be filed and have paid or made adequate provision for the payment of all federal, state and local taxes, charges and assessments payable by Borrower and each Borrower Party, respectively.

Section 7.11Solvency. Giving effect to the Loans, the fair saleable value of Borrower’s assets exceeds and will, immediately following the making of the Loans, exceed Borrower’s total liabilities, including, without limitation, subordinated, unliquidated, disputed and contingent liabilities. The fair saleable value of Borrower’s assets is and will, immediately following the making of the Loans, be greater than Borrower’s probable liabilities, including the maximum amount of its contingent liabilities on its Debts as such Deb ts become absolute and matured. Borrower’s assets do not and, immediately following the making of the Loans will not, constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted. Borrower does not intend to, and does not believe that it will, incur Debts and liabilities (including contingent liabilities and other commitments) beyond its ability to pay such Debts as they mature (taking into account the timing and amounts of cash to be received by Borrower and the amounts to be payable on or in respect of obligations of Borrower).

Section 7.12Full and Accurate Disclosure. No statement of fact made by or on behalf of Borrower or any Borrower Party in this Agreement or in any of the other Loan Documents or in any certificate, statement or questionnaire delivered by Borrower or any Borrower Party in connection with the Loans contains any untrue statement of a material fact or omits to state any material fact necessary to make statements contained herein or therein not misleading. There is no fact presently known to Borrower or any Borrower Party which has not been di sclosed to Administrative Agent which might have a Material Adverse Effect.

Section 7.13Single Purpose Entity. Borrower is and has at all times since its formation been a Single Purpose Entity.

Section 7.14Property Management Agreement. The Property Management Agreement is the only management agreement in existence with respect to the operation or management of the Project. The copy of the Property Management Agreement delivered to Administrative Agent is a true and correct copy, and such agreement has not been amended or modified. Neither party to such agreement is in default under such agreement and the Property Manager has no defense, offset right or other right to withhold performance under or terminate such agre ement.

Section 7.15No Conflicts. The execution, delivery and performance of this Agreement and the other Loan Documents by Borrower do not and will not conflict with or result in a breach of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any Lien (other than pursuant to the Loan Documents) upon any of the property or assets of Borrower pursuant to the terms of any indenture, mortgage, deed of trust, loan agreement, operating agreement or other agreement or instrument to which Borrower is a party or by whi ch any of Borrower’s property or assets is subject, nor will such action result in any violation of the provisions of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over Borrower or any of Borrower’s properties or assets, and any consent, approval, authorization, order, registration or qualification of or with any court or any such regulatory authority or other governmental agency or body required for the execution, delivery and performance by Borrower of this Agreement or any other Loan Documents has been obtained and is in full force and effect.

Section 7.16Title. Borrower has good, marketable and insurable fee simple title to the Project, free and clear of all Liens whatsoever, except for the Permitted Encumbrances and such other Liens as are permitted pursuant to the Loan Documents. The Mortgage creates (and upon the recordation thereof and of any related financing statements there will be perfected) (1) a valid Lien on the Project, subject only to Permitted Encumbrances and (2) security interests in and to, and collateral assignments of, all personalty (including the leases), all in acc ordance with the terms thereof, in each case subject only to any applicable Permitted Encumbrances and such other Liens as are permitted pursuant to the Loan Documents. There are no claims for payment for work, labor or materials affecting the Project which are or may become a Lien prior to, or of equal priority with, the Liens created by the Loan Documents. None of the Permitted Encumbrances, individually or in the aggregate, materially interfere with the benefits of the security intended to be provided by the Mortgage and this Agreement, materially and adversely affect the value of the Project, impair the use or operations of the Project or impair Borrower’s ability to pay its obligations in a timely manner.

Section 7.17Use of Project. The Project is being, and will continue to be, used exclusively for retail, office and other ancillary uses permitted by applicable zoning law, and for no other purpose or purposes.

Section 7.18Flood Zone. No portion of the Project or the Improvements is located in an area identified by the Secretary of Housing and Urban Development or any successor thereto as an area having special flood hazards pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973 or the National Flood Insurance Act of 1994, as amended, or any successor law.

Section 7.19Insurance. Borrower has obtained and has delivered to Administrative Agent certified copies of all of the insurance policies for the Project reflecting the insurance coverages, amounts and other insurance requirements set forth in this Agreement. No claims have been made under any such policy, and no Person, including Borrower, has done, by act or omission, anything which would impair the coverage of any such policy.

Section 7.20Certificate of Occupancy; Licenses. All certifications, permits, licenses and approvals, including without limitation, certificates of completion and occupancy permits, required for the legal use, occupancy and operation of the Project as an office building (with multi-floor retail uses) (collectively, the “Licenses”) have been obtained and are in full force and effect. Borrower shall keep and maintain all Licenses in full force and effect.&# 160; The use being made of the Project is in conformity with any applicable certificate of occupancy issued for the Project.

Section 7.21Physical Condition. Except as disclosed in the building condition reports certified to Administrative Agent and delivered in connection with the initial advance of the Loans, the Project, including, without limitation, all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, are in good condition, order and repair in all materi al respects; to Borrower’s knowledge, there exists no structural or other material defects or damages in the Project, whether latent or otherwise, and Borrower has not received written notice from any insurance company or bonding company of any defects or inadequacies in the Project, or any part thereof, which would adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.

Section 7.22Boundaries. All of the Improvements lie wholly within the boundaries and building restriction lines of the Project, and no improvements on adjoining properties encroach upon the Project, and no Improvements encroach upon or violate any easements or other encumbrances upon the Project, so as to materially adversely affect the value or marketability of the Project, except those which are insured against by title insurance.

Section 7.23Separate Lots. The Project is comprised of one (1) or more parcels which constitutes one (1) or more separate tax lots and does not constitute a portion of any other tax lot not a part of the Project.

Section 7.24Survey. The survey for the Project delivered to Administrative Agent in connection with this Agreement does not fail to reflect any material matter affecting the Project or the title thereto.

Section 7.25Filing and Recording Taxes. All transfer taxes, deed stamps, intangible taxes or other amounts in the nature of transfer taxes required to be paid by any Person under applicable legal requirements currently in effect in connection with the transfer of the Project to Borrower or any transfer of a controlling interest in Borrower have been paid. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by any Person in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of the Loan Documents, including, without limitation, the Mortgage, have been paid and, the Mortgage is enforceable in accordance with its terms by Administrative Agent or any subsequent holder thereof (on behalf of the Lenders), subject to applicable bankruptcy, insolvency, or similar laws generally affecting the enforcement of creditors’ rights.

Section 7.26Investment Company Act. Borrower is not (1) an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended; (2) a “holding company” or a “subsidiary company” of a “holding company” or an “affiliate” of either a “holding company” or a “subsidiary company” within the meaning of the Public Utility Holding Company Act of 1935, as amended; or (3) subject to any other federal or state law or regulation which purports to restrict or regulate its ability to borrow money.

Section 7.27 Foreign Assets Control Regulations, Etc.

(1) Neither the execution and delivery of the Notes and the other Loan Documents by Borrower Parties nor the use of the proceeds of the Loans, will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or the Anti-Terrorism Order or any enabling legislation or executive order relating to any of the same. Without limiting the generality of the foregoing, no Borrower Party or any of their respective subsidiaries (a) is or will become a blocked person described in Section 1 of the Anti-Terrorism Order or (b) engages or will engage in any dealings or transactions or be otherwise associated with any such blocked person.

(2) Each partner or member or other direct or indirect principal of Borrower shall be at all times during the term of the Loans an entity or person which (a) is (and whose principals shall be) a reputable entity or person of good character and in good standing as reasonably determined by the Lenders, (b) is creditworthy and not adverse to any of the Lenders in any pending litigation or arbitration in which any Lender is also a party, (c) is not a Prohibited Person, and (d) is in good standing in its state or country of organization.

Section 7.28Organizational Structure.

(1) Borrower has heretofore delivered to Administrative Agent a true and complete copy of the Organizational Documents of each Borrower Party. The only member of Borrower on the date hereof is Managing Member. The Managing Member is the sole managing member of Borrower. As of the date hereof, there are no outstanding equity rights with respect to Borrower or the Managing Member.

(2) The only members of the Managing Member on the date hereof are Guarantor and P/A Associates LLC. Guarantor is the sole managing member of the Managing Member.

(3) Schedule 7.28 contains a true and accurate chart reflecting the ownership of all of the direct and indirect equity interests in Borrower, including the percentage of ownership interest of the Persons shown thereon.

ARTICLE 8

FINANCIAL REPORTING

Section 8.1Financial Statements.

(1) Quarterly Reports. Within forty-five (45) days after the end of each calendar quarter, Lead Borrower shall furnish to Administrative Agent a detailed operating statement (showing quarterly activity and year-to-date) stating Operating Revenues, Operating Expenses, operating income and Net Cash Flow, and capital expenditures for the calendar quarter just ended and a balance sheet for such quarter for Borrower. Borrower’s quarterly statements shall be accompanied by (i) a comparison of the budgeted income and expenses and the actual income and expenses for the prior calendar quarter, (ii) a calculation reflecting the Debt Service Coverage Ratio as of the last day of such quarter, for such quarter and the last four quarters; (iii) a current rent roll for the Project, and (iv) a certificate executed by the chief financial officer of Borrower or the managing member of Borrower stating that each such quarterly statement presents fairly the financial condition and the results of operations of Borrower and the Project and has been prepared in accordance with general accepted accounting principles.

(2) Annual Reports. Within ninety (90) days after the end of each calendar year of Borrower’s operation of the Project, Lead Borrower will furnish to Administrative Agent a complete copy of Borrower’s annual financial statements prepared in accordance with GAAP and otherwise in form and detail reasonably acceptable to Administrative Agent, for such calendar year which financial statements shall contain a balance sheet, a detailed operating statement stating Operating Revenues, Operating Expenses, operating income and Net Cash Flow for each of Borrower and the Project. Borrower’s annual financial statements shall be accompanied by (i) a comparison of the budgeted income and e xpenses and the actual income and expenses for the prior calendar year, (ii) a certificate executed by the chief financial officer of Borrower or the managing member of Borrower stating that each such annual financial statement presents fairly the financial condition and the results of operations of Borrower and the Project and has been prepared in accordance with general accepted accounting principles.

(3) Additional Reports. Upon request of Administrative Agent, Lead Borrower shall deliver to Administrative Agent as soon as reasonably available, but in no event later than thirty (30) days after such items become available to Borrower in final form a summary report containing each of the following with respect to the Project for the most recently completed calendar year: (A) aggregate sales by tenants under leases or other occupants of the Project, both on an actual (or to the extent such information is not provided by tenants, Property Manager’s or Borrower’s best estimate) and on a comparable store basis, (B) rent per square foot payable by each tenant, (C) aggregate Occupancy of t he Project by anchor space and in-line store space as of December 31 and (D) such other information as Administrative Agent shall reasonably request.

(4) Certification; Supporting Documentation. Each such financial statement shall be in scope and detail satisfactory to Administrative Agent and certified by the chief financial representative of Borrower.

Section 8.2Accounting Principles. All financial statements shall be prepared in accordance with sound accounting principles applicable to commercial real estate, consistently applied from year to year. If the financial statements are prepared on an accrual basis, such statements shall be accompanied by a reconciliation to cash basis accounting principles.

Section 8.3Other Information. Lead Borrower shall deliver to Administrative Agent such additional information regarding Borrower, its subsidiaries, its business, any Borrower Party, and the Project within thirty (30) days after Administrative Agent’s request therefor.

Section 8.4Annual Budget. At least thirty (30) days prior to the commencement of each fiscal year, Lead Borrower will provide to Administrative Agent Borrower’s proposed annual operating and capital improvements budget for such fiscal year for review and approval by Administrative Agent.

Section 8.5Audits. Administrative Agent shall have the right to choose and appoint a certified public accountant to perform financial audits as it deems necessary, at Borrower’s expense, provided, however unless an Event of Default has occurred, Borrower shall not be required to pay for more than one (1) financial audit per calendar year. Borrower shall permit Administrative Agent to examine such records, books and papers of Borrower which reflect upon its financial condition and the income and expense relative to the Project.

ARTICLE 9

COVENANTS

Borrower covenants and agrees with Administrative Agent and the Lenders as follows:

Section 9.1Due on Sale and Encumbrance; Transfers of Interests. Without the prior written consent of Administrative Agent and the Lenders (to the extent required under Section 12.2),

(1) Borrower shall not allow any Change of Control to occur, or permit any Transfer to occur (whether of equity interests or through any pledge or encumbrance of equity interests, or of the economic or other benefits therefrom, whether voluntary, involuntary, by operation of law or otherwise) if any such Transfer would result in a Change of Control;

(2) neither Borrower nor any other Person having an ownership or beneficial interest in Borrower shall (a) allow, directly or indirectly, any Transfer (other than a Permitted Transfer), to occur; (b) further encumber, alienate, grant a Lien or grant any other interest in the Project or any part thereof (including any partnership, membership or other ownership interest in Borrower), whether voluntarily or involuntarily; or (c) enter into any easement or other agreement granting rights in or restricting the use or development of the Project;

(3) no new general partner, member, or limited partner having the ability to control the affairs of Borrower shall be admitted to or created in Borrower (nor shall any existing general partner or member or controlling limited partner withdraw from Borrower), and no change in Borrower’s organizational documents relating to control over Borrower and/or the Project shall be effected.

As used in this Section 9.1, “Transfer” shall include the sale, transfer, conveyance, mortgage, pledge, or assignment of the legal or beneficial ownership of (a) the Project (including any Unit), (b) any partnership interest in any general partner in Borrower that is a partnership, (c) any membership interest in any member in Borrower that is a limited liability company and (d) any voting stock in any managing member in Borrower that is a corporation; “Transfer” shall not include (i) the leasing of any space within the Project so long as Borrower complies with the provisions of the Loan Documents relating to such leasing activity; or (ii) the transfers of non-managing membership interests in Borrower so long as no Change of Control results therefrom.

Section 9.2Taxes; Charges. Borrower shall pay before any fine, penalty, interest or cost may be added thereto, and shall not enter into any agreement to defer, any real estate taxes and assessments, franchise taxes and charges, and other governmental charges that may become a Lien upon the Project or become payable during the term of the Loans (collectively, the “Taxes”), and will promptly furnish Administrative Agent with evidence of such payment; however, Borrowe r’s compliance with Section 4.1 of this Agreement relating to impounds for taxes and assessments shall, with respect to payment of such taxes and assessments, be deemed compliance with this Section 9.2. Borrower shall not suffer or permit the joint assessment of the Project with any other real property constituting a separate tax lot or with any other real or personal property. Borrower shall pay when due all claims and demands of mechanics, materialmen, laborers and others which, if unpaid, might result in a Lien on the Project; however, Borrower may contest the validity of such claims and demands or taxes so long as (1) Lead Borrower notifies Administrative Agent that Borrow er intends to contest such claim or demand, (2) Borrower provides Administrative Agent with an indemnity, bond or other security satisfactory to Administrative Agent (including an endorsement to Administrative Agent’s title insurance policy insuring against such claim or demand) assuring the discharge of Borrower’s obligations for such claims and demands, including interest and penalties, (3) Borrower is diligently contesting the same by appropriate legal proceedings in good faith and at its own expense and concludes such contest prior to the tenth (10th) day preceding the earlier to occur of the Maturity Date or the date on which the Project is scheduled to be sold, forfeited, terminated, cancelled or lost for non payment, (4) such proceedings shall not subject Borrower, the Administrative Agent or any Lender to criminal or civil liability (other than civil liability as to which adequate security has been provided pursuant to clause (2) above), and (5) Borrower shall promptly upon final determin ation thereof pay the amount of such items, together with all costs, interests and penalties.

Section 9.3Control; Management. Borrower shall not terminate, replace or appoint any manager or terminate or amend the Property Management Agreement for the Project without Administrative Agent’s prior written approval. Any change in ownership or control of the Property Manager shall be cause for Administrative Agent to re-approve such Property Manager and Property Management Agreement. If at any time Administrative Agent consents to the appointment of a new manager, such new manager and Borrower shall, as a condition of Administra tive Agent’s consent, execute a Property Manager’s Consent and Subordination of Property Management Agreement in the form then used by Administrative Agent. Each manager shall hold and maintain all necessary licenses, certifications and permits required by law. Borrower shall fully perform all of its covenants, agreements and obligations under the Property Management Agreement.

Section 9.4Operation; Maintenance; Inspection. Borrower shall observe and comply with all legal requirements applicable to the ownership, use and operation of the Project. Borrower shall maintain the Project in good condition and promptly repair any damage or casualty. Borrower shall permit Administrative Agent and the Lenders and their agents, representatives and employees, upon reasonable prior notice to Borrower, to inspect the Project and conduct such environmental and engineering studies as Administrative Agent may require, pro vided such inspections and studies do not materially interfere with the use and operation of the Project.

Section 9.5Taxes on Security. Borrower shall pay all taxes, charges, filing, registration and recording fees, excises and levies payable with respect to the Notes or the Liens created or secured by the Loan Documents, other than income, franchise and doing business taxes imposed on Administrative Agent or any Lender. If there shall be enacted any law (1) deducting the Loans from the value of the Project for the purpose of taxation, (2) affecting any Lien on the Project, or (3) changing existing laws of taxation of mortgages, deeds of trust, securit y deeds, or debts secured by real property, or changing the manner of collecting any such taxes, Borrower shall promptly pay to Administrative Agent, on demand, all taxes, costs and charges for which Administrative Agent or any Lender is or may be liable as a result thereof; however, if such payment would be prohibited by law or would render the Loans usurious, then instead of collecting such payment, Administrative Agent may (and on the request of the Majority Lenders shall) declare all amounts owing under the Loan Documents to be immediately due and payable.

Section 9.6Legal Existence; Name, Etc.

(1) Borrower and each managing member in Borrower shall preserve and keep in full force and effect its existence as a Single Purpose Entity, entity status, franchises, rights and privileges under the laws of the state of its formation, and all qualifications, licenses and permits applicable to the ownership, use and operation of the Project. Neither Borrower nor any managing member of Borrower shall wind up, liquidate, dissolve, reorganize, merge, or consolidate with or into, or convey, sell, assign, transfer, lease, or otherwise dispose of all or substantially all of its assets, or acquire all or substantially all of the assets of the business of any Person, or permit any subsidiary or Affiliate of Borrower to do so. Borrower and each managing mem ber in Borrower shall conduct business only in its own name and shall not change its name, identity, or organizational structure, or the location of its chief executive office or principal place of business unless Borrower (a) shall have obtained the prior written consent of Administrative Agent to such change, and (b) shall have taken all actions necessary or requested by Administrative Agent to file or amend any financing statement or continuation statement to assure perfection and continuation of perfection of security interests under the Loan Documents.

(2) Borrower shall at all times cause there to be at least one (1) duly appointed member of the board of managers or other governing board or body of the managing member of the Managing Member, who is an Independent Manager. Borrower shall not take any action or permit any action to be taken which, under the terms of this Agreement, or the limited partnership agreement or limited liability company operating agreement of Borrower, the Managing Member, or the managing member of the Managing Member, requires the consent of such Independent Manager(s), unless such Independent Manager(s) shall have consented in writing to such action.

(3) Neither Borrower nor Borrower’s Managing Member shall cause or permit any modification to be made in its organizational documents that would be inconsistent with the provisions of Section 7.28 or this Section 9.6, that would interfere with its ability to comply with its status as a Single Purpose Entity, as applicable, or that otherwise in any other respect would violate this Agreement or could reasonably be expected to have a Material Adverse Effect.

Section 9.7Affiliate Transactions. Without the prior written consent of Administrative Agent, Borrower shall not engage in any transaction affecting the Project with an Affiliate of Borrower.

Section 9.8Limitation on Other Debt. Borrower and Managing Member shall not, without the prior written consent of Administrative Agent and the Majority Lenders, incur any Debt other than, in the case of the Borrower, the Loans and trade and operational debt described in subsection (p) of the definition of Single Purpose Entity.

Section 9.9Further Assurances. Borrower shall promptly (1) cure any defects in the execution and delivery of the Loan Documents, and (2) execute and deliver, or cause to be executed and delivered, all such other documents, agreements and instruments as Administrative Agent may reasonably request to further evidence and more fully describe the collateral for the Loans, to correct any omissions in the Loan Documents, to perfect, protect or preserve any Liens created under any of the Loan Documents, or to make any recordings, file any notices, or obtai n any consents, as may be necessary or appropriate in connection therewith.

Section 9.10Loan Certificates. Borrower or Administrative Agent, within ten (10) days after request from the other party, shall furnish to the requesting party a written statement, duly acknowledged, setting forth the amount due on the Loans, the terms of payment of the Loans, the date to which interest has been paid, whether any offsets or defenses exist against the Loans and, if any are alleged to exist, the nature thereof in detail, and such other matters as the requesting party reasonably may request.

Section 9.11Notice of Certain Events. Lead Borrower shall promptly notify Administrative Agent of (1) any Potential Default or Event of Default, together with a detailed statement of the steps being taken to cure such Potential Default or Event of Default; (2) any notice of default received by Borrower or any Borrower Party under other obligations relating to the Project or otherwise material to Borrower’s business; and (3) any threatened or pending legal, judicial or regulatory proceedings, including any dispute between Borrower and any Governmental Authority, affecting Borrower or the Project.

Section 9.12Indemnification. Borrower shall indemnify, defend and hold Administrative Agent and each Lender harmless from and against any and all losses, liabilities, claims, damages, expenses, obligations, penalties, actions, judgments, suits, costs or disbursements of any kind or nature whatsoever, including the reasonable fees and actual expenses of their counsel, which may be imposed upon, asserted against or incurred by any of them relating to or arising out of (1) the Project or (2) any of the Loan Documents or the transactions contemplated thereby, inc luding, without limitation, (a) any accident, injury to or death of persons or loss of or damage to property occurring in, on or about any of the Project or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways, (b) any inspection, review or testing of or with respect to the Project, (c) any investigative, administrative, mediation, arbitration, or judicial proceeding, whether or not Administrative Agent or any Lender is designated a party thereto, commenced or threatened at any time (including after the repayment of the Loans) in any way related to the execution, delivery or performance of any Loan Document or to the Project, (d) any proceeding instituted by any Person claiming a Lien, and (e) any brokerage commissions or finder’s fees claimed by any broker or other party claiming to have dealt with the Borrower in connection with the Loans, the Project, or any of the transactions contemplated in the Loan Documents, including thos e arising from the joint, concurrent, or comparative negligence of Administrative Agent or any Lender, except to the extent any of the foregoing is caused by Administrative Agent’s or any Lender’s gross negligence or willful misconduct, in which case the party to whom the gross negligence or willful misconduct is attributable (but not any other party) shall not be entitled to the indemnification provided for hereunder to the extent of such gross negligence or willful misconduct, to the extent determined by a court of competent jurisdiction.

Section 9.13Payment for Labor and Materials. Borrower will promptly pay when due all bills and costs for labor, materials, and specifically fabricated materials incurred in connection with the Project and never permit to exist beyond the due date thereof in respect of the Project or any part thereof any Lien, even though inferior to the Liens of the Loan Documents, and in any event never permit to be created or exist in respect of the Project or any part thereof any other or additional Lien other than the Liens or security of the Loan Documents, except for the Permitted Encumbrances; however, Borrower may contest the validity of such Liens so long as (1) Lead Borrower notifies Administrative Agent that Borrower intends to contest such Liens, (2) Borrower provides Administrative Agent with an indemnity, bond or other security satisfactory to Administrative Agent (including an endorsement to Administrative Agent’s title insurance policy insuring against such Liens) assuring the discharge of Borrower’s obligations for such Liens, including interest and penalties, (3) Borrower is diligently contesting the same by appropriate legal proceedings in good faith and at its own expense and concludes such contest prior to the tenth (10th) day preceding the earlier to occur of the Maturity Date or the date on which the Project is scheduled to be sold, forfeited, terminated, cancelled or lost for non payment, (4) such proceedings shall not subject Borrower, the Administrative Agent or any Lender to criminal or civil liability (other than civil liability as to w hich adequate security has been provided pursuant to clause (2) above), and (5) Borrower shall promptly upon final determination thereof pay the amount of such items, together with all costs, interests and penalties.

Section 9.14Alterations. Borrower shall obtain Administrative Agent’s prior written consent, which consent shall not be unreasonably withheld or delayed, to any alterations to any improvements that may have a Material Adverse Effect on Borrower’s financial condition, the use, operation or value of the Project or the actual Net Operating Income with respect to the Project, other than (a) tenant improvement work performed pursuant to the terms of any lease executed on or before the date hereof, (b) tenant improvement work performed pursuant to the t erms and provisions of a lease and not adversely affecting any structural component of any improvements, any utility or HVAC system contained in any improvements or the exterior of any building constituting a part of any improvements at the Project, or (c) alterations performed in connection with the restoration of the Project after the occurrence of a casualty in accordance with the terms and provisions of this Agreement.

Section 9.15Hedge Agreements.

(1) At Borrower’s option, the Borrower may enter into one or more Hedge Agreements. Each Hedge Agreement shall, at Borrower’s option, be based on an Interest Period (each, an “Interest Rate Hedge Period”) of one (1) month. The economic and other benefits of the Hedge Agreements and all of the other rights thereunder shall be collaterally assigned to Administrative Agent as additional security for the Loans, pursuant to a Hedge Agreement Pledge. All Hedge Agreement Pledges shall be accompanied by (i) Uniform Commercial Code financing statements, in duplicate, with respect to such pledges and (ii) the consent and agreement of the counter party thereunder that it will pay all amounts due thereunder to an account designated by Administrative Agent and will continue to perform its obligations under such Hedge Agreement for the benefit of Administrative Agent and the Lenders after enforcement of and/or realization on such Hedge Agreement Pledge and an acknowledgement that Administrative Agent shall not be deemed to have assumed any of the obligations or duties of Borrower under any such Hedge Agreement.

(2) All of Borrower’s obligations under any Hedge Agreement provided by a Eurohypo Counterparty shall be secured by the lien of the Mortgage on a pari passu basis with the Loans and other sums evidenced or secured by the Loan Documents.

(3) Any Hedge Agreement entered into with one or more banks or insurance companies (each a “Third-Party Counterparty”) other than a Eurohypo Counterparty (a “Third-Party Hedge Agreement”) shall not be secured by the Mortgage or a Lien on any portion of the collateral under the Security Documents or on or in any direct or indirect interest in Borrower.

(4) Borrower shall cause all payments payable by a Third-Party Counterparty under the Hedge Agreement to be deposited into an account designated by Administrative Agent. On the due date for interest on the Loans each month, the amounts so deposited in such account shall be debited, and applied to pay the accrued but unpaid interest on the Loans due on such date, before applying any portion of the Loan proceeds which is allocated to the Interest Reserve for such purpose, and before applying any Operating Revenues for such purpose.

(5) Any payment due from the counterparty under any Hedge Agreement upon a termination thereof, shall be delivered to Administrative Agent and applied by Administrative Agent to any amounts due under the Loan Documents.

(6) In connection with a Third-Party Hedge Agreement, Lead Borrower shall obtain and deliver to Administrative Agent an opinion from counsel (which counsel may be in-house counsel for the Third-Party Counterparty) for the Third-Party Counterparty (in form reasonably satisfactory to Administrative Agent and upon which Administrative Agent, the Lenders and their respective successors and assigns may rely) which shall provide, in relevant part, that:

(a) the Third-Party Counterparty is duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation or organization and has the organizational power and authority to execute and deliver, and to perform its obligations under, the Third-Party Hedge Agreement;

(b) the execution and delivery of the Third-Party Hedge Agreement by the Third-Party Counterparty, and any other agreement which the Third-Party Counterparty has executed and delivered pursuant thereto, and the performance of its obligations thereunder have been and remain duly authorized by all necessary action and do not contravene any provision of its certificate of incorporation or by-laws (or equivalent organizational documents) or any law, regulation or contractual restriction binding on or affecting it or its property;

(c) all consents, authorizations and approvals required for the execution and delivery by the Third-Party Counterparty of the Third-Party Hedge Agreement, and any other agreement which the Third-Party Counterparty has executed and delivered pursuant thereto, and the performance of its obligations thereunder have been obtained and remain in full force and effect, all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with any Governmental Authority or regulatory body is required for such execution, delivery or performance; and

(d) the Third-Party Hedge Agreement, and any other agreement which the Third-Party Counterparty has executed and delivered pursuant thereto, has been duly executed and delivered by the Third-Party Counterparty and constitutes the legal, valid and binding obligation of the Third-Party Counterparty, enforceable against the Third-Party Counterparty in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

Section 9.16Certain Financial Covenants.

(1) Debt Service Coverage Ratio.

(a) Commencing on December 31, 2009 Borrower shall not permit (a) the Debt Service Coverage Ratio for any calendar quarter to be less than (i) with respect to the period from the Closing Date through and including the first anniversary of the Closing Date, 1.35:1.00; and (ii) from the first day after the first anniversary of the Closing Date through and including the original Maturity Date, 1.25:1.00; or (b) in the event that Borrower exercises the option to extend the term of the Loan pursuant to Section 2.5 hereof, the Pro Forma Debt Service Coverage Ratio for any calendar quarter during the Extension Period to be less than 1.45:1.00.

(b) Upon the occurrence of a Low DSCR Trigger Event, Borrower shall, on or before the date which is five (5) Business Days after the date of any such determination (but in any event within fifty (50) days after the end of the applicable calendar quarter) either (a) make a payment in reduction of the outstanding principal amount in an amount determined by Administrative Agent (together with all applicable breakage costs or other charges, if any, provided for herein) such that after giving effect to such payment, the Debt Service Coverage Ratio would not have triggered a Low DSCR Trigger Event for the applicable calendar quarter had such prepayment been made as of the first day of such calendar quarter; or (b) make a deposit of cash with Administrative Agent, and/or deli ver a Collateral Letter of Credit to Administrative Agent as additional collateral for the Notes and Borrower’s other obligations under the Loan Documents, in each case, in an amount determined by Administrative Agent such that if the amount so deposited were used to make a principal prepayment, the Debt Service Coverage Ratio would not have triggered a Low DSCR Trigger Event for the applicable calendar quarter had such prepayment been made as of the first day of such calendar quarter. Any cash shall be deposited by Administrative Agent in the Low DSCR Account and be subject to the terms of the Cash Management Agreement, including the security interest granted by Borrower therein pursuant to the Cash Management Agreement. If the Low DSCR Release Event shall occur within six (6) months of the Low DSCR Trigger Event, provided that there is no then existing Potential Default or Event of Default, any funds held in the Lo w DSCR Account pursuant to this subsection (b) and any undrawn Collateral Letters of Credit delivered pursuant to this subsection (b) shall be released to Lead Borrower. In the event that the Low DSCR Release Event does not occur within six (6) months of the Low DSCR Trigger Event, then Administrative Agent shall have the right to apply any funds held in the Low DSCR Account pursuant to this subsection (b) and to draw on any Collateral Letters of Credit delivered pursuant to this subsection (b) and apply such amounts in reduction of the outstanding principal balance of the Loan.

Section 9.17 Handicapped Access.

(1) Borrower (a) agrees that it shall use commercially reasonable efforts to ensure that the Project shall at all times comply with the applicable requirements of the Americans with Disabilities Act of 1990, the Fair Housing Amendments Act of 1988, all state and local laws and ordinances related to handicapped access and all rules, regulations, and orders issued pursuant thereto including, without limitation, the Americans with Disabilities Act Accessibility Guidelines for Buildings and Facilities (collectively, “Access Laws”) and (b) has no actual knowledge as to the Project’s non-compliance with any Access Laws where the failure to so comply could have a Materia l Adverse Effect on the Project or on Borrower’s ability to repay the Loans in accordance with the terms hereof.

(2) Notwithstanding any provisions set forth herein or in any other document regarding Administrative Agent’s approval of alterations of the Project, Borrower shall not alter the Project in any manner which would materially increase Borrower’s responsibilities for compliance with the applicable Access Laws without the prior written approval of Administrative Agent. The foregoing shall apply to tenant improvements constructed by Borrower or by any of its tenants. Administrative Agent may condition any such approval upon receipt of a certificate of Access Law compliance from an architect, engineer, or other person reasonably acceptable to Administrative Agent.

(3) Lead Borrower agrees to give prompt notice to Administrative Agent of the receipt by Borrower of any written complaints related to violation of any Access Laws with respect to the Project and of the commencement of any proceedings or investigations which relate to compliance with applicable Access Laws.

Section 9.18Zoning. Borrower shall not, without Administrative Agent’s prior consent, such consent not to be unreasonably withheld, seek, make, suffer, consent to or acquiesce in any change or variance in any zoning or land use laws or other conditions of use of the Project or any portion thereof. Borrower shall not use or permit the use of any portion of the Project in any manner that could result in such use becoming a non-conforming use under any zoning or land use law or any other applicable law or modify any agreements relating to zoning or land use matters or with the joinder or merger of lots for zoning, land use or other purposes, without the prior written consent of Administrative Agent. Without limiting the foregoing, in no event shall Borrower take any action that would reduce or impair either (a) the number of parking spaces at the Improvements or (b) access to the Project from adjacent public roads. Further, without Administrative Agent’s prior written consent, such consent not to be unreasonably withheld, Borrower shall not file or subject any part of the Project to any additional declaration of condominium or co-operative or convert any part of the Project to an additional condominium, co-operative or other direct or indirect form of multiple ownership and governance.

Section 9.19ERISA. Borrower shall not take any action, or omit to take any action, which would (a) cause Borrower’s assets to constitute “plan assets” for purposes of ERISA or the Internal Revenue Code or (b) cause the Loan Transactions to be a nonexempt prohibited transaction (as such term is defined in Section 4975 of the Internal Revenue Code or Section 406 of ERISA) that could subject Administrative Agent and/or the Lenders, on account of any Loan or execution of the Loan Documents hereunder, to any tax or penalty on prohibited transacti ons imposed under Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA.

Section 9.20Books and Records. Borrower will, and will cause each of the other Borrower Parties to, keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. Borrower will, and will cause each of the other Borrower Parties to, permit any representatives designated by Administrative Agent or any Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.

Section 9.21Foreign Assets Control Regulations. Neither Borrower nor any Borrower Party shall use the proceeds of the Loan in any manner that will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or the Anti-Terrorism Order or any enabling legislation or executive order relating to any of the same. Without limiting the foregoing, neither Borrower nor any Borrower Party will permit itself nor any of its Subsidiarie s to (a) become a blocked person described in Section 1 of the Anti-Terrorism Order or (b) knowingly engage in any dealings or transactions or be otherwise associated with any person who is known by such Borrower Party or who (after such inquiry as may be required by applicable law) should be known by such Borrower Party to be a blocked person.

Section 9.22Appraisals. Administrative Agent may, at its option, commission one or more new and/or updated Appraisals from time to time after the closing date; provided, however, that Borrower shall only be required to reimburse Administrative Agent for such new and updated Appraisal (A) not more than annually unless (1) an Event of Default exists or (2) there is, in Administrative Agent’s reasonable judgment, a material adverse change in the Project or the market conditions related to the Project, (B) in connection with Section 2. 5 and (C) at any time such appraisal is required by applicable law or regulatory requirements.

Section 9.23 Covenants Regarding the Condominium Declaration.

Borrower covenants and agrees that:

(1) Borrower shall pay when due and before any fine, penalty, interest or cost may be added thereto for the late payment or non-payment thereof, all Unit Annual Assessments imposed on Borrower’s Project Interest and all other charges mentioned in and payable by Borrower under the Condominium Declaration (including, without limitation, all insurance and taxes applicable to Borrower’s Project Interest), and shall comply with all of its other obligations under the Condominium Declaration, and shall do all things necessary to preserve and to keep unimpaired Borrower’s rights, powers and privileges (whether as the owner of the Units, as the Declarant, as the holder of any special class of voting rights, or otherwise) thereunder. If Borrower shall fai l to do so, the Lenders shall, if required by Administrative Agent, pay such Unit Annual Assessments or other charges. Lead Borrower shall deliver to Administrative Agent, upon request, copies of receipts or other proof satisfactory to Administrative Agent evidencing the timely payment of such Unit Annual Assessments and other charges.

(2) Borrower shall comply with the covenants, agreements and provisions of the Condominium Documents, and Lead Borrower shall promptly notify Administrative Agent of (a) any failure by Borrower to comply with the Condominium Declaration and (b) the receipt by Borrower of any notice asserting or claiming a default by Borrower under the Condominium Declaration, and shall promptly cause a copy of such notice to be delivered to Administrative Agent.

(3) Borrower shall not vote in favor of or otherwise approve any amendment of the Condominium Declaration without the prior written consent of Administrative Agent, which consent shall not be unreasonably withheld.

(4) Borrower shall not waive any material right of the Borrower (whether as the owner of the Units, as the Declarant, as the holder of any special class of voting rights, or otherwise) under the Condominium Declaration without the prior written consent of Administrative Agent which shall not be unreasonably withheld.

(5) The Lien of the Mortgage shall encumber all of Borrower’s Project Interest, including all of Borrower’s rights to vote on or approve any matter with respect to Borrower’s Project Interest. Without the prior written consent of Administrative Agent, Borrower shall not exercise such voting or approval rights with respect to any of the following:

(a) any partition of all or a part of the Project subject to the Condominium Declaration;

(b) the nature and amount of any insurance covering all or a part of the Project and the disposition of any proceeds thereof;

(c) the manner in which any condemnation or threat of condemnation of all or a part of the Project shall be defended or settled and the disposition of any award or settlement in connection therewith;

(d) the construction of any additions or improvements to, or any repair, rebuilding or restoration of all or a portion of any Improvements to, the Project (to the extent that the same would require the approval of Administrative Agent under this Agreement);

(e) the distribution of any insurance or condemnation proceeds (other than in compliance with this Agreement); and

(f) any other material action or decision provided for in the Condominium Declaration.

(6) If required by the Administrative Agent, Lead Borrower will take all action to obtain as promptly as possible, and forthwith upon receipt furnish to the Administrative Agent, a true and correct copy of: (a) any statement showing the allocation of expenses and other assessments against the Units and (b) any statements issued to Borrower calling for payment of expenses.

(7) Lead Borrower shall be, and remain through the repayment of the Loans in full, the Declarant under the Condominium Declaration.

(8) Borrower shall cause the condominium association created by the Condominium Documents to, at all times, have furnished to Administrative Agent at no cost or expense to Administrative Agent, insurance policies for the insurance required hereunder and under the Condominium Documents, with extended coverage naming Administrative Agent, said condominium association, and Borrower (as owner of the Units), as their respective interests may appear, as the insureds, covering all of the Improvements; said insurance shall at all times be an amount equal to 100% of the insurable value of the Improvements and shall otherwise comply with the applicable conditions contained in the Mortgage and elsewhere in this Agreement.

(9) Borrower shall at all times comply with the following covenants:

(a) Borrower shall satisfy all of the requirements of the Condominium Act and of any other applicable law necessary to maintain a valid condominium regime inclusive of all of the Units; and obtain any required approval of the Condominium Documents from the Attorney General of the State of New York. Any Condominium Documents and any modifications or amendments thereto shall be reasonably approved by Administrative Agent prior to the recording, filing or effectiveness thereof, provided that in the case of any such amendment which shall increase the number of condominium units, in the event that a casualty or condemnation has occurred and the provisions of ARTICLE 3 prevent restorat ion in connection with such casualty or condemnation, then prior to the recording, filing or effectiveness, as applicable, of such amendment, Lead Borrower, at Administrative Agent's option, shall be prohibited from recording, filing or otherwise causing the amendment to become effective and Administrative Agent, at the Majority Lenders' election, shall be permitted to vote, on Lead Borrower's behalf in accordance with the Voting Proxy delivered to Administrative Agent, or require Lead Borrower to vote, to terminate and dissolve the Condominium. In connection with such amendment, Lead Borrower shall provide updates of the documents and opinion provided herein in the event that the Condominium Declaration has been modified or amended or any of the officers, managers or directors have changed as a result of such amendment;

(b) Borrower shall duly perform or cause to be duly performed, in all material respects, all obligations of the developers or sponsors under the Condominium Documents, and do or cause to be done all things necessary to operate and maintain the Project and the Condominium as a retail condominium project, that are required to be done by the developers or sponsors and comply with all Applicable Laws applicable to the Condominium, and furnish such evidence of compliance therewith as Administrative Agent may reasonably request;

(c) Subject to Administrative Agent’s approval in its reasonable discretion, Borrower shall not cancel, terminate or revoke, or modify, or in any way alter or permit the alteration of, any of the material provisions of the Condominium Documents or grant any consents or waivers thereunder, and not to exercise any right it may have under the Condominium Documents to cancel, terminate or revoke the same. Any request for approval by Administrative Agent pursuant to this paragraph shall be made to, and approved by, Administrative Agent prior to, if necessary, submitting such request to the Attorney General of the State of New York

(10) Borrower acknowledges and agrees that nothing set forth in this Section or in any of the other provisions of the Loan Documents shall impose upon Administrative Agent or any Lender any obligation or responsibility to Borrower under the Condominium Declaration.

Section 9.24Industrial and Commercial Incentive Program.

(1) On or before the Closing Date, Borrower shall have delivered to Administrative Agent the preliminary application submitted to the New York City Department of Finance (“Department of Finance”) evidencing the Project’s eligibility for the partial tax exemption in accordance with paragraph 24 of Schedule 4-Part A.

(2) On or before the Closing Date, pursuant to Title 11, Chapter 2, Part 4 of the Administrative Code of the City of New York City and the regulations promulgated thereunder, as amended from time to time (“Code”), Borrower shall have made a thorough and complete final application to the Department of Finance for a certificate of eligibility for a partial exemption of real property taxes for the Improvements for a twenty-five (25) year period (“ICIP Tax Exemption”) subsequent to commencing construction on the Project. Borrower shall provide a copy of the said application to Administrative Agent evidencing that same was received by the Department of Finance on or before the Closing Date.

(3) Pursuant to the Code, Borrower shall have submitted a thorough and complete final construction report within sixty (60) days of completing construction on the Project to the Department of Finance for a certificate of eligibility for the ICIP Tax Exemption. Borrower shall have provided a copy of the certificate of eligibility, or if unavailable, a letter from the Department of Finance evidencing same, to Administrative Agent promptly upon Borrower’s receipt thereof and in any event no later than sixty (60) days after the submission of such application, or such later date to the extent that the Borrower’s failure to receive such certificate is due to Unavoidable Delay.

(4) Borrower shall do or shall have done all things necessary and required by statute, rule and regulation to maintain the availability of the ICIP Tax Exemption, including, but not limited to the following: (i) having notified the ICIP unit of the Department of Finance (“ICIP Unit”) and the New York City Department of Small Business Services/Division of Labor Services (“Division of Labor Services”) in writing fifteen (15) business days prior to commencing construction on the Project; (ii) submitting construction employment reports for the Project to the Division of Labor Services; and, if requested by the Department of Finance, filing a certificate of continuing use with the ICIP Unit annually in each year of benefit period.

(5) Notwithstanding anything to the contrary in this Agreement, Borrower’s failure to obtain a certificate of eligibility for a ICIP Tax Exemption pursuant to clauses (2) and (3) above shall not constitute a default provided that (a) Borrower has otherwise complied with the provisions of this Section 9.24, (b) is diligently proceeding to obtain such certificate and (iii) the only cause for Borrower’s inability to obtain the applicable certificate is the Department of Finance’s bureaucratic delay in issuing the applicable certificate and not for reasons related to Borrower’s actions or eligibility.

ARTICLE 10

EVENTS OF DEFAULT

Each of the following shall constitute an Event of Default under the Loans:

Section 10.1Payments. Borrower’s failure to (i) pay any regularly scheduled installment of principal, interest, the Administrative Fee or other amount due under the Loan Documents or (ii) make a deposit of cash, and/or deliver a Collateral Letter of Credit required under the Loan Documents, within five (5) days of (and including) the date when due, or Borrower’s failure to pay the Loans at the Maturity Date, whether by acceleration or otherwise.

Section 10.2Insurance. Borrower’s failure to maintain insurance as required under Section 3.1 of this Agreement.

Section 10.3Single Purpose Entity. If Borrower or any Borrower Party materially breaches its covenant under Section 9.6 with respect to its status as a Single Purpose Entity.

Section 10.4Taxes. If any of the Taxes are not paid when the same are due and payable and such failure continues for ten (10) Business Days after Borrower has actual knowledge of such failure.

Section 10.5Sale, Encumbrance, Etc. The sale, transfer, conveyance, pledge, mortgage or assignment of any part or all of the Project, or any interest therein, or of any interest in Borrower, in violation of Section 9.1 of this Agreement.

Section 10.6Representations and Warranties. Any representation or warranty made in any Loan Document proves to be untrue in any material respect when made or deemed made.

Section 10.7Other Encumbrances. Any material default under any document or instrument, other than the Loan Documents, evidencing or creating a Lien on the Project or any part thereof that is not cured within any applicable notice or cure period.

Section 10.8Various Covenants. Borrower defaults under any of its obligations under Section 4.2(3) (pertaining to the TI/LC Letter of Credit), Section 6.2 (pertaining to lease approvals) and Sections 9.3 (management of the Project), 9.7 (transactions with Affiliates), 9.8 (limitations on debt), 9.15 (hedge arrangements), 9.18 (zoning and use changes) or 9.19 (ERISA), of this Agreement.

Section 10.9Reserved.

Section 10.10Financial Covenants. Borrower defaults under any of its obligations under Section 9.16 of this Agreement.

Section 10.11Involuntary Bankruptcy or Other Proceeding. Commencement of an involuntary case or other proceeding against Borrower, any Borrower Party or any other Person having an ownership or security interest in the Project (each, a “Bankruptcy Party”) which seeks liquidation, reorganization or other relief with respect to it or its debts or other liabilities under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeks the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any of its property, and such involuntary case or other proceeding shall remain undismissed or unstayed for a period of sixty (60) days; or an order for relief against a Bankruptcy Party shall be entered in any such case under the Federal Bankruptcy Code.

Section 10.12Voluntary Petitions, Etc. Commencement by a Bankruptcy Party of a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its Debts or other liabilities under any bankruptcy, insolvency or other similar law or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official for it or any of its property, or consent by a Bankruptcy Party to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or the making by a Bankruptcy Party of a general assignment for the benefit of creditors, or the failure by a Bankruptcy Party, or the admission by a Bankruptcy Party in writing of its inability, to pay its debts generally as they become due, or any action by a Bankruptcy Party to authorize or effect any of the foregoing.

Section 10.13Indebtedness. Any of the Borrower Parties, or any combination thereof, shall default in the payment when due of any principal of or interest on any of its other Indebtedness aggregating $1,000,000.00 or more and such default shall not be cured within any applicable notice or cure period provided with respect to such Indebtedness; or any event specified in any note, agreement, indenture or other document evidencing or relating to any such Indebtedness shall occur if the effect of such event is to cause, or (with the giving of any notice or the lap se of time or both) to permit the holder or holders of such Indebtedness to cause, such Indebtedness to become due, or to be prepaid in full (whether by redemption, purchase, offer to purchase or otherwise); prior to its stated maturity.

Section 10.14Dissolution. Any of the Borrower Parties shall be terminated, dissolved or liquidated (as a matter of law or otherwise) or proceedings shall be commenced by any Person (including any Borrower Party) seeking the termination, dissolution or liquidation of any Borrower Party , which, in the case of actions by Persons other than a Borrower Party or any of their Affiliates, shall continue unstayed and in effect for a period of sixty (60) or more days.

Section 10.15Judgments. One or more (i) judgments for the payment of money (exclusive of judgment amounts fully covered by insurance where the insurer has admitted liability in respect of such judgment) aggregating with respect to any Borrower Party (other than Guarantor) in excess of $1,000,000.00 shall be rendered against such party or parties or (ii) non-monetary judgments, orders or decrees shall be entered against any of the Borrower Parties which have or would reasonably be expected to have a Material Adverse Effect, and, in either case, the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of such Borrower Party to enforce any such judgment.

Section 10.16Security. The Liens created by the Security Documents shall at any time not constitute a valid and perfected first priority Lien (subject to the Permitted Encumbrances) on the collateral intended to be covered thereby in favor of Administrative Agent, free and clear of all other Liens (other than the Permitted Encumbrances), or, except for expiration in accordance with its terms, any of the Security Documents shall for whatever reason be terminated or cease to be in full force and effect, or the enforceability thereof shall be contested by any Bo rrower Party or any of their Affiliates, provided that, as long as the security provided by the Security Documents shall not be impaired, with respect to a Lien (other than a Permitted Encumbrance) on the collateral, Borrower shall have ten (10) days for monetary Liens and thirty (30) days for all non-monetary Liens within which to provide Administrative Agent with evidence that such Lien has been bonded or otherwise removed of record.

Section 10.17Guarantor Documents. Guarantor shall (i) default under any Guarantor Document beyond any applicable notice and grace period; or (ii) revoke or attempt to revoke, contest or commence any action against its obligations under any Guarantor Document.

Section 10.18Security Accounts. Borrower uses, or permits the use of, funds from any reserves or from any Security Accounts for any purpose other than the purpose for which such funds were disbursed from such reserves or the Security Accounts and such default is not cured within ten (10) days of Borrower’s knowledge of such default.

Section 10.19Reserved.

Section 10.20Covenants. Borrower’s failure to perform or observe any of the agreements and covenants contained in this Agreement or in any of the other Loan Documents and not specified above, and, if such failure is susceptible to being cured, the continuance of such failure for thirty (30) days after notice by Administrative Agent to Lead Borrower; provided, however, subject to any shorter period for curing any failure by Borrower as specified in any of the other Loan Document s, Borrower shall have an additional ninety (90) days to cure such failure if (1) such failure does not involve the failure to make payments on a monetary obligation; (2) such failure cannot reasonably be cured within thirty (30) days; (3) Borrower is diligently undertaking to cure such default, and (4) Borrower has provided Administrative Agent with security reasonably satisfactory to Administrative Agent against any reasonably anticipated interruption of payment or impairment of collateral as a result of such continuing failure.

Section 10.21Co-Borrower Documents. Either Borrower shall (i) default under any Co-Borrower Document beyond any applicable notice and grace period; or (ii) revoke or attempt to revoke, contest or commence any action against its obligations under any Co-Borrower Document.

Notwithstanding anything set forth in this Article 10, no cure periods will be afforded for any willful breach hereunder or under any of the Loan Documents.

ARTICLE 11

REMEDIES

Section 11.1Remedies - Insolvency Events. Upon the occurrence of any Event of Default described in Section 10.8 or 10.9, and all amounts due under the Loan Documents immediately shall become due and payable, all without written notice and without presentment, demand, protest, notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of acceleration of the maturity thereof, or any other notice of default of any kind, all of which are hereby expressly waived by Borrower; provided, however, if the Bankruptcy Party under Section 10.8 or 10.9 is other than Borrower, then all amounts due under the Loan Documents shall become immediately due and payable at Administrative Agent’s election.

Section 11.2Remedies - Other Events. Except as set forth in Section 11.1 above, while any Event of Default exists, Administrative Agent may (1) by written notice to Lead Borrower, declare the entire amount of the Loans to be immediately due and payable without presentment, demand, protest, notice of protest or dishonor, notice of intent to accelerate the maturity thereof, notice of acceleration of the matur ity thereof, or other notice of default of any kind, all of which are hereby expressly waived by Borrower, (2) terminate the obligation, if any, of the Lenders to advance amounts hereunder, and (3) exercise all rights and remedies therefor under the Loan Documents and at law or in equity.

Section 11.3Administrative Agent’s Right to Perform the Obligations. If Borrower shall fail, refuse or neglect to make any payment or perform any act required by the Loan Documents, then while any Event of Default exists, and without notice to or demand upon Borrower and without waiving or releasing any other right, remedy or recourse Administrative Agent or any Lender may have because of such Event of Default, Administrative Agent may (but shall not be obligated to) make such payment or perform such act for the account of and at the expense of Borrower, and shall have the right to enter upon the Project for such purpose and to take all such action thereon and with respect to the Project as it may deem necessary or appropriate. If Administrative Agent shall elect to pay any sum due with reference to the Project, Administrative Agent may do so in reliance on any bill, statement or assessment procured from the appropriate Governmental Authority or other issuer thereof without inquiring into the accuracy or validity thereof. Similarly, in making any payments to protect the security intended to be created by the Loan Documents, Administrative Agent shall not be bound to inquire into the validity of any apparent or threatened adverse title, Lien, encumbrance, claim or charge before making an advance for the purpose of preventing or removing the same. Additionally, if any Hazardous Materials affect or threaten to affect the Project, Administrative Agent may (but shall not be obligated to) give such notices and take such actions as it deems necessary or advisable in order to abate the discharge of any Hazardous Materials or remove the Hazardous Materials. Borrower shall indemnify, defend and hold Administrative Agent and the Lenders harmless from and against any and all losses, liabilities, claims, damages, expenses, obligations, penalties, actions, judgments, suits, costs or disbursements of any kind or nature whatsoever, including reasonable attorneys’ fees and disbursements, incurred or accruing by reason of any acts performed by Administrative Agent or any Lender pursuant to the provisions of this Section 11.3, including those arising from the joint, concurrent, or comparative negligence of Administrative Agent and any Lender, except as a result of Administrative Agent’s or any Lender’s gross negligence or willful misconduct. All sums paid by Administrative Agent pursuant to this Section 11.3, and all other sums expended by Administrative Agent or any Lender to which it shall be entitled to be indemnified, together with interest thereon at the Default Rate from the date of such payment or expenditure until paid, shall constitute additions to the Loans, shall be secured by the Loan Documents and shall be paid by Borrower to Administrative Agent upon demand.

ARTICLE 12

MISCELLANEOUS

Section 12.1Notices. Any notice required or permitted to be given under this Agreement shall be in writing and either shall be (a) mailed by certified mail, postage prepaid, return receipt requested, (b) sent by overnight air courier service, (c) personally delivered to a representative of the receiving party, or (d) sent by telecopy (provided an identical notice is also sent simultaneously by mail, overnight courier, or personal delivery as otherwise provided in this Section 12.1) to the intended recipient at the “Address for Notices” specified below its name on the signature pages hereof. Any communication so addressed and mailed shall be deemed to be given on the earliest of (1) when actually delivered, (2) on the first Business Day after deposit with an overnight air courier service, or (3) on the third Business Day after deposit in the United States mail, postage prepaid, in each case to the address of the intended addressee, and any communication so delivered in person shall be deemed to be given when receipted for by, or actually received by Administrative Agent, a Lender, Lead Borrower or Borrower, as the case may be. If given by telecopy, a notice shall be deemed given and received when the telecopy is transmitted to the party’s telecopy number specified above, and confirmation of complete receipt is received by the transmitting party during normal business hour s or on the next Business Day if not confirmed during normal business hours, and an identical notice is also sent simultaneously by mail, overnight courier, or personal delivery as otherwise provided in this Section 2.1. Any party may designate a change of address by written notice to each other party by giving at least ten (10) days’ prior written notice of such change of address.

Section 12.2 Amendments, Waivers, Etc.

(1) Subject to any consents required pursuant to this Section 12.2 and any other provisions of this Agreement and any other Loan Document which expressly require the consent, approval or authorization of the Majority Lenders, this Agreement and any other Loan Document may be modified or supplemented only by an instrument in writing signed by Borrower and Administrative Agent; provided that, Administrative Agent may (without any Lender’s consent) give or withhold its agreement to any amendments of the Loan Documents or any waivers or consents in respect thereof or exercise or refrain from exercising any other rights or remedies which Administrative Agent may have under the Loan Documents or otherwise provided that such actions do not, in Administrative Agent’s judgment reasonably exercised, materially adversely affect the value of any collateral, taken as a whole, or represent a departure from Administrative Agent’s standard of care described in Section 14.5, except that Administrative Agent will not, without the consent of such Lender, agree to any amendment, waiver or consent for which a Lender’s consent is required pursuant to Section 14.9.

(2) Notwithstanding anything to contrary contained in this Agreement, any modification or supplement of Article 14, or of any of the rights or duties of Administrative Agent hereunder, shall require the consent of Administrative Agent.

Section 12.3Limitation on Interest. It is the intention of the parties hereto to conform strictly to applicable usury laws. Accordingly, all agreements between Borrower, Administrative Agent and the Lenders with respect to the Loans are hereby expressly limited so that in no event, whether by reason of acceleration of maturity or otherwise, shall the amount paid or agreed to be paid to Administrative Agent or any Lender or charged by any Lender for the use, forbearance or detention of the money to be lent hereunder or otherwise, exceed the maximum amount allowed by law. If the Loans would be usurious under applicable law (including the laws of the State and the laws of the United States of America), then, notwithstanding anything to the contrary in the Loan Documents: (1) the aggregate of all consideration which constitutes interest under applicable law that is contracted for, taken, reserved, charged or received under the Loan Documents shall under no circumstances exceed the maximum amount of interest allowed by applicable law, and any excess shall be credited on the Notes by the holders thereof (or, if the Notes have been paid in full, refunded to Borrower); and (2) if maturity is accelerated by reason of an election by Administrative Agent in accordance with the terms hereof, or in the event of any prepayment, then any consideration which constitutes interest may never include more than the maximum amount allowed by applicable law. In such case, excess interest, if any, provided for in the Loan Documents or otherwis e, to the extent permitted by applicable law, shall be amortized, prorated, allocated and spread from the date of advance until payment in full so that the actual rate of interest is uniform through the term hereof. If such amortization, proration, allocation and spreading is not permitted under applicable law, then such excess interest shall be cancelled automatically as of the date of such acceleration or prepayment and, if theretofore paid, shall be credited on the Notes (or, if the Notes have been paid in full, refunded to Borrower). The terms and provisions of this Section 12.3 shall control and supersede every other provision of the Loan Documents. The Loan Documents are contracts made under and shall be construed in accordance with and governed by the laws of the State, except that if at any time the laws of the Unit ed States of America permit the Lenders to contract for, take, reserve, charge or receive a higher rate of interest than is allowed by the laws of the State (whether such federal laws directly so provide or refer to the law of any state), then such federal laws shall to such extent govern as to the rate of interest which the Lenders may contract for, take, reserve, charge or receive under the Loan Documents.

Section 12.4Invalid Provisions. If any provision of any Loan Document is held to be illegal, invalid or unenforceable, such provision shall be fully severable; the Loan Documents shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part thereof; the remaining provisions thereof shall remain in full effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance therefrom; and in lieu of such illegal, invalid or unenforceable provision there shall be added automati cally as a part of such Loan Document a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible to be legal, valid and enforceable.

Section 12.5Reimbursement of Expenses. Borrower shall pay or reimburse Administrative Agent and/or the Lenders within ten (10) Business Days of demand by the applicable party for: (1) all expenses incurred by Administrative Agent in connection with the Loans, including reasonable fees and expenses of Administrative Agent’s attorneys, environmental, engineering and other consultants, and fees, charges or taxes for the negotiation, recording or filing of Loan Documents, (2) all expenses of Administrative Agent in connection with the administration of the Loans, including audit costs, inspection fees, reasonable attorneys’ fees and disbursement, settlement of condemnation and casualty awards, and premiums for title insurance and endorsements thereto, (3) all of Administrative Agent’s reasonable costs and expenses (including reasonable fees and disbursements of Administrative Agent’s external counsel) incurred in connection with the syndication of the Loans to the Lenders, and (4) Administrative Agent and the Lenders for all amounts expended, advanced or incurred by Administrative Agent and the Lenders to collect the Notes, or to enforce the rights of Administrative Agent and the Lenders under this Agreement or any other Loan Document, or to defend or assert the rights and claims of Administrative Agent and the Lenders under the Loan Documents or with respect to the Project (by litigation or other proceedings), which amounts will include all court costs, reasonable attorneys’ fees and expenses, fees and expenses of financial adviso rs, fees of auditors and accountants, and investigation expenses as may be incurred by Administrative Agent and the Lenders in connection with any such matters (whether or not litigation is instituted), together with interest at the Default Rate on each such amount from the date of disbursement until the date of reimbursement to Administrative Agent and the Lenders, all of which shall constitute part of the Loans and shall be secured by the Loan Documents.

Section 12.6Approvals; Third Parties; Conditions. All approval rights retained or exercised by Administrative Agent and the Lenders with respect to leases, contracts, plans, studies and other matters are solely to facilitate the Lenders’ credit underwriting, and shall not be deemed or construed as a determination that the Lenders have passed on the adequacy thereof for any other purpose and may not be relied upon by Borrower or any other Person. This Agreement is for the sole and exclusive use of Administrative Agent, the Lenders, the Lead Bo rrower and Borrower and may not be enforced, nor relied upon, by any Person other than Administrative Agent, the Lenders, the Lead Borrower and Borrower. All conditions of the obligations of Administrative Agent and the Lenders hereunder, including any obligation to make advances, are imposed solely and exclusively for the benefit of Administrative Agent and the Lenders, their successors and assigns, and no other Person shall have standing to require satisfaction of such conditions or be entitled to assume that the Lenders will refuse to make advances in the absence of strict compliance with any or all of such conditions, and no other Person shall, under any circumstances, be deemed to be a beneficiary of such conditions, any and all of which may be freely waived in whole or in part by Administrative Agent and the Lenders at any time in their sole discretion.

Section 12.7Lenders and Administrative Agent Not in Control; No Partnership. None of the covenants or other provisions contained in this Agreement shall, or shall be deemed to, give Administrative Agent or any Lender the right or power to exercise control over the affairs or management of Borrower, the powers of Administrative Agent and the Lenders being limited to the rights to exercise the remedies referred to in the Loan Documents. The relationship between Borrower and the Lenders is, and at all times shall remain, solely that of debtor and cred itor. No covenant or provision of the Loan Documents is intended, nor shall it be deemed or construed, to create a partnership, joint venture, agency or common interest in profits or income between Administrative Agent, the Lenders, Lead Borrower and Borrower or to create an equity in the Project in Administrative Agent or any Lender. Administrative Agent and the Lenders neither undertake nor assume any responsibility or duty to Borrower or to any other person with respect to the Project or the Loans, except as expressly provided in the Loan Documents; and notwithstanding any other provision of the Loan Documents: (1) neither Administrative Agent nor any Lender is, nor shall be construed as, a partner, joint venturer, alter ego, manager, controlling person or other business associate or participant of any kind of Borrower or any Borrower Party or any of their respective stockholders, members, or partners and neither Administrative Agent nor any Lender intends to ever assume such st atus; (2) no Lender or Administrative Agent shall in any event be liable for any Debts, expenses or losses incurred or sustained by Borrower or any Borrower Party; and (3) no Lender or Administrative Agent shall be deemed responsible for or a participant in any acts, omissions or decisions of Borrower or any Borrower Party or any of their respective stockholders, members, or partners. Administrative Agent, the Lenders and Borrower disclaim any intention to create any partnership, joint venture, agency or common interest in profits or income between Administrative Agent, the Lenders and Borrower, or to create an equity in the Project in Administrative Agent or any Lender, or any sharing of liabilities, losses, costs or expenses.

Section 12.8 Time of the Essence. Time is of the essence with respect to this Agreement.

Section 12.9 Successors and Assigns. Subject to the provisions of Section 12.24, this Agreement shall be binding upon and inure to the benefit of Administrative Agent, the Lenders and Borrower and the respective successors and permitted assigns.

Section 12.10Renewal, Extension or Rearrangement. All provisions of the Loan Documents shall apply with equal effect to each and all promissory notes and amendments thereof hereinafter executed which in whole or in part represent a renewal, extension, increase or rearrangement of the Loans. For portfolio management purposes, the Lenders may elect to divide the Loans into two or more separate loans evidenced by separate promissory notes so long as the payment and other obligations of Borrower are not effectively increased or otherwise modified. ; Borrower agrees to cooperate with Administrative Agent and the Lenders and to execute such documents as Administrative Agent reasonably may request to effect such division of the Loans.

Section 12.11Waivers. No course of dealing on the part of Administrative Agent or any Lender, their officers, employees, consultants or agents, nor any failure or delay by Administrative Agent or any Lender with respect to exercising any right, power or privilege of Administrative Agent or any Lender under any of the Loan Documents, shall operate as a waiver thereof.

Section 12.12Cumulative Rights. Rights and remedies of Administrative Agent and the Lenders under the Loan Documents shall be cumulative, and the exercise or partial exercise of any such right or remedy shall not preclude the exercise of any other right or remedy.

Section 12.13Singular and Plural. Words used in this Agreement and the other Loan Documents in the singular, where the context so permits, shall be deemed to include the plural and vice versa. The definitions of words in the singular in this Agreement and the other Loan Documents shall apply to such words when used in the plural where the context so permits and vice versa.

Section 12.14Phrases. When used in this Agreement and the other Loan Documents, the phrase “including” shall mean “including, but not limited to,” the phrases “satisfactory to any Lender” or “satisfactory to Administrative Agent” shall mean in form and substance satisfactory to such Lender or Administrative Agent, as the case may be, in all respects, the phrases “with Lender’s consent”, “with Lender’s approval”, “with Administrative Agent’s consent” or “with Administrative Agent’s approval” shall mean such consent or approval at Lender’s or Administrative Agent’s, as the case may be, discretion, and the phrases “acceptable to Lender” or “acceptable to Administrative Agent” shall mean acceptable to Lender or Administrative Agent, as the case may be, at such party’s sole discretion.”

Section 12.15Exhibits and Schedules. The exhibits and schedules attached to this Agreement are incorporated herein and shall be considered a part of this Agreement for the purposes stated herein.

Section 12.16Titles of Articles, Sections and Subsections. All titles or headings to articles, sections, subsections or other divisions of this Agreement and the other Loan Documents or the exhibits hereto and thereto are only for the convenience of the parties and shall not be construed to have any effect or meaning with respect to the other content of such articles, sections, subsections or other divisions, such other content being controlling as to the agreement between the parties hereto.

Section 12.17Promotional Material. Borrower authorizes Administrative Agent and each of the Lenders to issue press releases, advertisements and other promotional materials in connection with Administrative Agent’s or such Lender’s own promotional and marketing activities, and describing the Loans in general terms or in detail and Administrative Agent’s or such Lender’s participation in the Loans. All references to Administrative Agent or any Lender contained in any press release, advertisement or promotional material issued by Borrower shall be approved in writing by Administrati ve Agent and such Lender in advance of issuance.

Section 12.18Survival. All of the representations, warranties, covenants, and indemnities of Borrower hereunder (including environmental matters under Article 5, the obligations under Sections 2.9(1), 2 .9(5) and 2.9(6)), and under the indemnification provisions of the other Loan Documents shall survive (a) the repayment in full of the Loans and the release of the Liens evidencing or securing the Loans, (b) the transfer (by sale, foreclosure, conveyance in lieu of foreclosure or otherwise) of any or all right, title and interest in and to the Project to any party, whether or not an Affiliate of Borrower and (c) in the case of any Lender that may assign any interest in its Commitment or Loans hereunder in accordance with the terms of this Agreement, the making of such assignment, notwithstanding that such assigning Lender may cease to be a “Lender” hereunder.

Section 12.19WAIVER OF JURY TRIAL. BORROWER, ADMINISTRATIVE AGENT AND EACH LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF EITHER PARTY OR ANY EXERCISE BY ANY PARTY OF THEIR RESPECTIVE RIGHTS UNDER THE LOAN DOCUMENTS OR IN ANY WAY RELATING TO THE LOANS OR THE PROJECT (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS AGREEMENT, AND A NY CLAIM OR DEFENSE ASSERTING THAT THIS AGREEMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). THIS WAIVER IS A MATERIAL INDUCEMENT FOR ADMINISTRATIVE AGENT AND EACH LENDER TO ENTER THIS AGREEMENT.

Section 12.20Remedies of Borrower. It is expressly understood and agreed that, notwithstanding any applicable law or any provision of this Agreement or the other Loan Documents to the contrary, the liability of Administrative Agent and each Lender (including their respective successors and assigns) and any recourse of Borrower against Administrative Agent and each Lender shall be limited solely and exclusively to their respective interests in the Loans and/or Commitments or the Project. Without limiting the foregoing, in the event that a claim or adjudication is made that Administrative Agent, any of th e Lenders, or their agents, acted unreasonably or unreasonably delayed acting in any case where by applicable law or under this Agreement or the other Loan Documents, Administrative Agent, any Lender or any such agent, as the case may be, has an obligation to act reasonably or promptly, or otherwise violated this Agreement or the Loan Documents, Borrower agrees that none of Administrative Agent, the Lenders or their agents shall be liable for any incidental, indirect, special, punitive, consequential or speculative damages or losses resulting from such failure to act reasonably or promptly in accordance with this Agreement or the other Loan Documents.

Section 12.21Governing Law.

(1) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY ADMINISTRATIVE AGENT AND LENDERS AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTES DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE AND ANY APPLICABLE LAW OF THE UNITED STATES OF AME RICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIENS AND SECURITY INTERESTS CREATED PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROJECT IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY LAW, EACH OF BORROWER, ADMINISTRATIVE AGENT AND EACH LENDER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT AND THE NOTES, AND THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

(2) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST ADMINISTRATIVE AGENT, ANY LENDER OR BORROWER ARISING OUT OF OR RELATING TO THE LOAN DOCUMENTS MAY AT ADMINISTRATIVE AGENT’S OPTION (WHICH DECISION SHALL BE MADE BY THE MAJORITY LENDERS) BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND BORROWER WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND APPOINT NATIONAL REGISTERED AGENTS, INC., 875 AVENUE OF THE AMERICAS, SUITE 501, NEW YORK, NY 10001 AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER (A) SHALL GIVE PROMPT NOTICE TO ADMINISTRATIVE AGENT OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (B) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (C) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YOR K, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.

Section 12.22Entire Agreement. This Agreement and the other Loan Documents embody the entire agreement and understanding between Administrative Agent, the Lenders and Borrower and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof. Accordingly, the Loan Documents may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties. If any conflict or inconsiste ncy exists between this Agreement and any of the other Loan Documents, the terms of this Agreement shall control.

Section 12.23Counterparts. This Agreement may be executed in multiple counterparts, each of which shall constitute an original, but all of which shall constitute one document.

Section 12.24 Assignments and Participations.

(1) Assignments by Borrower. Borrower may not assign any of its rights or obligations hereunder or under the Notes without the prior consent of all of the Lenders and Administrative Agent.

(2) Assignments by the Lenders. Each Lender may assign any of its Loans, its Note and its Commitment (but only with the consent of Administrative Agent); provided that:

(a) no such consent by Administrative Agent shall be required in the case of any assignment by any Lender to another Lender or an Affiliate of such Lender or such other Lender (provided that in the case of an assignment to an Affiliate of the assigning Lender, the assigning Lender will not be released from its obligations under the Loan Documents and Administrative Agent may continue to deal only with such assigning Lender);

(b) except to the extent Administrative Agent shall otherwise consent, any such partial assignment (other than to another Lender or an Affiliate of a Lender) shall be in an amount at least equal to $10,000,000;

(c) each such assignment (including an assignment to another Lender or an Affiliate of a Lender) by a Lender of its Loans or Commitment shall be made in such manner so that the same portion of its Loans and Commitment is assigned to the respective assignee;

(d) subject to the applicable Lender’s compliance with the provisions of clauses (b) and (c) above, Administrative Agent’s consent to an assignment shall not be unreasonably withheld, delayed or conditioned if (i) such assignment is made to an Eligible Assignee, and (ii) the provisions of clause (e) have been satisfied; and

(e) upon execution and delivery by the assignee (even if already a Lender) to Borrower and Administrative Agent of an Assignment and Acceptance pursuant to which such assignee agrees to become a “Lender” hereunder (if not already a Lender) having the Commitment and Loans specified in such instrument, and upon consent thereto by Administrative Agent to the extent required above, the assignee shall have, to the extent of such assignment (unless otherwise consented to by Administrative Agent), the obligations, rights and benefits of a Lender hereunder holding the Commitment and Loans (or portions thereof) assigned to it (in addition to the Commitment and Loans, if any, theretofore held by such assignee) and the assigning Lender shall, to the extent of such assignme nt, be released from the Commitment (or portion thereof) so assigned. Upon each such assignment the assigning Lender shall pay Administrative Agent a processing and recording fee of $3,500 (unless the assignee is an Affiliate of the Assigning Lender) and the reasonable fees and disbursements of Administrative Agent’s counsel incurred in connection therewith.

(3) Participations.

(a) A Lender may sell or agree to sell to one or more other Persons (each a “Participant”) a participation in all or any part of any Loans held by it, or in its Commitment, provided (A) such Lender’s obligations under this Agreement and the other Loan Documents shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (C) Borrower, Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents. In no event shall a Lender that sells a participation agree with the Participant to take or refrain from taking any action hereunder or under any other Loan Document except that such Lender may agree with the Participant that it will not, without the consent of the Participant, agree to (i) increase or extend the term of such Lender’s Commitment, (ii) extend the date fixed for the payment of principal of or interest on the related Loan or Loans or any portion of any fee hereunder payable to the Participant, (iii) reduce the amount of any such payment of principal, (iv) reduce the rate at which interest is payable thereon, or any fee hereunder payable to the Participant, to a level below the rate at which the Participant is entitled to receive such interest or fee or (v) consent to any modification, supplement or waiver hereof or of any of the other Loan Documents to the extent that the same, under Section 12.2, requires the consent of each Lender. Subject to subsection (3)(b) of this Section 12.24, Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.9(1), 2.9(5), and 2.9(6) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (2) of this Section 12.24. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 12.24 as though it were a Lender; provided that such Participant agrees to be subject to Section 12.24 as though it were a Lender.

(b) A Participant shall not be entitled to receive any greater payment under Section 2.9(1) or 2.9(6) than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Borrower’s prior written consent. A Participant that is a non-U.S. Person that would become a Lender shall not be entitled to the benefits of Section 2.9(6) unless Lead Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of Borrower, to comply with Section 2.9(6) as though it were a Lender

(4) Certain Pledges. In addition to the assignments and participations permitted under the foregoing provisions of this Section 12.24 (but without being subject thereto), any Lender may (without notice to Borrower, Administrative Agent or any other Lender and without payment of any fee) assign and pledge all or any portion of its Loans and its Note to any Federal Reserve Bank as collateral security pursuant to Regulation A and any operating circular issued by such Federal Reserve Bank, and such Loans and Note shall be fully transferable as provided th erein. No such assignment shall release the assigning Lender from its obligations hereunder.

(5) Provision of Information to Assignees and Participants. A Lender may furnish any information concerning Borrower, any Borrower Party or any of their respective Affiliates or the Project in the possession of such Lender from time to time to assignees and participants (including prospective assignees and participants); provided that such assignee and participant agree to be bound by the terms of Section 12.29.

(6) No Assignments to Borrower or Affiliates. Anything in this Section 12.24 to the contrary notwithstanding, no Lender may assign or participate any interest in any Loan held by it hereunder to Borrower or any of its Affiliates without the prior consent of each Lender.

Section 12.25Brokers. Borrower hereby represents to Administrative Agent and each Lender that Borrower has not dealt with any broker, underwriters, placement agent, or finder in connection with the transactions contemplated by this Agreement and the other Loan Documents. Borrower hereby agrees to indemnify and hold Administrative Agent and each Lender harmless from and against any and all claims, liabilities, costs and expenses of any kind in any way relating to or arising from a claim by any Person that such Person acted on behalf of Borrower in c onnection with the transactions contemplated herein.

Section 12.26 Right of Set-off.

(1) Upon the occurrence and during the continuance of any Event of Default, each of the Lenders is, subject (as between the Lenders) to the provisions of subsection (3) of this Section 12.26, hereby authorized at any time and from time to time, without notice to Borrower (any such notice being expressly waived by Borrower) and to the fullest extent permitted by law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) at any time he ld, and other indebtedness at any time owing, by such Lender in any of its offices, in Dollars or in any other currency, to or for the credit or the account of Borrower against any and all of the respective obligations of Borrower now or hereafter existing under the Loan Documents, irrespective of whether or not such Lender or any other Lender shall have made any demand hereunder and although such obligations may be contingent or unmatured and such deposits or indebtedness may be unmatured. Each Lender hereby acknowledges that the exercise by any Lender of offset, set-off, banker’s lien, or similar rights against any deposit or other indebtedness of Borrower whether or not located in New York or any other state with certain laws restricting lenders from pursuing multiple collection methods, could result under such laws in significant impairment of the ability of all the Lenders to recover any further amounts in respect of the Loan. Therefore, each Lender agrees that no Lender shall exercise any such right of set-off, banker’s lien, or otherwise, against any assets of Borrower (including all general or special, time or demand, provisional or other deposits and other indebtedness owing by such Lender to or for the credit or the account of Borrower) without the prior written consent of Administrative Agent.

(2) Each Lender shall promptly notify Lead Borrower and Administrative Agent after any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of the Lenders under this Section 12.26 are in addition to other rights and remedies (including other rights of set-off) which the Lenders may have.

(3) Each Lender agrees that it shall turn over to Administrative Agent any payment (whether voluntary or involuntary, through the exercise of any right of setoff or otherwise) on account of the Loans held by it in excess of its ratable portion (in accordance with this Agreement and any separate agreement among Administrative Agent and the Lenders) of payments on account of the Loans obtained by all the Lenders.

Section 12.27Limitation on Liability of Administrative Agent’s and the Lenders’ Officers, Employees, etc. Any obligation or liability whatsoever of Administrative Agent or any Lender which may arise at any time under this Agreement or any other Loan Document shall be satisfied, if at all, out of Administrative Agent’s or such Lender’s respective assets only. No such obligation or liability shall be personally binding upon, nor shall resort for the enforcement thereof be had to, the property of any of Administrative Agent’s or any Lender’s shareholders, directors, offi cers, employees or agents, regardless of whether such obligation or liability is in the nature of contract, tort or otherwise.

Section 12.28Cooperation with Syndication. Borrower acknowledges that Arranger intends to syndicate a portion of the Commitments to one or more Lenders (the “Syndication”) and in connection therewith, Borrower will take all actions as Arranger may reasonably request to assist Arranger in its Syndication effort. Without limiting the generality of the foregoing, Borrower shall, at the request of Arranger (i) facilitate the review of the Loan and the Project by any prospectiv e Lender; (ii) assist Arranger and otherwise cooperate with Arranger in the preparation of information offering materials (which assistance may include reviewing and commenting on drafts of such information materials and drafting portions thereof); (iii) deliver updated information on Borrower and the Project; (iv) make representatives of Borrower available to meet with prospective Lenders at tours of the Project and bank meetings; (v) facilitate direct contact between the senior management and advisors of Borrower and any prospective Lender; and (vi) provide Arranger with all information reasonably deemed necessary by it to complete the Syndication successfully. Borrower agrees to take such further action, in connection with documents and amendments to the Loan Documents, as may reasonably be required to effect such Syndication; provided, however, that notwithstanding any other provision of this Section 12.28 or Section 12.29 to the contrary, Borrower shall not be required to enter into any such documents and amendments which would alter any of the material economic terms of the Loan Documents or which would create new or greater obligations or liabilities on Borrower Parties under the Loan Documents.

Section 12.29Severance of Loan. Loan Components. The Administrative Agent shall have the right, at any time, with respect to all or any portion of the Loan, to (a) cause the Notes, the Mortgage and the other Security Documents to be severed and/or split into two or more separate notes, mortgages and other security agreements, so as to evidence and secure one or more senior and subordinate mortgage loans, (b) create one or more senior and subordinate notes (i.e., an A/B or A/B/C structure) secured by the Mortgage and the other Security Documen ts, (c) create multiple components of the Notes (and allocate or re-allocate the outstanding principal amount of the Loan among such components) or (d) otherwise sever the Loan into two or more loans secured by the Mortgage and the other Security Documents (each of clauses (a) through (d), a “Bifurcation”); in each such case, in whatever proportions and priorities as Administrative Agent may so direct in its discretion to Administrative Agent; provided, however, that in each such instance (i) the outstanding principal amount of all the Notes evidencing the Loan (or components of such Notes) immediately following such Bifurcation shall be equal to the outstanding principal amount of the Loan immediately prior to such Bifurcation, and (ii) the weighted average Applicable Margin and/or Base Rate, as applicable, with respect to the new notes immediately after such Bifurcation and at all times prior to the occurrence o f any Event of Default shall not exceed the weighted average Applicable Margin and/or Base Rate, as applicable, with respect to the initial Notes delivered hereunder (as such interest rates are subject to being adjusted from time to time in accordance herewith, including as a result of the accrual of interest at the Default Rate). If requested by Administrative Agent in writing, Borrower shall execute within ten (10) days after such request, a severance agreement, amendments to or amendments and restatements of any one or more Loan Documents, and such documentation as Administrative Agent may reasonably request to evidence and/or effectuate any such Bifurcation, all in form and substance reasonably satisfactory to Administrative Agent.

Section 12.30Confidentiality. Each of Administrative Agent and the Lenders and Borrower Parties and Sponsor agrees to maintain the confidentiality of the Confidential Information, except that Confidential Information may be disclosed (a) to it and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made shall be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority, (c) to the extent required by Applicable Law or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) to any assignee or pledgee of or Participant in, or any prospective assignee or pledgee of or Participant in, any of its rights or obligations under this Agreement or any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to Borrower and its obligations, (g) with the consent of Borrower or Administrative Agent, as applicable, or (h) to the extent such Confidential Information (i) becomes publicly available other than as a result of a breach of this Section 12.29 or of arrangements entered into pursuant hereto or (ii) becomes availabl e to such party from a source other than Borrower or its Affiliates or the Administrative Agent or the Lender or their Affiliates, as applicable; provided, however, the obligation to maintain the confidentiality of the Confidential Information provided hereunder shall expire twelve (12) months after the date upon which the Loans hereunder are indefeasibly paid in full. Administrative Agent and each Lender, to the extent required to maintain the confidentiality of Information as provided in this Section 12.29, shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Confidential Information as a commercial banker exercising reasonable and customary business practices would accord to its own confidential information. Notwithstanding anything herein to the contrary, the information subject to this Section 12.29 shall not include, and Administrative Agent and each Lender may disclose without limitation of any kind, any information with respect to the “tax treatment” and “tax structure” (in each case, within the meaning of Treasury Regulation Section 1.6011 4) of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are provided to Administrative Agent or such Lender relating to such tax treatment and tax structure. For purposes of this Section 12.29, the information that shall be treated as Confidential Information shall mean, in the case of Administrative Agent and the Lenders, written non-public information concerning the Project and, in the case of Borrower, information concerning the terms and conditions set forth in the Loan Documents.

Section 12.31Designation of Lead Borrower as Agent for Borrower.

(1) Each Borrower hereby irrevocably designates and appoints the Lead Borrower as that Borrower’s agent to obtain loans and advances under the Loan. As the disclosed principal for its agent, each Borrower shall be obligated to the Agent and the Lenders on account of loans and advances so made under the Loan as if made directly by the Lenders to that Borrower, notwithstanding the manner by which such loans and advances are recorded on the books and records of the Lead Borrower and/or of any Borrower (including, without limitation, on account of any such treatment of said loan or advance as an equity investment in a Borrower by Lead Borrower). Lead Borrower shall ensure that each Borrower receives from the Loan proceeds an amount or benefit that is a reasonably equivalent value for the grants of security made by each Borrower to Administrative Agent.

(2) Each Borrower recognizes that credit available to it under the Loan is in excess of and on better terms than it otherwise could obtain on and for its own account and that one of the reasons therefor is its joining in the credit facility contemplated herein with all other Borrowers. Consequently, each Borrower, jointly and severally, hereby assumes and agrees fully, faithfully, and punctually to discharge all obligations of all of the Borrowers under the Loan Documents.

(3) The proceeds of the Loan shall be deposited into an account in the name of the Lead Borrower or as otherwise indicated by the Lead Borrower. Neither the Agent nor any Lender shall have any obligation to see to the application of such proceeds.

(4) Each Borrower hereby irrevocably designates and appoints the Lead Borrower as that Borrower’s attorney-in-fact to act in the Borrower’s name and stead and to do and perform all matters, to grant to the Agent for the benefit of the Lenders a security interest in the Collateral, transact all business, and make, execute and acknowledge all Loan Documents and other instruments relating to this Agreement including but not limited to, this Agreement, the Note, and the Security Documents. The Borrowers hereby acknowledge and agree that the power of attorney created hereby is coupled with an interest.

ARTICLE 13

RECOURSE LIABILITY

Section 13.1Recourse Liability . No past, present or future member, or any past, present or future shareholder, partner, member, officer, employee, servant, executive, director, agent, authorized representative or Affiliate of Borrower or any member of Borrower, (each such Person, an “Exculpated Party”) shall be personally liable for payments due hereunder or under any other Loan Document or for the performance of any obligation, or breach of any representation or warranty made by Borrower hereunder or thereunder. The sole recourse of the Lenders and Administrative Agent for satisfaction of the obligations of Borrower hereunder and under any other Loan Document shall be against Borrower and its assets and not against any assets or property of any such Exculpated Party other than the direct or indirect ownership interest of such Exculpated Party in Borrower. In the event that a Potential Default or Event of Default occurs in connection with such obligations, no action shall be brought against any such Exculpated Party by virtue of its direct or indirect ownership interest in Borrower. In the event of foreclosure or other sale or disposition of the Project, no judgment for any deficiency upon the obligations hereunder or under any other Loan Document shall be obtainable by the Lenders or Administrative Age nt against any such Exculpated Party. Notwithstanding the foregoing, nothing in this Section 13.1 shall affect or diminish the obligations of Borrower or Guarantor under or in respect of each Loan Document to which it is a party, including Guarantor Documents (including the right to name any Guarantor in any foreclosure action in connection with its obligations under the Guarantor Documents) and the Co-Borrower Documents. Notwithstanding the foregoing provisions of this Section 13.1, each Exculpated Party shall be personally (and on a full recourse basis) liable for and shall indemnify and defend Administrative Agent and the Lenders from and against, and shall hold Administrative Agent and th e Lenders harmless of, from and against any deficiency, liability, loss, damage, costs, and expenses (including legal fees and disbursements) suffered by Administrative Agent and/or the Lenders and caused by, or arising out of or as a result of any of the following: (i) such Person’s commission of a criminal act, (ii) such Person’s failure to comply with the provisions of the Loan Documents prohibiting a transfer or Change of Control; (iii) such Person’s misappropriation of any cash flow or other revenue derived from or in respect of the Project, including security deposits, insurance proceeds, condemnation awards, or any rental, sales or other income derived directly or indirectly from the Project, or the misapplication of any of the foregoing sums, in either event, in contravention of any provision of this Agreement or the other Loan Documents; (iv) such Person’s fraud or misrepresentation or inaccurate certification made at any time in connection with the Loan Documents or the Loans; (v) such Person’s intentional interference with Administrative Agent’s (or the Lenders’) exercise of its rights under any of the Loan Documents; (vi) such Person’s intentional destruction or removal of fixtures or personal property securing the Loans unless replaced by items of equal value and utility; (vii) such Person’s misapplication or misappropriation of funds disbursed from the Security Accounts or the Controlled Accounts; (viii) such Person’s commissions of intentional waste to or of the Project or any portion thereof or failure to maintain the Project in the manner required by the Loan Documents; (ix) failure to maintain the insurance coverage required by the Loan Documents; (x) failure to pay taxes, assessments and any other charges, including, without limitation, charges for labor or materials, which could result in prior liens against any portion of the Project; (xi) willful misconduct; (xii) Borrower files a voluntary petition under the Federal Ba nkruptcy Code or any other Federal or state bankruptcy or insolvency law; (xiii) such Person files or joins in the filing of, or solicits or acts in concert with, or colludes or conspires with petitioning creditors with respect to, an involuntary petition against Borrower under the Federal Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (xiv) Borrower files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Federal Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (xv) such Person consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or any portion of the Project; (xvi) Borrower makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; or (xvii) Borrower violates any of provisions se t forth in the definition of Single Purpose Entity and such violation results in a substantive consolidation of the Borrower or its assets in the bankruptcy of an Affiliate.

Section 13.2No Waiver of Certain Rights. Notwithstanding anything to the contrary contained in this Agreement or the other Loan Documents, (A) neither of Administrative Agent nor the Lenders shall be deemed to have waived any right which Administrative Agent or any Lender may have under Sections 506(a), 506(b), 1111(b) or any other provision of the Federal Bankruptcy Code, as such sections may be amended, to file a claim for the full amount due to Administrative Agent or such Lender under the Loan Documents or to require that all collateral shall continue to secure the amounts due under the Loan Documents and (B) Administrative Agent may pursue any power of sale, bring any foreclosure action, any action for specific performance, or any other appropriate action or proceedings against Borrower or any other Person for the purpose of enabling the Administrative Agent and the Lenders to realize upon the collateral for the Loans (including, without limitation, any Net Operating Income to the extent provided for in the Loan Documents) or to obtain the appointment of a receiver.

ARTICLE 14

ADMINISTRATIVE AGENT

Section 14.1Appointment, Powers and Immunities. Each Lender hereby appoints and authorizes Administrative Agent to act as its agent hereunder and under the other Loan Documents with such powers as are specifically delegated to Administrative Agent by the terms of this Agreement and of the other Loan Documents, together with such other powers as are reasonably incidental thereto. Administrative Agent (which term as used in this sentence and in Section 14.5 and the first sentence of Section 14.6 shall include reference to its Affiliates and its own and its Affiliates’ officers, directors, employees and agents):

(a) shall have no duties or responsibilities except those expressly set forth in this Agreement and in the other Loan Documents, and shall not by reason of this Agreement or any other Loan Document be a trustee for any Lender except to the extent that Administrative Agent acts as an agent with respect to the receipt or payment of funds, nor shall Administrative Agent have any fiduciary duty to Borrower nor shall any Lender have any fiduciary duty to Borrower or any other Lender;

(b) shall not be responsible to the Lenders for any recitals, statements, representations or warranties contained in this Agreement or in any other Loan Document, or in any certificate or other document referred to or provided for in, or received by any of them under, this Agreement or any other Loan Document (except of representations, warranties and certifications expressly made by Administrative Agent to a Lender in writing as set forth in any Assignment and Acceptance executed by Administrative Agent in favor of a Lender), or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement, any Note or any other Loan Document or any other document referred to or provided for herein or therein or for any failure by Borrower or any othe r Person to perform any of its obligations hereunder or thereunder; and

(c) shall not be responsible for any action taken or omitted to be taken by it hereunder or under any other Loan Document or under any other document or instrument referred to or provided for herein or therein or in connection herewith or therewith, except to the extent any such action taken or omitted violates Administrative Agent’s standard of care set forth in the first sentence of Section 14.5.

(d) shall not, except to the extent expressly instructed by the Majority Lenders with respect to collateral security under the Security Documents, be required to initiate or conduct any litigation or collection proceedings hereunder or under any other Loan Document; and

(e) shall not be required to take any action which is contrary to this Agreement or any other Loan Document or Applicable law.

The relationship between Administrative Agent and each Lender is a contractual relationship only, and nothing herein shall be deemed to impose on Administrative Agent any obligations other than those for which express provision is made herein or in the other Loan Documents. Administrative Agent may employ agents and attorneys-in-fact, and may delegate all or any part of its obligations hereunder, to third parties and shall not be responsible for the negligence or misconduct of any such agents, attorneys-in-fact or third parties selected by it in good faith. Administrative Agent may deem and treat the payee of a Note as the holder thereof for all purposes hereof unless and until a notice of the assignment or transfer thereof shall have been filed with Administrative Agent, any such assignment or transfer to be subject to the provisions of Section 12.24. Except to the extent expressly provided in Sections 14.8, the provisions of this Article 14 are solely for the benefit of Administrative Agent and the Lenders, and Borrower shall not have any rights as a third-party beneficiary of any of the provisions hereof and the Lenders may Modify or waive such provisions of this Article 14 in their sole and absolute discretion..

Section 14.2Reliance by Administrative Agent. Administrative Agent shall be entitled to rely upon any certification, notice or other communication (including, without limitation, any thereof by telephone, telecopy, telegram or cable) reasonably believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons, and upon advice and statements of legal counsel, independent accountants and other experts selected by Administrative Agent. As to any matters not expressly provided for by this Agreement or any other Loan Document, Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder or thereunder in accordance with instructions given by the Majority Lenders, and such instructions of the Majority Lenders and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders.

Section 14.3 Defaults.

(1) Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of a Potential Default or Event of Default, other than a payment Event of Default arising out of Section 10.1, unless Administrative Agent has received notice from a Lender, Lead Borrower or Borrower specifying such Potential Default or Event of Default and stating that such notice is a “Notice of Default”. In the event that Administrative Agent receives such a notice of the occurrence of a Potential Default or Event of Default, Administrative Agent shall give prompt notice thereof to the Lenders. Within ten (10) days of delivery of such notice of Potential Default or Event of Default fr om Administrative Agent to the Lenders (or such shorter period of time as Administrative Agent determines is necessary), Administrative Agent and the Lenders shall consult with each other to determine a proposed course of action. Administrative Agent shall (subject to Section 14.7) take such action with respect to such Potential Default or Event of Default as shall be directed by the Majority Lenders, provided that, (A) unless and until Administrative Agent shall have received such directions, Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, including decisions (1) to make protective advances that Administrative Agent determines are necessary to protect or maintain the Project and (2) to foreclose on any of the Project o r exercise any other remedy, with respect to such Potential Default or Event of Default as it shall deem advisable in the interest of the Lenders except to the extent that this Agreement expressly requires that such action be taken, or not be taken, only with the consent or upon the authorization of all of the Lenders and (B) no actions approved by the Majority Lenders shall violate the Loan Documents or applicable law; provided further that if no consensus is reached by Majority lenders within one hundred twenty (120) days, Administrative Agent shall commence a foreclosure action with respect to the Project. Each of the Lenders acknowledges and agrees that no individual Lender may separately enforce or exercise any of the provisions of any of the Loan Documents (including the Notes) other than through Administrative Agent. Administrative Agent shall advise the Lenders of all material actions which Administrative Agent takes in accordance with the provisions of this Section 14.3(1) and shall continue to consult with the Lenders with respect to all of such actions. Notwithstanding the foregoing, if the Majority Lenders shall at any time direct that a different or additional remedial action be taken from that already undertaken by Administrative Agent, including the commencement of foreclosure proceedings, such different or additional remedial action shall be taken in lieu of or in addition to, the prosecution of such action taken by Administrative Agent; provided that all actions already taken by Administrative Agent pursuant to this Section 14.3(1) shall be valid and binding on each Lender. All money (other th an money subject to the provisions of Section 14.7) received from any enforcement actions, including the proceeds of a foreclosure sale of the Project, shall be applied, first, to the payment or reimbursement of Administrative Agent for expenses incurred in accordance with the provisions of Sections 14.3(2), (3) and (4) and 14.5 and to the payment of the Administrative Fee to the extent not paid by B orrower pursuant to Section 14.11, second, to the payment or reimbursement of the Lenders for expenses incurred in accordance with the provisions of Sections 14.3(2), (3) and (4) and 14.5; third, to the payment or reimbursement of the Lenders for any advances made pursuant to Sec tion 14.3(2); and fourth, to the Lenders in accordance with their respective Proportionate Shares (and, if applicable, to Eurohypo Counterparty under any Hedge Agreement for its Additional Interest in accordance with Section 9.15), unless an Unpaid Amount is owed pursuant to Section 14.12, in which event such Unpaid Amount shall be deducted from the portion of such proceeds of the Defaulting Lender and be applied to payment of such Unpaid Amount to the Special Advance Lender.

(2) All losses with respect to interest (including interest at the Default Rate) and other sums payable pursuant to the Notes or incurred in connection with the Loans shall be borne by the Lenders in accordance with their respective proportionate shares of the Loans. All losses incurred in connection with the Loans, the enforcement thereof or the realization of the security therefor, shall be borne by the Lenders in accordance with their respective proportionate shares of the Loan, and the Lenders shall promptly, upon request, remit to Administrative Agent their respective proportionate shares of (i) any actual out of pocket expenses incurred by Administrative Agent in connection with any Default to the extent any expenses have not been paid by Borrower, (ii) any advances made to pay taxes or insurance or otherwise to preserve the Lien of the Security Documents or to preserve and protect the Project, whether or not the amount necessary to be advanced for such purposes exceeds the amount of the Mortgage, and (iii) any other actual out of pocket expenses incurred in connection with the enforcement of the Mortgage or other Loan Documents. To the extent any such advances are recovered in connection with the enforcement of the Mortgage or the other Loan Documents, each Lender shall be paid its proportionate share of such recovery after deduction of the expenses of Administrative Agent and the Lenders.

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(3) If, at the direction of the Majority Lenders or otherwise as provided in Section 14.3(1), any action(s) is brought to collect on the Notes or enforce the Security Documents or any other Loan Document, such action shall (to the extent permitted under applicable law and the decisions of the court in which such action is brought) be an action brought by Administrative Agent and the Lenders, collectively, to collect on all or a portion of the Notes or enforce the Security Documents or any other Loan Document and counsel selected by Administrative Agent shall prosecute any such action on behalf of Administrative Agent and the L enders, and Administrative Agent and the Lenders shall consult and cooperate with each other in the prosecution thereof. All decisions concerning the appointment of a receiver while such action is pending, the conduct of such receivership, the conduct of such action, the collection of any judgment entered in such action and the settlement of such action shall be made by Administrative Agent. The costs and expenses of any such action shall be borne by the Lenders in accordance with each of their respective proportionate shares.

(4) If, at the direction of the Majority Lenders or otherwise as provided in Section 14.3(1), any action(s) is brought to foreclose the Mortgage, such action shall (to the extent permitted under applicable law and the decisions of the court in which such action is brought) be an action brought by Administrative Agent and the Lenders, collectively, to foreclose all or a portion of the Mortgage and collect on the Notes. Counsel sele cted by Administrative Agent shall prosecute any such foreclosure on behalf of Administrative Agent and the Lenders and Administrative Agent and the Lenders shall consult and cooperate with each other in the prosecution thereof. All decisions concerning the appointment of a receiver, the conduct of such foreclosure, the acceptance of a deed in lieu of foreclosure, the bid on behalf of Administrative Agent and the Lenders at the foreclosure sale of the Project, the manner of taking and holding title to the Project (other than as set forth in subsection (6) below), and the commencement and conduct of any deficiency judgment proceeding shall be made by Administrative Agent. All decisions concerning the sale of the Project after foreclosure shall be made by the Majority Lenders, provided, however, the Lenders agree that if Administrative Agent receives a bona fide “all cash” (as determined by Administrative Agent in its reasonable discretion) offer for the purchase of the entire Project which has been approved in writing by Administrative Agent and (i) such offer (A) equals or exceeds ninety percent (90%) of the most recent appraised value of the Project as established by an Appraisal that has been completed within six (6) months of such offer and (B) is equal to or greater than ninety percent (90%) of the outstanding principal balance of the Loan, and (ii) the consent of the Majority Lenders is not achieved within ninety (90) days from the date that Administrative Agent received such offer, then, notwithstanding anything to the contrary contained in this subsection (4), Administrative Agent is irrevocably authorized to accept such offer on behalf of all Lenders. The costs and expenses of foreclosure will be borne by the Lenders in accordance with their respective proportionate shares.

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(5) If title is acquired to the Project after a foreclosure sale or by a deed in lieu of foreclosure, title shall be held by Administrative Agent in its own name in trust for the Lenders or, at Administrative Agent’s election, in the name of a wholly owned subsidiary of Administrative Agent on behalf of the Lenders, or a subsidiary wholly owned by the Lenders and managed by the Administrative Agent.

(6) If Administrative Agent (or its subsidiary) acquires title to the Project or is entitled to possession of the Project during or after the foreclosure, all material decisions with respect to the possession, ownership, development, construction, control, operation, leasing, and management of the Project shall be made by Administrative Agent. All income or other money received after so acquiring title to or taking possession of the Project with respect to the Project, including income from the operation and management of the Project and the proceeds of a sale of the Project, shall be applied (subject to the terms of any separate agreement among Administrative Agent and the Lenders), first, to the payment or reimbursement of Administrative Agent and the expenses incurred in accordance with the provisions of this Article 14 and to the payment of the Administrative Fee to the extent not paid by Borrower pursuant to Section 14.11, second, to the payment of operating expenses, taxes and insurance with respect to the Project; third, to the establishment of reasonable reserves for the operation of the Project; fourth, to the payment or reimbursement of the Lenders for any advances made pursuant to Section 14.3(2); fifth to fund any capital improvement, leasing and other reserves; and sixth, to the Lenders in accordance with their respective Proportionate Shares (and, if applicable, to Eurohypo Counterparty under any Hedge Agreement for its Additional Interest in accordance with Section 9.15), unless an Unpaid Amount is owed pursuant to Section 14.12, in which event such Unpaid Amount shall be deducted from the portion of such proceeds of the Defa ulting Lender and be applied to payment of such Unpaid Amount to the Special Advance Lender.

Section 14.4Rights as a Lender. With respect to its Commitment and the Loans made by it Eurohypo (and any successor acting as Administrative Agent) in its capacity as a Lender hereunder shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not acting as Administrative Agent, and the term “Lender” or “Lenders” shall, unless the context otherwise indicates, include Administrative Agent in its individual capacity. Eurohypo (and any successor acting as Administrative Agen t) and its Affiliates may (without having to account therefor to any Lender) lend money to, make investments in and generally engage in any kind of lending, trust or other business with Borrower (and any of its Affiliates)(to the extent otherwise permitted by the terms of this Agreement) as if it were not acting as Administrative Agent, and Eurohypo and its Affiliates may accept fees and other consideration from Borrower for services in connection with this Agreement or otherwise without having to account for the same to the Lenders.

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Section 14.5Standard of Care; Indemnification. In performing its duties under the Loan Documents, Administrative Agent will exercise the same degree of care as it normally exercises in connection with real estate loans that it syndicates and administers and holds for its own account, but Administrative Agent shall have no further responsibility to any Lender except as expressly provided herein and except for its own gross negligence or willful misconduct which resulted in actual loss to such Lender, and, except to such extent, Administrative Agent shall have no responsibility to any Lender for the failure by Administrative Agent to comply with any of Administrative Agent’s obligations to Borrower under the Loan Documents or otherwise. Subject to the terms of any separate agreement among Administrative Agent and the Lenders, the Lenders agree to indemnify Administrative Agent (to the extent not reimbursed under Section 12.5, but without limiting the obligations of Borrower under Section 12.5) ratably in accordance with the aggregate principal amount of the Loans held by the Lenders (or, if no Loans are at the time outstanding, ratably in accordance with their respective Commitments), for any and all liabilities, obligations, losses (other tha n losses due to Borrower’s failure to pay any interest, principal and fees payable by Borrower under the Loan Documents), damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted against Administrative Agent (including by any Lender) arising out of or by reason of any investigation in or in any way relating to or arising out of this Agreement or any other Loan Document or any other documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby (including, without limitation, the costs and expenses that Borrower is obligated to pay under Section 12.5, but excluding, unless an Event of Default has occurred and is continuing, normal administrative costs and expenses incident to the performance of its age ncy duties hereunder) or the enforcement of any of the terms hereof or thereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from Administrative Agent’s breach of its standard of care set forth in the first sentence of this Section.

Section 14.6Non-Reliance on Administrative Agent and Other Lenders. Each Lender agrees that it has, independently and without reliance on Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own credit analysis of Borrower and its Affiliates and decision to enter into this Agreement and that it will, independently and without reliance upon Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its ow n analysis and decisions in taking or not taking action under this Agreement or under any other Loan Document. Subject to the provisions of the first sentence of Section 14.5, Administrative Agent shall not be required to keep itself informed as to the performance or observance by Borrower of this Agreement or any of the other Loan Documents or any other document referred to or provided for herein or therein or to inspect the Project or the books of Borrower or any of its Affiliates. Except for notices, reports and other documents and information expressly required to be furnished to the Lenders by Administrative Agent hereunder or as otherwise agreed by Administrative Agent and the Lenders, Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the affairs, financial condition or business of Borrower or any of its Affiliates that may come into the possession of Administrative Agent or any of its Affiliates.

Section 14.7Failure to Act. Except for action expressly required of Administrative Agent hereunder, and under the other Loan Documents, Administrative Agent shall in all cases be fully justified in failing or refusing to act hereunder and thereunder unless it shall receive further assurances to its satisfaction from the Lenders of their indemnification obligations under Section 14.5 against any and all l iability and expense that may be incurred by it by reason of taking or continuing to take any such action.

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Section 14.8Successor Administrative Agent. Administrative Agent may resign at any time by giving notice thereof to the Lenders and Lead Borrower. The Majority Lenders (including all Lenders exclusive of Administrative Agent, for the purposed of determining the Majority Lenders), on the basis of gross negligence or willful misconduct (as to which a final determination is made in a judicial proceeding in which Administrative Agent has had an opportunity to be heard, which determination includes a specific finding that Administrative Agent had acted in a grossly negligent manner or had engaged in willful misconduct), may remove Administrative Agent at any time by giving thirty (30) days’ prior written notice to Administrative Agent, Borrower and the other Lenders. Upon any such resignation or removal, the Majority Lenders shall have the right to appoint a successor Administrative Agent that shall be a Person that meets the qualifications of an Eligible Assignee. If no successor Administrative Agent shall have been so appointed by the Majority Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent’s giving of notice of resignation or the Majority Lenders’ giving notice of removal, as the case may be, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent, that shall be an institutional lender that meets the requirements of the immediately preceding sentence. Upon the acceptance of any appointment as Adm inistrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and prospective obligations hereunder (if not already discharged therefrom as provided above in this Section 14.8). The fees payable by Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrower and such successor. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provision of this Article 14 and Section 12.5 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent.

Section 14.9Consents under Loan Documents. Administrative Agent may (without any Lender’s consent) give or withhold its agreement to any amendments of the Loan Documents or any waivers or consents in respect thereof or exercise or refrain from exercising any other rights or remedies which Administrative Agent may have under the Loan Documents or otherwise provided that such actions do not, in Administrative Agent’s reasonable judgment, materially adversely affect the value of any collateral, taken as a whole, or represent a departure from Admin istrative Agent’s standard of care described in Section 14.5, except that, except as otherwise provided in any separate agreement entered into among Administrative Agent and the Lenders, Administrative Agent shall not agree to the following (provided that no Lender’s consent shall be required for any of the following which are otherwise required or contemplated under the Loan Documents):

(a) increase the Commitment of any Lender without the consent of such Lender;

(b) reduce the principal amount of the Loans or reduce the interest rate thereon without the consent of each Lender affected thereby;

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(d) extend any stated payment date for principal of or interest on the Loans payable to any Lender without the consent of each Lender affected thereby;

(e) release Borrower, any Guarantor or any other party from liability under the Loan Documents (except for any assigning Lender pursuant to Section 12.24 and any resigning Administrative Agent pursuant to Section 14.8 without the consent of each Lender (except that no such consent shall be required, and Administrative Agent is hereby authorized, to release Borrower and Guarantor upon payment of the Obligations in full in accordance with the terms of the Loan Documents);

(f) release or subordinate in whole or in part any material portion of the collateral given as security for the Loans without the consent of each Lender (except that no such consent shall be required, and Administrative Agent is hereby authorized, to release any Lien covering the collateral under the Security Documents upon payment of the Obligations in full in accordance with the terms of the Loan Documents);

(g) modify any of the provisions of Section 12.2 or this Section 14.9 or the definition of “Majority Lenders” or any other provision in the Loan Documents specifying the number or percentage of Lenders required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder without the consent of each Lender;

(h) modify the terms of, or definition of, any Event of Default without the consent of each Lender;

(i) consent to (i) the sale, transfer or encumbrance of any portion of the Project (or any interest therein) or any direct or indirect ownership interest therein and (ii) the incurrence by Borrower of any additional indebtedness secured by the Project, in each case to the extent such consent is required under the Loan Documents (and subject to any standard of reasonability set forth therein) without the consent of each Lender;

(j) A modification or waiver of conditions to extension of the Maturity Date without the consent of each Lender;

(k) A modification or waiver of any financial covenants of Borrower in the Loan Documents without the consent of the Majority Lenders;

(l) A material modification of the terms of any cash management arrangement or lockbox without the consent of the Majority Lenders; or

(m) a waiver of any Event of Default without consent of the Majority Lenders.

Notwithstanding anything to the contrary contained in this Agreement, (a) any modification or supplement of ARTICLE 14, or of any of the rights or duties of Administrative Agent hereunder, shall require the consent of Administrative Agent and (b) Administrative Agent is hereby authorized to enter into modifications or amendments to the Loan Documents which are ministerial in nature, including the preparation and execution of Uniform Commercial Code forms, Assignments and Assumptions and subordination and non-disturbance agreements with tenants at the Project. If Administrative Agent solicits any consents or approvals from the Lenders under any of the Loan Documents, each Lender shall within ten (10) Business Days of receiving such request, give Administrative Agent written notice of its consent or approval or denial thereof; provided that, if Administrative Agent’s request states that failure to respond within ten (10) Business Days shall be deemed consent and any Lender does not respond within such ten (10) Business Days, such Lender shall be deemed to have authorized Administrative Agent to vote such Lender’s interest with respect to the matter which was the subject of Administrative Agent’s solicitation as Administrative Agent elects. Any such solicitation by Administrative Agent for a consent or approval shall be in writing and shall include a description of the matter or thing as to which such consent or approval is requested and shall include Administrative Agent’s recommended course of action or determination in respect thereof.

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Section 14.10Authorization. Administrative Agent is hereby authorized by the Lenders to execute, deliver and perform in accordance with the terms of each of the Loan Documents to which Administrative Agent is or is intended to be a party and each Lender agrees to be bound by all of the agreements of Administrative Agent contained in such Loan Documents. Borrower shall be entitled to rely on all written agreements, approvals and consents received from Administrative Agent as being that also of the Lenders, without obtaining separate acknowledgment or proo f of authorization of same.

Section 14.11Administrative Fee. So long as the Commitments are in effect and until payment in full of all obligations under this Agreement, the Notes and the other Loan Documents, Borrower shall pay to Administrative Agent, for its sole account, the Administrative Fee. The Administrative Fee shall be payable annually in advance commencing on the Closing Date pursuant to the Fee Letter.

Section 14.12 Defaulting Lenders.

(1) If any Lender (a “Defaulting Lender”) shall for any reason fail to (i) make any respective Loan required pursuant to the terms of this Agreement or (ii) pay its proportionate share of an advance or disbursement to protect the Project or the Lien of the Security Documents in accordance with this Agreement, any of the other Lenders may, but shall not be obligated to, make all or a portion of the Defaulting Lender’s Loan or proportionate share of such advance, provided that such Lender gives the Defaulting Lender and Administrative Agent prior notice of its intention to do so. The right to make such advances in respect of the Defaulting Lender shall be exercisable first by the Len der holding the greatest proportionate share and thereafter to each of the Lenders in descending order of their respective proportionate shares of the Loans or in such other manner as the Majority Lenders (excluding the Defaulting Lender) may agree on. Any Lender making all or any portion of the Defaulting Lender’s proportionate share of the applicable Loan or advance in accordance with the foregoing terms and conditions shall be referred to as a “Special Advance Lender”.

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(2) In any case where a Lender becomes a Special Advance Lender (i) the Special Advance Lender shall be deemed to have purchased, and the Defaulting Lender shall be deemed to have sold, a senior participation in the Defaulting Lender’s respective Loan to the extent of the amount so advanced or disbursed (the “Advanced Amount”) bearing interest at the Loan rates provided herein (including interest at the Default Rate, if applicable) and (ii) the Defaulting Lender shall have no voting rights under this Agreement or any other Loan Documents so long as it is a Defaulting Lender. It is expressly understood and agreed that each of the respective obligations under this Agreemen t and the other Loan Documents, including advancing Loans, losses incurred in connection with the Loan, costs and expenses of enforcement, advancing to preserve the Lien of the Mortgage or to preserve and protect the Project, shall be without regard to any adjustment in the proportionate shares occasioned by the acts of a Defaulting Lender. The Special Advance Lender shall be entitled to an amount (the “Unpaid Amount”) equal to the applicable Advanced Amount, plus any unpaid interest due and owing with respect thereto, less any repayments thereof made by the Defaulting Lender immediately upon demand. The Defaulting Lender shall have the right to repurchase the senior participation in its Loan from the Special Advance Lender at any time by the payment of the Unpaid Amount.

(3) A Special Advance Lender shall (i) give notice to the Defaulting Lender, Administrative Agent and each of the other Lenders (provided that failure to deliver said notice to any party other than the Defaulting Lender shall not constitute a default under this Agreement) of the Advance Amount and the percentage of the Special Advance Lender’s senior participation in the Defaulting Lender’s Loan and (ii) in the event of the repayment of any of the Unpaid Amount by the Defaulting Lender, give notice to the Defaulting Lender and Administrative Agent of the fact that the Unpaid Amount has been repaid (in whole or in part), the amount of such repayment and, if applicable, the revised percentage of the Special Advance Lender’s senior participation. P rovided that Administrative Agent has received notice of such participation, Administrative Agent shall have the same obligations to distribute interest, principal and other sums received by Administrative Agent with respect to a Special Advance Lender’s senior participation as Administrative Agent has with respect to the distribution of interest, principal and other sums under this Agreement; and at the time of making any distributions to the Lenders, shall make payments to the Special Advance Lender with respect to a Special Advance Lender’s senior participation in the Defaulting Lender’s Loan out of the Defaulting Lender’s share of any such distributions before paying any amounts to the Defaulting Lender.

(4) A Defaulting Lender shall immediately pay to a Special Advance Lender all sums of any kind paid to or received by the Defaulting Lender from Borrower, whether pursuant to the terms of this Agreement or the other Loan Documents or in connection with the realization of the security therefor until the Unpaid Amount is fully repaid. Notwithstanding the fact that the Defaulting Lender may temporarily hold such sums, the Defaulting Lender shall be deemed to hold same as a trustee for the benefit of the Special Advance Lender, it being the express intention of the Lenders that the Special Advance Lender shall have an ownership interest in such sums to the extent of the Unpaid Amount.

(5) Each Defaulting Lender shall indemnify, defend and hold Administrative Agent and each of the other Lenders harmless from and against any and all losses, damages, liabilities or expenses (including reasonable attorneys’ fees and expenses and interest at the Default Rate) which they may sustain or incur by reason of the Defaulting Lender’s failure or refusal to abide by its obligations under this Agreement or the other Loan Documents, except to the extent a Defaulting Lender became a Defaulting Lender due to the gross negligence or willful misconduct of Administrative Agent and/or any Lender. Administrative Agent shall, after payment of any amounts due to any Special Advance Lender pursuant to the terms of subsection (3) above, set-off against any payments due to such Defaulting Lender for the claims of Administrative Agent and the other Lenders pursuant to this indemnity.

107

(6) In the event any Lender becomes a Defaulting Lender and none of the other Lenders elects to be a Special Advance Lender pursuant to subsection (1) above, Borrower shall have the right, at any time prior to the Completion Date, provided that no Potential Default or Event of Default exists, to cause another financial institution, reasonably acceptable to (x) the Majority Lenders if such institution is not an Eligible Assignee or (y) Administrative Agent if such institution is an Eligible Assignee, to assume Defaulting Lender’s obligations with respect to the Advance Amount on the then-existing terms and conditions of the Loan Documents (such replacement institution, a “Replacement Len der”). Such assumption shall be pursuant to a written instrument reasonably satisfactory to administrative Agent. Upon such assumption, the Replacement Lender shall become a “Lender” for all purposes hereunder, with a Commitment in an amount equal to the Advance Amount, and the Defaulting Lender’s Commitment shall automatically be reduced by the Advance Amount. In connection with the foregoing, Borrower shall execute and deliver to the Replacement Lender and the Defaulting Lender substitute notes substantially in the form of Exhibit C and stating: “This Note is a substitute note as contemplated by Section 14.12 of the Agreement; it replaces and is in lieu of that certain note made by Maker dated [date of Note] to the order of [Defaulting Lender] in the principal sum of [Defaulting Lender̵ 7;s original Commitment].” Such substitute notes shall be in amounts equal to, in the case of the Replacement Lender’s note, the Advance Amount and, in the case of the Defaulting Lender’s note, its Commitment as reduced aforesaid. Such substitute notes shall constitute “Notes” and the obligations evidenced by such substitute notes shall be secured by the Mortgage. In connection with Borrower’s execution of substitute notes as aforesaid, Borrower shall deliver to Administrative Agent evidence, satisfactory to Administrative Agent, of all requisite partnership/limited liability company/corporate action to authorize Borrower’s execution and delivery of the substitute notes and any related documents. Upon delivery of the foregoing substitute notes, each Defaulting Lender shall return to Borrower its note which was replaced, provided that the delivery of a substitute note to the Defaulting Lender pursuant to this Section 14.12 shall operate to void and replace the note previously held by the Defaulting Lender regardless of whether Defaulting Lender returns the same as required hereby. Borrower, Administrative Agent and Lenders shall execute such modifications to the Loan Documents as shall, in the reasonable judgment of Administrative Agent, be necessary or desirable in connection with the substitution of Lenders in accordance with the foregoing provisions of this Section. Lenders shall reasonably cooperate with Borrower’s attempts to obtain a Replacement Lender, but they shall not be obligated to modify the Loan Documents in connection therewith, other than modifications pursuant to the immediately preceding sentence.

Section 14.13Liability of Administrative Agent. Administrative Agent shall not have any liabilities or responsibilities to Borrower on account of the failure of any Lender (other than Administrative Agent in its capacity as a Lender) to perform its obligations hereunder or to any Lender on account of the failure of Borrower to perform its obligations hereunder or under any other Loan Document.

108

Section 14.14Transfer of Agency Function. Without the consent of Borrower or any Lender, Administrative Agent may at any time or from time to time transfer its functions as Administrative Agent hereunder to any of its offices wherever located in the United States; provided that Administrative Agent shall promptly notify Lead Borrower and the Lenders thereof.

Section 14.15Information for Lenders. Administrative Agent shall promptly provide each Lender with copies of all financial statements delivered by Borrower or Guarantor to Administrative Agent pursuant to the Loan Documents. Administrative Agent shall promptly deliver to each Lender all material information regarding the Property, Borrower and any other holder of any of the ownership interests of Borrower furnished to or obtained by Administrative Agent with respect to the Loan. Administrative Agent shall promptly provide each Lender with copies of all requests and notices received from Borrower by Admi nistrative Agent and all appraisals ordered by Administrative Agent on behalf of the Lenders.

Section 14.16Pfandbriefe. Notwithstanding anything to the contrary in this Agreement, each Lender shall be permitted to assign or otherwise transfer its interest in the Loan and the Loan Documents to a trustee, administrator or receiver (or their respective nominees, collateral agents or security trustees) of a pool securing covered mortgage bonds (Pfandbriefe) issued by a German Pfandbriefebank under German Pfandbriefe legislation in connection with a Pfandbriefe Offering.

Section 14.17Restrictions on Transfers by Borrower. Notwithstanding any provision of this Agreement that may permit Transfers of any nature without consent of Administrative Agent and the Lenders, any Transfer of a direct or indirect ownership interest in Borrower, Borrower’s direct or indirect members, Borrower’s manager or any Guarantor shall be subject to the requirement that, after giving effect to such Transfer, such person and each Lender shall be in compliance with all Transfer Restriction Regulations. A “Transfer Restriction Regulation” shall mean any law or regulation of any Governmental Authority, including the USA Patriot Act and regulations issued pursuant thereto and “know your customer” laws, rules, regulations and orders, or any interpretation, directive or request under any such law or regulation by any court or Governmental Authority or monetary authority charged with the interpretation or administration thereof, or any internal Lender policy resulting therefrom, or any internal Lender policy limiting the amount of loans which may be extended to any one customer of the Lender. If any Lender determines that a proposed transfer that does not require the Lender’s consent under this Agreement would cause the Lender to be in violation of a Transfer Restriction Regulation (any such Lender being herein called a “Restricted Lender”), such Lender shall notify Borrower. Borrower may not cause or permit the Transfer unless Borrower shall first either (i) prepay such Restricted Lender’s outstanding Loans or (ii) arrange for the transfer by such Restricted Lender of all of its right, title and interest under this Agreement and such Restricted Lender’s Note to an Eligible Assignee selected by Borrower that is reasonably satisfactory to Agent, such Eligible Assignee assumes all of the obligations of such Restricted Lender hereunder, and purchases all of such Restricted Lender’s interests hereunder for consideration equal to the aggregate outstanding principal amount of such Restricted Lender’s Loans, together with interest thereon to the date of such purchase (to the extent not paid by Borrower) and all other amounts accrued and payable hereunder to such Restricted Lender as of the date of such transfer

[Signature Pages Follow]

109

EXECUTED as of the date first written above.

LENDER:	EUROHYPO AG, NEW YORK BRANCH

	By:	/s/ Mark A. Fisher
		Name: Mark A. Fisher
		Title: Executive Director

	By:	/s/ John Hayes
		Name: John Hayes
		Title: Vice President

	Address for Notices to Eurohypo AG, New York Branch:

	Eurohypo AG, New York Branch
	1114 Avenue of the Americas, 29th Floor
	New York, New York 10036
	Attention: Legal Director
	Telecopier No.: 866 267 7680

	With copies to:

	Eurohypo AG, New York Branch
	1114 Avenue of the Americas, 29th Floor
	New York, New York 10036
	Attention: Head of Portfolio Operations
	Telecopier No.: 866 267 7680

		– and –

	Riemer & Braunstein LLP
	Times Square Tower, Suite 2506
	Seven Times Square
	New York, New York 10036
	Attention: Steven J. Weinstein, Esq.
	Telecopier No.: (617) 692-3503

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

LENDER:	DEUTSCHE GENOSSENSCHAFTS - HYPOTHEKENBANK AG

	By:	/s/ Gielens
		Name: Gielens
		Title: Authorized signature

	By:	/s/Köhn
		Name: Köhn
		Title: Authorized signature

	Applicable Lending Office

	Address for Notices:
	Deutsche Genossenschafts-Hypothekenbank AG
	Rosenstraße 2
	20095 Hamburg
	Germany
	Attention: Polina Melnikova
	Telecopier: +49 (0) 40 33 34 2916

	With copies to:

	Deutsche Genossenschafts-Hypothekenbank AG
	Rosenstraße 2
	20095 Hamburg
	Germany
	Attention: Johanna Jürgens
	Telecopier: +49 (0) 40 33 34 2916

	Trimont
	Monarch Tower
	3424 Peachtree Road, N.E., Suite 2200
	Atlanta, GA 30326
	Attention: Trica Burell
	Telecopier: (404) 581-7841

	Trimont
	Monarch Tower
	3424 Peachtree Road, N.E., Suite 2200
	Atlanta, GA 30326
	Attention: Laura Holton
	Telecopier: (404) 582-8901

	DGHYP
	609 Fifth Ave., 6th Floor
	New York, New York 10017-1021
	Attention: Jean Barden
	Telecopier: (212) 796-4313

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

LENDER:	AMALGAMATED BANK

	By:	/s/ Cynthia Lash
		Name: Cynthia Lash
		Title: Senior Vice President

	By:	/s/
		Name:
		Title:

	Applicable Lending Office

	Address for Notices:
	275 Seventh Avenue
	New York, New York 10001
	Attention: Cynthia Lash
	Telephone No.: (212) 895-4415
	Telecopier No.: (212) 895-4728

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

LENDER:	TD BANK, as successor-in-interest to Commerce Bank, N.A.

	By:	/s/ Matthew Schatz
		Name: Matthew Schatz
		Title: Vice President

	Applicable Lending Office

	Address for Notices:
	317 Madison Avenue
	New York, New York 10017
	Attention: Matthew Schatz
	Telephone No.: (212) 651-2717
	Telecopier No.: (212) 299-5757

	With copies to:

	1701 Route 70 East
	Cherry Hill, New Jersey 08034

	- and -

	Anderson Kill & Olick, P.C.
	1251 Avenue of the Americas
	Attention: Arnold L. Bartfield, Esq.
	Telephone No.: (212) 278-1511 Telecopier No.: (212) 278-1733

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

BORROWER:	ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

	By:	Acadia-P/A Holding Company, LLC, a Delaware
		limited liability company, its sole member

		By:	Acadia Strategic Opportunity Fund II, LLC, a
			Delaware limited liability company, its managing member

			By:	Acadia Realty Acquisition II, LLC, a
				Delaware limited liability company, its
				managing member

				By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

					By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

						By: /s/ Robert Masters
						Name: Robert Masters
						Title: Senior Vice President-General Counsel

		Address for Notices:

		c/o Acadia Realty Trust
		1311 Mamaroneck Avenue, Suite 260
		White Plains, NY 10605
		Attention: Robert Masters
		Telecopier No.: 914-428-3646

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

BORROWER:	FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

	By:	Acadia-P/A Holding Company, LLC, a Delaware
		limited liability company, its sole member

		By:	Acadia Strategic Opportunity Fund II, LLC, a
			Delaware limited liability company, its managing member

			By:	Acadia Realty Acquisition II, LLC, a
				Delaware limited liability company, its
				managing member

				By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

					By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

						By: /s/ Robert Masters
						Name: Robert Masters
						Title: Senior Vice President-General Counsel

		Address for Notices:

		c/o Acadia Realty Trust
		1311 Mamaroneck Avenue, Suite 260
		White Plains, NY 10605
		Attention: Robert Masters
		Telecopier No.: 914-428-3646

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

ADMINISTRATIVE AGENT:	EUROHYPO AG, NEW YORK BRANCH, AS Administrative Agent

	By:	/s/ Mark A. Fisher
		Name: Mark A. Fisher
		Title: Executive Director

	By:	/s/ John Hayes
		Name: John Hayes
		Title: Director

	Address for Notices to Eurohypo AG, New York Branch:

	Eurohypo AG, New York Branch
	1114 Avenue of the Americas, 29th Floor
	New York, New York 10036
	Attention: Legal Director
	Telecopier No.: 866 267 7680

	With copies to:

	Eurohypo AG, New York Branch
	1114 Avenue of the Americas
	New York, New York 10036
	Attention: Head of Portfolio Operations
	Telecopier No.: 866 267 7680

		– and –

	Riemer & Braunstein LLP
	Times Square Tower, Suite 2506
	Seven Times Square
	New York, New York 10036
	Attention: Steven J. Weinstein, Esq.
	Telecopier No.: (617) 692-3503

Signature Page to Consolidated, Amended and Restated Term Loan Agreement

EXHIBIT A

LEGAL DESCRIPTION OF PROJECT

The condominium units (the “Units” - each a “Unit”) in the building known as The 400 E. Fordham Road Condominium and by the street number 2502 Webster Avenue, 2504 Webster Avenue and 400 East Fordham Road and 250 Webster Avenue, Bronx, New York (the “Building”), designated and described as the Retail Unit and the Office/Community Unit in that certain declaration made pursuant to Article 9-B of the Real Property Law of the State of New York (the “Condominium Act”) establishing a plan for condominium ownership of the Building and the land (the “Land”) on which the Building is situated (which Land is more particularly described below), dated October 23, 2008, and recorded in the Office of the New York City Register, Bronx County, on December 18, 2008, under CRFN 2008000481411, as amended (the “Declaration”). The Units are also designated as the Tax Lots 1001 (as to the Retail Unit) and 1002 (as to the Office/Community Unit) in Block 3033 on the Tax Map of the City of New York of the County of the Bronx on the Tax Map and on the Floor Plans of the Building, and filed with Real Property Assessment Department on December 15, 2008 as Condominium Plan No. 116 and also filed in the Office of the New York City Register, Bronx County, as Condominium Map No. under CRFN 2008000481412;

TOGETHER WITH an undivided 70.0% interest (as to the Retail Unit) and an undivided 30.0% interest (as to the Office/Community Unit) in the Common Elements (as such term is defined in the Declaration).

The Land upon which the Building containing the Units is located is described as follows:

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

BEGINNING at a point formed by the intersection of the easterly side of Webster Avenue (100 feet wide) with the southerly side of East Fordham Road (a.k.a. Pelham Avenue, variable width) and from said point of beginning running thence; the following three (3) courses along said southerly side of East Fordham Road;

South 84 degrees 34 minutes 46 seconds East, a distance of 43.27 feet to a point, thence;

South 54 degrees 01 minutes 22 seconds East, a distance of 29.77 feet to a point, thence;

South 40 degrees 09 minutes 32 seconds East, a distance of 85.32 feet to a point on the westerly side of Park Avenue (variable width). Thence;

Along said westerly side of Park Avenue, South 00 degrees 10 minutes 48 seconds East, a distance of 201.71 feet to a point, thence;

Along the common dividing line between lot 12, lot 8 and lot 4 (lands now or formerly of Automotive Realty Corporation), block 3033, North 85 degrees 39 minutes 56 seconds West, a distance of 164.24 feet to a point on the aforementioned easterly side of Webster Avenue; thence

Along said easterly side of Webster Avenue, North 08 degrees 26 minutes 11 seconds East, a distance of 279.09 feet to the point or place of BEGINNING.

Ex. A

EXHIBIT B

INTENTIONALLY OMITTED

Ex. B

EXHIBIT C

[Form of Note]

PROMISSORY NOTE

$_______________

_________ __, 200_

[__________][__________]

FOR VALUE RECEIVED, ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company and FORDHAM PLACE OFFICE LLC (individually and collectively, jointly and severally, the “Borrower”), hereby promises to pay to __________________ (the “Lender”), for account of its respective Applicable Lending Offices provided for by the Agreement referred to below, at the principal office of EUROHYPO AG, NEW YORK BRANCH, at 1114 Avenue of the Americas, 2nd Floor, New York, New York 10036, the principal sum of _______________ Dollars ($___________) (or such lesser amount as shall equal the aggregate unpaid principal amount of the Loans made by the Lender to Borrower under the Agreement), in lawful money of the United States of Americ a and in immediately available funds, on the dates and in the principal amounts provided in the Agreement, and to pay interest on the unpaid principal amount of each such Loan, at such office, in like money and funds, for the period commencing on the date of such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Agreement.

With respect to the definition of “Borrower”, except where the context otherwise provides, (i) any representations contained herein of Borrower shall be applicable to each Borrower, (ii) any affirmative covenants contained herein shall be deemed to be covenants of each Borrower and shall require performance by all Borrowers, (iii) any negative covenants contained herein shall be deemed to be covenants of each Borrower, and shall be breached if any Borrower fails to comply therewith, (iv) the occurrence of any Event of Default with respect to any Borrower shall be deemed to be an Event of Default hereunder, and (v) any Indebtedness and/or obligations of Borrower shall be deemed to include any Indebtedness and/or obligations of the Borrowers, or any Indebtedness and/or oblig ations of any one of them.

The date, amount, Type, interest rate and duration of Interest Period (if applicable) of each Loan made by the Lender to Borrower, and each payment made on account of the principal thereof, shall be recorded by the Lender on its books and, prior to any transfer of this Note, endorsed by the Lender on the schedule attached hereto or any continuation thereof, provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of Borrower to make a payment when due of any amount owing under the Agreement or hereunder in respect of the Loans made by the Lender.

This Note is one of the Notes referred to in the Loan Agreement dated as of _________ __, 200_ (as modified, supplemented, extended and in effect from time to time, the “Agreement”) among Borrower, the lenders party thereto (including the Lender) and Eurohypo AG New York Branch, as Administrative Agent, and evidences Loans made by the Lender thereunder. Terms used but not defined in this Note have the respective meanings assigned to them in the Agreement.

Ex. C

The Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Loans upon the terms and conditions specified therein.

Except as permitted by Sections 12.9 and 12.24 of the Agreement, this Note may not be assigned by the Lender to any other Person.

This Note shall be governed by, and construed in accordance with, the law of the State of New York without regard to conflicts of laws principles other than Section 5-1401 of the General Obligations Law of the State of New York.

As long as a Hedge Agreement with the Eurohypo Counterparty is in effect, the interest payable under this Note shall be increased or decreased from time to time in accordance with such Hedge Agreement. Therefore, this Note also evidences such amounts as may become due and payable by Borrower under the Hedge Agreement with the Eurohypo Counterparty, including, without limitation, any amount payable upon or in connection with termination of such Hedge Agreement, all of which sums shall be deemed to constitute “Additional Interest” evidenced hereby and payable pursuant to this Note and in accordance with the terms and provisions of the Hedge Agreement with a Eurohypo Counterparty.

[Remainder of Page Intentionally Left Blank]

Ex. C

IN WITNESS WHEREOF, Borrower has executed and delivered this Note as of the date first above written.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By:	Acadia-P/A Holding Company, LLC, a Delaware
	limited liability company, its sole member

	By:	Acadia Strategic Opportunity Fund II, LLC, a
		Delaware limited liability company, its managing member

		By:	Acadia Realty Acquisition II, LLC, a
			Delaware limited liability company, its
			managing member

			By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

				By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

					By:
					Name: Robert Masters
					Title: Senior Vice President-General Counsel

Ex. C

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By:	Acadia-P/A Holding Company, LLC, a Delaware
	limited liability company, its sole member

	By:	Acadia Strategic Opportunity Fund II, LLC, a
		Delaware limited liability company, its managing member

		By:	Acadia Realty Acquisition II, LLC, a
			Delaware limited liability company, its
			managing member

			By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

				By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

					By:
					Name: Robert Masters
					Title: Senior Vice President-General Counsel

Ex. C

SCHEDULE OF LOANS

This Note evidences Loans made, Continued or Converted under the within-described Agreement to Borrower, on the dates, in the principal amounts, of the Types, bearing interest at the rates and having Interest Periods (if applicable) of the durations set forth below, subject to the payments, Continuations, Conversions and prepayments of principal set forth below:

					Amount
Date					Paid,
Made,	Principal			Duration	Prepaid,
Continued	Amount	Type		of	Continued	Unpaid
or	of	of	Interest	Interest	or	Principal	Notation
Converted	Loan	Loan	Rate	Period	Converted	Amount	Made by

Ex. C

EXHIBIT D

[Form of Assignment and Acceptance]

ASSIGNMENT AND ACCEPTANCE

Reference is made to (a) the Loan Agreement dated as of _________ __, 200_ (as amended and in effect on the date hereof, the “Agreement”), among ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company and FORDHAM PLACE OFFICE LLC (individually and collectively, jointly and severally, the “Borrower”), the Lenders named therein and [___________], as Administrative Agent for the Lenders among Administrative Agent and each Lender. Terms defined in the Agreement are used herein with the same meanings.

The Assignor named below hereby sells and assigns, without recourse, to the Assignee named below, and the Assignee hereby purchases and assumes, without recourse, from the Assignor, effective as of the Assignment Date set forth below, the interests set forth below (the “Assigned Interest”) in the Assignor’s rights and obligations under the Agreement, including, without limitation, the interests set forth below in the Commitment of the Assignor on the Assignment Date and Loans owing to the Assignor which are outstanding on the Assignment Date, together with (a) interest on the assigned Loans from and after the Assignment Date and (b) the amount, if any, set forth below of the fe es accrued to the Assignment Date for account of the Assignor. The Assignee hereby acknowledges receipt of a copy of the Agreement. From and after the Assignment Date (i) the Assignee shall be a party to and be bound by the provisions of the Agreement and, to the extent of the interests assigned by this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent of the interests assigned by this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Agreement.

This Assignment and Acceptance is being delivered to Administrative Agent together with, if the Assignee is not already a Lender under the Agreement, an administrative questionnaire in the form supplied by Administrative Agent, duly completed by the Assignee. The [Assignee/Assignor] shall pay the fee payable to Administrative Agent pursuant to Section 12.24(2)(e) of the Agreement.

This Assignment and Acceptance shall be governed by and construed in accordance with the laws of the State of _______.

The Assignor represents and warrants to the Assignee that the Assignor is the legal and beneficial owner of the Assigned Interest and has not created any adverse interest therein. The Assignor and the Assignee represent and warrant to each other that they are, respectively, authorized to execute and deliver this Assignment and Acceptance.

D-1

Date of Assignment:

Legal Name of Assignor:

Legal Name of Assignee:

Assignee’s Address for Notices:

Effective Date of Assignment

(“Assignment Date”)1:

		Percentage Assigned of
		Facility/Commitment
		(set forth, to at
		least 4 decimals, as a
		percentage of the
		Facility and the
		aggregate Commitments
	Principal Amount	of all Lenders
	Assigned	thereunder


Current Outstanding
Loans Assigned:	$	%] 2
Future Funding
Commitment: $		%
[Fees Assigned (if any):]

The terms set forth above and below are hereby agreed to:

	[NAME OF ASSIGNOR] , as Assignor

	By:_________________________
	Name:
	Title:
	[NAME OF ASSIGNEE] , as Assignee
	By:_________________________
	Name:
	Title:

1 Must be at least five Business Days after execution hereof by all required parties.

2 Delete if no future advances are involved.

D-2

The undersigned hereby consent to the within assignment:3

[ ],

as Administrative Agent

By:_________________________

Name:

Title:

3 Consent to be included to the extent required by Section 11.24(2) of the Agreement.

D-3

EXHIBIT E

FORM OF HEDGE AGREEMENT PLEDGE

(See attached)

Ex. E-1

EXHIBIT F

FORM OF NOTICE OF CONVERSION/CONTINUATION

_______________, 200_

Eurohypo AG, New York Branch, as Administrative Agent

1114 Avenue of the Americas

New York, New York 10036

Attn: ________________________________

Re: Loan Agreement dated as of _______________, 200_ (as the same may be amended, modified or supplemented from time to time, the “Agreement”) by and among [BORROWER] (the “Borrower”), the lenders from time to time party to the Agreement (the “Lenders”), and EUROHYPO AG, NEW YORK BRANCH, as Administrative Agent on behalf of the Lenders (the “Administrative Agent”)

Ladies and Gentlemen:

Reference is made to the Agreement. Capitalized terms used in this Notice of Conversion/Continuation without definition have the meanings specified in the Agreement.

Pursuant to Section 2.8(5) of the Agreement, Borrower hereby elects to convert or continue the loans described in attached Schedule 1 (the “Loans”). In connection therewith, Borrower and the undersigned authorized officer of Borrower hereby certify that:

(1) Representations and Warranties. All representations and warranties of Borrower contained in the Loan Documents, including those contained in ARTICLE 7 of the Agreement, are true and correct as of the date hereof and shall be true and correct on the date of the continuation/conversion of the Loans, both before and after giving effect to such continuation/conversion; and

(2) No Event of Default. No Event of Default exists as of the date hereof or will result from the continuation/conversion of the Loans.

[BORROWER],

a ________________________

By:___________________________

Name:

Title:

Schedule 1

to Notice of Conversion/Continuation

LOAN TO BE CONVERTED OR CONTINUED

A. All conversions and continuations must be of a Loan, or portion thereof, in a principal amount in excess of $1,000,000.

B. Conversions/continuations to a LIBOR-based Loan under paragraphs (2) and (3) below are not permitted if, after giving effect to thereto, (a) there would be more than one (1) LIBOR-based Loans in effect, or (b) the aggregate outstanding principal amount of all LIBOR-based Loans would be reduced to be less than $1,000,000.

(1) Conversion of a LIBOR-based Loan into a Base Rate Loan.

The following LIBOR-based Loan to a Base Rate Loan:

Amount: $

Requested Conversion Date:

(must be a Business Day at least three (3)

Business Days after date of notice)

Last day of current Interest Period:

(2) Conversion of a Base Rate Loan into a LIBOR-based Loan.

The following Base Rate Loan to a LIBOR-based Loan:

Amount: $

Requested Conversion Date:

(must be a Business Day at least three (3)

Business Days after date of notice)

(3) Continuation of a LIBOR-based Loan into a Subsequent Interest Period.

The following LIBOR-based Loan into a subsequent Interest Period:

Amount: $

Last day of current Interest Period:

(must be a Business Day at least three (3)

Business Days after date of notice)

SCHEDULE 1

COMMITMENTS

	LENDER	COMMITMENT

1.	Eurohypo AG New York Branch	$34,099,000.00

2.	Deutsche Genossenschafts-Hypothekenbank AG	$20,313,200.00

3.	Amalgamated Bank	$18,051,400.00

4.	TD Bank, N.A.	$13,536,400.00

Total Commitment:		$86,000,000.00

SCHEDULE 1.1(97)

LEASING GUIDELINES

(See attached)

SCHEDULE 1.1(146)

PROPORTIONATE SHARES

Lender		Percentage
Eurohypo AG, New York Branch		39.65%
Deutsche Genossenschafts-Hypothekenbank AG		23.62%
Amalgamated Bank		20.99%
TD Bank, N.A.		15.74%
Total		100%

SCHEDULE 2.1

PRECONDITIONS TO EFFECTIVENESS OF AGREEMENT

PART A. CONDITIONS TO EFFECTIVENESS OF AGREEMENT.

The preconditions to effectiveness of Agreement shall be Administrative Agent’s and each Lender’s receipt, review, approval and/or confirmation of the following, at Borrower’s cost and expense, each in form and content satisfactory to Administrative Agent and each Lender in their sole and absolute discretion:

1. The Loan Documents, executed by Borrower and, as applicable, each Borrower Party.

2. Payment to Administrative Agent (on behalf of the Lenders) of the commitment fee as set forth in the Fee Letter.

3. An ALTA (or equivalent) mortgagee policy of title insurance in the maximum amount of the Loans, with reinsurance and endorsements as Administrative Agent may require, containing no exceptions to title (printed or otherwise) which are unacceptable to Administrative Agent, and insuring that the Mortgage is a first-priority Lien on the Project and related collateral. Without limitation, such policy shall (a) be on the 2006 ALTA (revised 6-17-06) form or, if not available, ALTA 1992 form (deleting arbitration and creditors’ rights, if permissible) or, if not available, the form commonly used in the state where the property is located, insuring Administrative Agent (on behalf of the Lenders) or any and its successors and assigns; and (b) include the following endorsements and/or affirmative coverages to the extent available or applicable: (1) Comprehensive endorsement, (2) Survey, (3) Zoning (with additional coverage for number and type of parking spaces), (4) Usury, (5) Doing Business, (6) Access, (7) Separate Tax Lot, (8) Environmental Protection Lien, (9) Subdivision, (10) Contiguity, (11) Tax Deed, and (12) Mortgage Recording Tax, and such endorsements and/or affirmative coverages as Administrative Agent may require in its sole and absolute discretion.

4. All documents evidencing the formation, organization, valid existence, good standing, and due authorization of and for Borrower and each Borrower Party for the execution, delivery, and performance of the Loan Documents by Borrower and each Borrower Party, including an organizational chart for Borrower and Borrower Parties.

5. Legal opinions issued by counsel for Borrower and each Borrower Party, opining as to the due organization, valid existence and good standing of Borrower and each Borrower Party, and the due authorization, execution, delivery, enforceability and validity of the Loan Documents with respect to, Borrower and each Borrower Party; that the Loans, as reflected in the Loan Documents, are not usurious; to the extent that Administrative Agent is not otherwise satisfied, that the Project and its use is in full compliance with all legal requirements; and as to such other matters as Administrative Agent and Administrative Agent’s counsel reasonably may specify.

Schedule 2.1 - 1

6. Current Uniform Commercial Code searches, and litigation, bankruptcy, judgment and federal tax lien reports as requested by Administrative Agent, with respect to Borrower, Borrower’s members, and Guarantor.

7. Evidence of insurance as required by this Agreement, and conforming in all respects to the requirements of Administrative Agent.

8. A current “as-built” survey of the Project, dated to the reasonable satisfaction of the Administrative Agent, certified to Administrative Agent (on behalf of the Lenders) and the issuer of the title insurance, prepared by a licensed surveyor acceptable to Administrative Agent and the issuer of the title insurance, and conforming to Administrative Agent’s current standard survey requirements, which may include certification to additional participants, co-lenders and/or investors. Without limitation, the minimum requirements for the survey shall be as set forth in the 2005 Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys, “Urban Survey” classification, with the following additional items from Table A, “Opt ional Survey Responsibilities and Specifications”: “2” (vicinity map showing nearby highway or major intersection), “3” (flood zone designation), “4” (land area), “6” (setbacks, height and bulk restrictions), “8” (other visible improvements), “9” (parking areas), “10” (access to public way, driveway and curb cuts), “11(a)” (utilities).

9. A current engineering report or architect’s certificate with respect to the Project, covering, among other matters, inspection of heating and cooling systems, roof and structural details, showing no failure of compliance with building plans and specifications, applicable legal requirements (including requirements of the Americans with Disabilities Act) and fire, safety and health standards and reviewing and approving, among other matters, soil tests, plans and specifications (including heating, ventilation and cooling systems, roof and structural details, mechanical and electrical systems), and compliance with local, state or federal laws, regulations, codes, etc., and containing a declaration satisfactory to Administrative Agent that there will be no asbestos in t he Project. The engineer/architect preparing such report or certificate must be satisfied that the Project is in compliance with fire, safety and health standards which such engineer/architect deems reasonable, in addition to standards imposed by law, regulation or codes. As requested by Administrative Agent, such report shall also include an assessment of the Project’s tolerance for earthquake and seismic activity.

10. A current Site Assessment.

11. All appraisals, environmental reports, building condition reports and Site Assessments delivered to Administrative Agent prior to the execution of this Agreement shall be certified to Administrative Agent (on behalf of the Lenders and their successors and assigns) without modification or change thereto in the form reasonably requested by Administrative Agent which may include certification to additional participants, co-lenders and/or investors.

12. A current rent roll of the Project, certified by Borrower or the current owner of the Project. Such rent roll shall include the following information: (a) tenant names; (b) unit/suite numbers; (c) area of each demised Project and total area of the Project (stated in net rentable square feet); (d) rental rate (including escalations) (stated in gross amount and in amount per net rentable square foot per year); (e) lease term (commencement, expiration and renewal options); and (f) expense pass-throughs. In addition, Borrower shall provide Administrative Agent with a copy of the standard lease form to be used by Borrower in leasing space in the Project, and, at Administrative Agent’s request, true and correct copies of all leases of the Project.

Schedule 2.1 - 2

13. A copy of the Property Management Agreement for the Project, certified by Borrower as being true, correct and complete.

14. Borrower’s deposit into the applicable Reserve Account of the amount required by Administrative Agent to impound for taxes and assessments under Article 4 and to fund any other required escrows or reserves.

15. Evidence that (a) the Project and the operation thereof comply with all legal requirements, including that all requisite certificates of occupancy, building permits, and other licenses, certificates, approvals or consents required by any Governmental Authority have been issued without variance or condition, (b) following any casualty, the improvements which form a part of the Project may be reconstructed and the current use thereof restored, and (c) that there is no litigation, action, citation, injunctive proceedings, or like matter pending or threatened with respect to the validity of such matters. At Administrative Agent’s request, Borrower shall furnish Administrative Agent with a zoning endorsement to Administrative Agent’s title insurance po licy, zoning letters from applicable municipal agencies, and utility letters from applicable service providers.

16. No change shall have occurred in the financial condition of Borrower or any Borrower Party or in the Net Operating Income of the Project, or in the financial condition of any major or anchor tenant, which would have, in Administrative Agent’s or any Lender’s judgment, a Material Adverse Effect on the Project or on Borrower’s or any Borrower Party’s ability to repay the Loans or otherwise perform its obligations under the Loan Documents. Further, there shall not exist any material default by Borrower or any principal in Borrower (or any entity owned or controlled by any of them) under any loan, financing or similar arrangement with any lender.

17. No condemnation or adverse zoning or usage change proceeding shall have occurred or shall have been threatened against the Project; the Project shall not have suffered any significant damage by fire or other casualty which has not been repaired; no structural change to the Project shall have occurred or to any of the Improvements thereon; no law, regulation, ordinance, moratorium, injunctive proceeding, restriction, litigation, action, citation or similar proceeding or matter shall have been enacted, adopted, or threatened by any third party or Governmental Authority, which would have, in Administrative Agent’s or any Lender’s judgment, a Material Adverse Effect on Borrower, any Borrower Party or the Project.

18. All fees and commissions payable to real estate brokers, mortgage brokers, or any other brokers or agents in connection with the Loans or the acquisition of the Project have been paid, such evidence to be accompanied by any waivers or indemnifications deemed necessary by Administrative Agent.

19. Intentionally Omitted.

Schedule 2.1 - 3

20. Payment of Administrative Agent’s costs and expenses in underwriting, documenting, and closing the transaction, including fees and expenses of Administrative Agent’s inspecting engineers, consultants, and outside counsel.

21. The Collateral Letter of Credit, if any, and the TI/LC Letter of Credit required under Article 4.

22. Estoppel certificates and subordination, non-disturbance and attornment agreements from tenants, as requested by Administrative Agent.

23. Service contracts, warranties, licenses and permits, applicable to the operation or use of the Project.

24. An Appraisal of the Project, which, among other things, verifies that the value of the Project is not less than $123,900,000.00.

25. Prepayment of the Loans under the Original Loan Agreement such that the outstanding principal balance of the Loan as of of the Closing Date will be $86,000,000.00.

26. Such other documents or items as Administrative Agent or its counsel reasonably may require.

27. The representations and warranties contained in this Loan Agreement and in all other Loan Documents are true and correct.

28. The title policy, survey, insurance policies, appraisal, environmental report, engineering report and other third party reports shall run in favor of Eurohypo AG, New York Branch or its designee, as Administrative Agent on behalf of the lenders in its lending syndicate from time to time, and the successors and assigns of each of the foregoing, all of whom may rely thereon.

29. No Potential Default or Event of Default shall have occurred or exist.

Schedule 2.1 - 4

SCHEDULE 2.4(1)

WIRE INSTRUCTIONS

Commerzbank AG, New York

Fed ABA No.: 026-008-044

For Account of: Eurohypo AG, New York

A/C No.: 150-9409269-00USD

Ref: 400 E. Fordham Road

Schedule 2.4(1) - 1

SCHEDULE 2.4(2)

AMORTIZATION SCHEDULE

Schedule 2.4(2) - 1

SCHEDULE 7.28

ORGANIZATIONAL CHART

(See Attached)

Schedule 7.28 - 1

Schedule 7.28 - 2

Schedule 7.28 - 3

SECTION:

BLOCK:

3033

LOTS:

9 and 12 now known as Lots 1001 and 1002

COUNTY:

Bronx

ADDRESS:

2502 Webster Avenue, 2504 Webster Avenue, and 400-414 East Fordham Road, a/k/a 4747-4763 Park Avenue, a/k/a 2506-2526 Webster Avenue, Bronx, New York

As of November 4, 2009

MORTGAGE CONSOLIDATION AND MODIFICATION AGREEMENT

between

EUROHYPO AG, NEW YORK BRANCH,

as Administrative Agent for "Lenders" (as hereinafter defined)

(together with its successors in such capacity, "Mortgagee")

and

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC,

a Delaware limited liability company

and

FORDHAM PLACE OFFICE LLC

a Delaware limited liability company

(jointly and severally, individually and collectively, the “Mortgagor”)

This instrument prepared by,

and after recording please return to:

Riemer & Braunstein LLP

7 Times Square, Suite 2506

New York, New York 10036

Attention: Steven J. Weinstein, Esq.

MORTGAGE CONSOLIDATION AND MODIFICATION AGREEMENT

MORTGAGE CONSOLIDATION AND MODIFICATION AGREEMENT (this "Agreement") made as of the 4th day of November, 2009 between EUROHYPO AG, NEW YORK BRANCH, as administrative agent (“Administrative Agent”) for “Lenders” (as hereinafter defined) (together with its successors in such capacity, “Mortgagee”), having an office at 1114 Avenue of the Americas, New York, New York 10036 and ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, and FORDHAM PLACE OFFICE LLC, each a Delaware limited liability company (jointly and severally, individually and collectively, “Mortgagor”), each having an address for notice at c/o Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, NY 10605.

W I T N E S S E T H :

WHEREAS, Mortgagor is a party to that certain Consolidated, Amended and Restated Term Loan Agreement dated the date hereof with Administrative Agent, Lenders (as hereinafter defined) and Mortgagor (as the same may hereafter be amended, modified or supplemented from time to time, the "Loan Agreement") which consolidates, modifies and amends existing loans to Mortgagor from Eurohypo AG, New York Branch and other lenders party thereto and such other lending institutions who became "Lenders" pursuant to the Loan Agreement (each individually, a "Lender" and collectively, "Lenders");

WHEREAS, Mortgagee is the lawful owner and holder of the mortgages (collectively, the “Mortgages") more particularly described in EXHIBIT A attached hereto and made a part hereof, and the Lenders are holders of the notes (collectively, the “Existing Notes”) and other obligations secured thereby;

WHEREAS, the maximum principal amount which is or under any contingency may be secured by the Mortgages is $86,000,000.00 (the "Consolidated Indebtedness"), plus interest thereon and all additional interest and late payment and prepayment charges in respect thereof, plus all amounts expended by Mortgagee following a default thereunder in respect of insurance premiums and real estate taxes, and all legal costs or expenses of collection of the note(s) secured thereby or of the defense or prosecution of the rights and lien created thereby;

WHEREAS, the Mortgages are presently valid liens on all of the real property described in SCHEDULE A attached hereto and made a part hereof (the "Premises");

WHEREAS, Mortgagor is the lawful owner of the Premises; and

WHEREAS, Mortgagee has agreed to consolidate the Mortgages to form a single first lien on the entire Premises and to modify the terms of the Mortgages in the manner hereinafter set forth;

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein expressed, the parties hereto covenant and agree as follows:

1. Mortgagor hereby agrees to be bound by all of the terms of, the Mortgages, as herein modified and consolidated. The liens of the Mortgages are hereby consolidated and coordinated to constitute a single mortgage which encumbers all of the "Mortgaged Property" (as such term is defined in the Mortgages, as modified hereby), so that together they shall hereafter constitute in law but one first mortgage, a valid and enforceable single lien upon the Premises, securing the Consolidated Indebtedness, together with interest accrued and to accrue thereon and all other sums secured thereby.

2. Mortgagor hereby agrees to pay the Consolidated Indebtedness and interest thereon at the rate(s) of interest and on the terms provided for the payment of principal and interest in the replacement notes (said replacement notes, as the same may be amended, modified, extended, severed, assigned, renewed, replaced or restated, and including any substitute or replacement notes executed pursuant to the Loan Agreement, hereinafter the "Notes") delivered pursuant to and in accordance with that certain Note Consolidation, Severance and Modification Agreement (the “Note Agreement”), dated the date hereof, between each of the Lenders and Mortgagor.

3. The Mortgages are hereby amended and restated in their entirety by EXHIBIT B attached hereto and made a part hereof, and Mortgagor hereby agrees to comply with and be bound by all of the terms, covenants and conditions set forth in said EXHIBIT B.

4. Mortgagor hereby certifies that this Agreement secures the same indebtedness evidenced by the Existing Notes, as consolidated and modified by the Note Agreements (and evidenced by the Notes), and secured by the Mortgages, as consolidated and modified hereby, and secures no new or further indebtedness or obligation.

5. Mortgagor represents and warrants that there exist no defenses, offsets or counterclaims with respect to its obligations under the Mortgages, as modified hereby, or under the Existing Notes, as modified by the Note Agreements (and now evidenced by the Notes), including its obligation for the payment of the Consolidated Indebtedness.

6. The terms and provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their heirs, representatives, successors and assigns.

7. This Agreement and the rights and obligations of the parties hereto shall in all respects be governed by, and construed and enforced in accordance with, the laws of the State of New York (without giving effect to New York's choice of law principles).

8. This Agreement may be executed in multiple counterparts, each of which shall constitute an original and together which shall constitute but one and the same instrument.

9. The information set forth on the cover hereof is incorporated herein.

[Remainder of page intentionally left blank.]

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by each of the parties hereto as of the day and year first above written.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By:_/s/ Robert Masters_________

Name: Robert Masters

Title: Senior Vice President-General Counsel

[Signature Page to Mortgage Consolidation and Modification Agreement]

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters___________

Name: Robert Masters

Title: Senior Vice President-General Counsel

[Signature Page to Mortgage Consolidation and Modification Agreement]

EUROHYPO AG, NEW YORK BRANCH,

as Administrative Agent

By: /s/ Mark A. Fisher__________________

Name: Mark A. Fisher

Title: Executive Director

By: /s/ John C. Hayes___________________

Name: John C. Hayes

Title: Director

[Signature Page to Mortgage Consolidation and Modification Agreement]

STATE OF NEW YORK	)
	) ss.:
COUNTY OF WESTCHESTER	)

On the 16yh day of October in the year 2009, before me, the undersigned, a notary public in and for said state, personally appeared Robert Masters, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.

	/s/ Debra Leibler-Jones
	Notary Public

My Commission Expires:	Debra Leibler-Jones
	Notary Public, State of New York
	Dutchess County CLK #01JO6005994
_4/20/2010_____________	Commission Expires 4/20/10

[Acknowledgement to Mortgage Consolidation and Modification Agreement]

STATE OF NEW YORK	)
	) ss.:
COUNTY OF NEW YORK	)

On the 16 day of October in the year 2009, before me, the undersigned, a notary public in and for said state, personally appeared Mark A. Fisher, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.

	/s/ Patricia A. Ferro
	Notary Public

My Commission Expires:	Patricia A. Ferro
	Notary Public, State of New York
	No. 01FE6170163
__July 2, 2011___________	Qualified in Kings County
	My Commission Expires July 2, 2011

STATE OF NEW YORK	)
	) ss.:
COUNTY OF NEW YORK	)

On the 16 day of October in the year 2009, before me, the undersigned, a notary public in and for said state, personally appeared John C. Hayes, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.

	/s/ Patricia A. Ferro
	Notary Public

My Commission Expires:	Patricia A. Ferro
	Notary Public, State of New York
	No. 01FE6170163
__July 2, 2011___________	Qualified in Kings County
	My Commission Expires July 2, 2011

[Acknowledgement to Mortgage Consolidation and Modification Agreement]

SCHEDULE A

Property Description

The Land upon which the Building containing the Units is located is described as follows:

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

South 84 degrees 34 minutes 46 seconds East, a distance of 43.27 feet to a point, thence;

South 54 degrees 01 minutes 22 seconds East, a distance of 29.77 feet to a point, thence;

South 40 degrees 09 minutes 32 seconds East, a distance of 85.32 feet to a point on the westerly side of Park Avenue (variable width). Thence;

Along said westerly side of Park Avenue, South 00 degrees 10 minutes 48 seconds East, a distance of 201.71 feet to a point, thence;

Schedule A

Along said easterly side of Webster Avenue, North 08 degrees 26 minutes 11 seconds East, a distance of 279.09 feet to the point or place of BEGINNING.

Schedule A

EXHIBIT A

Prior Mortgage(s)

ACQUISTION LOAN MORTGAGES

A. Mortgage in the original principal amount of $550,000 made by Alfred M. Rogers and Florence Hills Rogers, his wife, and Howard J. Rogers and Elizabeth J. Rogers, his wife, to Dollar Savings Bank of the City of New York dated 2/2/25 and recorded 2/2/25 in Liber 876 page 139.

Mortgage Tax Paid: $

1. Said mortgage A was extended by Extension Agreement dated 6/14/30 and recorded 6/26/30 in Liber 1513 page 64.

2. A $100,000 subordinate interest in said mortgage A was assigned by Dollar Savings Bank of the City of New York to Lillian Markowitz and Maybelle Mintz by Assignment of Mortgage dated 2/28/50 and recorded 3/10/50 in Liber 2590 page 367.

3. Maybelle Mintz thence assigned her interest in the $100,000 subordinate interest in said mortgage A to Lillian Markowitz by Assignment of Mortgage dated 10/16/50 and recorded 8/6/52 in Liber 2802 page 174.

4. Lillian Markowitz thence assigned her interest in the $100,000 subordinate interest in said mortgage A to The Emigrant Industrial Savings Bank by Assignment of Mortgage dated 7/22/52 and recorded 8/6/52 in Liber 2802 page 189.

5. Priority interest in said mortgage A was assigned by Dollar Savings Bank of the City of New York to The Emigrant Industrial Savings Bank by Assignment of Mortgage dated 7/17/52 and recorded 8/6/52 in Liber 2802 page 170.

B. Mortgage in the original principal amount of $294,793.25 made by Bruce Realty Company of New York, Inc. to The Emigrant Savings Bank dated 7/22/52 and recorded 8/6/52 in Liber 2802 page 153.

Mortgage Tax Paid: $

1. Said mortgages A and B were consolidated to form a single lien of $600,000 by Consolidation, Spreader, Extension and Modification Agreement made by and between The Emigrant Industrial Savings Bank and Bruce Realty Company of New York, Inc. dated 7/22/52 and recorded 8/6/52 in Liber 2802 page 161.

2. Said mortgages A and B, as consolidated, were assigned by The Emigrant Savings Bank to The Seamen's Bank for Savings in the City of New York by Assignment of Mortgage dated 2/18/64 and recorded 2/21/64 in Liber 3860 mp 3.

Exhibit A

C. Mortgage in the original principal amount of $769,437.11 made by Bruce Realty Company of New York, Inc. to The Seamen's Bank for Savings in the City of New York dated 2/20/64 and recorded 2/21/64 in Liber 3868 page 36.

Mortgage Tax Paid: $

1. Said mortgages A, B and C were consolidated to form a single lien of $1,200,000 by Consolidation and Extension Agreement made by and between Bruce Realty Company of New York, Inc. and The Seamen's Bank for Savings in the City of New York dated 2/20/64 and recorded 2/27/64 in Liber 3869 page 192.

2. Said mortgages A, B and C, as consolidated, were modified by Extension Agreement made by and between Bruce Realty Company of New York, Inc. and The Seamen's Bank for Savings dated as of 6/10/78 and recorded 8/3/78 in Reel 367 page 1877.

3. Said mortgages A, B and C, as consolidated, were assigned by The Seamen's Bank for Savings (f/k/a The Seamen's Bank for Savings in the City of New York) to Chemical Bank by Assignment of Mortgage dated 8/18/83 and recorded 8/30/83 in Reel 515 page 965.

4. Said mortgages A, B and C, as consolidated, were modified by Extension Agreement made by and between 400 East Fordham Associates and Chemical Bank dated 8/22/83 and recorded 8/30/83 in Reel 515 page 919.

5. Said mortgages A, B and C, as consolidated, were further assigned by Chemical Bank to Crossland Savings, FSB by Assignment of Mortgage dated 3/17/86 and recorded 3/26/86 in Reel 639 Page 1930.

D. Mortgage in the original principal amount of $498,000 made by 400 East Fordham Associates to Bruce Realty Company of New York, Inc. dated 6/15/82 and recorded 6/28/82 in Reel 476 page 897.

Mortgage Tax Paid: $ 7,470.00

1. Said mortgage D was assigned by Bruce Realty Company Liquidating Trust (successor in interest to Bruce Realty Company of New York, Inc.) to New Enterprises, Inc. by Assignment of Mortgage dated 11/21/84 and recorded 12/6/84 in Reel 570 Page 875.

2. Said mortgage D was further assigned by New Enterprises, Inc. to Chemical Bank by Assignment of Mortgage dated 11/29/84 and recorded 12/6/84 in Reel 570 Page 872.

Exhibit A

3. Said mortgage D was further assigned by Chemical Bank to New Enterprises, Inc. by Assignment of Mortgage dated 3/17/86 and recorded 3/26/86 in Reel 639 Page 1928.

4. Said mortgage D was further assigned by New Enterprises, Inc. to Crossland Savings, FSB by Assignment of Mortgage dated 3/17/86 and recorded 3/26/86 in Reel 639 Page 1939.

E. Mortgage in the original principal amount of $2,305,982.59 made by 400 East Fordham Associates to Crossland Savings, FSB dated 3/17/86 and recorded 3/26/86 in Reel 639 Page 1920.

Mortgage Tax Paid: $ 51,885

1. Said mortgages A, B, C, D and E were consolidated to form a single lien of $3,200,000 by Consolidation and Extension Agreement made by and between 400 East Fordham Associates and Crossland Savings, FSB dated 3/17/86 and recorded 3/26/86 in Reel 639 Page 1941.

2. Said mortgages A, B, C, D and E, as consolidated, were assigned by Crossland Savings, FSB to Crossland Commercial Funding Corp. I by Assignment of Mortgage dated as of 6/22/89 and recorded 6/30/89 in Reel 928 Page 90.

3. Said mortgages A, B, C, D and E, as consolidated, were further assigned by Crossland Commercial Funding Corp. I to Wilmington Trust Company, as Trustee, by Collateral Assignment of Mortgage dated as of 6/22/89 and recorded 6/30/89 in Reel 928 Page 85.

4. Said mortgages A, B, C, D and E, as consolidated, were further assigned by Wilmington Trust Company, as Trustee, to Crossland Commercial Funding Corp. I by Assignment of Mortgage dated 6/15/93 and recorded 7/2/93 in Reel 1174 Page 1111.

5. Said mortgages A, B, C, D and E, as consolidated, were further assigned by Crossland Commercial Funding Corp. I to Crossland Federal Savings Bank by Assignment of Mortgage dated 12/13/93 and recorded 12/20/93 in Reel 1205 Page 1723.

6. Said mortgages A, B, C, D and E, as consolidated, were further assigned by Crossland Federal Savings Bank to Bear, Stearns Funding, Inc. by Assignment of Mortgage Without Covenant dated 12/12/95 and recorded 1/22/96 in Reel 1365 page 349.

F. Mortgage in the original principal amount of $1,095,319.74 made by 400 East Fordham Associates to Bear, Stearns Funding, Inc. dated 12/13/95 and recorded 1/22/96 in Reel 1365 page 227.

Exhibit A

Mortgage Tax Paid: $

1. Said mortgages A, B, C, D, E and F were consolidated to form a single lien of $4,000,000 by Consolidation, Modification, Spreader and Extension Agreement made by and between 400 East Fordham Associates and Bear, Stearns Funding, Inc. dated as of 12/13/95 and recorded 1/22/96 in Reel 1365 page 235.

2. Said mortgages A, B, C, D, E and F, as consolidated, were assigned by Bear, Stearns Funding, Inc. to LaSalle National Bank, as trustee for the registered holders of Chase Commercial Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates Series, 1996-1 by Assignment of Mortgage dated 7/19/96 and recorded 11/22/04 as CRFN 2004000722254.

3. Said mortgages A, B, C, D, E and F, as consolidated, were assigned by LaSalle National Bank, as trustee for the registered holders of Chase Commercial Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates Series, 1996-1 to Acadia Realty Limited Partnership by Assignment of Mortgage dated 9/8/04 and recorded 11/22/04 as CRFN 2004000722256.

4. Said mortgages A, B, C, D, E and F, as consolidated, were assigned by Acadia Realty Limited Partnership to Bank of China, New York Branch by Assignment of Mortgage dated 10/26/04 and recorded 2/18/05 as CRFN 2005000103995.

G. Mortgage in the original principal amount of $14,597,734.90 made by Acadia-PA East Fordham Acquisitions, LLC (f/k/a Acadia-P/A East Fordham Acquisitions, LLC) to Bank of China, New York Branch dated 10/26/04 and recorded 2/18/05 as CRFN 2005000103996.

Mortgage Tax Paid: $ 401,426.76

1. Said mortgages A, B, C, D, E, F and G were consolidated to form a single lien of $18,000,000 by a Consolidated and Restated Mortgage, Assignment of Leases and Rents and Security Agreement made between Acadia-PA East Fordham Acquisitions, LLC (f/k/a Acadia-P/A East Fordham Acquisitions, LLC) and Bank of China, New York Branch, dated 10/26/04 and recorded 2/18/05 as CRFN 2005000103997.

2. Said mortgages A, B, C, D, E, F and G, as consolidated, were assigned by Bank of China, New York Branch to Bank of America, N.A. by Assignment of Mortgage dated 11/01/06 and recorded 11/22/06 as CRFN 2006000650021.

3. Said mortgages A, B, C, D, E, F and G, as consolidated, were modified and assumed by Mortgage Assumption, Modification and Spreader Agreement made between Bank of America, N.A. and Acadia-PA East Fordham Acquisitions, LLC dated as of 11/1/06 and recorded 11/22/06 as CRFN 2006000650022.

Exhibit A

4. Said Mortgages A, B, C, D, E, F and G, as consolidated, were assigned by Bank of America, N.A. to Eurohypo AG, New York Branch, as Administrative Agent pursuant to the Assignment of Mortgage by Bank of America, N.A. to Eurohypo AG, New York Branch, as Administrative Agent, dated 10/5/07 and recorded 11/2/07 as CRFN 2007000554121 and as modified by the Mortgage Assumption, Modification and Spreader Agreement in the amount of $18,000,000 made between Acadia-PA East Fordham Acquisitions, LLC and Eurohypo AG, New York Branch, as Administrative Agent, dated as of 10/5/07 and recorded 11/2/07 as CRFN 2007000554123. Said Mortgage Assumption, Modification and Spreader Agreement was amended by that certain First Amendment to Mortgage Assumption, Modification and Spreader Agree ment made by and among Acadia-PA East Fordham Acquisitions, LLC and Fordham Place Office LLC to Eurohypo AG, New York Branch, as Administrative Agent, dated 12/30/08 and recorded 1/15/09 as CRFN 2009000014261.

BUILDING LOAN MORTGAGE

H. Building Loan Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing in the original principal amount of $75,339,243.00 made by Acadia-PA East Fordham Acquisitions, LLC to Eurohypo AG, New York Branch, as Administrative Agent, dated 10/5/07 and recorded 11/2/07 as CRFN 2007000554119.

Mortgage Tax Paid: $2,109,497.60

1. Said mortgage H was amended by that certain First Amendment to Building Loan Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing made by and among Acadia-PA East Fordham Acquisitions, LLC and Fordham Place Office LLC to Eurohypo AG, New York Branch, as Administrative Agent, dated 12/30/08 and recorded 1/15/09 as CRFN 2009000014259.

PROJECT LOAN MORTGAGES

I. Project Loan Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing in the original principal amount of $1,930,757.00 made by Acadia-PA East Fordham Acquisitions, LLC to Eurohypo AG, New York Branch, as Administrative Agent, dated 10/5/07 and recorded 11/2/07 as CRFN 2007000554120.

Mortgage Tax Paid: $54,062.40

1. Said mortgage I was amended by that certain First Amendment to Project Loan Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing made by and among Acadia-PA East Fordham Acquisitions, LLC and Fordham Place Office LLC to Eurohypo AG, New York Branch, as Administrative Agent, dated 12/30/08 and recorded 1/15/09 as CRFN 2009000014260.

Exhibit A

On which said Mortgages A, B, C, D, E, F, G, H and I remains the unpaid principal sum of $86,000,000.00, which said Mortgages A, B, C, D, E, F, G, H and I are consolidated into one joint lien and first mortgage.

Exhibit A

EXHIBIT B

Form of Mortgage

See Attached

(ii)

EXHIBIT B

Mortgage, Assignment of Leases and Rents,

Security Agreement and Fixture Filing

made by

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC,

a Delaware limited liability company

and

FORDHAM PLACE OFFICE, LLC

a Delaware limited liability company,

(jointly and severally, individually and collectively, the “Mortgagor”)

in favor of

Eurohypo AG, New York Branch, as Administrative Agent

(together with its successors in such capacity, “Mortgagee”)

Dated: As of November 4, 2009

__________________________________

Section: 11

Block: 3033

Lots: 9 and 12 now known as Lots 1001 and 1002

2502 Webster Avenue, 2504 Webster Avenue, and 400-414 East Fordham Road, a/k/a 4747-4763 Park Avenue, a/k/a 2506-2526 Webster Avenue, Bronx, New York

City of New York, Bronx County, State of New York

__________________________________

Mortgage Amount: $86,000,000.00

__________________________________

RECORD AND RETURN TO:

RIEMER & BRAUNSTEIN LLP

7 Times Square, Suite 2506

New York, New York 10036

Attention: Steven J. Weinstein, Esq.

__________________________________

THIS MORTGAGE DOES NOT COVER REAL PROPERTY PRINCIPALLY IMPROVED OR TO BE IMPROVED BY ONE OR MORE STRUCTURES CONTAINING IN THE AGGREGATE NOT MORE THAN SIX RESIDENTIAL DWELLING UNITS, EACH DWELLING UNIT HAVING ITS OWN SEPARATE COOKING FACILITIES.

TABLE OF CONTENTS

Page No.

ARTICLE 1 OBLIGATIONS		6
Section 1.01	Obligations.	6
Section 1.02	Maximum Secured Indebtedness.	6

ARTICLE 2 PARTICULAR COVENANTS AND AGREEMENTS OF MORTGAGOR		7
Section 2.01	Payment of Secured Obligations.	7
Section 2.02	Title, etc.	8
Section 2.03	Further Assurances; Filing; Re-Filing; etc.	9
Section 2.04	Liens; Transfers.	9
Section 2.05	Insurance.	9
Section 2.06	Impositions.	10
Section 2.07	Maintenance of the Improvements and Equipment.	10
Section 2.08	Compliance With Laws.	10
Section 2.09	Limitations of Use.	10
Section 2.10	Actions to Protect Mortgaged Property.	11
Section 2.11	Insurance and Condemnation Proceeds.	12
Section 2.12	Inspections.	12

ARTICLE 3 ASSIGNMENT OF LEASES AND RENTS		12
Section 3.01	Assignment of Rents, Issues and Profits.	12
Section 3.02	Grant of License; Revocation.	14
Section 3.03	Direction to Tenants.	15
Section 3.04	Section 291-f Agreement.	16

ARTICLE 4 SECURITY AGREEMENT; FIXTURE FILING		16
Section 4.01	Creation of Security Interest.	16
Section 4.02	Continuation Statements; Amendments.	17
Section 4.03	Fixture Filing.	18

ARTICLE 5 DEFAULTS; REMEDIES		18
Section 5.01	Events of Default.	18
Section 5.02	Remedies.	20
Section 5.03	Application of Proceeds.	21
Section 5.04	Right to Sue.	21
Section 5.05	Powers of Mortgagee.	21
Section 5.06	Remedies Cumulative.	21
Section 5.07	General Provisions.	22
Section 5.08	No Mortgagee-in-Possession.	24


ARTICLE 6 MISCELLANEOUS		25
Section 6.01	Release by Mortgagee.	25
Section 6.02	Notices.	25
Section 6.03	No Waiver.	25
Section 6.04	Amendments; etc.	26
Section 6.05	Successors and Assigns.	26
Section 6.06	Captions.	26
Section 6.07	Severability.	27
Section 6.08	Usury Savings Clause.	28
Section 6.09	CERTAIN WAIVERS.	28
Section 6.10	GOVERNING LAW.	28
Section 6.11	SUBMISSION TO JURISDICTION.	28
Section 6.12	WAIVER OF JURY TRIAL.	28
Section 6.13	Attorney-In-Fact.	29
Section 6.14	New York Lien Law.	30

Exhibit A - Description of Land

Exhibit B - Personal Property Collateral

(ii)

MORTGAGE, ASSIGNMENT OF LEASES AND

RENTS, SECURITY AGREEMENT AND FIXTURE FILING

THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this “Mortgage”) is made as of the ___ day of November, 2009 by ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC (“Acquisitions”) and FORDHAM PLACE OFFICE LLC (“Office”; together with Acquisitions, individually and collectively, jointly and severally, “Mortgagor”), each a limited liability company duly organized and validly existing under the laws of the State of Delaware and having an office at c/o Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, NY 10605, in favor of EUROHYPO AG, NEW YORK BRANCH, having an office at 1114 Avenue of the Americas, New York, New York 10036, as Administrative Agent for the lenders referred to below (in such capacity, together with its successors in such capacity, “Mortgagee”).

W I T N E S S E T H:

WHEREAS, Acquisitions and the Office are the fee owners of that certain tract of land located in the County of Bronx, State of New York and being more fully described in Exhibit A attached hereto (the “Land”); and

WHEREAS, Mortgagor, certain lenders (collectively, the “Lenders”) and Mortgagee are parties to a Loan Agreement dated as of the date hereof (said Loan Agreement, as modified and supplemented and in effect from time to time, being herein called the “Loan Agreement”; and except as otherwise herein expressly provided, all terms defined in the Loan Agreement are being used herein as defined therein), which Loan Agreement provides, among other things, for Loans to be made by the Lenders to Mortgagor in an aggregate principal amount not exceeding $86,000,000.00 to be evidenced by, and repayable with interest thereon in accordance with, various Notes to be executed and delivered to the respe ctive order of the Lenders (collectively, as such notes may be consolidated, severed, modified, amended, restated or extended, the “Notes”); and

WHEREAS, pursuant to that certain Declaration of Condominium for The 400 E. Fordham Road Condominium (hereinafter, the “Declaration”) dated as of October 23, 2008 and recorded on December 18, 2008 in the New York County Office of the New York City Register as CRFN 2008000481411, together with all amendments thereto, if any, Acquisitions has established a condominium consisting of two (2) separate and distinct units, more specifically identified in the Declaration as the “Retail Unit” and the “Office/Community Unit”; and

WHEREAS, Acquisitions has transferred the Office/Community Unit to Fordham Office; and

WHEREAS, it is a condition to the obligation of the Lenders to extend credit to Mortgagor pursuant to the Loan Agreement that Mortgagor execute and deliver this Mortgage as the Mortgage under the Loan Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated into the operative provisions of this Mortgage by this reference, and for other good and valuable consideration, the receipt and adequacy of which are hereby conclusively acknowledged,

To secure the payment of an indebtedness in the principal sum of EIGHTY-SIX MILLION DOLLARS ($86,000,000.00), lawful money of the United States of America to be paid with interest (including, without limitation, any Additional Interest under any Hedge Agreement to the extent provided in the Loan Agreement) according to the Notes, and the payment and performance of all other Obligations (defined below) of Mortgagor hereunder, Mortgagor has mortgaged, given, granted, bargained, sold, alienated, conveyed, confirmed, pledged, assigned and hypothecated and by these presents do mortgage, give, grant, bargain, sell, alienate, convey, confirm, pledge, assign and hypothecate unto Mortgagee all right, title, interest and estate of Mortgagor, now owned, or hereafter acquired, in and to the following property, rights and interests (such property, rights and interests being collectively referred to herein as the “Mortgaged Property”), subject only to the Permitted Encumbrances (as defined below):

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(i) the Land;

(ii) any and all buildings, constructions and improvements now or hereafter erected or located in or on the Land or any portion thereof, including all Equipment (defined below) and other articles now or hereafter attached or affixed thereto or located thereon and owned or ground leased by Mortgagor, together with all appurtenances and additions thereto and betterments, renewals, substitutions and replacements thereof (collectively, the “Improvements”), all of which shall be deemed and construed to be part of the realty;

(iii) all of the estate, rights, title, interest, claims or demands of any nature whatsoever of Mortgagor, whether in law or in equity, in possession or expectancy, in and to the Mortgaged Property or any part thereof;

(iv) all easements, streets, rights-of-way, strips and gores of land, ways, alleys, passages, sewer rights, waters, water courses, water rights and powers, and all estates, rights, titles, interests, privileges, liberties, tenements, hereditaments, and appurtenances of any nature whatsoever, in any way belonging, relating or pertaining to the Mortgaged Property (including any and all development rights, air rights, signage rights, rights under trackage agreements, mineral, mining, oil and gas rights and rights to produce or share in the production of anything related thereto and similar or comparable rights of any nature whatsoever now or hereafter appurtenant to the Project or now or hereafter transfer red to the Project) and all land lying in the bed of any street, road or avenue, opened or proposed, in front of or adjoining the Project to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtesy and rights of curtesy property, possessions, claims and demands whatsoever, both at law and in equity, of Mortgagor of, in and to the Project, and every part and parcel thereof, with the appurtenances thereto (collectively, the “Appurtenances”; the Land, the Improvements and the Appurtenances being referred to herein, collectively, as the “Premises”);

(v) all machinery, apparatus, equipment, fittings, fixtures (including all heating, air conditioning, plumbing, lighting, communications and elevator fixtures) and other property of every kind and nature whatsoever owned or leased by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Mortgaged Property, or appurtenant thereto, or useable in connection with the present or future operation and occupancy of the Mortgaged Property and all building equipment, materials and supplies of any nature whatsoever owned by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Mortgaged Property, including all such items that do not constitute personal property under the laws of the State of New York (herein collectively referred to as the “Equipment”), and the right, title and interest of Mortgagor in and to any of the Equipment that may be subject to any security agreements (as defined in the Uniform Commercial Code of the State of New York (the “Uniform Commercial Code”)), superior or inferior or pari passu in lien to the lien of this Mortgage;

(vi) all awards or payments, including interest thereon, and the right to receive the same, which may heretofore or hereafter be made with respect to the whole or part of the Mortgaged Property, whether from the exercise of the right of eminent domain (including any proceeding or transfer in lieu of or in anticipation of the exercise of such right), or for any other injury to or decrease in the value of the Mortgaged Property, including any award resulting from a change of any streets (whether as to grade, access or otherwise) and any award for severance damages;

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(vii) all tax refunds, including interest thereon, and tax abatements, and the right to receive the same, which may be payable or available with respect to the Mortgaged Property;

(viii) all leasehold estates, leases, ground leases, subleases, licenses, concessionaire agreements, bailments or other agreements affecting the use, enjoyment or occupancy of the Mortgaged Property or any portion thereof now or hereafter existing or entered into (including any use or occupancy arrangements created pursuant to Section 365(d) of Title 11 of the United States Code (the “Bankruptcy Code”) or otherwise in connection with the commencement or continuance of any bankruptcy, reorganization, arrangement, insolvency, dissolution, receivership or similar proceedings, or any assignment for the benefit of creditors, in respect o f any tenant or occupant of any portion of the Mortgaged Property (a “Tenant”) and all extensions, amendments and modifications thereto heretofore or hereafter entered into (collectively, the “Leases”), and all right, title and interest of Mortgagor thereunder, including all guaranties thereof;

(ix) all rents, issues, profits, royalties, use and occupancy charges (including all oil and gas or other mineral royalties and bonuses), income and other benefits now or hereafter derived from any portion of the Mortgaged Property or the use or occupancy thereof (including any payments received pursuant to Section 502(b) of the Bankruptcy Code or otherwise in connection with the commencement or continuance of any bankruptcy, reorganization, arrangement, insolvency, dissolution, receivership or similar proceedings, or any assignment for the benefit of creditors, in respect of any Tenant of any portion of the Mortgaged Property and all claims as a creditor in connection with any of the foregoing) and all cash or security deposits, advance rentals, and all deposits or payments of a similar nature relating thereto (collectively, the “Rents”);

(x) all proceeds of and any unearned premiums on any insurance policies that may now or hereafter cover the Mortgaged Property, including the right to receive and apply the proceeds of any insurance, judgments or settlements made in lieu thereof, for damage to the Mortgaged Property;

(xi) all right, title and interest of Mortgagor in, to and under all plans, specifications, maps, surveys, studies, reports, permits, licenses, architectural, engineering and construction contracts, books of account, insurance policies and other documents, of whatever kind or character, relating to the use, development, construction upon, occupancy, leasing, sale or operation of the Mortgaged Property;

(xii) all the fixtures and, to the extent the same constitutes an interest in real property, all of the property described in Exhibit B attached hereto, now owned or hereafter acquired by Mortgagor, and all appurtenances and additions thereto and betterments, renewals, substitutions and replacements thereof (collectively, the “Fixtures”); and, if the lien and security interest of this Mortgage is subject to any security interest in such property, all right, title and interest of Mortgagor now owned or hereafter arising in and to any and all such property is hereby assi gned to Mortgagee, together with the benefits of all deposits and payments now or hereafter made thereon by or on behalf of Mortgagor;

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(xiii) all right, title and interest now owned or hereafter acquired by Mortgagor in and to all options to purchase or ground lease the Mortgaged Property or any portion thereof or interest therein, and in and to any greater estate in the Premises or any other Mortgaged Property;

(xiv) the right, in the name and on behalf of Mortgagor, to appear in and defend any action or proceeding brought with respect to the Mortgaged Property, and to commence any action or proceeding to protect the interest of Mortgagee and the Lenders in the Mortgaged Property;

(xv) all proceeds, products, substitutions, and accessions of the foregoing of every type; and

(xvi) all right, title and interest of Mortgagor in, to and under (including the benefits thereunder) the Declaration (as defined above).

As used herein, “Permitted Encumbrances” means the outstanding liens, easements, restrictions, security interests and other exceptions to title set forth in the policy of title insurance insuring the lien of this Mortgage, together with the liens and security interests in favor of Mortgagee created by the Loan Documents.

TO HAVE AND TO HOLD the above granted and described Mortgaged Property unto and to the use and benefit of Mortgagee, and the successors and assigns of Mortgagee, forever;

PROVIDED ALWAYS, that if the principal of and interest (including, without limitation, any Additional Interest) on the Notes and all of the other Obligations shall be paid in full according to the terms of the Notes, the Loan Agreement, any Hedge Agreement (but only if entered into with a Eurohypo Counterparty thereof pursuant to the terms of the Loan Agreement) and the other Loan Documents and Mortgagor shall abide by and comply with each and every covenant contained herein or therein, then this Mortgage and the estate hereby granted shall cease, terminate and become void.

TO PROTECT THE SECURITY OF THIS MORTGAGE, MORTGAGOR HEREBY COVENANTS AND AGREES WITH MORTGAGEE AND THE LENDERS AS FOLLOWS:

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OBLIGATIONS

(b) Obligations.

This Mortgage is executed, acknowledged and delivered by Mortgagor to secure and enforce the following obligations (collectively, the “Obligations”), subject to the limitations set forth in Section 1.02 hereof:

(i) Payment of the entire unpaid principal amount of the Notes, together with all interest (including, without limitation, any Additional Interest) accrued and unpaid thereon, any fees due under the Fee Letter and all other amounts that may or shall become due and owing under this Mortgage, the Notes, the Loan Agreement, the Hedge Agreement (but only if entered into with a Eurohypo Counterparty thereof pursuant to the terms of the Loan Agreement) and the other Loan Documents, including all sums advanced pursuant to the terms of this Mortgage to protect and preserve the Mortgaged Property and the lien and security interest hereby created therein at the time and in the manner provided therein for such payment;

(ii) Full and prompt performance of every obligation, covenant and agreement of Mortgagor arising under or in connection with this Mortgage, the Notes, the Loan Agreement and all other Loan Documents at the time and in the manner provided therein for such performance;

(iii) Payment of all other indebtedness and liabilities and performance of all other obligations of Mortgagor to Mortgagee and the Lenders arising pursuant to or in connection with this Mortgage or any other Loan Document (including, without limitation, as Additional Interest, any Hedge Agreement, but only if entered into with a Eurohypo Counterparty thereof pursuant to the terms of the Loan Agreement); and

(iv) All renewals, extensions, amendments, modifications, consolidations and changes of, or substitutions or replacements for, all or any part of the items described under clauses (a) through (c) above.

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NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, THE MAXIMUM AMOUNT OF PRINCIPAL INDEBTEDNESS SECURED BY THIS MORTGAGE AT THE TIME OF EXECUTION OR WHICH UNDER ANY CONTINGENCY MAY HEREAFTER BECOME SECURED BY THIS MORTGAGE AT ANY TIME IS EIGHTY-SIX MILLION DOLLARS ($86,000,000.00); TOGETHER WITH (A) INTEREST (INCLUDING, WITHOUT LIMITATION, ANY ADDITIONAL INTEREST) ON THE AFORESAID PRINCIPAL INDEBTEDNESS AT THE RATES SET FORTH IN THE NOTES AND (B) AMOUNTS EXPENDED BY MORTGAGEE AFTER DEFAULT OF SUMS ADVANCED OR PAID FOR HEREUNDER TO MAINTAIN THE LIEN OF THIS MORTGAGE OR TO PROTECT THE PREMISES SECURED BY THIS MORTGAGE, INCLUDING, WITHOUT LIMITATION, AMOUNTS IN RESPECT OF INSURANCE PREMIUMS, IMPOSITIONS (OR PAYMENTS IN LIEU OF IMPOSITIONS), LITIGATION EXPENSES TO PROSECUTE OR DEFEND THE RIGHTS, REMEDIES AND LIEN OF THIS MORTGAGE OR TITLE TO THE PREMISES SECURED HEREBY, AND ANY COSTS, CHARGES OR AMOUNTS TO WHICH MORTGAGEE OR THE LENDERS BECOME SUBROGATED UPON PAYMENT, WHETHER UNDER RECOGNIZED PRINCIPLES OF LAW OR EQUITY OR UNDER EXPRESS STATUTORY AUTHORITY.

10.

PARTICULAR COVENANTS AND AGREEMENTS OF MORTGAGOR

(a) Payment of Secured Obligations.

Mortgagor shall pay and perform the Obligations in full in accordance with the terms of the Notes, the Loan Agreement and the other Loan Documents.

(b) Title, etc.

(i) Mortgagor represents and warrants that (i) Mortgagor is lawfully seized and possessed of good, marketable and insurable fee simple title to the Premises and good sufficient and legal title to all other portions of the Mortgaged Property, in each case subject to no Liens other than Permitted Encumbrances and (iii) it has the full power and lawful authority to grant, bargain, sell, release, convey, warrant, assign, transfer, mortgage, pledge, set over and confirm unto Mortgagee the Mortgaged Property as hereinabove provided.

(ii) Mortgagor shall, at Mortgagor’s sole cost and expense, preserve Mortgagor’s title to the Mortgaged Property and the validity, enforceability and first priority of the lien of this Mortgage (subject to the Permitted Encumbrances) and shall forever warrant and defend the same to Mortgagee against the claims of each and every Person claiming or threatening to claim the same or any part thereof.

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(iii) If the lien or security interest created by this Mortgage, or the validity, enforceability or priority thereof or of this Mortgage, or if title or any of the rights of Mortgagor or Mortgagee in or to the Mortgaged Property, shall be endangered or questioned, or shall be attacked directly or indirectly, or if any action or proceeding is instituted against Mortgagor, Mortgagee or any Lender with respect thereto, Mortgagor will promptly notify Mortgagee thereof and will diligently take such action as may be required to cure any defect that may be developed or claimed, and will take all necessary and proper steps for the defense of such action or proceeding, including the employment of counsel, the prosecu tion or defense of litigation and (subject to Mortgagee’s approval, not to be unreasonably withheld or delayed) the release or discharge of any and all adverse claims. Mortgagee shall have the right to appear in and defend any such actions or proceedings (whether or not originally named as a party to such actions or proceedings) and is hereby authorized and empowered (but shall not be obligated) to take such additional steps as it may deem necessary or proper, in the name and on behalf of Mortgagor, for the defense of any such action or proceeding or the protection of the lien, security interest, validity, enforceability or priority of this Mortgage or of such title or rights, including the employment of counsel, the institution, prosecution or defense of litigation, the compromise, release or discharge of such adverse claims, the purchase of any tax title and the removal of such prior liens and security interests.

(i) Mortgagor shall execute, acknowledge and deliver, from time to time, such further instruments as may be necessary, or that Mortgagee may reasonably require to accomplish the purposes of this Mortgage.

(ii) Mortgagor, immediately upon the execution and delivery of this Mortgage, and thereafter from time to time, shall cause this Mortgage, any security agreement or mortgage supplemental hereto and each instrument of further assurance to be executed, acknowledged, filed, registered or recorded and refiled, re-registered or re-recorded in such manner and in such places as may be required by Mortgagee or by any present or future law in order to publish notice of and perfect the lien and estate of this Mortgage upon, and security interest in, the Mortgaged Property.

(iii) Mortgagor shall pay all filing, registration and recording fees, all refiling, re-registration and re-recording fees, and all expenses incident to the execution, filing, recording and acknowledgment of this Mortgage, any security agreement or mortgage supplemental hereto and any instrument of further assurance, and all Federal, state, county and municipal stamp taxes, mortgage taxes and other taxes, duties, imposts, assessments and charges arising out of or in connection with the execution, delivery, filing and recording of the Notes, this Mortgage, the Loan Agreement or any of the other Loan Documents, any security agreement or mortgage supplemental hereto or any instruments of further assurance.

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(d) Liens; Transfers.

Mortgagor shall not create or suffer to be created any Lien upon the Mortgaged Property prior to, on a parity with, or subordinate to the lien of this Mortgage or permit any transfers in violation of Section 9.1 of the Loan Agreement, other than Permitted Encumbrances.

(e) Insurance.

Mortgagor shall cause the Mortgaged Property to be insured in the manner and to the extent required by Section 3.1 of the Loan Agreement.

(f) Impositions.

Mortgagor shall pay or cause to be paid, before any fine, penalty, interest or cost attaches thereto, all Impositions (as defined below) in accordance with Section 9.2 of the Loan Agreement, including, without limitation, all taxes, assessments, water and sewer rates, utility charges and all other governmental or nongovernmental charges or levies now or hereafter assessed or levied against any part of the Mortgaged Property (including, without limitation, nongovernmental levies or assessments such as maintenance charges, owner association dues or charges or fees, levies or charges resulting from covenants, conditions and restrictions affecting the Mortgaged Property) or upon the lien or estate of Mortgagee therein, as well as all claims for labor, materials or supplies that, if unpaid, might by law become a prior lien thereon (collecti vely, the “Impositions”), and within ten (10) days after request by Mortgagee will exhibit receipts showing payment of any of the foregoing; provided, however, that if by law any such Imposition may be paid in installments (whether or not interest shall accrue on the unpaid balance thereof), Mortgagor may pay the same in installments (together with accrued interest on the unpaid balance thereof) as the same respectively become due, before any fine, penalty or cost attaches thereto.

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(g) Maintenance of the Improvements and Equipment.

Mortgagor shall (i) not permit the Improvements or Fixtures to be removed or demolished; (ii) maintain the Mortgaged Property in good repair, working order and condition; and (iii) restore and repair the Improvements and Equipment or any part thereof now or hereafter affected by any Casualty Event or Taking in accordance with the Loan Agreement.

(h) Compliance With Laws.

Mortgagor covenants and agrees to (i) comply with all applicable laws, including, without limitation, Environmental Laws, in accordance with Article 5 of the Loan Agreement and the Environmental Indemnity and (ii) indemnify and hold Mortgagee and the Lenders harmless from and against any and all losses, liabilities, claims, damages or expenses arising from Mortgagor’s failure to so comply with applicable law, including, without limitation, Environmental Laws, in accordance with the Loan Agreement and the Environmental Indemnity.

(i) Limitations of Use.

Mortgagor shall not initiate, join in or consent to any change in any private restrictive covenant, zoning ordinance or other public or private restrictions limiting or defining the uses that may be made of the Premises or any part thereof without the prior written consent of Mortgagee. Mortgagor shall comply with the provisions of all Governmental Approvals and all licenses, agreements and private covenants, conditions and restrictions that at any time are applicable to the Mortgaged Property.

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(j) Actions to Protect Mortgaged Property.

If Mortgagor shall fail beyond any applicable notice and/or grace period to (i) effect the insurance required by Section 2.05 hereof, (ii) make the payments required by Section 2.06 hereof or (iii) perform or observe any of its other covenants or agreements hereunder, Mortgagee may, without obligation to do so, and upon notice to Mort gagor (except in an emergency) effect or pay the same; provided however, any such payment by the Mortgagee shall not affect whether such failure by the Mortgagor constitutes an Event of Default. To the maximum extent permitted by law, all sums, including reasonable attorneys’ fees and disbursements, so expended or expended to sustain the lien or estate of this Mortgage or its priority, or to protect or enforce any of the rights hereunder, or to recover any of the Obligations, shall be a lien on the Mortgaged Property, and shall, subject to the provisions of Section 1.02 hereof, be deemed to be added to the Obligations secured hereby, and shall be paid by Mortgagor within 10 days after demand therefor, together with interest thereon at the Post-Default Rate . For such purpose, Mortgagor expressly grants to Mortgagee, in addition to, and without prejudice to, any other rights and remedies hereunder, (1) the right to enter upon (and, in Mortgagee’s discretion, to take possession of) the Mortgaged Property to such extent and as often as it may deem necessary or desirable to prevent or remedy any such default or to take any such action, and (2) the right to appear in, defend or bring any action or proceeding to protect Mortgagee’s interest in the Mortgaged Property or, during the continuance of an Event of Default, to foreclose this Mortgage or collect the Obligations, and Mortgagor hereby irrevocably appoints and constitutes Mortgagee as Mortgagor’s lawful attorney-in-fact, coupled with an interest and with full power of substitution, for such purposes and the taking of all acts incidental thereto. No such advance, performance or action or proceeding shall be deemed to have cured such Default or any Event of Default (as here inafter defined) with respect thereto. In any action or proceeding to foreclose this Mortgage or recover or collect the Obligations, Mortgagee and the Lenders shall be entitled to recover the reasonable costs, expenses and attorneys’ fees and disbursements incurred in foreclosing or attempting to collect upon the Obligations, which costs, expenses and attorneys’ fees, to the extent permitted by applicable law, shall also be secured by this Mortgage.

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(k) Insurance and Condemnation Proceeds.

Mortgagor assigns to Mortgagee on behalf of the Lenders, all of Mortgagor’s right, title and interest in (i) all awards or payments, including interest thereon, and the right to receive the same, which may heretofore or hereafter be made with respect to the whole or part of the Mortgaged Property, whether from the exercise of the right of eminent domain (including any proceeding or transfer in lieu of or in anticipation of the exercise of such right), or for any other injury to or decrease in the value of the Mortgaged Property, including any award resulting from a change of any streets (whether as to grade, access or otherwise) and any award for severance damages and (ii) all proceeds of and any unearned premiums on any insurance policies that may now or hereafter cover the Mortgaged Property, including the right to receive and apply the proceeds of any insurance, judgments or settlements made in lieu thereof, for damage to the Mortgaged Property. Any Insurance Proceeds or Condemnation Awards shall be held and applied by Mortgagee in accordance with Article X of the Loan Agreement.

(l) Inspections.

Mortgagor shall permit Mortgagee and each Lender, and their agents, representatives and employees, upon reasonable prior notice to Mortgagor, to inspect the Mortgaged Property and conduct such environmental and engineering studies as Mortgagee may require pursuant to the Environmental Indemnity, provided that such inspections and studies shall not materially interfere with the use and operation of the Mortgaged Property.

11.

ASSIGNMENT OF LEASES AND RENTS

(a) Assignment of Rents, Issues and Profits.

(i) Mortgagor hereby absolutely and unconditionally assigns to Mortgagee, as part of the consideration for the transactions contemplated by this Mortgage and the other Loan Documents, the Rents and Leases and other documents or instruments evidencing the Rents now or hereafter in effect and any and all deposits or letters of credit held as security under the Leases, it being intended by Mortgagor and Mortgagee that such assignment constitutes an absolute and present assignment and not an assignment for additional security only. Nothing contained in the foregoing sentence shall be construed to bind Mortgagee to the performance of any of the covenants, conditions or provisions contained in any such Lease or other document or otherwise to impose any obligation on Mortgagee (including any liability under the covenant of quiet enjoyment contained in any Lease), except that Mortgagee shall be accountable for any money or security actually received pursuant to such assignment. Such assignment and grant shall continue in effect until the Obligations have been indefeasibly paid in full, the execution of this Mortgage constituting and evidencing the irrevocable consent of Mortgagor to the entry upon and taking possession of the Mortgaged Property by Mortgagee and the exercise by Mortgagee of the rights and powers granted pursuant hereto, including, without limitation, those set forth in clauses (i) through (vii) below, regardless of whether foreclosure has been instituted and without applying for a receiver. Such assignment shall include, without limitation:

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the immediate and continuing right to receive and collect all amounts payable by all Tenants, including without limitation (A) all Rents,(B) all damages or other amounts payable in the event of any expiration or termination of any Lease pursuant to the terms thereof, by operation of law or otherwise, (C) any indemnification against, or reimbursement for, sums paid and costs and expenses incurred by Mortgagor under any Lease or otherwise, (D) any award in the event of the bankruptcy of any Tenant or guarantor of a Lease, and (E) all security deposits, other security instruments, other deposits or prepayments with respect to any such Leases;

all claims, rights, powers, privileges and remedies of Mortgagor, whether provided for in any Lease or arising by statute or at law or in equity or otherwise, consequent on any failure on the part of any Tenant to perform or comply with any term of any Lease;

all right to take all action upon the happening of a default under any Lease as shall be permitted by any Lease or by law, including, without limitation, the commencement, conduct and consummation of proceedings at law or in equity;

the full power and authority, in the name of Mortgagor, or otherwise, to enforce, collect, receive and make receipt for any and all of the foregoing and to do any and all other acts and things whatsoever which Mortgagor, or any landlord is or may be entitled to do under any Lease;

the full power and authority, in the name of Mortgagor, or otherwise, to enforce any Lease;

the full power and authority, in the name of Mortgagor, or otherwise, to lease the Mortgaged Property; and

the right to apply the Rents to the payment of the Obligations in accordance with the Loan Agreement.

(ii) During the term hereof, all rights, powers and privileges of Mortgagee herein set forth are coupled with an interest and are irrevocable, subject to the terms and conditions hereof, and Mortgagor will not take any action under any Lease or otherwise which is inconsistent with this Mortgage or any of the terms hereof or thereof and any such action inconsistent herewith or therewith shall, to the fullest extent permitted by applicable law, be void. Any further assignment of any rents, issues, or profits from the Mortgaged Property shall to the fullest extent permitted by law be void. To the fullest extent permitted by applicable law, Mortgagor hereby waives any requirement that Mortg agee commence any foreclosure proceeding with respect to any or all of the Mortgaged Property prior to enforcement of any remedies pursuant to this Article 3, including the right to commence and prosecute an action to appoint a receiver for rents and all other amounts due under any Leases. Mortgagor will, from time to time, upon request of Mortgagee, execute all instruments and further assurances and all supplemental instruments and take all such action as Mortgagee from time to time may reasonably request in order to perfect, preserve and protect the interests intended to be assigned to Mortgagee hereby.

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(iii) Mortgagor hereby agrees that it will not, unilaterally or by agreement, (i) subordinate, amend, modify, extend, discharge, terminate, surrender, waive or otherwise change any term of any Lease in any manner which would violate this Mortgage, the Loan Agreement or the other Loan Documents or (ii) except for security deposits, accept a prepayment of Rent in excess of Rent for one month. If any Lease shall be amended as permitted hereby, such Lease shall continue to be subject to the provisions hereof without the necessity of any further act by any of the parties hereto, subject to the provisions of any non-disturbance agreement which Mortgagee may have granted in accordance with the provisions of this Mortgage.

(b) Grant of License; Revocation.

Until the occurrence of an Event of Default, Mortgagee waives its rights under Section 3.01 above, and grants Mortgagor a license to collect the Rents and enforce any rights, remedies, entitlements, benefits and/or powers assigned hereunder or granted to Mortgagee, including, without limitation, those enumerated in clauses (i) through (vii) of Section 3.01(a). Such license to collect, receive and retain the Rents and enforce such rights, remedies, entitlements, benefits and/or powers shall be autom atically revoked and the rights of Mortgagor thereunder shall automatically cease and terminate upon the occurrence of an Event of Default under this Mortgage. In such event, (i) Mortgagor hereby authorizes Mortgagee to receive and collect the Rents due under the terms of each Lease and to direct any Tenant, by written notice from Mortgagee or otherwise, to forward such Rents by mail or in person to Mortgagee and (ii) Mortgagor shall immediately pay to Mortgagee any Rents held by or under the control of Mortgagor. Mortgagor hereby irrevocably appoints and constitutes Mortgagee as Mortgagor’s lawful attorney-in-fact, coupled with an interest and with full power of substitution, for the purpose of taking any of the actions described in the immediately preceding sentence and all acts incidental thereto. Following the revocation of the license herein granted, Mortgagee may retain and apply the Rents toward payment of the Obligations in such order, priority and proportions a s Mortgagee, in its discretion, shall deem proper, or to the operation, maintenance and repair of the Mortgaged Property, and irrespective of whether Mortgagee shall have commenced a foreclosure of this Mortgage or shall have applied or arranged for the appointment of a receiver with respect thereto.

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Mortgagor hereby irrevocably authorizes and directs each Tenant of the Mortgaged Property, upon receipt of notice from Mortgagee of an Event of Default, to pay all Rents due or to become due under its Lease directly to Mortgagee or to any appointed receiver of the Mortgaged Property. Each such Tenant shall have the right to rely upon any such notice of Mortgagee directing the payment of all Rents to Mortgagee, without any obligation to inquire as to the actual existence of the Event of Default, notwithstanding any claim of Mortgagor to the contrary and Mortgagor shall have no rights or claims against any Tenant for any Rents so paid to Mortgagee. Mortgagor shall facilitate, in all reasonable ways, the collection of the Rents by Mortgagee and will, upon request by Mortgagee, execute a written notice to each Tenant directing the Tenant to pay the Rents payable under such Tenant’s respective Lease to Mortgagee. Each Tenant is hereby expressly authorized and directed, upon demand by Mortgagee and without the necessity of any further consent by, or notice from, Mortgagor, to attorn to Mortgagee as the owner of the Leases and to pay any and all Rents due to Mortgagor pursuant to such Tenant’s Lease directly to Mortgagee or to any appointed receiver, and to observe and perform such Tenant’s obligations under the Tenant’s Lease to or for Mortgagee and to accept performance of the landlord’s obligations under the Lease from Mortgagee. Each Tenant is hereby expressly relieved of any and all duty, liability or obligation to Mortgagor in respect of all payments so made. The payment of Rents to Mortgagee pursuant to Mortgagee’s demand and the performance of obligations under any Lease to or for the benefit of Mortgagee shall not cause Mortgagee to assume or be b ound by any of the provisions of any such Lease and shall not relieve Mortgagor of its obligations thereunder.

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(d) Section 291-f Agreement.

(i) This Mortgage is intended to be, and shall operate as, the agreement described in Section 291-f of the Real Property Law of the State of New York and shall be entitled to the benefits afforded thereby.

(ii) Mortgagor shall (unless such notice is contained in such Tenant’s Lease) deliver notice of this Mortgage, which notice shall be to all present and future holders of any interest in any Lease, by assignment or otherwise, and shall take such other action as may now or hereafter be reasonably required to afford Mortgagee the full protections and benefits of such Section 291-f; and

(iii) Mortgagor shall request the recipient of any such notice to acknowledge the receipt thereof.

12.

SECURITY AGREEMENT; FIXTURE FILING

(a) Creation of Security Interest.

This Mortgage constitutes both a real property mortgage and a “security agreement”, within the meaning of the Uniform Commercial Code. The Mortgaged Property includes both real and personal property and all other rights and interest, whether tangible or intangible in nature, of Mortgagor in the Mortgaged Property whether now or hereafter existing. Mortgagor by executing and delivering this Mortgage has granted and hereby grants to Mortgagee, as security for the Obligations, a security interest in (a) the Mortgaged Property, and (b) the personal property identified on Exhibit B attached hereto whether now or hereafter existing, in each case to the fullest extent that the same may be subject to the Uniform Commercial Code (all of such personal property so subject to the Uniform Commercial Code, the “Personal Property Collateral”). If an Event of Default shall exist, (i) Mortgagee, in addition to any other rights and remedies that it may have, shall have and may exercise immediately and without demand, any and all rights and remedies granted to a secured party upon default under the Uniform Commercial Code, including the right to take possession of the Personal Property Collateral, or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Personal Property Collateral and (ii) upon request or demand of Mortgagee, Mortgagor shall, at Mortgagor’s sole expense, assemble the Personal Property Collateral and make it available to Mortgagee at a convenient place acceptable to Mortgagee. Mortgagor shall pay to Mortgagee on demand any and all expenses, including reasonabl e attorneys’ fees, costs and disbursements, incurred or paid by Mortgagee in protecting its interest in the Personal Property Collateral and in enforcing its rights hereunder with respect to the Personal Property Collateral. Any notice of sale, disposition or other intended action by Mortgagee with respect to the Personal Property Collateral sent to Mortgagor in accordance with the provisions of this Mortgage at least five (5) Business Days prior to such sale, disposition or other action, shall constitute reasonable notice to Mortgagor, and the method of sale or disposition or other intended action set forth or specified in such notice shall conclusively be deemed to be commercially reasonable within the meaning of the Uniform Commercial Code unless objected to by Mortgagor within three (3) Business Days after such notice. The proceeds of any sale or disposition of the Personal Property Collateral, or any part thereof, may be applied by Mortgagee to the payment of the Obligations in such priority and proportions as Mortgagee in its discretion shall deem proper.

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(b) Continuation Statements; Amendments.

Mortgagor hereby authorizes Mortgagee to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Personal Property Collateral without the signature of Mortgagor where permitted by applicable law.

This Mortgage shall also constitute a “fixture filing” filed as a fixture filing in the Official Records of the County Recorder of the county in which the Mortgaged Property is located for the purposes of the Uniform Commercial Code against all of the Mortgaged Property which is or is to become fixtures. Information concerning the security interest herein granted may be obtained at the address of Debtor (Mortgagor).

13.

DEFAULTS; REMEDIES

(a) Events of Default.

If any Event of Default (herein, an “Event of Default”) under the Loan Agreement shall occur and be continuing then, as more particularly provided in the Loan Agreement, the unpaid principal of and accrued interest on the Notes and all other Obligations under the Loan Agreement may be declared, or may become, due and payable, without presentment, demand, protest or other formalities of any kind, all of which have been waived pursuant to the Loan Agreement.

(b) Remedies.

If an Event of Default shall have occurred and be continuing, this Mortgage may, to the maximum extent permitted by law, be enforced, and Mortgagee may exercise any right, power or remedy permitted to it hereunder, under the Loan Agreement or under any of the other Loan Documents or by law, and, without limiting the generality of the foregoing, Mortgagee may, personally or by its agents, exercise any of the following to the maximum extent permitted by law:

(i) Subject to any applicable provisions of the Notes, the Loan Agreement, the Hedge Agreement and the other Loan Documents, Mortgagee may declare all or any portion of the unpaid principal balance under the Notes, together with all accrued and unpaid interest (including, without limitation, any Additional Interest) thereon, and all other unpaid Obligations, to be immediately due and payable;

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(ii) Mortgagee may enter into or upon the Premises, personally or by its agents, nominees or attorneys, and may dispossess Mortgagor and its agents and servants therefrom, and thereupon Mortgagee at its sole discretion may: (i) use, operate, manage, control, insure, maintain, repair, restore and otherwise deal with all and every portion of the Mortgaged Property and conduct business thereon, in any case either in the name of Mortgagee or in such other name as Mortgagee shall deem best; (ii) complete any construction with respect to the Mortgaged Property in such manner and form as Mortgagee deems advisable; (iii) make alterations, additions, renewals, replacements and improvements to or on the Mor tgaged Property; (iv) exercise all rights and powers of Mortgagor with respect to the Mortgaged Property, whether in the name of Mortgagor or otherwise, including the right to make, cancel, enforce or modify Leases, obtain and evict tenants, and demand, sue for, collect and receive all Rents; and (v) apply the receipts of all such Rents to the payment of the Obligations as provided in the Loan Agreement, after deducting therefrom all expenses (including reasonable attorneys’ fees and disbursements) incurred in connection with the aforesaid operations and all amounts necessary to pay the operating costs for the Mortgaged Property and other charges in connection with the Mortgaged Property, as well as just and reasonable compensation for the services of Mortgagee, its agents, nominees and attorneys.

(iii) With or without entry, personally or by its agents, nominees or attorneys, Mortgagee may sell all or any portion of the Mortgaged Property and all or any portion of Mortgagor’s estate, right, title, interest, claim and demand therein and right of redemption thereof at one or more private or public sales in the manner and to the extent permitted by law, as an entirety or in parcels or portions, and Mortgagee shall have the statutory power of sale if and to the extent provided by applicable law.

(iv) Mortgagee may institute proceedings for the complete or partial foreclosure of this Mortgage against all or any portion of the Mortgaged Property, in which case the Mortgaged Property may be sold for cash or upon credit, as an entirety or in parcels or portions.

(v) Mortgagee may institute an action, suit or proceeding at law or in equity for the specific performance of any covenant, condition or agreement contained herein or in the Notes, the Loan Agreement or any other Loan Document, or in aid of the execution of any power granted hereunder or for the enforcement of any other appropriate legal or equitable remedy.

(vi) Mortgagee may recover judgment on the Notes, either before, during or after any proceedings for the foreclosure (or partial foreclosure) or enforcement of this Mortgage.

(vii) Mortgagee may, as a matter of right, secure the appointment of a receiver, trustee, liquidator or similar official of the Mortgaged Property or any portion thereof, and Mortgagor hereby consents and agrees to such appointment, without notice to Mortgagor and without regard to the adequacy of the security for the Obligations and without regard to the solvency of Mortgagor or any other Person liable for the payment of the Obligations, and such receiver or other official shall have all rights and powers permitted by applicable law and such other rights and powers as the court making such appointment may confer, but the appointment of such receiver or other official shall not impair or in any manner prejud ice the rights of Mortgagee to receive the Rents with respect to the Mortgaged Property pursuant to this Mortgage.

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(viii) In addition to the rights which Mortgagee may have herein, upon the occurrence of any Event of Default, Mortgagee, at its option, may require Mortgagor to pay monthly in advance to Mortgagee, or any receiver appointed to collect the Rents, the fair and reasonable rental value for the use and occupation of any portion of the Mortgaged Property occupied by Mortgagor and may require Mortgagor to vacate and surrender possession to Mortgagee of the Mortgaged Property or to such receiver and, Mortgagor may be evicted by summary proceedings or otherwise.

(ix) Mortgagee shall have all of the rights and remedies with respect to the Mortgaged Property and the Personal Property Collateral of a secured party under the Uniform Commercial Code (whether or not said Uniform Commercial Code is in effect in the jurisdiction where the rights and remedies are asserted) and such additional rights and remedies to which a secured party is entitled under the applicable laws, including, without limitation, the right, to the maximum extent permitted by law, to exercise all voting, consensual and other power of ownership pertaining to the Mortgaged Property or the Personal Property Collateral as if Mortgagee were the sole and absolute owner thereof (and Mortgagor agrees to take all such action as may be appropriate to give effect to such right).

(x) Mortgagee or the Lenders may pursue against Mortgagor, any other rights and remedies of Mortgagee permitted by law, equity or contract or as set forth herein or in the Loan Agreement, the Hedge Agreement or the other Loan Documents.

(xi) Reference is made to Section 1401(1) of the New York Real Property Actions and Proceedings Law. Mortgagor agrees that, during the existence of any Event of Default hereunder or the Notes secured hereby, Mortgagee shall have the right to sell the Land and without limitation, that this Mortgage may be foreclosed in the manner prescribed in Article 14 of the New York Real Property Actions and Proceedings Law for a non-judicial proceeding for foreclosure by power of sale in accordance with the requirements of such Article 14 or any provision of New York law which may hereafter be enacted permitting foreclosure by sale, power of sale or similar procedure.

The proceeds of any sale made either under the power of sale hereby given or under a judgment, order or decree made in any action to foreclose or to enforce this Mortgage, or of any monies held by Mortgagee hereunder shall be applied in the following order:

(i) First, to payment of the costs and expenses of taking possession of the Mortgaged Property, and of the costs and expenses of the sale, including but not limited to Mortgagee’s fees, legal fees and disbursements, title charges and transfer taxes, and payment of all expenses, liabilities and advances of Mortgagee;

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(ii) Second, payment of all sums expended by Mortgagee under the terms of this Mortgage and not yet repaid, together with interest on such sums at the Post-Default Rate;

(iii) Third, to payment of the secured indebtedness and all other Obligations secured by this Mortgage, including, without limitation, interest at the Post-Default Rate provided for under the Loan Documents, and any charge expressly required to be paid under the Notes in order to prepay principal, in any order that Mortgagee chooses in its sole discretion; and

(iv) Finally, the remainder, if any, of such funds shall be disbursed to Mortgagor or to any other Person or Persons legally entitled thereto.

(d) Right to Sue.

Mortgagee shall have the right from time to time to sue for any sums required to be paid by Mortgagor under the terms of this Mortgage as the same become due, without regard to whether or not the Obligations shall be, or have become, due and without prejudice to the right of Mortgagee thereafter to bring any action or proceeding of foreclosure or any other action upon the occurrence of any Event of Default existing at the time such earlier action was commenced.

(e) Powers of Mortgagee.

Mortgagee may at any time or from time to time renew or extend this Mortgage or (with the agreement of Mortgagor) alter or modify the same in any way, or waive any of the terms, covenants or conditions hereof or thereof, in whole or in part, and may release any portion of the Mortgaged Property or any other security, and grant such extensions and indulgences in relation to the Obligations, or release any Person liable therefor as Mortgagee may determine without the consent of any junior lienor or encumbrancer, without in any manner affecting the priority of the Lien and estate of this Mortgage on or in any part of the Mortgaged Property, and without affecting the liability of any other Person liable for any of the Obligations.

(f) Remedies Cumulative.

(i) No right or remedy herein conferred upon or reserved to Mortgagee is intended to be exclusive of any other right or remedy, and each and every right and remedy shall be cumulative and in addition to any other right or remedy under this Mortgage and the other Loan Documents, or under applicable law, whether now or hereafter existing; the failure of Mortgagee to insist at any time upon the strict observance or performance of any of the provisions of this Mortgage or to exercise any right or remedy provided for herein or under applicable law, shall not impair any such right or remedy nor be construed as a waiver or relinquishment thereof.

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(ii) Mortgagee shall be entitled to enforce payment and performance of any of the Obligations and to exercise all rights and powers under this Mortgage or under any Loan Document or any laws now or hereafter in force, notwithstanding that some or all of the Obligations may now or hereafter be otherwise secured, whether by mortgage, deed of trust, pledge, lien, assignment or otherwise; neither the acceptance of this Mortgage nor its enforcement, whether by court action or pursuant to the power of sale or other powers herein contained, shall prejudice or in any manner affect Mortgagee’s right to realize upon or enforce any other security now or hereafter held by Mortgagee, it being stipulated that Mortga gee shall be entitled to enforce this Mortgage, any of the Security Documents and any other security now or hereafter held by Mortgagee in such order and manner as Mortgagee, in its sole discretion, may determine; every power or remedy given by the Loan Agreement, this Mortgage or any of the other Loan Documents to Mortgagee, or to which Mortgagee is otherwise entitled, may be exercised, concurrently or independently, from time to time and as often as may be deemed expedient by Mortgagee, and Mortgagee may pursue inconsistent remedies.

(g) General Provisions.

(i) Effect of Judgment. No recovery of any judgment by Mortgagee and no levy of an execution under any judgment upon any other property of Mortgagor shall adversely affect in any manner or to any extent the Lien of this Mortgage upon the Mortgaged Property, or any rights, powers or remedies of Mortgagee hereunder. Such Lien, rights, powers and remedies of Mortgagee shall continue unimpaired as before.

(ii) Continuing Power of Sale. The power of sale conferred upon Mortgagee in this Mortgage shall not be exhausted by any one or more sales as to any portion of the Mortgaged Property or the Personal Property Collateral remaining unsold, but shall continue unimpaired, to the fullest extent permitted by law, until all of the Obligations are paid in full.

(iii) Right to Purchase. At any sale of the Mortgaged Property or the Personal Property Collateral or any portion thereof pursuant to the provisions of this Mortgage, Mortgagee shall have the right to purchase the Mortgaged Property (or such portion thereof) being sold, and in such case shall have the right to credit against the amount of the bid made therefor (to the extent necessary) all or any portion of the Obligations.

(iv) Adjournment of Sale. Mortgagee may postpone or adjourn from time to time any sale of all or any part of the Mortgaged Property by it to be made hereunder or by virtue hereof by announcement at the time and place appointed for such sale or such adjourned sale or sales; and, except as otherwise provided by any applicable provision of law, Mortgagee, without further notice or publication, may make such sale at the time and place to which the same shall be so postponed or adjourned, as the case may be.

(v) Right to Terminate Proceedings. Mortgagee may terminate or rescind any proceeding or other action brought in connection with its exercise of the remedies provided in this Article 5 at any time before the conclusion thereof, as determined in Mortgagee’s sole discretion and without prejudice to Mortgagee.

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(vi) No Waiver or Release. Mortgagee may resort to any remedies and the security given by the Loan Documents, in whole or in part, and in such portions and in such order as determined in Mortgagee’s sole discretion. No such action shall in any way be considered a waiver of any rights, benefits or remedies evidenced or provided by the Loan Documents. The failure of Mortgagee to exercise any right, remedy or option provided in the Loan Documents shall not be deemed a waiver of such right, remedy or option or of any covenant or obligation secured by the Loan Documents. No acceptance by Mortgagee of any payment after the occurrence of an Event of Default and no payment by Mortgagee of any obligation for which Mortgagor is liable hereunder shall be deemed to waive or cure any Event of Default with respect to Mortgagor, or Mortgagor’s liability to pay such obligation. No sale of all or any portion of the Mortgaged Property, no forbearance on the part of Mortgagee, and no extension of time for the payment of the whole or any portion of the Obligations or any other indulgence given by Mortgagee to Mortgagor or any other Person, shall operate to release or in any manner affect the interest of Mortgagee in any remaining portion of the Mortgaged Property or the liability of Mortgagor to pay and perform the Obligations, except to the extent that such liability shall be reduced by net proceeds actually received by Mortgagee with respect to any portion of the Mortgaged Property. No waiver by Mortgagee shall be effective unless it is in writing and then only to the extent specifically stated.

(vii) No Impairment; No Release. The interests and rights of Mortgagee under the Loan Documents shall not be impaired by any indulgence, including (i) any renewal, extension or modification which Mortgagee may grant with respect to any of the Obligations; (ii) any surrender, compromise, release, renewal, extension, exchange or substitution which Mortgagee may grant with respect to the Mortgaged Property or any portion thereof; or (iii) any waiver, release or indulgence granted to any maker, endorser, guarantor or surety of any of the Obligations.

(viii) Waivers and Agreements Regarding Remedies. To the fullest extent Mortgagor may legally do so, Mortgagor, for itself and for all persons hereunder claiming through or under it or who may at any time acquire a lien on all or any part of the Mortgaged Property or any interest therein:

agrees that Mortgagor will not at any time insist upon, plead, claim or take the benefit or advantage of any laws now or hereafter in force providing for any appraisal or appraisement, valuation, stay, extension or redemption, and waives and releases all rights of redemption, valuation, appraisal or appraisement, stay of execution, extension and notice of election to accelerate or declare due the whole or any portion of the Obligations;

waives all rights to a marshaling of the assets of Mortgagor and others with interests in Mortgagor, and of the Mortgaged Property, or to a sale in inverse order of alienation in the event of foreclosure of the interests hereby created, and agrees not to assert any right under any laws pertaining to the marshaling of assets, the sale in inverse order of alienation, homestead exemption, the administration of estates of decedents, or any other matters whatsoever to defeat, reduce or affect the right of Mortgagee under the Loan Documents to a sale of the Mortgaged Property for the collection of the Obligations without any prior or different resort for collection, or the right of Mortgagee to the payment of the Obligations out of the net proceeds from the Mortgaged Property in preference to every other claimant whatsoever;

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waives any right to bring or utilize any defense, counterclaim or setoff; provided, however, that if such counterclaim or setoff is based on a claim which could be tried in an action for money damages, the foregoing waiver shall not bar a separate action for such damage (unless such claim is required by law or applicable rules of procedure to be pleaded in or consolidated with the action initiated by Mortgagee), but such separate action shall not thereafter be consolidated with any foreclosure action of Mortgagee; and provided further that the bringing of such separate action for money damages shall not be deemed to afford any grounds for staying any such foreclosure action;

waives and relinquishes any and all rights and remedies which Mortgagor may have or be able to assert by reason of the provisions of any laws pertaining to the rights and remedies of sureties; and

waives any right which it may have to require the Mortgaged Property (or any part thereof) to be sold as one or more units.

(ix) Subrogation. If all or any portion of the proceeds of the Notes or any disbursement shall be used directly or indirectly to pay off, discharge or satisfy, in whole or in part, any prior Lien upon the Mortgaged Property or any portion thereof, then Mortgagee shall be subrogated to, and shall have the benefit of the priority of, such other Lien and any additional security held by the holder thereof.

(h) No Mortgagee-in-Possession.

None of the enforcement of any of the remedies under this Article 5, the assignment of the Leases and Rents under Article 3, the security interests under Article 4, nor any other remedies afforded to Mortgagee and/or the Lenders under the Loan Documents, at law or in equity shall cause Mortgage e or any Lender to be deemed or construed to be a mortgagee in possession of the Mortgaged Property, to obligate Mortgagee or any Lender to lease the Mortgaged Property or attempt to do so, or to take any action, incur any expense, or perform or discharge any obligation, duty or liability whatsoever under any of the Leases or otherwise.

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14.

MISCELLANEOUS

(a) Release by Mortgagee.

Upon the termination of the Commitments under and as defined in the Loan Agreement and the payment in full of the Obligations, Mortgagee shall release the lien of this Mortgage, or upon the request of Mortgagor, and, provided that Mortgagor shall pay Mortgagee’s reasonable expenses, assign, without recourse, representation or warranty of any kind, this Mortgage to Mortgagor’s designee, or to the person or persons legally entitled thereto, by an instrument duly acknowledged in form for recording.

(b) Notices.

All notices, demands, consents, requests or other communications that are permitted or required to be given by any party to the other hereunder shall be in writing and given in the manner specified in the Loan Agreement.

Any failure by Mortgagee to insist upon strict performance of any of the terms, provisions or conditions of this Mortgage or the other Loan Documents shall not be deemed to be a waiver of same, and Mortgagee shall have the right at any time to insist upon strict performance of all of such terms, provisions and conditions.

(d) Amendments; etc.

This Mortgage cannot be modified, changed or discharged except by an agreement in writing, duly acknowledged in form for recording, signed by Mortgagor and Mortgagee and, to the extent provided in the Loan Agreement, the consent of the Lenders. For purposes hereof, a statement by the Mortgagee in any modification or supplement to this Mortgage to the effect that such modification or supplement has been consented to by the Lenders as provided in the Loan Agreement shall be conclusive evidence of such consent and it shall not be necessary for a copy of such consent to be recorded with such modification or supplement as a condition to such modification or supplement being recorded in the appropriate real estate records.

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(e) Successors and Assigns.

This Mortgage applies to, inures to the benefit of and binds Mortgagor and Mortgagee and their respective successors and assigns, as permitted under the Loan Agreement, and shall run with the Premises.

(f) Captions.

The captions or headings at the beginning of each Article and Section hereof are for the convenience of reference and are not a part of this Mortgage.

(g) Severability.

If any term or provision of this Mortgage or the application thereof to any person or circumstance shall to any extent be invalid or unenforceable, the remainder of this Mortgage, or the application of such term or provision to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term and provision of this Mortgage shall be valid and enforceable to the maximum extent permitted by law. If any portion of the Obligations shall for any reason not be secured by a valid and enforceable lien upon any part of the Mortgaged Property, then any payments made in respect of the Obligations (whether voluntary or under foreclosure or other enforcement action or procedure or otherwise) shall, for purposes of this Mortgage (except to the extent otherwise required by app licable law) be deemed to be made (i) first, in respect of the portion of the Obligations not secured by the lien of this Mortgage, (ii) second, in respect of the portion of the Obligations secured by the lien of this Mortgage, but which lien is on less than all of the Mortgaged Property, and (iii) last, to the portion of the Obligations secured by the lien of this Mortgage, and which lien is on all of the Mortgaged Property.

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(h) Usury Savings Clause.

It is the intention of Mortgagor, Mortgagee and the Lenders to conform strictly to the usury and similar laws relating to interest payable on loans from time to time in force, and all agreements between Mortgagor, Mortgagee and the Lenders, whether now existing or hereafter arising and whether oral or written, are hereby expressly limited so that in no contingency or event whatsoever, whether by acceleration of maturity hereof otherwise, shall the amount paid or agreed to be paid in the aggregate to the Lenders as interest (whether or not designated as interest, and including any amount otherwise designated by deemed constitute interest by a court of competent jurisdiction) hereunder or under the other Loan Documents or in any other agreement given to secure the Obligations, or in any other document evidencing, securing or pertaining t o the Obligations, exceed the maximum amount (the “Maximum Rate”) permissible under applicable laws. If under any circumstances whatsoever fulfillment of any provision hereof, of the Loan Agreement or of the other Loan Documents, at the time performance of such provisions shall be due, shall involve exceeding the Maximum Rate, then, ipso facto, the obligation to be fulfilled shall be reduced to the Maximum Rate. For purposes of calculating the actual amount of interest paid and/or payable hereunder in respect of laws pertaining to usury or such other laws, all sums paid or agreed to be paid to the Lenders for the use, forbearance or detention of the Obligations evidenced hereby, outstanding from time to time shall, to the extent permitted by applicable law, be amortized, pro-rated, allocated and spread from the date of disbursement of the proceeds of the Notes until payment in full of all of such indebtedness, so that the actual rate of interest on account of such Obligations is uniform through the term hereof. If under any circumstances any Lender shall ever receive an amount which would exceed the Maximum Rate, such amount shall be deemed a payment in reduction of the principal amount of the Loans and shall be treated as a voluntary prepayment under the Loan Agreement and shall be so applied in accordance with the provisions of the Loan Agreement or if such excessive interest exceeds the Outstanding amount of the Loans and any other Obligations, the excess shall be deemed to have been a payment made by mistake and shall be refunded to Mortgagor.

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(i) CERTAIN WAIVERS.

MORTGAGOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, IN CONNECTION WITH ANY FORECLOSURE OR OTHER ACTION BROUGHT BY MORTGAGEE TO ENFORCE ITS RIGHTS AND REMEDIES UNDER THIS MORTGAGE, ANY AND EVERY RIGHT MORTGAGOR MAY HAVE TO (A) INTERPOSE ANY COUNTERCLAIM THEREIN, OTHER THAN A COMPULSORY COUNTERCLAIM, AND (B) HAVE THE SAME CONSOLIDATED WITH ANY OTHER OR SEPARATE SUIT, ACTION OR PROCEEDING. NOTHING CONTAINED IN THE IMMEDIATELY PRECEDING SENTENCE SHALL PREVENT OR PROHIBIT THE BORROWER FROM INSTITUTING OR MAINTAINING A SEPARATE ACTION AGAINST THE ADMINISTRATIVE AGENT OR THE LENDERS WITH RESPECT TO ANY ASSERTED CLAIM.

(j) GOVERNING LAW.

THIS MORTGAGE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(k) SUBMISSION TO JURISDICTION.

THE PROVISIONS OF SECTION 12.21 OF THE LOAN AGREEMENT SHALL BE APPLICABLE TO THIS AGREEMENT.

(l) WAIVER OF JURY TRIAL.

EACH OF MORTGAGOR, MORTGAGEE AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS MORTGAGE, THE NOTES, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.

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(m) Attorney-In-Fact.

Mortgagor hereby irrevocably appoints Mortgagee (on behalf of the Lenders) and its successors and assigns, as its attorney-in-fact, which agency is coupled with an interest, (a) to execute and/or record any notices of completion, cessation of labor or any other notices that Mortgagee deems appropriate to protect Mortgagee’s interest, if Mortgagor shall fail to do so within ten (10) days after written request by Mortgagee, (b) upon the issuance of a deed pursuant to the foreclosure of this Mortgage or the delivery of a deed in lieu of foreclosure, to execute all instruments of assignment, conveyance or further assurance with respect to the Leases, Rents, Personalty and Fixtures in favor of the grantee of any such deed and as may be necessary or desirable for such purpose, (c) to prepare, execute and file or record financing statem ents, continuation statements, applications for registration and like papers necessary to create, perfect or preserve Mortgagee’s security interests and rights in or to any of the collateral, and (d) while any Event of Default exists, to perform any obligation of Mortgagor hereunder; however: (i) Mortgagee shall not under any circumstances be obligated to perform any obligation of Mortgagor; (ii) any sums advanced by Mortgagee in such performance shall be added to and included in the Obligations and shall bear interest at the Default Rate; (iii) Mortgagee as such attorney-in-fact shall only be accountable for such funds as are actually received by Mortgagee; and (iv) neither Mortgagee nor any Lender shall be liable to Mortgagor or any other person or entity for any failure to take any action which it is empowered to take under this Section.

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(n) New York Lien Law.

Pursuant to Section 13 of the Lien Law of the State of New York, Mortgagor shall receive the advances secured by this Mortgage and shall hold the right to receive such advances as a trust fund to be applied first for the purpose of paying the cost of any improvement and shall apply such advances first to the payment of the cost of any such improvement on the Premises before using any part of the total of the same for any other purpose.

(o) Limitation on Liability.

The liability of each Mortgagor hereunder is joint and several. Notwithstanding the foregoing, Mortgagor’s liability hereunder is subject to the limitation on liability provisions of Section 13.1 of the Loan Agreement.

[signature page follows]

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IN WITNESS WHEREOF, this Mortgage has been duly executed by Mortgagor as of the day and year first above written.

	ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC,
	a Delaware limited liability company

By:	/s/Robert Masters
	Name: Robert Masters
	Title: Senior Vice President

	FORDHAM PLACE OFFICE, LLC,
	a Delaware limited liability company

By:	/s/Robert Masters
	Name: Robert Masters
	Title: Senior Vice President

STATE OF NEW YORK	)
	) ss.:
COUNTY OF NEW YORK	)

On the 4th day of November, 2009, before me, the undersigned, personally appeared __________________, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument, and acknowledged to me that he executed the same in his capacity and that by his signature on the instrument the individual or the person upon behalf of which the individual acted executed the instrument.

/s/ Debra Liebler-Jones

Signature and Office of individual

taking acknowledgement

EXHIBIT A

LEGAL DESCRIPTION OF LAND

The Land upon which the Building containing the Units is located is described as follows:

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

South 84 degrees 34 minutes 46 seconds East, a distance of 43.27 feet to a point, thence;

South 54 degrees 01 minutes 22 seconds East, a distance of 29.77 feet to a point, thence;

South 40 degrees 09 minutes 32 seconds East, a distance of 85.32 feet to a point on the westerly side of Park Avenue (variable width). Thence;

Along said westerly side of Park Avenue, South 00 degrees 10 minutes 48 seconds East, a distance of 201.71 feet to a point, thence;

Along said easterly side of Webster Avenue, North 08 degrees 26 minutes 11 seconds East, a distance of 279.09 feet to the point or place of BEGINNING.

Exhibit A-1

EXHIBIT B

PERSONAL PROPERTY COLLATERAL

As used in this Exhibit B, the term “Premises” means that certain real property, including all improvements thereon, more particularly described in Schedule 1 attached hereto. All capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in that certain Mortgage, Assignment of Leases and Rents and Security Agreement dated as of November 4, 2009 by and from ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC and FORDHAM PLACE OFFICE, LLC, each a limited liability company duly org anized and validly existing under the laws of the State of Delaware (“Debtor”), in favor of EUROHYPO AG, NEW YORK BRANCH, as Administrative Agent for the Lenders referred to therein (collectively, the “Secured Party”) (as amended, modified, extended, split or consolidated, the “Mortgage”).

(i) All personal property in all of its forms, including, without limitation, all goods, supplies, equipment, furniture, furnishings, fixtures, machinery, inventory (including, without limitation, inventory as such term is defined in the Uniform Commercial Code), raw materials, work in process and construction materials which Debtor now or hereafter owns or in which Debtor now or hereafter acquires an interest or right, including, without limitation, those in which Debtor has an interest or right of any kind, those which are now or hereafter located on or affixed to the Premises, and those in transit thereto or in any other location, or used or useful in the operation, use or occupancy of t he Premises or the construction of any improvements thereon, including, without limitation, all documents of title with respect to such personal property, any interest of Debtor in and to personal property that is leased or subject to any superior security interest, all books, records, ledger cards, leases, other documents of whatever kind or character, relating to the Premises;

(ii) All computer programs, tapes, disks, and related data processing software (owned by Debtor or in which it has an interest) that at any time evidence or contain information relating to the Premises or to Debtor’s business thereon;

(iii) All fees, income, rents, issues, profits, earnings, receipts, royalties and revenues which, after the date hereof and while any portion of the indebtedness secured hereby remains unpaid, may accrue to Debtor from such goods, fixtures, furnishings, equipment and building materials or any part thereof located on the Premises, or which may be received or receivable by Debtor from any hiring, using, letting, leasing, subhiring, subletting, or subleasing of the Premises;

Exhibit B-1

(iv) All of Debtor’s present and future rights and claims to receive payments of money, utility deposits, services or property relating to the Premises, including, without limitation, rights to all deposits from tenants of the Premises, rights to receive payment with respect to media and advertising agreements and sponsorships, amounts payable on account of the sale of interests in Debtor, accounts receivable, deposit or other accounts (including, without limitation, deposit accounts maintained with Secured Party; and accounts as that term is defined in the Uniform Commercial Code), chattel paper, notes, drafts, contract rights, rights to performance, instruments (including, without limitation, i nstruments as such term is defined in the Uniform Commercial Code), general intangibles, principal, interest and payments due on account of goods sold, services rendered, loans made or credit extended, guaranties, letters of credit, documents, drafts, acceptances, and tax refunds, together with title or interest in all documents evidencing or securing the same, and judgments taken on any rights or claims which now or hereafter relate to, are derived from or used in connection with the Premises or the ownership, construction, use, operation, maintenance, occupancy or enjoyment thereof or the conduct of business or activities therefrom;

(v) All of Debtor’s rights and interests in all other general intangibles including all payment intangibles (as the foregoing terms are defined in the Uniform Commercial Code) and Debtor’s rights and interest relating to the Premises or the construction, development, use or operation thereof, or used in connection therewith, including but not limited to all governmental permits relating to construction or other activities on the Premises, all names under or by which the Premises may at any time be operated or known, all rights to carry on business under any such names, or any variant thereof, all trade names, trademarks and franchises relating in any way to the Premises, all patents a nd copyrights of Debtor relating in any way to the Premises, all good will in any way relating to the Premises, all licenses and permits relating in any way to, or to the operation of, the Premises, all contract rights, all options, all purchase orders, all manufacturers’ warranties with respect to improvements, all construction contracts, all maintenance contracts, and all of Debtor’s claims and rights arising under or pursuant to Section 365 of the Bankruptcy Code, 11 U.S.C. § 365;

(vi) All of Debtor’s rights under all warranties, guaranties or insurance policies (whether or not Secured Party is the loss payee thereunder) covering the Premises or any of the aforesaid collateral, and all proceeds, loss payments and premium refunds payable regarding the same;

(vii) All of Debtor’s rights and interests in reserves, deferred payments, deposits, refunds, cost savings and payments of any kind relating to the construction of any improvements on the Premises;

(viii) All of Debtor’s rights and interests in all causes of action, claims compensation and recoveries for any damage to or condemnation or taking of the Premises or the aforesaid collateral, or for any conveyance in lieu thereof, whether direct or consequential, or for any damage or injury to the Premises or the aforesaid collateral, or for any loss or diminution in value of the Premises or the aforesaid collateral;

(ix) All architectural, structural, mechanical and engineering plans and specifications prepared for construction of improvements or extraction of minerals or gravel from the Premises and all studies, data and drawings related thereto; and also all contracts and agreements relating to the aforesaid plans and specifications or to the aforesaid studies, data and drawings or to the construction of improvements on or extraction of minerals or gravel from the Premises;

(x) All sums on deposit with the Secured Party for any reason whatsoever pursuant to the terms and provisions of the Mortgage to be recorded in the office of the County Recorder of New York County, State of New York simultaneously with the filing of financing statements with respect to the collateral described above; and

(xi) All proceeds, products, offspring, rents, profits, income, benefits, accessions, substitutions and replacements from sale, collection, exchange or other disposition of the aforesaid collateral, whether such disposition is voluntary or involuntary.

Exhibit B-2

SCHEDULE 1

LEGAL DESCRIPTION OF LAND

The Land upon which the Building containing the Units is located is described as follows:

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

South 84 degrees 34 minutes 46 seconds East, a distance of 43.27 feet to a point, thence;

South 54 degrees 01 minutes 22 seconds East, a distance of 29.77 feet to a point, thence;

South 40 degrees 09 minutes 32 seconds East, a distance of 85.32 feet to a point on the westerly side of Park Avenue (variable width). Thence;

Along said westerly side of Park Avenue, South 00 degrees 10 minutes 48 seconds East, a distance of 201.71 feet to a point, thence;

Exhibit B

Along said easterly side of Webster Avenue, North 08 degrees 26 minutes 11 seconds East, a distance of 279.09 feet to the point or place of beginning.

THIS REPLACEMENT NOTE AMENDS, RESTATES AND REPLACES IN ITS ENTIRETY THAT CERTAIN (I) ACQUISTION LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO AMALGAMATED BANK DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $3,778,734.12, (II) BUILDING LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO AMALGAMATED BANK DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $15,815,942.69 AND (III) PROJECT LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO AMALGAMATED BANK DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $405,323.19.

REPLACEMENT NOTE

$18,051,400.00

November 4, 2009

New York, New York

FOR VALUE RECEIVED, ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC and FORDHAM PLACE OFFICE LLC, each a Delaware limited liability company (“Borrower”), hereby promises to pay to AMALGAMATED BANK (the “Lender”), for account of its respective Applicable Lending Offices provided for by the Agreement referred to below, at the principal office of Eurohypo AG, New York Branch, at 1114 Avenue of the Americas, 2nd Floor, New York, New York 10036, the principal sum of Eighteen Million Fifty-One Thousand Four Hundred and 00/100 Dollars ($18,051,400.00) (or such lesser amount as shall equal the aggregate unpaid principal amount of the Loans made by the Lender to Borr ower under the Agreement), in lawful money of the United States of America and in immediately available funds, on the dates and in the principal amounts provided in the Agreement, and to pay interest on the unpaid principal amount of each such Loan, at such office, in like money and funds, for the period commencing on the date of such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Agreement.

This Note is one of the Notes referred to in the Consolidated, Amended and Restated Term Loan Agreement dated as of the date hereof (as modified, supplemented, extended and in effect from time to time, the “Agreement”) between Borrower, the lenders party thereto (including the Lender) and Eurohypo AG, New York Branch, as Administrative Agent, and evidences Loans made by the Lender thereunder, and is issued pursuant to that certain Note Consolidation, Severance and Modification Agreement between said parties dated as of the date hereof as one of the four replacement notes described therein. Terms used but not defined in this Note have the respective meanings assigned to them in the Agreement.

The Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Loans upon the terms and conditions specified therein.

Except as expressly permitted by Section 12.24 of the Agreement, this Note may not be assigned by the Lender to any other Person.

[Remainder of page intentionally left blank]

Executed as of the date first written above.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, itsgeneral partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

THIS REPLACEMENT NOTE AMENDS, RESTATES AND REPLACES IN ITS ENTIRETY THAT CERTAIN (I) ACQUISTION LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO DEUTSCHE GENOSSENSCHAFTS - HYPOTHEKENBANK AG DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $4,251,075.89, (II) BUILDING LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO DEUTSCHE GENOSSENSCHAFTS - HYPOTHEKENBANK AG DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $17,792,935.52 AND (III) PROJECT LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO DEUTSCHE GENOSSENSCHAFTS - HYPOTHEKENBANK AG DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $455,988.59.

REPLACEMENT NOTE

$20,313,200.00

November 4, 2009

New York, New York

FOR VALUE RECEIVED, ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC and FORDHAM PLACE OFFICE LLC, each a Delaware limited liability company (“Borrower”), hereby promises to pay to DEUTSCHE GENOSSENSCHAFTS - HYPOTHEKENBANK AG (the “Lender”), for account of its respective Applicable Lending Offices provided for by the Agreement referred to below, at the principal office of Eurohypo AG, New York Branch, at 1114 Avenue of the Americas, 2nd Floor, New York, New York 10036, the principal sum of Twenty Million Three Hundred Thirteen Thousand Two Hundred and 00/100 Dollars ($20,313,200.00) (or such lesser amount as shall equal the aggregate unpaid principal amount o f the Loans made by the Lender to Borrower under the Agreement), in lawful money of the United States of America and in immediately available funds, on the dates and in the principal amounts provided in the Agreement, and to pay interest on the unpaid principal amount of each such Loan, at such office, in like money and funds, for the period commencing on the date of such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Agreement.

The Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Loans upon the terms and conditions specified therein.

Except as expressly permitted by Section 12.24 of the Agreement, this Note may not be assigned by the Lender to any other Person.

[Remainder of page intentionally left blank]

Executed as of the date first written above.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

THIS REPLACEMENT NOTE AMENDS, RESTATES AND REPLACES IN ITS ENTIRETY THAT CERTAIN (I) AMENDED AND RESTATED ACQUISTION LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $4,302,088.81, (II) AMENDED AND RESTATED BUILDING LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $18,006,450.75, (III) AMENDED AND RESTATED PROJECT LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $461,460.44, (IV) ACQUISITION LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $2,834,050.59, (V) BUILDING LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $11,861,957.02 AND (VI) PROJECT LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $303,992.39.

REPLACEMENT NOTE

$34,099,000.00

November 4, 2009

New York, New York

FOR VALUE RECEIVED, ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC and FORDHAM PLACE OFFICE LLC, each a Delaware limited liability company (“Borrower”), hereby promises to pay to EUROHYPO AG, NEW YORK BRANCH (the “Lender”), for account of its respective Applicable Lending Offices provided for by the Agreement referred to below, at the principal office of Eurohypo AG, New York Branch, at 1114 Avenue of the Americas, 2nd Floor, New York, New York 10036, the principal sum of Thirty-Four Million Ninety-Nine Thousand and 00/100 Dollars ($34,099,000.00) (or such lesser amount as shall equal the aggregate unpaid principal amount of the Loans made by the Lender to Borrower under the Agreement), in lawful money of the United States of America and in immediately available funds, on the dates and in the principal amounts provided in the Agreement, and to pay interest on the unpaid principal amount of each such Loan, at such office, in like money and funds, for the period commencing on the date of such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Agreement.

The Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Loans upon the terms and conditions specified therein.

Except as expressly permitted by Section 12.24 of the Agreement, this Note may not be assigned by the Lender to any other Person.

[Remainder of page intentionally left blank]

Executed as of the date first written above.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, aDelaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

THIS REPLACEMENT NOTE AMENDS, RESTATES AND REPLACES IN ITS ENTIRETY THAT CERTAIN (I) ACQUISTION LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $2,834,050.59, WITH AN ALLONGE ENDORSEMENT DATED NOVEMBER 20, 2009 IN THE ORIGINAL PRINCIPAL AMOUNT OF $2,834,050.59 MADE PAYABLE TO COMMERCE BANK, N.A. (II) BUILDING LOAN NOTE FROM ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $11,861,957.02, WITH AN ALLONGE ENDORSEMENT DATED NOVEMBER 20, 2009 IN THE ORIGINAL PRINCIPAL AMOUNT OF $11,861,957.02 MADE PAYABLE TO COMMERCE BANK, N.A. AND (III) PROJECT LOAN NOTE FROM ACADIA-PA EA ST FORDHAM ACQUISITIONS, LLC AND FORDHAM PLACE OFFICE LLC TO EUROHYPO AG, NEW YORK BRANCH DATED NOVEMBER 16, 2007 IN THE ORIGINAL PRINCIPAL AMOUNT OF $303,992.39, WITH AN ALLONGE ENDORSEMENT DATED NOVEMBER 20, 2009 IN THE ORIGINAL PRINCIPAL AMOUNT OF $303,992.39 MADE PAYABLE TO COMMERCE BANK, N.A. .

REPLACEMENT NOTE

$13,536,400.00

November 4, 2009

New York, New York

FOR VALUE RECEIVED, ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC and FORDHAM PLACE OFFICE LLC, each a Delaware limited liability company (“Borrower”), hereby promises to pay to TD BANK, as successor-in-interest to Commerce Bank, N.A. (the “Lender”), for account of its respective Applicable Lending Offices provided for by the Agreement referred to below, at the principal office of Eurohypo AG, New York Branch, at 1114 Avenue of the Americas, 2nd Floor, New York, New York 10036, the principal sum of Thirteen Million Five Hundred Thirty-Six Thousand Four Hundred and 00/100 Dollars ($13,536,400.00) (or such lesser amount as shall equal the aggregate unpaid pr incipal amount of the Loans made by the Lender to Borrower under the Agreement), in lawful money of the United States of America and in immediately available funds, on the dates and in the principal amounts provided in the Agreement, and to pay interest on the unpaid principal amount of each such Loan, at such office, in like money and funds, for the period commencing on the date of such Loan until such Loan shall be paid in full, at the rates per annum and on the dates provided in the Agreement.

The Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Loans upon the terms and conditions specified therein.

Except as expressly permitted by Section 12.24 of the Agreement, this Note may not be assigned by the Lender to any other Person.

[Remainder of page intentionally left blank]

Executed as of the date first written above.

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By: Acadia-P/A Holding Company, LLC, a Delaware limited liability company, its sole member

By: Acadia Strategic Opportunity Fund II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Acquisition II, LLC, a Delaware limited liability company, its managing member

By: Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

By: Acadia Realty Trust, a Maryland real estate investment trust, its general partner

By: /s/ Robert Masters

Name: Robert Masters

Title: Senior Vice President-General Counsel

EXHIBIT E

FORM OF HEDGE AGREEMENT PLEDGE

(See attached)

ASSIGNMENT, PLEDGE AND SECURITY AGREEMENT

(Hedge Agreement)

ASSIGNMENT, PLEDGE AND SECURITY AGREEMENT (this "Agreement") dated as of the day of , 20_ between ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware and FORDHAM PLACE OFFICE LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (hereinafter, jointly and severally, and singly and collectively, "Pledgor") having its principal place of business at c/o Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, NY 10605, and EUROHYPO AG, NEW YORK BRANCH, having an office at 1114 Avenue of the Americas , New York, New York 10036, as Administrative Agent for the lenders referred to below (in such capacity, together with its successors in such capacity, the "Administrative Agent").

R E C I T A L S :

A. Pledgor, certain lenders (the "Lenders") and the Administrative Agent are parties to a Loan Agreement dated as of _, 2009 (said Loan Agreement, as modified and supplemented and in effect from time to time, being herein called the "Loan Agreement"; and, except as otherwise herein expressly provided, all terms defined in the Loan Agreement are being used herein as defined therein), which Loan Agreement provides, among other things, for Loans to be made by the lenders party thereto from time to time to Pled gor in an aggregate principal amount not exceeding $________ to finance the property located at ____________, _________, _________. The loans are to be evidenced by, and repayable with interest thereon in accordance with those certain promissory notes dated of even date herewith (collectively, and in each case as the same may be consolidated, replaced, severed, modified, amended or extended from time to time, the "Notes") in the aggregrate principal amount of $______________.

B. In consideration of the foregoing, Pledgor has agreed to assign, pledge and grant a security interest in the Collateral (as hereinafter defined) as security for the Secured Obligations (as hereinafter defined).

C. The execution of this Agreement is a condition precedent to the obligation of the Lenders to make the Loans.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

Section 1 Certain Definitions. As used herein, the following terms shall have the following meanings (all tenns defined in the singular to have the same meanings when used in the plural and vice versa):

"Accounts" shall have the meaning assigned to such term in Section 3(d) hereof. "Administrative Agent" shall have the meaning ascribed thereto in the heading of this Agreement.

"Agreement" shall have the meaning ascribed thereto in the preamble ofthis Agreement.

"Collateral" have the meaning ascribed thereto in Section 3 hereof.

"Counterparty" shall mean ________________________ as counterparty under the Hedge Agreement.

"Disposition" shall mean any sale, assignment, transfer or other disposition of any of the Collateral by Pledgor to any other Person (other than any such sale, assignment, transfer or other disposition to Administrative Agent as contemplated by this Agreement).

"Event of Default" shall have the meaning ascribed thereto in Section 8.01.

"Hedge Agreement" shall mean (a) during the initial term of the Loans, that certain [Agreement], dated as of _____, 200_, between Borrower and the Counterparty, together with the schedule thereto and a trade confinnation thereunder, each dated as of the date of the aforementioned [Agreement], with respect to an interest rate swap transaction in the notional amount of $ ______ and attached hereto as Exhibit B and (b) any other Hedge Agreement entered into by Pledgor in accordance with the Loan Agreement.

"Instruments" shall have the meaning assigned to such tenn in Section 3(c) hereof.

"Lenders" shall have the meaning ascribed thereto in the recitals to this Agreement.

"Loan Agreement" shall have the meaning ascribed thereto in the recitals to this Agreement.

"Pledgor" shall have the meaning ascribed thereto in the preamble ofthis Agreement.

"Secured Obligations" shall mean, collectively, all obligations, liabilities and indebtedness of every nature of Pledgor, from time to time owing to the Administrative Agent or any Lender under or in connection with this Agreement, the Notes or any other Loan Document to which it is a party, including principal, interest, fees (including fees of counsel), and expenses whether now or hereafter existing under the Loan Documents.

"Uniform Commercial Code" shall mean the Uniform Commercial Code in effect from time to time in the State of _______ or, if the creation, perfection and enforcement of any security interest herein granted is governed by the laws of a state other than _________, then, as to the matter in question, the Uniform Commercial Code in effect in that state.

Section 2 Representations and Warranties. Pledgor represents and warrants to the Administrative Agent and the Lenders that:

(a) Pledgor is the sole beneficial owner of the Collateral and no Lien currently exists or will exist upon the Collateral, or any portion thereof, at any time (and no right or option to acquire the same exists or will exist in favor of any other Person), except for the pledge and security interest in favor of the Administrative Agent created, granted and confirmed herein, which pledge and security interest constitutes a first priority perfected pledge and security interest in and to all of the Collateral.

(b) There currently exists and will exist no offsets, counterclaims, defenses or deductions to Pledgor's right to receive any payments of money, or any other consideration, under or with respect to any of the Collateral.

Section 3 Assignment, Pledge and Security Interest. As collateral security for the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations, Pledgor hereby irrevocably assigns, pledges, sets over, delivers and grants to the Administrative Agent a security interest in all of Pledgor's right, title and interest in the following property, whether now owned by Pledgor or hereafter acquired and whether now existing or hereafter coming into existence and wherever located (collectively, the "Collateral"):

(a) all of Pledgor's right title and interest in the Hedge Agreement;

(b) all moneys due and to become due, and all other consideration paid and to be paid, to Pledgor under, pursuant to or in connection with the Collateral, whether or not such property interest shall be classified as an account or a general intangible under the Uniform Commercial Code, and all accounts and general intangibles (each as defined in the Uniform Commercial Code) arising from or in connection with, existing in respect of, or relating to, the Collateral (such rights to the payment of money and other consideration, and such accounts and general intangibles, being collectively referred to herein as "Accounts");

(c) all instruments or chattel paper (each as defined in the Uniform Commercial Code) of Pledgor evidencing, representing, arising from or existing in respect of, relating to, securing or otherwise supporting the payment of any of the Accounts (herein collectively called "Instruments"); and

(d) all proceeds, products, accessions, rents, profits, income, benefits, substitutions and replacements of and to any of the property of Pledgor described in the preceding clauses ofthis Section 3.

Section 4 Counterparty. Pledgor shall, and hereby does, irrevocably direct Counterparty to make any payments to become payable under or pursuant to the Hedge Agreement into an Additional Cash Collateral Account established pursuant to the provisions of the Cash Management Agreement, or otherwise as directed by the Administrative Agent, until such time as this Agreement is terminated or otherwise canceled (and the parties hereto shall jointly notify Counterparty of the same) at which time any such payments shall be made as directed by or on behalf of the Pledgor. Pledgor shall cause Counterparty to execute and deliver to the Administrative Agent, not later than thirty (30) days from and af ter the date hereof, a letter agreement, substantially in the form of Exhibit A attached hereto, evidencing Counterparty's acknowledgment of such direction and agreement to act in accordance with the provisions of this Agreement, including without limitation this Section 4 and Section 6(h) hereof.

Section 5 Present Assignment. The assignment contained in Section 3 is present and absolute and Pledgor shall not take any action with respect to the Collateral without the Administrative Agent's prior approval.

Section 6 Covenants. Pledgor agrees that, at its sole cost and expense, until the payment and satisfaction in full ofthe Secured Obligations in accordance with their terms:

(a) Pledgor shall not take or omit to take any action, or do anything, or grant any consent, waiver or ratification, that may (i) impair the value of the Collateral or the value of the liens created, granted and/or confirmed herein, (ii) cause or permit any lien (other than the liens granted hereunder) to encumber any of the Collateral or (iii) result in a Disposition of the Collateral;

(b) Pledgor shall promptly perform and observe all of the terms, covenants and conditions required to be performed and observed by it under or in respect of the Collateral, and any and all documents and agreements related thereto, including any confidentiality agreements executed by Pledgor in connection therewith, and shall do all things necessary to preserve and to keep unimpaired its rights thereunder;

(c) Pledgor shall promptly furnish the Administrative Agent with copies of any notice given or received under or in respect of any of the Collateral;

(d) If Pledgor shall fail promptly to perform or observe any of the terms, covenants or conditions required to be performed or observed by it under or in respect of the Collateral, the Administrative Agent may, in its sole discretion, take such action as is appropriate to cause such terms, covenants or conditions promptly to be performed or observed on behalf of Pledgor but no such action by the Administrative Agent shall release Pledgor from any of its obligations with respect to the Collateral, the Notes, the Security Documents, any of the other Loan Documents or this Agreement;

(e) Pledgor shall not and shall not agree to (i) surrender its rights and interests with respect to the Collateral, nor terminate or cancel or permit the termination or cancellation of any of its rights with respect to the Collateral, or (ii) modify, change, supplement, alter, terminate, cancel, waive, release or amend, nor permit the modification, change, supplementation, alteration, termination, cancellation, waiver, release or amendment of, its rights with respect to the Collateral or the terms thereof, either orally or in writing; and Pledgor does hereby expressly release, relinquish and surrender unto the Administrative Agent all its right, power and authority to terminate, cancel, modify, change, supplement, alter, waive, release or amend any ofits rights with respect to the Collateral;

(f) Pledgor shall deliver to the Administrative Agent, promptly after Pledgor knows or has reason to believe that any breach or default by an account debtor or other Person obligated under with respect to the Collateral, a notice of such breach or default describing the same in reasonable detail and, together with such notice, a description of the action that Pledgor has taken or proposes to take with respect thereto. Without limiting the generality of the foregoing, and upon any such breach or default, Pledgor, at the written request of the Administrative Agent, shall promptly enforce its rights and remedies with respect to the Collateral as is necessary and appropriate in order to collect any defaulted payments, provided that the manner of such enforcement shall be approved by the Administrative Agent and, in any event, Pledgor sh all not exercise any rights or remedies with respect to the Collateral on account of any breach or default under or in respect thereof without the prior written approval of the Administrative Agent;

(g) Pledgor shall warrant and defend its title to the Collateral and the pledge and security interest granted in favor of the Administrative Agent therein against all claims and demands of all Persons whomsoever, and shall maintain and preserve such pledge and security interest at all times;

(h) If Pledgor shall be entitled to receive any payments with respect to the Collateral, Pledgor shall cause such payments to be directly paid over to the Administrative Agent and applied to payments due under the Notes; and

(i) If Pledgor fails to perfonn any of the covenants or obligations contained herein, the Administrative Agent may itself perform, or cause performance of, such covenants or obligations, and the reasonable expenses of Administrative Agent incurred in connection therewith shall be payable by Pledgor to the Administrative Agent in accordance with Section 9 hereof.

Section 7 Perfection; Further Assurances.

7.01 Perfection.

(a) Pledgor authorizes the Administrative Agent to execute and deliver such financing statements and other documents as the Administrative Agent may reasonably require to perfect the security interests granted by Section 3 of this Agreement. In addition, Pledgor shall, from time to time, promptly execute, acknowledge and deliver, or cause the execution, acknowledgement and delivery of, such documents or instruments, and shall take or cause to be taken such other actions, as the Administrative Agent may reasonably request for the perfection against Pledgor and all third parties of the security interests granted herein, or for the continuation and protection thereof. Pledgor shall promptly give to the Administrative Agent evidence satisfactory to the Administrative Agent of a ll such actions. Without limiting the generality of the foregoing, Pledgor shall, promptly upon the execution and delivery of this Agreement, and at any time or from time to time thereafter upon the request of the Administrative Agent, execute, acknowledge and deliver such financing and continuation statements, notices and additional security agreements, make such notations on its records and take such other action as the Administrative Agent may reasonably request for the purpose of so perfecting, maintaining and protecting the security interests granted herein. Pledgor hereby irrevocably designates, makes, constitutes and appoints the Administrative Agent (and all Persons designated by the Administrative Agent) as Pledgor's true and lawful attorney (and agent-in-fact) to take any of the foregoing actions in the name of Pledgor, and Pledgor hereby further authorizes the Administrative Agent to effect any filing or recording which t he Administrative Agent has requested pursuant to this Section 7 without the signature of Pledgor to the extent permitted by applicable law so long as the Administrative Agent has requested Pledgor to take any such action and Pledgor has failed to do so promptly.

(b) Pledgor shall deliver and pledge to the Administrative Agent all Instruments, endorsed and/or accompanied by such instruments of assignment and transfer in such form and substance as the Administrative Agent may reasonably request.

7.02 Records and Inspection. Pledgor shall also:

(a) keep full and accurate books and records relating to the Collateral as required in order to reflect the security interests granted by this Agreement; and

(b) permit representatives of the Administrative Agent, upon reasonable notice, at any time during normal business hours to inspect and make abstracts from its books and records pertaining to the Collateral, and forward copies of any notices or communications received by Pledgor with respect to the Collateral, in such manner as the Administrative Agent may reasonably request.

7.03 Other Financing Statements and Liens. Pledgor shall not file or suffer to be on file, or authorize or permit to be filed or to be on file, in any jurisdiction, any financing statement or like instrument with respect to the Collateral in which the Administrative Agent is not named as the sole secured party.

7.04 Name; State of Formation. Pledgor shall not change its name, the location of its chief executive office, its state of formation or organizational structure unless Pledgor shall have complied with the provisions of Section [____] of the Loan Agreement.

7.05 Preservation of Rights. The Administrative Agent shall not be required to take steps necessary to preserve any rights against prior parties to any ofthe Collateral.

Section 8 Default; Remedies.

8.01 Events of Default. The following occurrences or happenings at any time and from time to time shall constitute events of default (each, an "Event of Default") under this Agreement which shall entitle Assignee to exercise its rights and remedies under this Agreement:

(a) the occurrence of an Event of Default under the Loan Agreement; or

(b) the failure of Pledgor to cause the deposit of any payments it is entitled to receive with respect to the Collateral directly with the Administrative Agent.

8.02 Remedies.

(a) If an Event of Default shall occur and be continuing:

(i) The Administrative Agent may (or at the direction of the Majority Lenders in accordance with the Loan Agreement shall) make any reasonable compromise or settlement deemed desirable with respect to any of the Collateral and may extend the time of payment, arrange for payment in installments, or otherwise modify the terms of, any ofthe Collateral;

(ii) The Administrative Agent shall have all of the rights and remedies with respect to the Collateral of a secured party under the Uniform Commercial Code and such additional rights and remedies to which a secured party is entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be asserted, including, without limitation, the right, to the maximum extent permitted by law, to exercise all voting, consensual and other powers of ownership pertaining to the Collateral as if the Administrative Agent were the sole and absolute owner thereof (and Pledgor agrees to take all such action as may be appropriate to give effect to such right);

(iii) The Administrative Agent in its discretion may (or at the direction of the Majority Lenders in accordance with the Loan Agreement will), in its name or in the name of Pledgor or otherwise, demand, sue for, collect or receive any money or property at any time payable or receivable on account of or in exchange for any ofthe Collateral, but shall be under no obligation to do so;

(iv) The Administrative Agent may, upon ten days' prior written notice to Pledgor of the time and place, with respect to the Collateral or any part thereof which shall then be or shall thereafter come into the possession, custody or control of the Administrative Agent or any of its agents, sell, lease, assign or otherwise dispose of all or any part of such Collateral, at such place or places as the Administrative Agent deems best, and for cash or for credit or for future delivery (without thereby assuming any credit risk), at public or private sale, without demand of performance or notice of intention to effect any such disposition or of the time or place thereof (except such notice as is required above or by applicable statute and cannot be waived), and the Administrative Agent or anyone else may be the purchaser, lessee, assignee or r ecipient ofany or all of the Collateral so disposed of at any public sale (or, to the extent permitted by law, at any private sale) and thereafter hold the same absolutely, free from any claim or rightofwhatsoeverkind, includinganyrightorequity ofredemption(statutoryor otherwise), of Pledgor, any such demand, notice and right or equity being hereby expressly waived and released. The Administrative Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which the sale may be so adjourned; provided the Administrative Agent shall give Pledgor ten (10) days' prior notice of the date of such adjourned sale;

(v) Pledgor shall, at the request of the Administrative Agent, assemble the Collateral owned by it at such place or places, reasonably convenient to the Administrative Agent; and

(vi) the Administrative Agent may (or at the direction of the Majority Lenders in accordance with the Loan Agreement will) exercise such other rights and remedies as may be available to it or the Lenders pursuant to the other Loan Documents, or at law or in equity.

(b) Until the termination of this Agreement in accordance with Section 9, the power of sale and all other rights, powers and remedies granted to the Administrative Agent hereunder shall continue to exist and may be exercised by it at any time and from time to time. No sale or other disposition of all or any part of the Collateral by the Administrative Agent pursuant to this Section 8 shall be deemed to relieve Pledgor of its obligations under the Secured Obligations except to the extent the proceeds thereof are applied by the Administrative Agent to the payment ofthe Secured Obligations.

8.03 Private Sale, Etc.

(a) The Administrative Agent shall incur no liability as a result of the sale of the Collateral, or any part thereof, at any private sale pursuant to Section 8.02 hereof conducted in a commercially reasonable manner. Pledgor hereby waives any claims against the Administrative Agent arising by reason ofthe fact that the price at which the Collateral may have been sold at such a private sale was less than the price that might have been obtained at a public sale or was less than the aggregate amount ofthe Secured Obligations, even if the Administrative Agent accepts the first offer received and does not offer the Collateral to more than one offeree.

(b) To the fullest extent it may lawfully so agree, Pledgor agrees that it will not at any time insist upon, claim, plead, or take any benefit or advantage of any appraisement, valuation, stay, extension, moratorium, redemption, or similar law now or hereafter in force in order to prevent, delay, or hinder the enforcement hereof or the absolute sale of any part of the Collateral or the possession thereof by any purchaser at any sale pursuant to this Agreement; and Pledgor for itself and all who claim through it, so far as it or they now or hereafter lawfully may do so, hereby waives the benefit of all such laws, and all right to have the Collateral marshalled upon any foreclosure hereof, and agrees that any court having jurisdiction to foreclose this Agreement may order the sale of the Collateral as an entirety. Without limiting the gene rality of the foregoing, Pledgor hereby: (i) authorizes the Administrative Agent and/or the Lenders, in their sole discretion and without notice to or demand upon Pledgor and without otherwise affecting the obligations of Pledgor hereunder or in respect of the Secured Obligations (and without affecting any such other collateral), from time to time to hold other collateral (in addition to the Collateral, including, without limitation, the Mortgage) for payment of the Secured Obligations or any other obligations, or any part thereof, and to exchange, enforce or release such other collateral or any part thereof and to accept and hold any endorsement or guarantee of payment of the Secured Obligations or any part thereof and to release or substitute any endorser or guarantor or any other person granting security for or in any other way obligated upon any Secured Obligations or any part thereof; and (ii) waives and releases any and all right to require the Administrative Agent to collect any of the Secured Obligat ions from any specific item or items of the Collateral, from any other party liable as guarantor or in any other manner in respect of any of the Secured Obligations or from any collateral (other than the Collateral) for any of such obligations.

8.04 Application of Proceeds. Except as otherwise herein expressly provided, the proceeds of any collection, sale or other realization of all or any part of the Collateral pursuant hereto, shall be applied by the Administrative Agent:

First, to the payment of the costs and expenses of such collection, sale or other realization, including reasonable out-of-pocket costs and expenses of the Administrative Agent and the fees and expenses of its agents and counsel, and all expenses incurred and advances made by the Administrative Agent in connection therewith;

Next, to the payment in full of the Secured Obligations, in each case equally and ratably in accordance with the respective amounts thereof then due and owing or as the Lenders holding the same may otherwise agree; and

Finally, to the payment to Pledgor, or its successors or assigns, or as a court of competent jurisdiction may direct, of any surplus then remaining.

As used in this Section 8, "proceeds" of Collateral shall mean cash, securities and other property realized in respect of, and distributions in kind of, Collateral, including any thereof received under any reorganization, liquidation or adjustment of debt of Pledgor or any issuerofor obligor on any ofthe Collateral.

8.05 Attorney-in-fact; Etc. Pledgor hereby appoints the Administrative Agent as its true and lawful attorney, which appointment is irrevocable and coupled with interest, with full power of substitution, in the name of Pledgor (a) to give notice of this Agreement at any time to each Person or entity with obligations owing to Pledgor (provided such obligations are included in the Collateral), (b) to demand, receive, compromise, sue for, and give acquittance for, any and all moneys and claims for money due and to become due under or arising out of such obligations or this Agreement, (c) to endorse any checks or other Instruments or orders in connection therewith, (d) to file any claims or take any actions or institute an y proceedings which the Administrative Agent may deem to be necessary or advisable in its discretion and to compromise, litigate or settle the same and (e) to take any other action which by the terms of this Agreement is to be taken by Pledgor; provided, that the Administrative Agent may not exercise such power of attorney until an Event of Default shall have occurred and be continuing. Notwithstanding any provision to the contrary contained herein, neither the Administrative Agent nor any of its nominees or assignees shall have any obligation or liability by reason of or arising out of this Agreement to make any inquiry as to the nature or sufficiency of, to present or file any claim with respect to, or to take any action to collect or enforce the payment of, any amounts to which it may be entitled at any time or times due to this Agreement.

8.06 Non-Waiver.

(a) No right or remedy herein conferred upon or reserved to the Administrative Agent is intended to be exclusive of any other right or remedy, and each and every such right or remedy shall be cumulative and continuing, shall be in addition to every other right or remedy given hereunder or under the other Loan Documents, or now or hereafter existing at law or in equity, and may be exercised from time to time and as often as may be deemed expedient by the Administrative Agent (or as directed by the Majority Lenders in accordance with the Loan Agreement.

(b) No delay or omission by the Administrative Agent or any of the Lenders to exercise any right or remedy hereunder or under any other Loan Document upon any Default or Event of Default, or failure of the Administrative Agent to insist on strict performance of any term ofthis Agreement or other Loan Document shall impair such exercise, or be construed to be a waiver of any such Potential Default or Event of Default or an acquiescence therein. No act of the Administrative Agent or any of the Lenders shall be construed as an election to proceed under anyone provision of this Agreement or of any other Loan Document to the exclusion of any other provision.

(c) The failure, refusal or waiver by the Administrative Agent or any of the Lenders of its right to assert any right or remedy hereunder or under any other Loan Document upon any default or Event of Default on the part of Pledgor or other occurrence shall not be construed as waiving such right or remedy upon any other or subsequent default or Event of Default or other occurrence.

(d) Neither the Administrative Agent nor any of the Lenders shall have any obligation to pursue any rights or remedies it may have under any other agreement securing the Secured Obligations or any portion thereof, prior to pursuing its rights or remedies hereunder or under the other Loan Documents.

(e) Acceptance of any payment after the occurrence of any Potential Default or Event of Default shall not be deemed a waiver or a cure of such Potential Default or Event of Default, and acceptance of any payment in an amount less than any amount then due shall be deemed an acceptance on account only.

(f) Pledgor shall not be relieved of its obligation to satisfy the Secured Obligations, including, without limitation, its obligations to pay the Loans at the time and in the manner provided for its payment in the Loan Documents by reason of, and the rights of the Administrative Agent and the Lenders hereunder shall not be affected by, (i) any failure of the Administrative Agent or any of the Lenders to comply with any request of any other obligor for the Secured Obligations to take any action to foreclose this Agreement or otherwise enforce any of the provisions of any Loan Document, (ii) any release, regardless of consideration, of the whole or any part of the collateral covered by the Security Documents or any other security for the Secured Obligations , or (iii) any alteration, extension, renewal, change, modification, release, amendment, compromise or cancellation, in whole or in part, of any term, covenant or provision of any ofthe Loan Documents, including any increase or decrease in the principal amount of the Loans or in the rate of interest applicable thereto or any extension oftime for payment thereof.

Section 9 Continuing Security Interest. This Agreement shall create a continuing security interest in the Collateral and shall remain in full force and effect until the payment in full of all Secured Obligations. When all Secured Obligations shall have been satisfied in full, this Agreement shall terminate, and the Administrative Agent shall forthwith cause to be assigned, transferred and delivered, against receipt but without any recourse, warranty or representation whatsoever, any remaining Collateral and money received in respect thereof, to or on the order ofPledgor. This Agreement shall also constitute a security agreement as that term is used in the UCC; provided that to the extent that the UCC is used to define any term herein or in any other Loan Document and suc h term is defined differently in different Articles or Divisions of the UCC, the definition of such term contained in Article or Division 9 shall govern or, if the creation, perfection and enforcement of any security interest herein granted is governed by the laws of a state other than New York, then, as to the matter in question, the Uniform Commercial Code in effect in that state.

Section 10 Expenses. Pledgor agrees to reimburse the Administrative Agent and each of the Lenders for all costs and expenses of the Administrative Agent (including, without limitation, the reasonable fees and expenses oflegal counsel) in connection with (a) any Event of Default and any enforcement or collection proceeding resulting therefrom, including, without limitation, all manner of participation in or other involvement with (i) performance by the Administrative Agent of any obligations of Pledgor in respect of the Collateral that Pledgor has failed or refused to perform, (ii) bankruptcy, insolvency, receivership, foreclosure, winding up or liquidation proceedings, or any actual or attempted sale, or any exchange, enforcement, collection, compromise or settlement in respect of any of the Collateral, and for the care of the Collateral and defending or asserting rights and claims of the Administrative Agent in respect thereof, by litigation or otherwise, including expenses of insurance, (iii) judicial or regulatory proceedings and (iv) workout, restructuring or other negotiations or proceedings (whether or not the workout, restructuring or other transaction contemplated thereby is consummated) and (b) the enforcement of this Section 10, and all such costs and expenses shall be Secured Obligations entitled to the benefits of the collateral security provided pursuant to Section 3 hereof. The provisions of this Section 10 shall survive the termination of this Agreement.

Section 11 No Obligation by the Administrative Agent or the Lenders. Neither the Administrative Agent nor any ofthe Lenders shall be obligated to perform or discharge, nor does any of them hereby undertake to perform or discharge, any obligation, duty or liability of Pledgor under any ofthe Collateral.

Section 12 Reasonable Care. Beyond the exercise of reasonable care in the custody thereof, the Administrative Agent shall not have any duty as to any Collateral or any income thereon in its possession or control or in the possession or control of any agents for, or of, the Administrative Agent for the preservation of rights against any Person or otherwise with respect thereto. The Administrative Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which a reasonable person would exercise under similar circumstances, it being understood that the Adminis trative Agent shall not be liable or responsible for any loss or damage to any of the Collateral, or for any diminution in value thereof by reason of any act or omission of the Administrative Agent or its agents, employees or bailees, except to the extent that such loss or damage results from the Administrative Agent's gross negligence or willful misconduct.

Section 13 Miscellaneous.

13.01 GOVERNING LAW; CONSENT TO JURISDICTION.

(A) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY THE ADMINISTRATIVE AGENT AND LENDERS AND ACCEPTED BY PLEDGOR IN THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA. TO THE FULLEST EXTENT PERMITTED BY LAW, EACH OF PLEDGOR, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE L AW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, AND THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

(B) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER OR PLEDGOR ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY AT THE ADMINISTRATIVE AGENT'S OPTION (WHICH DECISION SHALL BE MADE BY THE MAJORITY LENDERS) BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF [NEW YORK], COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND PLEDGOR WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND PLEDGOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. PLEDGOR DOES HEREBY DESIGNATE AND APPOINT [ ] AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED OR DELIVERED TO PLEDGOR IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON PLEDGOR, IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. PLEDGOR (A) SHALL GIVE PROMPT NOTICE TO THE ADMINISTRATIVE AGENT OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (B) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (C) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SU CCESSOR.

Nothing in this Section 13.01 shall affect the right of the Administrative Agent or any Lender to serve legal process in any other manner permitted by law or affect the right ofthe Administrative Agent or any Lender to bring any suit, action or proceeding against Pledgor or the property of Pledgor in the courts of any other jurisdictions.

13.02 Notices. All notices, requests, demands, statements, authorizations, approvals, directions, consents and other communications provided for herein shall be given or made in writing and shall be deemed sufficiently given or served for all purposes as of the date (a) when hand delivered (provided that delivery shall be evidenced by a receipt executed by or on behalf of the addressee), (b) three (3) days after being sent by postage pre-paid registered or certified mail, return receipt requested, (c) one (1) Business Day after being sent by reputable overnight courier service (with delivery evidenced by written receipt), or (d) with a simultaneous delivery by one of the means in (a), (b) or (c) by facsimile, when sent, with confirmation and a copy sent by first class ma il, in each case addressed to the intended recipient at the "Address for Notices" specified below; or, as to any party, at such other address as shall be designated by such party in a notice to each other party. Unless otherwise expressly provided herein, Pledgor shall only be required to send notices, requests, demands, statements, authorizations, approvals, directions, consents and other communications to the Administrative Agent on behalf of all of the Lenders.

(a) Notices and other communications to the Administrative Agent hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Administrative Agent. The Administrative Agent or Pledgor may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

Address for Notices:

If to Pledgor: [________________________]
_________________________
_________________________
_________________________
Attention: _________________ Telecopier No.: _____________

With Copies to: [________________________]
_________________________
_________________________
_________________________
Attention: _________________ Telecopier No.: _____________

If to Administrative Agent:

Eurohypo AG, New York Branch
1114 Avenue of the Americas
New York, New York 10036
Attention: Head of Portfolio Administration
Telecopier No.: 866-267-7680

With copies to:

Eurohypo AG, New York Branch
1114 Avenue of the Americas
New York, New York 10036
Attention: Head of Portfolio Administration
Telecopier No.: 866-267-7680

- and -

Riemer & Braunstein LLP Times Square Tower, Suite 2506 Seven Times Square New York, New York 10036 Attention: Steven J. Weinstein, Esq. Telecopier No.: (617) 692-3503

13.03 Amendments, Etc. The terms of this Agreement may be waived, modified and amended only by an instrument in writing duly executed by Pledgor and the Administrative Agent (with any required consent of the Lenders pursuant to the Loan Agreement). Any such waiver, modification or amendment shall be binding upon the Administrative Agent, each Lender, each holder of any ofthe Notes and Pledgor.

13.04 No Waiver. No failure on the part of the Administrative Agent, any Lender or any of their agents to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Administrative Agent, any Lender or any of their agents of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

13.05 Cumulative Remedies. All rights and remedies set forth in this Agreement are cumulative, and the Administrative Agent (on behalf of the Lenders) may recover judgment thereon, issue execution therefor, and resort to every other right or remedy available at law or in equity, without first exhausting and without affecting or impairing the security of any right or remedy afforded hereby; and no such right or remedy set forth in this Agreement shall be deemed exclusive of any of the remedies or rights granted to the Administrative Agent and the Lenders in the Notes, the Mortgage or any other Loan Document. Nothing contained in this Agreement shall be deemed to limit or restrict the rights and remedies of the Administrative Agent and/or the Lenders under any ofthe other document related to the Secured Obligations.

13.06 Agent's Discretion. Whenever the Administrative Agent exercises any right pursuant to this Agreement to approve or disapprove, to determine whether any arrangement or term is satisfactory or to give its consent, the decision of the Administrative Agent to approve or disapprove, to decide whether such arrangements or terms are satisfactory or not satisfactory or to consent shall (except as is otherwise specifically herein provided) be in the sole discretion of the Administrative Agent and shall be final and conclusive. In the event that a claim or adjudication is made that the Administrative Agent has acted unreasonably or unreasonably delayed acting in any case where by law or under this Agreement or the other Loan Documents, it has an obligation to act reasonably or promptly, the Administrative Agent shall not be liable for any monetary damages, and Pledgor's remedies shall be limited to injunctive relief or declaratory judgment.

13.07 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of Pledgor, the Administrative Agent, the Lenders and any holder of any of the Secured Obligations (provided, however, that Pledgor shall not assign or transfer its rights or obligations hereunder without the prior written consent of the Administrative Agent).

13.08 Captions. The captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement.

13.09 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and any of the parties hereto may execute this Agreement by signing any such counterpart.

13.10 Severability. If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and (b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction.

13.11 WAIVERS BY PLEDGOR. EXCEPT AS IS OTHERWISE EXPRESSLY PROVIDED FOR HEREIN, PLEDGOR WAIVES (A) PRESENTMENT, DEMAND AND PROTEST AND NOTICE OF PRESENTMENT, PROTEST, DEFAULT, NON-PAYMENT, INTENT TO ACCELERATE, ACCELERATION, MATURITY, RELEASE, COMPROMISE, SETTLEMENT, EXTENSION OR RENEWAL OF ANY OR ALL COMMERCIAL PAPER, ACCOUNTS, CONTRACT RIGHTS, DOCUMENTS, INSTRUMENTS, CHATTEL PAPER AND GUARANTIES AT ANY TIME HELD BY ADMINISTRATIVE AGENT OR ANY OF THE LENDERS ON WHICH PLEDGOR MAY IN ANY WAY BE LIABLE AND HEREBY RATIFIES AND CONFIRMS WHATEVER THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS MAY DO IN THIS REGARD; (B) NOTICE PRIOR TO TAKING POSSESSION OR CONTROL OF THE COLLATERAL OR OBTAINING ANY BOND OR SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT PRIOR TO ALLOWING THE ADMINISTRATIVE AGENT TO EXERCISE ANY OF THE ADMINISTRATIVE AGENT'S OR THE LENDERS' REMEDIES; (C) ANY AND ALL RIGHTS TO ASSERT ANY OFFSET, NONCOMPULSORY COUNTERCLAIM, CROSS-CLAIM OR DEFENSE (OTHER THAN PAYMENT) OF ANY NATURE WHATSOEVER WITH RESPECT TO THIS AGREEMENT OR THE SECURED OBLIGATIONS OR OTHERWISE IN ANY ACTION OR PROCEEDING BROUGHT BY THE ADMINISTRATIVE AGENT OR THE LENDERS WITH RESPECT TO THE SECURED OBLIGATIONS, OR ANY PORTION THEREOF, OR TO ENFORCE, FORECLOSE OR REALIZE UPON ANY OF THE LIENS OR SECURITY INTERESTS CREATED BY THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS; AND (D) NOTICE OF ACCEPTANCE HEREOF. PLEDGOR ACKNOWLEDGES THAT THE FOREGOING WAIVERS ARE A MATERIAL INDUCEMENT TO THE ADMINISTRATIVE AGENT'S ENTERING INTO THIS AGREEMENT AND THAT THE ADMINISTRATIVE AGENT AND THE LENDERS ARE RELYING UPON THE FOREGOING WA IVERS IN MAKING THE LOANS AND IN THEIR FUTURE DEALINGS WITH PLEDGOR. PLEDGOR SHALL NOT BE ENTITLED TO ANY NOTICES OF ANY NATURE WHATSOEVER FROM THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS EXCEPT WITH RESPECT TO MATTERS FOR WHICH THIS AGREEMENT SPECIFICALLY AND EXPRESSLY PROVIDE FOR THE GIVING OF NOTICE BY THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS TO PLEDGOR AND EXCEPT WITH RESPECT TO MATTERS FOR WHICH PLEDGOR IS NOT, PURSUANT TO APPLICABLE LEGAL REQUIREMENTS, PERMITTED TO WAIVE THE GIVING OF NOTICE. PLEDGOR HEREBY EXPRESSLY WAIVES THE RIGHT TO RECEIVE ANY NOTICE FROM THE ADMINISTRATIVE AGENT AND ANY OF THE LENDERS WITH RESPECT TO ANY MATTER FOR WHICH THIS AGREEMENT DOES NOT SPECIFICALLY AND EXPRESSLY PROVIDE FOR THE GIVING OF NOTICE BY THE ADMINISTRATIVE AGENT OR ANY OF THE LENDERS TO PLEDGOR.

13.12 WAIVER OF JURY TRIAL. PLEDGOR, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTION OF EITHER PARTY OR ANY EXERCISE BY ANY PARTY OF THEIR RESPECTIVE RIGHTS UNDER THIS AGREEMENT OR IN ANY WAY RELATING TO THE LOANS OR THE PROJECT (INCLUDING, WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS ASSIGNMENT, AND ANY CLAIM OR DEFENSE ASSERTING THAT THIS DEED OF TRUST WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). THIS WAIVER A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND EACH LENDER TO ENTER THIS AGREEMENT.

13.13 Conflicts with Loan Agreement. Notwithstanding anything to the contrary contain in this Assignment, in the event of a conflict or ambiguity created between the Loan Agreement and any provision herein, the terms ofthe Loan Agreement shall govern and control.

[Signature page follows]

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

ACADIA-PA EAST FORDHAM ACQUISITIONS, LLC, a Delaware limited liability company

By:	Acadia-P/A Holding Company, LLC, a Delaware
	limited liability company, its sole member

	By:	Acadia Strategic Opportunity Fund II, LLC, a
		Delaware limited liability company, its managing member

		By:	Acadia Realty Acquisition II, LLC, a
			Delaware limited liability company, its
			managing member

			By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

				By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

					By: _______________________
					Name: Robert Masters
					Title: Senior Vice President-General Counsel

FORDHAM PLACE OFFICE LLC, a Delaware limited liability company

By:	Acadia-P/A Holding Company, LLC, a Delaware
	limited liability company, its sole member

	By:	Acadia Strategic Opportunity Fund II, LLC, a
		Delaware limited liability company, its managing member

		By:	Acadia Realty Acquisition II, LLC, a
			Delaware limited liability company, its
			managing member

			By:	Acadia Realty Limited Partnership, a Delaware limited partnership, its sole member

				By:	Acadia Realty Trust, a Maryland real estate investment trust, its general partner

					By:
					Name: Robert Masters
					Title: Senior Vice President-General Counsel

	ADMINISTRATIVE AGENT:

	EUROHYPO AG, NEW YORK BRANCH,
	as Administrative Agent

			By:	__________________________________
				Name: Title:

			By:	__________________________________
				Name: Title:

EXHIBIT A

ACKNOWLEDGMENT OF SECURITY INTEREST

The undersigned, _____________, Counterparty to the Hedge Agreement, by its execution of this acknowledgment of the security interest granted in the foregoing Assignment, Pledge and Security Agreement (the "Pledge Agreement"), hereby consents to the pledge and grant of the security interest in favor of Eurohypo, AG, New York Branch, as Administrative Agent (the "Administrative Agent"), and the other terms of the Pledge Agreement, and agrees that (i) it will make all termination payments into the following account: ______________ Eurohypo AG, New York Branch, 1114 Avenue of the Americas, New York, New York 10036 or as otherwise directe d by the Administrative Agent, and (ii) upon receipt by Counterparty ofinstructions from the Administrative Agent with respect to thereto (to be given to Counterparty at its address set forth below, but otherwise in accordance with the provision for notices set forth in the Pledge Agreement), Counterparty will make all payments of all sums (including, without limitation, all termination payments) payable or to become payable by it under or pursuant to the Hedge Agreement, into an account or as otherwise directed by the Administrative Agent. All such payments shall be made without offset or deduction for any claim by the undersigned against Pledgor, all of which such claims will be asserted directly or separately against Pledgor. In consideration of the foregoing agreement by Counterparty, Pledgor agrees that (i) Counterparty shall be entitled to conclusively rely (without any independent investigation) on the Administrative Agent's statement that the Administrative Agent is entitled to payment under the Hedg e Agreement, and (ii) Counterparty shall be held harmless and shall be fully indemnified by Pledgor, from and against any and all claims, other than those ultimately determined to be founded on gross negligence or willful misconduct of Counterparty, and from and against any damages, penalties, judgments, liabilities, losses or expenses (including reasonable attorneys' fees and disbursements) incurred by Counterparty as a result of the assertion of any claim, by any person or entity, arising out of, or otherwise related to, any actions taken or omitted to be taken by Counterparty in reliance upon any such notice provided by the Administrative Agent.

Counterparty agrees that, until such time as it receives from the Administrative Agent written notice that the Pledge Agreement is terminated or otherwise canceled, Counterparty shall not, without first obtaining the Administrative Agent's prior written consent, amend, modify, cancel or terminate the Hedge Agreement (except for partial reductions of the notional amount under the Hedge Agreement for which no consent of the Administrative Agent is required under the express terms of the Loan Agreement, that are certified by Pledgor to the Administrative Agent and Counterparty in a written instrument to be in compliance with the first proviso set forth in Section 6(e)(i) of the Pledge Agreement), and no attempt to amend, modify, cancel or terminate the Hedge Agreement (except for partial reductions as provided above) without the Administrative Agent's prior written consent, shall be binding on the Administrative Agent or of any force or effect.

Ex. A-1

Counterparty hereby agrees that, in the event of any breach or default by the Pledgor under the Hedge Agreement that has not been cured by Pledgor, and in the event of any termination event that could be claimed by Counterparty under the Hedge Agreement as a result of any act, omission, event or condition attributable to Pledgor which could be cured through the paYment ofmoney or otherwise through performance by a person other than Pledgor, that has not been cured by Pledgor, Counterparty shall notify the Administrative Agent at its address set forth in the Pledge Agreement (and otherwise in accordance with the procedures for notice set forth in the Pledge Agreement) of the occurrence of such breach, default or event. Counterparty further agrees that the Administrative Agent shall have the right to cure any such breach, default or event; that the Counterparty shall accept any such cure tendered by the Administrative Agent within the same period for cure of such breach, default or event set forth in the Hedge Agreement, which cure period shall be measured, however, from the date notice of such breach, default or event is delivered to the Administrative Agent in accordance herewith) (herein, the "Cure Period"); and that Counterparty shall not terminate the Hedge Agreement or exercise any remedies on account of such breach, default or event, unless the Administrative Agent fails to cure such breach, default or event within the Cure Period. Counterparty acknowledges and agrees that the Administrative Agent shall have the right (but shall be under no obligation) to cure such breach, default or event, and that neither the tender of any such cure by or on behalf of the Administrative Agent, nor this Acknowledgment or any term or provision of the Pledge Agreement, s hall be deemed to result in the assumption by the Administrative Agent of any obligations ofthe Pledgor under the Hedge Agreement.

ACKNOWLEDGED AND CONSENTED TO:

[COUNTERPARTY]

By:	_________________________
	Name:
	Title:

Address For Notices:
_____________________
_____________________

Ex A-2

EX-10.29 3 a6488986ex10_29.htm EXHIBIT 10.29 Unassociated Document

Exhibit 10.29

LOAN AGREEMENT

Dated as of July 1, 2010

by and between

NEW YORK CITY CAPITAL RESOURCE CORPORATION,

a local development corporation created pursuant to the Not-for-Profit Corporation Law of the

State of New York at the direction of the Mayor of The City of New York, having its principal

office at 110 William Street, New York, New York 10038,

as “Issuer”

and

ALBEE RETAIL DEVELOPMENT LLC,

a limited liability company organized and existing under the laws of the

State of Delaware, having its principal office at

1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605,

as “Company”

$20,000,000

New York City Capital Resource Corporation

Recovery Zone Facility Revenue Bonds

(Albee Retail Development LLC Project),

Series 2010

TABLE OF CONTENTS

Page

ARTICLE I

DEFINITIONS AND CONSTRUCTION

Section 1.1.	Definitions	iii
Section 1.2.	Construction	xxiii

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1.	Representations and Warranties by Issuer	xxiv
Section 2.2.	Representations and Warranties by the Company	xxv

ARTICLE III
THE PROJECT; MAINTENANCE; REMOVAL OF PROPERTY AND TITLE INSURANCE
Section 3.1.	Agreement to Undertake Project.	xxx
Section 3.2.	Manner of Project Completion.	xxx
Section 3.3.	Maintenance	xxxi
Section 3.4.	Alterations and Improvements.	xxxii
Section 3.5.	Removal of Property of the Facility.	xxxiii
Section 3.6.	Implementation of Additional Improvements and Removals.	xxxiv
Section 3.7.	Title Insurance	xxxiv

ARTICLE IV

LOAN; PAYMENT PROVISIONS

Section 4.1.	Loan of Proceeds	xxxv
Section 4.2.	Duration of Term	xxxv
Section 4.3.	Loan Payments; Pledge of this Agreement and of the Promissory Note.	xxxv
Section 4.4.	Payment of Purchase Price	xxxviii
Section 4.5.	Loan Payments and Other Payments Payable Absolutely Net	xxxviii
Section 4.6.	Nature of Company’s Obligation Unconditional	xxxix
Section 4.7.	Advances by the Trustee	xxxix
Section 4.8.	No Warranty of Condition or Suitability	xxxix

ARTICLE V

DAMAGE, DESTRUCTION AND CONDEMNATION

Section 5.1.	Damage, Destruction and Condemnation	xli
Section 5.2.	Loss Proceeds.	xli
Section 5.3.	Election to Rebuild or Terminate.	xli
Section 5.4.	Effect of Election to Build.	xliii

ARTICLE VI

COVENANTS OF THE ISSUER

Section 6.1.	Issuance of Initial Bonds	xlv
Section 6.2.	Issuance of Additional Bonds	xlv
Section 6.3.	Pledge and Assignment to Trustee	xlv
Section 6.4.	Issuer to Make Bond Registration Books Available	xlv

ARTICLE VII

COVENANTS OF THE COMPANY

Section 7.1.	Insurance.	xlvi
Section 7.2.	Indemnity.	lii
Section 7.3.	Compensation and Expenses of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent; Administrative and Project Fees.	liii
Section 7.4.	Signage at Facility Site	liv
Section 7.5.	Environmental Matters.	liv
Section 7.6.	Employment Matters.	lv
Section 7.7.	Non-Discrimination.	lvi
Section 7.8.	Assignment or Sublease.	lvii
Section 7.9.	Retention of Interest in Facility; Grant of Easements; Release of Portions of Facility.	lxii
Section 7.10.	Discharge of Liens and Claims.	lxiv
Section 7.11.	Filing.	lxiv
Section 7.12.	No Further Encumbrances Permitted	lxvi
Section 7.13.	Documents Automatically Deliverable to the Issuer.	lxvii
Section 7.14.	Requested Documents	lxviii
Section 7.15.	Periodic Reporting Information for the Issuer.	lxix
Section 7.16.	Taxes, Assessments and Charges.	lxx
Section 7.17.	Compliance with Legal Requirements.	lxxi
Section 7.18.	Operation as Approved Facility.	lxxi
Section 7.19.	Restrictions on Dissolution and Merger.	lxxii
Section 7.20.	Security Interest and Further Assurances	lxxiv
Section 7.21.	Continuing Disclosure	lxxiv
Section 7.22.	Tax Regulatory Agreement.	lxxiv

Section 7.23.	Compliance with the Indenture	lxxiv
Section 7.24.	Reporting Information for the Trustee.	lxxv
Section 7.25.	Contracts with Affiliates	lxxvi
Section 7.26.	Business of Company	lxxvi
Section 7.27.	No Material Impairment of Value	lxxvi
Section 7.28.	Certain Covenants with Respect to the Ground Lease	lxxvi
Section 7.29.	Certain Covenants with Respect to the Facility Leases	lxxvi
Section 7.30.	Waiver of Defenses	lxxvii
Section 7.31.	Leasehold Condominium	lxxvii

ARTICLE VIII

REMEDIES AND EVENTS OF DEFAULT

Section 8.1.	Events of Default	lxxviii
Section 8.2.	Remedies on Default	lxxix
Section 8.3.	Bankruptcy Proceedings	lxxx
Section 8.4.	Remedies Cumulative	lxxxi
Section 8.5.	No Additional Waiver Implied by One Waiver	lxxxi
Section 8.6.	Effect on Discontinuance of Proceedings	lxxxi
Section 8.7.	Agreement to Pay Fees and Expenses of Attorneys and Other Consultants	lxxxi
Section 8.8.	Certain Continuing Representations	lxxxi
Section 8.9.	Late Delivery Fees.	lxxxii

ARTICLE IX

OPTIONS TO TERMINATE

Section 9.1.	Termination of this Agreement.	lxxxiii
Section 9.2.	Actions on Termination	lxxxiii
Section 9.3.	Survival of Company Obligations	lxxxiv

ARTICLE X

CERTAIN PROVISIONS RELATING TO THE BONDS

Section 10.1.	Issuance of Additional Bonds	lxxxv
Section 10.2.	Determination of Taxability	lxxxv
Section 10.3.	Mandatory Redemption of Bonds as Directed by the Issuer	lxxxvi
Section 10.4.	Right to Cure Issuer Defaults	lxxxvi
Section 10.5.	Option to Purchase or Invite Tenders of Bonds	lxxxvi
Section 10.6.	Investment of Funds	lxxxvii
Section 10.7.	Deposit to Additional Interest Deposit Fund	lxxxvii

iii


ARTICLE XI

MISCELLANEOUS

Section 11.1.	Force Majeure	lxxxviii
Section 11.2.	Pledge under Indenture and Mortgage	lxxxviii
Section 11.3.	Amendments	lxxxix
Section 11.4.	Service of Process	lxxxix
Section 11.5.	Notices	lxxxix
Section 11.6.	Consent to Jurisdiction	xci
Section 11.7.	Prior Agreements Superseded	xci
Section 11.8.	Severability	xci
Section 11.9.	Effective Date; Counterparts	xci
Section 11.10.	Binding Effect	xci
Section 11.11.	Third Party Beneficiaries	xci
Section 11.12.	Law Governing	xcii
Section 11.13.	Waiver of Trial by Jury	xcii
Section 11.14.	Recourse Under This Agreement	xcii

EXHIBITS

Exhibit A -	Description of the Land
Exhibit B -	Authorized Representative
Exhibit C -	Principals of Company and Parent
Exhibit D -	Project Cost Budget
Exhibit E-1 -	Form of Required Disclosure Statement for Other than Facility Tenants
Exhibit E-2 -	Form of Required Disclosure Statement for Facility Tenants
Exhibit F -	Form of Project Completion Certificate
Exhibit G -	Form of Promissory Note
Exhibit H –	Form of Subordination and Non-Disturbance Agreement

LOAN AGREEMENT

This LOAN AGREEMENT, made and entered into as of June 1, 2010, by and between NEW YORK CITY CAPITAL RESOURCE CORPORATION, a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State of New York at the direction of the Mayor of The City of New York, having its principal office at 110 William Street, New York, New York 10038, party of the first part, and ALBEE RETAIL DEVELOPMENT LLC, a limited liability company organized and existing under the laws of the State of Delaware, having its principal office at 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605, party of the second part (capitalized terms used but no t defined herein shall have the respective meanings assigned to such terms in Section 1.1 of this Agreement);

WITNESSETH:

WHEREAS, the Issuer is authorized pursuant to Section 1411(a) of the Not-for-Profit Corporation Law of the State of New York, as amended, and its Certificate of Incorporation, to promote community and economic development and the creation of jobs for the citizens of the City by developing and providing programs for manufacturing and industrial businesses and other entities to access low interest cost tax-exempt and non-tax-exempt financing for their eligible projects, and to issue and sell one or more series or classes of bonds, notes and other obligations through public letting, private placement, or negotiated underwriting to finance such activities above, on a secured or unsecured basis; and

WHEREAS, the Company entered into negotiations with officials of the Issuer for the construction, renovation, equipping and furnishing of the Improvements as part of the Facility; and

WHEREAS, pursuant to the American Recovery and Reinvestment Act of 2009, as amended, on June 9, 2009, as amended on February 9, 2010, the Board of Directors of the Issuer established a program for the issuance of recovery zone facility bonds including program requirements (“Program Requirements”), threshold requirements (“Threshold Requirements”) and selection criteria (“Selection Criteria”), and designated certain areas within the City as “Recovery Zones”; and

WHEREAS, on July 17, 2009, the Mayor of the City ratified the designations made by the Issuer of the “Recovery Zones”; and

WHEREAS, on September 15, 2009, the Issuer adopted a resolution approving the eligibility of the Project to receive a $20,000,000 allocation for the issuance of recovery zone facility bonds and determined, among other things, that the Project is located in a designated “Recovery Zone”, and that, in applying the Threshold Requirements and the Selection Criteria, the Project qualifies for the issuance of recovery zone facility bonds; and

WHEREAS, the Issuer has determined that the providing of financial assistance to the Company for the Project will promote and is authorized by and will be in furtherance of the Program Requirements and the corporate purposes of the Issuer; and

WHEREAS, the site for the Facility, including the improvements to be constructed thereon, will be subject to the Ground Lease; and

WHEREAS, to facilitate the Project and the issuance by the Issuer of its recovery zone facility revenue bonds to finance a portion of the costs of the Project, the Issuer and the Company have entered into negotiations pursuant to which (i) the Issuer will make the Loan of the proceeds of the Initial Bonds, in the original principal amount of the Initial Bonds, to the Company pursuant to this Agreement, and (ii) the Company will execute the Promissory Note in favor of the Issuer and the Trustee to evidence the Company’s obligation under this Agreement to repay the Loan; and

WHEREAS, to provide funds for a portion of the costs of the Project and for incidental and related costs and to provide funds to pay the costs and expenses of the issuance of the Initial Bonds, the Issuer has authorized the issuance of the Initial Bonds in the Authorized Principal Amount pursuant to the Bond Resolution and the Indenture; and

WHEREAS, concurrently with the execution hereof, in order to further secure the Initial Bonds, (i) the payment of the principal of, Sinking Fund Installments for, Purchase Price, redemption premium, if any, and interest on the Initial Bonds, and the payments, obligations, covenants and agreements of the Company under this Agreement and under the Promissory Note, will be guaranteed by the Guarantors pursuant to the Bond Guaranty Agreement in favor of the Trustee; (ii) the completion of the Project will be guaranteed by the Guarantors pursuant to the Project Completion Guaranty Agreement in favor of the Trustee; (iii) the Company will grant a lien in Facility Revenues and the remainder of the Pledged Collateral pursuant to the Pledge and Security Agreement in favor o f the Trustee, subject only to the lien of the Mortgage; and (iv) the Company will grant mortgage liens on and security interests in its leasehold interest in the Facility under the Ground Lease, and an assignment of leases and rents, to the Trustee pursuant to the Mortgage;

NOW, THEREFORE, in consideration of the premises and the respective representations and agreements hereinafter contained, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS AND CONSTRUCTION

Section 1.1. Definitions. In addition to the definitions set forth in Section 7.1(a), the following terms shall have the respective meanings in this Agreement:

Additional Bonds shall mean one or more Series of additional bonds issued, executed, authenticated and delivered under the Indenture.

Additional Improvements shall have the meaning specified in Section 3.4(a).

Advance Interest Deposit Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

An Affiliate of a Person shall mean a Person that directly or indirectly through one or more intermediaries Controls, or is under common Control with, or is Controlled by, such Person.

Agreement shall mean this Loan Agreement, dated as of July 1, 2010, between the Issuer and the Company, and shall include any and all amendments hereof and supplements hereto hereafter made in conformity herewith and with the Indenture.

Annual Administrative Fee shall mean that annual administrative fee established from time to time by the Issuer’s Board of Directors as generally applicable to Entities receiving or that have received financial assistance from the Issuer (subject to such exceptions from such general applicability as may be established by the Issuer’s Board of Directors).

Approved Facility shall mean the Facility as occupied, used and operated by the Company and all Facility Tenants substantially for the Approved Project Operations, including such other activities as may be substantially related to or substantially in support of such operations, all to be effected in accordance with this Agreement and the Ground Lease.

Approved Project Operations shall mean, subject to this Agreement, those uses and operations permitted under the Ground Lease, excluding, however, any Tax Prohibited Use or any use by a not-for-profit corporation.

Authorized Denomination shall mean, in the case of the Initial Bonds, $100,000 or any integral multiple of $5,000 in excess thereof.

Authorized Principal Amount shall mean, in the case of the Initial Bonds, $20,000,000.

Authorized Representative shall mean:

(i) in the case of the Issuer, the Chairperson, Vice Chairperson, Treasurer, Assistant Treasurer, Secretary, Assistant Secretary, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs, or any other officer or employee of the Issuer who is authorized to perform specific acts or to discharge specific duties;

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(ii) in the case of the Company, a person named in Exhibit B — “Authorized Representative”, or any other officer or employee of the Company who is authorized to perform specific duties hereunder or under any other Project Document and of whom another Authorized Representative of the Company has given written notice from time to time to the Issuer and the Trustee; and

(iii) in the case of the Parent, a person named in Exhibit B — “Authorized Representative”, or any other officer or employee of the Parent who is authorized to perform specific duties hereunder or under any other Project Document and of whom another Authorized Representative of the Parent has given written notice from time to time to the Issuer and the Trustee;

provided, however, that in each case for which a certification or other statement of fact or condition is required to be submitted by an Authorized Representative to any Person pursuant to the terms of this Agreement or any other Project Document, such certificate or statement shall be executed only by an Authorized Representative in a position to know or to obtain knowledge of the facts or conditions that are the subject of such certificate or statement.

Beneficial Owner shall mean, whenever used with respect to an Initial Bond, the Person in whose name such Initial Bond is recorded as the Beneficial Owner of such Initial Bond by the respective systems of DTC and each of the Participants of DTC. If at any time the Initial Bonds are not held in the Book-Entry System, Beneficial Owner shall mean “Holder” for purposes of the Security Documents.

Bond Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Bond Guaranty Agreement shall mean the Bond Guaranty Agreement, dated as of even date herewith, from the Guarantors to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Bondholder, Holder of Bonds, Holder or holder shall mean any Person who shall be the registered owner of any Bond or Bonds.

Bond Payment Date shall mean, with respect to a Series of Bonds, each date upon which interest, principal and/or Sinking Fund Installments shall be scheduled to be paid under such Series of Bonds.

Bond Placement Agreement shall mean the Bond Placement Agreement, dated July 1, 2010, with respect to the placement of the Initial Bonds, among the Issuer, the Company and the Placement Agent.

Bond Registrar shall mean the Trustee acting as registrar as provided in Section 3.10 of the Indenture.

Bond Resolution shall mean the resolution of the Issuer adopted on February 9, 2010, as amended on April 13, 2010, authorizing the issuance of the Initial Bonds.

Bonds shall mean the Initial Bonds and any Additional Bonds.

Building Loan Agreement shall mean the Building Loan Agreement, dated as of even date herewith, among the Issuer, the Company and the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Business Day shall mean any day that shall not be:

(i) a Saturday, Sunday or legal holiday;

(ii) a day on which the Trustee, the Tender Agent, the Paying Agent or the Remarketing Agent is required or authorized by law or executive order to be closed;

(iii) a day on which banking institutions in the City are authorized by law or executive order to close; or

(iv) a day on which the New York Stock Exchange is closed.

Capitalized Interest Account shall mean the special trust account of the Project Fund so designated, established pursuant to Section 5.01 of the Indenture.

City shall mean The City of New York, New York.

Claims shall have the meaning set forth in Section 7.2(a).

Closing Date shall mean July 1, 2010, the date of the initial issuance and delivery of the Initial Bonds.

Code shall mean the Internal Revenue Code of 1986, as amended, including the regulations thereunder. All references to Sections of the Code or regulations thereunder shall be deemed to include any such Sections or regulations as they may hereafter be renumbered in any subsequent amendments to the Code or such regulations.

Commencement Date shall mean July 1, 2010, on which date this Agreement was executed and delivered.

Company shall mean Albee Retail Development LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns; provided, however, that nothing contained in this definition shall be deemed to limit or modify the obligations of the Company under Section 7.8 or 7.19.

Company’s Property shall have the meaning specified in Section 3.4(c).

Company Purchase Account shall mean the special trust account of the Purchase Fund so designated, established pursuant to Section 5.01 of the Indenture.

Completed Improvements Rentable Square Footage shall mean approximately 44,728 rentable square feet, the rentable square footage of the Improvements upon completion of the Project Work.

Completion Date shall mean June 10, 2012, or such later date as shall be permitted by the landlord under the Ground Lease.

Conduct Representation shall mean any representation by the Company under Section 2.2(u), by the Parent under Section 2.1(h) of the Issuer Indemnification Agreement, or by any other Person in any Required Disclosure Statement delivered to the Issuer.

Construction Account shall mean the special trust account of the Project Fund so designated, established pursuant to Section 5.01 of the Indenture.

Control or Controls, including the related terms “controlled by” and “under common control with”, shall mean the power to direct the management and policies of a Person (x) through the ownership, directly or indirectly, of not less than a majority of its voting securities, (y) through the right to designate or elect not less than a majority of the members of its board of directors or trustees or other Governing Body, or (z) by contract or otherwise.

Costs of Issuance shall mean issuance costs with respect to the Initial Bonds described in Section 147(g) of the Code and any regulations thereunder, including but not limited to the following: fees of the Placement Agent; counsel fees (including bond counsel to the Issuer, counsel to the Placement Agent, Trustee’s counsel, Issuer’s counsel, Company’s counsel, as well as any other specialized counsel fees incurred in connection with the borrowing); financial advisor fees of any financial advisor to the Issuer or the Company incurred in connection with the issuance of the Initial Bonds; engineering and feasibility study costs; guarantee fees (other than Qualified Guarantee Fees, as defined in the Tax Regulatory Agreement); Rating Agency fees; Trustee, Paying Agent and Tender Agent fees; accountant fees and other expenses related to issuance of the Initial Bonds; printing costs (for the Initial Bonds and of the preliminary and final Private Placement Memorandum relating to the Initial Bonds); printing costs for the Initial Bonds and offering documents; public approval and process costs; fees and expenses of the Issuer incurred in connection with the issuance of the Initial Bonds; and Blue Sky fees and expenses; and similar costs.

Defeasance Obligations shall mean Government Obligations that are not subject to redemption prior to maturity.

Determination of Taxability shall mean;

(i) the adoption, promulgation or enactment of any federal statute or regulation, or any determination, decision, decree or ruling made by the Commissioner or any District Director of the Internal Revenue Service;

(ii) the issuance of a public or private ruling or a technical advice memorandum by the Internal Revenue Service in which the Company has participated or has been given the opportunity to participate, and which ruling or memorandum the Company, in its discretion, does not contest or from which no further right of judicial review or appeal exists; or

(iii) a determination from which no further right of appeal exists of any court of competent jurisdiction in the United States in a proceeding in which the Company has participated or has been a party, or has been given the opportunity to participate or be a party;

in any case, to the effect that the interest payable on the Bonds of a Holder or a former Holder thereof (other than a Holder of any Bond who is a “substantial user” of the Facility or a “related person”, within the meaning and for the purpose of Section 147(a) of the Code and the applicable regulations thereunder) is includable in gross income for federal income tax purposes; provided, however, that no such Determination of Taxability described in clauses (ii) or (iii) hereof shall be considered to exist unless (1) the Holder or former Holder of the Bond involved in such proceeding (A) gives the Company and the Trustee prompt notice of the commencement thereof and (B) (if the Company agrees to pay all expenses in connection therewith) offers the Company the opportunity to control the defense thereof and (2) either (A) the Company does not agree within thirty (30) days of receipt of such offer to pay such expenses and to control such defense or (B) the Company shall exhaust or choose not to exhaust all available proceedings for the contest, review, appeal or rehearing of such decree, judgment or action which the Company determines to be appropriate. No Determination of Taxability described above will result from the inclusion of interest on any Bond in the computation of minimum or indirect taxes.

DTC shall mean The Depository Trust Company, a limited purpose trust company organized under the laws of the State, and its successors and assigns.

Due Date shall have the meaning set forth in Section 8.9(a).

Earnings Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Electronic Means shall mean telecopy, facsimile transmission, e-mail transmission or other similar electronic means of communication providing evidence of transmission, including a telephonic communication confirmed by any other method set forth in this definition.

Employment Information shall have the meaning set forth in Section 7.6(c).

Entity shall mean any of a corporation, general partnership, limited liability company, limited liability partnership, joint stock company, trust, estate, unincorporated organization, business association, tribe, firm, joint venture, governmental authority or governmental instrumentality, but shall not include an individual.

Environmental Audit shall mean that certain Phase I Environmental Site Assessment Report dated April 2, 2010, prepared by the Environmental Auditor.

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Environmental Auditor shall mean CNS Management Corp.

Event of Default shall have the meaning specified in Section 8.1.

Event of Taxability shall mean the date specified in a Determination of Taxability as the date interest paid or payable on any Bond becomes includable for federal income tax purposes in the gross income of any Holder thereof (other than a Holder of any Bond who is a “substantial user” of the Facility or a “related person”, within the meaning and for the purpose of Section 147(a) of the Code and the applicable regulations thereunder) as a consequence of any act, omission or event whatsoever, including any change of law, and regardless of whether the same was within or beyond the control of the Company.

Existing Facility Property shall have the meaning set forth in Section 3.5(a).

Expiration Date shall mean November 1, 2042.

Facility shall mean, collectively, the Land and the Improvements.

Facility Lease Payments shall have the meaning specified in Section 4.1 of the Mortgage.

Facility Leases shall mean, collectively, all leases or other occupancy or use agreements, other than the Ground Lease, entered into with any Person for the use, possession or occupancy of the Facility or any portion thereof.

Facility Revenues shall mean all revenues, income, fees, receipts, charges, income and other money received in any period by or on behalf of the Company, derived from the leasing or operation of the Facility, including proceeds derived from insurance (including environmental insurance) and/or condemnation proceeds with respect to the Facility and business interruption insurance and extra expense insurance, in each case whether existing as of the Closing Date or hereafter coming into existence.

Facility Tenants shall mean all Persons as shall use, possess or occupy all or any portion of the Facility pursuant to a Facility Lease.

Favorable Opinion of Bond Counsel shall mean, with respect to any action the occurrence of which requires such an opinion, an unqualified Opinion of Counsel, which shall be a Nationally Recognized Bond Counsel, to the effect that such action is permitted under the Indenture and will not adversely affect the exclusion of interest on a Series of Bonds from gross income for purposes of Federal income taxation (subject to the inclusion of any exceptions contained in the opinion delivered upon original issuance of such Series of Bonds).

Fiscal Year shall mean a year of 365 or 366 days, as the case may be, commencing on January 1 and ending on December 31 of each calendar year, or such other fiscal year of similar length used by the Company for accounting purposes as to which the Company shall have given prior written notice thereof to the Issuer and the Trustee at least ninety (90) days prior to the commencement thereof.

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Fitch shall mean Fitch, Inc., a Delaware corporation, its successors and assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “Fitch” shall be deemed to refer to any other nationally recognized securities rating agency designated by the Trustee, by notice to the other Notice Parties.

Fixed Date Deliverables shall have the meaning set forth in Section 8.9(a)(ii).

GAAP shall mean those generally accepted accounting principles and practices that are recognized as such by the American Institute of Certified Public Accountants or by the Financial Accounting Standards Board or through other appropriate boards or committees thereof, and that are consistently applied for all periods, after the Commencement Date, so as to properly reflect the financial position of the Company, except that any accounting principle or practice required to be changed by the Financial Accounting Standards Board (or other appropriate board or committee of the said Board) in order to continue as a generally accepted accounting principle or practice may be so changed.

Governing Body shall mean, when used with respect to any Person, its board of directors, board of trustees or individual or group of individuals by, or under the authority of which, the powers of such Person are exercised.

Government Obligations shall mean the following:

(i) direct and general obligations of, or obligations unconditionally guaranteed by, the United States of America;

(ii) obligations of a Person controlled or supervised by and acting as an Issuer or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation of the United States of America for the timely payment thereof; or

(iii) securities or receipts evidencing ownership interests in obligations or specified portions (such as principal or interest) of obligations described in clauses (i) or (ii) above.

Ground Lease shall mean that certain Severance Lease (Site 1A), dated June 30, 2010, between the City, as landlord, and Albee Development, LLC, a Delaware limited liability company (“Albee Development”), as assigned on July 1, 2010 by Albee Development to, and assumed by, the Company, as tenant, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith, herewith and with the Mortgage.

Guarantors shall mean, collectively, the Company and the Parent, and their respective successors and assigns.

Hazardous Materials shall include any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or related materials defined in the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (42 U.S.C. Sections 9601, et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. Sections 5101, et seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C. Sections 6901, et seq.), and in the regulations adopted and publications promulgated pursuant thereto, or any other federal, state or local environmental law, ordinance, rule, or regulation.

Impositions shall have the meaning set forth in Section 7.16(a).

Improvements shall mean:

(i) all buildings, structures, foundations, related facilities, fixtures and other improvements existing on the Commencement Date and erected or situated on the Land;

(ii) any other buildings, structures, foundations, related facilities, fixtures and other improvements constructed or erected on the Land throughout the term of this Agreement (including any improvements or demolitions made as part of the Project Work pursuant to Section 3.2); and

(iii) all replacements, improvements, additions, extensions, substitutions, restorations and repairs to any of the foregoing.

Indemnification Commencement Date shall mean September 15, 2009, the date on which the Issuer adopted the Preliminary Resolution.

Indemnified Parties shall have the meaning set forth in Section 7.2(a).

Indenture shall mean the Indenture of Trust, dated as of even date herewith, between the Issuer and the Trustee, as from time to time amended or supplemented by Supplemental Indentures in accordance with Article XI of the Indenture.

Independent Accountant shall mean an independent certified public accountant or firm of independent certified public accountants selected by the Company and approved by the Issuer and the Trustee (such approvals not to be unreasonably withheld or delayed).

Independent Engineer shall mean a Person (not an employee of any of the Issuer, the Company, the Parent or any Affiliate of any thereof) registered and qualified to practice engineering or architecture under the laws of the State, selected by the Company, and approved in writing by the Trustee (which approval shall not be unreasonably withheld and shall be at the written direction of the Majority Holders).

Information Recipients shall have the meaning set forth in Section 7.6(c).

Initial Annual Administrative Fee shall mean $850.

Initial Bonds shall mean the Issuer’s $20,000,000 Recovery Zone Facility Revenue Bonds (Albee Retail Development LLC Project), Series 2010 authorized, issued, executed, authenticated and delivered on the Closing Date under the Indenture.

Interest Payment Date shall mean, with respect to the Initial Bonds, February 1, May 1, August 1 and November 1 of each year, commencing August 1, 2010, and with respect to any Series of Additional Bonds, the dates set forth therefor in the Supplemental Indenture pursuant to which such Series of Additional Bonds are issued.

Issuer shall mean New York City Capital Resource Corporation, a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State at the direction of the Mayor of the City, and its successors and assigns.

Issuer Indemnification Agreement shall mean the Issuer Indemnification Agreement, dated as of even date herewith, from the Parent to the Issuer, and shall include any and all amendments thereof and supplements thereto hereafter made.

Issuer’s Reserved Rights shall mean, collectively,

(i) the right of the Issuer in its own behalf to receive all Opinions of Counsel, reports, financial statements, certificates, insurance policies, binders or certificates, or other notices or communications required to be delivered to the Issuer under this Agreement;

(ii) the right of the Issuer to grant or withhold any consents or approvals required of the Issuer under this Agreement;

(iii) the right of the Issuer to enforce in its own behalf the obligation of the Company to complete the Project;

(iv) the right of the Issuer in its own behalf (or on behalf of the appropriate taxing authorities) to enforce, receive amounts payable under or otherwise exercise its rights under Sections 2.2, 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 4.4, 4.5, 4.6, 4.7, 4.8, 5.1, 5.2, 5.3, 5.4, 6.1, 6.3, 6.4, 7.1, 7.2, 7.3, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.13, 7.14, 7.15, 7.16, 7.17, 7.18, 7.19, 7.21, 7.22, 7.23, 7.26, 7.28, 7.29, 7.30, 8.1, 8.2, 8.3, 8.4, 8.5, 8.6, 8.7, 8.8, 8.9, 9.1, 9.2, 9.3, 10.1, 10.3, 10.6, 11.1, 11.3, 11.4, 11.5, 11.6, 11.11, 11.13, 11.14 and 11.15; and

(v) the right of the Issuer in its own behalf to declare a default with respect to any of the Issuer’s Reserved Rights and exercise the remedies set forth in Section 8.2(b).

Land shall mean that certain lot, piece or parcel of land in the Borough of Brooklyn (County of Kings), Block 149 and Lot 103, generally known by the street address 1 DeKalb Avenue, Brooklyn, New York, all as more particularly described in Exhibit A - “Description of the Land”, together with all easements, rights and interests now or hereafter appurtenant or beneficial thereto; but excluding, however, any real property or interest therein released pursuant to Section 7.9(c).

Land Square Footage shall mean approximately 10,000 square feet.

Legal Requirements shall mean the Constitutions of the United States and the State of New York and all laws, statutes, codes, acts, ordinances, resolutions, orders, judgments, decrees, injunctions, rules, regulations, permits, licenses, authorizations, certificates of occupancy, directions and requirements (including zoning, land use, planning, environmental protection, air, water and land pollution, toxic wastes, hazardous wastes, solid wastes, wetlands, health, safety, equal opportunity, minimum wages, and employment practices) of all governments, departments, commissions, boards, courts, authorities, agencies, officials and officers, including those of the City, foreseen or unforeseen, ordinary or extraordinary, that are applicable now or may be applicable at any time hereafte r to (i) the Company or any Facility Tenant, (ii) the Facility or any part thereof, or (iii) any use or condition of the Facility or any part thereof.

Letter of Representation and Indemnity Agreement shall mean the Letter of Representation and Indemnity Agreement, dated the Closing Date, from the Guarantors to the Issuer, the Trustee and the original purchaser(s) of the Initial Bonds.

Liability shall have the meaning set forth in Section 7.2(a).

Liens shall have the meaning specified in Section 7.10(a).

Loan shall mean the loan made by the Issuer to the Company pursuant to this Agreement as described in Section 4.1.

Loan Payment Date shall mean the fifth (5th) Business Day immediately preceding each Bond Payment Date.

Loss Event shall have the meaning specified in Section 5.1.

Majority Holders shall mean the Beneficial Owners of at least a majority in aggregate principal amount of the Bonds Outstanding, or, if the Bonds shall cease to be in book-entry form, the Holders of at least a majority in aggregate principal amount of the Bonds Outstanding.

Maximum Interest Rate shall mean, with respect to the Initial Bonds, a rate of interest equal to the lesser of (i) twelve percent (12%) per annum, or (ii) the maximum rate permitted by, or enforceable under, applicable law.

Merge shall have the meaning specified in Section 7.19(a)(v).

Moody’s shall mean Moody’s Investors Service Inc., a Delaware corporation, its successors and assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “Moody’s” shall be deemed to refer to any other nationally recognized securities rating agency designated by the Trustee, by notice to the other Notice Parties.

Mortgage shall mean, collectively, the Mortgage and Security Agreement and Assignment of Leases and Rents (Acquisition Loan), the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan) and the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan) relating to the Facility, each dated as of even date herewith, and each from the Company to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

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Nationally Recognized Bond Counsel shall mean counsel acceptable to the Issuer and the Trustee and experienced in matters relating to tax exemption of interest on bonds issued by states and their political subdivisions.

Net Proceeds shall mean, when used with respect to any insurance proceeds or condemnation award, compensation or damages, the gross amount of any such proceeds, award, compensation or damages less all expenses (including reasonable attorneys’ fees and any extraordinary expenses of the Issuer or the Trustee) incurred in the collection thereof.

Notice Parties shall mean the Issuer, the Company, the Parent, the Bond Registrar, the Paying Agents, the Trustee, the Tender Agent and the Remarketing Agent.

Notification of Failure to Deliver shall have the meaning specified in Section 8.9(b).

NYCEDC shall mean New York City Economic Development Corporation, a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State, and any successor thereof.

NYCIDA shall mean the New York City Industrial Development Agency, a corporate governmental agency constituting a body corporate and politic and a public benefit corporation of the State, duly organized and existing under the laws of the State, and any body, board, authority, agency or other governmental agency or instrumentality which shall hereafter succeed to the powers, duties, obligations and functions thereof.

Opinion of Counsel shall mean a written opinion of counsel for the Company, the Parent or any other Person (which counsel shall be reasonably acceptable to the Issuer and the Trustee) with respect to such matters as required under any Project Document or as the Issuer or the Trustee may otherwise reasonably require, and which shall be in form and substance reasonably acceptable to the Issuer and the Trustee.

Organizational Documents shall mean, (i) in the case of an Entity constituting a limited liability company, the articles of organization or certificate of formation, and the operating agreement of such Entity, (ii) in the case of an Entity constituting a corporation, the articles of incorporation or certificate of incorporation, and the by-laws of such Entity, and (iii) in the case of an Entity constituting a general or limited partnership, the partnership agreement of such Entity.

Outstanding, when used with reference to a Bond or Bonds, as of any particular date, shall mean all Bonds which have been issued, executed, authenticated and delivered under the Indenture, except:

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(i) Bonds cancelled by the Trustee because of payment or redemption prior to maturity or surrendered to the Trustee under the Indenture for cancellation;

(ii) any Bond (or portion of a Bond) for the payment or redemption of which, in accordance with Article X of the Indenture, there has been separately set aside and held in the Redemption Account of the Bond Fund either:

(A) moneys, and/or

(B) Defeasance Obligations in such principal amounts, of such maturities, bearing such interest and otherwise having such terms and qualifications as shall be necessary to provide moneys,

in an amount sufficient to effect payment of the principal or applicable Redemption Price of such Bond, together with accrued interest on such Bond to the payment or redemption date, which payment or redemption date shall be specified in irrevocable instructions given to the Trustee to apply such moneys and/or Defeasance Obligations to such payment on the date so specified, provided, that, if such Bond or portion thereof is to be redeemed, notice of such redemption shall have been given as provided in the Indenture or provision satisfactory to the Trustee shall have been made for the giving of such notice; and

(iii) Bonds in exchange for or in lieu of which other Bonds shall have been authenticated and delivered under Article III of the Indenture,

provided, however, that in determining whether the Holders of the requisite principal amount of Bonds Outstanding have given any request, demand, authorization, direction, notice, consent or waiver hereunder or under any other Security Document, Bonds owned by the Company, the Parent or any Affiliate of the Company or of the Parent shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Bonds which the Trustee knows to be so owned shall be so disregarded. Bonds which have been pledged in good faith may be regarded as Outstanding for such purposes if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to su ch Bonds and that the pledgee is not the Company, the Parent or any Affiliate of the Company or of the Parent.

Parent shall mean Acadia Strategic Opportunity Fund II LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns; provided, however, that nothing contained in this definition shall be deemed to limit or modify the obligations of the Parent under Section 3.6 of the Bond Guaranty Agreement or Section 3.4 of the Issuer Indemnification Agreement.

Participants shall mean those financial institutions for whom the Securities Depository effects book entry transfers and pledges of securities deposited with the Securities Depository, as such listing of Participants exists at the time of such reference.

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Paying Agent shall mean any paying agent for the Bonds appointed pursuant to the Indenture (and may include the Trustee) and its successor or successors and any other corporation which may at any time be substituted in its place pursuant to the Indenture.

Per Diem Fees shall mean, collectively, the Per Diem Late Fee and the Per Diem Supplemental Late Fee.

Per Diem Holdover Amount shall mean that per diem holdover amount established from time to time by the Issuer’s Board of Directors generally imposed upon Entities receiving or that have received financial assistance from the Issuer (subject to such exceptions from such general applicability as may be established by the Issuer’s Board of Directors) and that have failed to terminate this Agreement within the ten (10) day period referred to in Section 9.1.

Per Diem Late Fee shall mean that per diem late fee established from time to time by the Issuer’s Board of Directors generally imposed upon Entities receiving or that have received financial assistance from the Issuer (subject to such exceptions from such general applicability as may be established by the Issuer’s Board of Directors) and that have not (x) paid to the Issuer the Annual Administrative Fee on the date required under Section 7.3, (y) delivered to the Issuer all or any of the Fixed Date Deliverables on the respective dates required under Section 7.13 or 7.15, and/or (z) delivered to the Issuer all or any of the Requested Document Deliverables under Section 7.14 within five (5) Business Days of the Issuer having made the request therefor.

Per Diem Supplemental Late Fee shall mean that supplemental per diem late fee established from time to time by the Issuer’s Board of Directors generally imposed upon Entities receiving or that have received financial assistance from the Issuer (subject to such exceptions from general applicability as may be established by the Issuer’s Board of Directors).

Permitted Encumbrances shall mean:

(i) the Ground Lease, the Mortgage, the Pledge and Security Agreement, the Building Loan Agreement, all Facility Leases and any other Project Document;

(ii) liens for real estate taxes, if any, payments in lieu of real estate taxes, assessments, levies and other governmental charges, the payment of which is not yet due and payable;

(iii) any mechanic’s, workmen’s, repairmen’s, materialmen’s, contractors’, warehousemen’s, carriers’, suppliers’ or vendors’ lien, security interest, encumbrance or charge or right in respect thereof, placed on or with respect to the Facility or any part thereof, if payment is not yet due and payable, or if such payment is being disputed pursuant to Section 7.10(b);

(iv) utility, access and other easements and rights of way, restrictions and exceptions that an Authorized Representative of the Company certifies to the Issuer and the Trustee will not materially interfere with or impair the use and enjoyment of the Facility by the Company and the Facility Tenants as herein provided;

(v) such minor defects, irregularities, encumbrances, easements, rights of way and clouds on title as normally exist with respect to property similar in character to the Facility as do not, as set forth in a certificate of an Authorized Representative of the Company delivered to the Issuer and the Trustee, either singly or in the aggregate, render title to the Facility unmarketable or materially impair the property affected thereby for the purpose for which it was acquired or purport to impose liabilities or obligations on the Issuer;

(vi) those exceptions to title to the Facility enumerated in the title insurance policy delivered pursuant to Section 3.7 insuring the Trustee’s mortgagee interest under the Mortgage in the Facility, a copy of which is on file at the offices of the Issuer and at the designated corporate trust office of the Trustee;

(vii) liens arising by reason of good faith deposits with the Company in connection with the tenders, leases of real estate, bids or contracts (other than contracts for the payment of money), deposits by the Company to secure public or statutory obligations, or to secure, or in lieu of, surety, stay or appeal bonds, and deposits as security for the payment of taxes or assessments or other similar charges;

(viii) any lien arising by reason of deposits with, or the giving of any form of security to, any governmental entity or any body created or approved by law or governmental regulation for any purpose at any time as required by law or governmental regulation as a condition to the transaction of any business or the exercise of any privilege or license, or to enable the Company to maintain self-insurance or to participate in any funds established to cover any insurance risks or in connection with workmen’s compensation, unemployment insurance, old age pensions or other social security, or to share in the privileges or benefits required for companies participating in such arrangements;

(ix) any judgment lien against the Company, so long as the finality of such judgment is being contested in good faith and execution thereon is stayed;

(x) any purchase money security interest in movable personal property, including equipment leases and financing;

(xi) liens on property due to rights of governmental entities or third party payors for recoupment of excess reimbursement paid;

(xii) a lien, restrictive declaration or performance mortgage with respect to the operation of the Facility arising by reason of a grant or other funding received by the Company from the City, the State or any governmental entity;

(xiii) a subordinate mortgage granted by the Company to the Parent, as subordinate mortgagee, in an amount not to exceed $5.3 million, together with an intercreditor agreement among the Trustee, the Company and the subordinate mortgagee in form and substance acceptable to the Trustee; and

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(xiv) any lien, security interest, encumbrances or charge which exists in favor of the Trustee or to which the Trustee shall consent in writing.

Person shall mean an individual or any Entity.

Placement Agent shall mean, in the case of the Initial Bonds, Roosevelt & Cross, Incorporated, New York, New York.

Plans and Specifications shall mean the plans and specifications prepared for the Project by or on behalf of the Company, as amended from time to time by or on behalf of the Company to reflect any remodeling or relocating of the Project or substitutions, additions, modifications and improvements to the Project made by the Company in compliance with this Agreement, said plans and specifications being duly certified by an Authorized Representative of the Company and filed in the designated corporate trust office of the Trustee and available to the Issuer.

Pledge and Security Agreement shall mean the Pledge and Security Agreement, dated as of even date herewith, from the Company to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Pledged Collateral shall have the meaning specified in Section 3.1 of the Pledge and Security Agreement.

Policy(ies) shall have the meaning specified in Section 7.1(a).

Predecessor Company shall have the meaning specified in Section 7.19(b)(ii).

Preliminary Resolution shall mean the resolution of the Issuer adopted on September 15, 2009 approving the eligibility of the Project to receive an allocation for the issuance of up to $20,000,000 of recovery zone facility bonds to finance the Project.

Principal Account shall mean the special trust account of the Bond Fund so designated, established pursuant to Section 5.01 of the Indenture.

Principals shall mean, with respect to any Entity, the most senior three officers of such Entity, any Person with a ten percent (10%) or greater ownership interest in such Entity, and any Person as shall have the power to Control such Entity, and “principal” shall mean any of such Persons.

Private Placement Memorandum shall mean, in the case of the Initial Bonds, the Private Placement Memorandum, dated July 1, 2010, distributed by the Placement Agent and the Company in connection with the private placement of the Initial Bonds.

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Project shall mean the construction, renovation, equipping and furnishing of an approximately 50,000 square foot facility to be leased to retail commercial tenants.

Project Application Information shall mean the eligibility application and questionnaire submitted to the Issuer by or on behalf of the Company, for approval by the Issuer of the Project and the providing of financial assistance by the Issuer therefor, together with all other letters, documentation, reports and financial information submitted in connection therewith.

Project Completion Guaranty Agreement shall mean the Project Completion Guaranty Agreement, dated as of even date herewith, from the Guarantors to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Project Costs shall mean:

(i) all costs of engineering and architectural services with respect to the Project, including the cost of test borings, surveys, estimates, permits, Plans and Specifications and for supervising demolition, construction and renovation, as well as for the performance of all other duties required by or consequent upon the proper site preparation, construction of, and the making of alterations, renovations, additions and improvements in connection with, the completion of the Project;

(ii) all costs paid or incurred for labor, materials, services, supplies, machinery, equipment and other expenses and to contractors, suppliers, builders and materialmen in connection with the completion of the Project;

(iii) the interest on the Bonds during the construction and renovation of the Project until the completion of the Project;

(iv) payments pursuant to the Ground Lease during the construction and renovation of the Project until the completion of the Project;

(v) all costs of contract bonds and of insurance that may be required or necessary during the period of Project construction and renovation;

(vi) all costs of title insurance as provided in Section 3.7;

(vii) that portion of the mortgage recording tax payable upon the recording of the Mortgage as specified in the Tax Regulatory Agreement as eligible to be financed from the proceeds of the Bonds;

(viii) the payment of the Costs of Issuance with respect to the Initial Bonds;

(ix) the payment of the fees and expenses of the Trustee during the period of construction and renovation of the Project;

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(x) all costs which the Company shall be required to pay, under the terms of any contract or contracts, for the completion of the Project, including any amounts required to reimburse the Company for advances made for any item otherwise constituting a Project Cost or for any other costs incurred and for work done which are properly chargeable to the Project; and

(xi) all other costs and expenses relating to the completion of the Project or the issuance of a Series of Additional Bonds.

“Project Costs” shall not include (i) fees or commissions of real estate brokers; (ii) moving expenses; (iii) amounts payable as rent under the Ground Lease; or (iv) operational costs.

Project Documents shall mean, collectively, the Ground Lease, the Issuer Indemnification Agreement, the Remarketing Agreement, the Bond Placement Agreement, the Facility Leases and the Security Documents.

Project Fee shall mean $125,000, representing the Issuer’s financing fee.

Project Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Project Work shall mean the design and construction of the Improvements in accordance with the Plans and Specifications.

Promissory Note shall mean, with respect to the Initial Bonds, that certain Promissory Note in substantially the form of Exhibit G to this Agreement, and, with respect to any Series of Additional Bonds, that certain Promissory Note in substantially the form of any related Exhibit to an amendment to this Agreement, and shall include in each case any and all amendments thereof and supplements thereto made in conformity with this Agreement and the Indenture.

Purchase Date shall have the meaning assigned to such term in the Indenture.

Purchase Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Purchase Price shall mean an amount equal to the principal amount of any Initial Bond purchased on any Purchase Date, plus accrued interest to the Purchase Date (unless the Purchase Date is an Interest Payment Date, in which case the Purchase Price shall not include accrued interest, which shall be paid in the normal course).

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Qualified Investments shall mean, to the extent permitted by applicable law, the following: (i) obligations of the State or the United States of America, (ii) obligations, the principal and interest of which are guaranteed by the State or the United States of America, (iii) obligations of any agency of the United States of America which may from time to time be legally purchased by savings banks within the State as an investment of funds belonging to them or under their control, (iv) bankers’ acceptances of, or certificates of deposit issued by, or demand, trust or time deposits with, any bank, trust company or national banking association (including the Trustee and any of its affiliates) having undivided capital and surplus aggregating at least $25,000,000, (v) repurchase agreements or other contracts for the purchase and sale of and secured by obligations of the type specified in (i) through (iii) above, (vi) commercial paper of any Person other than the Company or any Affiliate of the Company which has been classified for rating purposes by Moody’s as Prime-1 or by S&P’s as A-1, (vii) money market mutual funds investing in the obligations described in (i), (ii), (iii) or (v) described above, including, without limitation, the JPMorgan Money Market Mutual Funds or any other fund for which the Trustee or an affiliate of the Trustee serves as investment manager, administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (x) the Trustee or an affiliate of the Trustee receives fees from such funds for services rendered, (y) the Trustee charges and collects fees for services rendered pursuant to this Indenture, which fees are separate from the fees received from such funds, and (z) services performed for such funds and pursuant to the Indenture may at times duplicate those provided to such funds by the Trustee or its affiliates, or (viii) investment agreements or repurchase agreements with any bank, trust company, national banking association (which may include the Trustee or any of its affiliates) or any other financial institution or insurance company or guaranteed thereby, provided that the institution providing such investment agreements or repurchase agreements shall be rated “A” (or its equivalent) or better by a Rating Agency, or the principal amount of such investment agreements or repurchase agreements then outstanding shall be fully secured and collateralized by the pledge and deposit of securities (including wireable securities) described in (i) above or obligations of the Federal National Mortgage Association with a market value equal to one hundred two and one-half percent (102 1/2%) of such principal amount, that the Trustee has a perfected first security interest in the collateral, tha t the Trustee or any agent has possession of the collateral, and that such obligations are free and clear of claims by third parties. The investment agreements or repurchase agreements described in (viii) above shall be only of institutions whose capital surplus (or in the case of financial institutions other than banks, net worth) is in excess of $50,000,000.

Rating Agency shall mean any of S&P, Moody’s or Fitch and such other nationally recognized securities rating agency as shall have awarded a rating to the Initial Bonds.

Rating Category shall mean one of the generic rating categories of a Rating Agency without regard to any refinement or gradation of such rating by a numerical modifier or otherwise.

Rebate Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Redemption Account shall mean the special trust account of the Bond Fund so designated, established pursuant to Section 5.01 of the Indenture.

Redemption Date shall mean the date fixed for redemption of Bonds subject to redemption in any notice of redemption given in accordance with the terms of the Indenture.

Redemption Price shall mean, with respect to any Bond or a portion thereof, the principal amount thereof to be redeemed in whole or in part, plus the applicable premium, if any, payable upon redemption thereof pursuant to such Bond or the Indenture.

Remarketing Account shall mean the special trust account of the Purchase Fund so designated, established pursuant to Section 5.01 of the Indenture.

Remarketing Agent shall mean (a) initially, Roosevelt & Cross, Incorporated, New York, New York, and (b) thereafter, any Person meeting the qualifications of and designated from time to time to act as Remarketing Agent for the Initial Bonds under Section 8.9(a) of the Indenture.

Remarketing Agreement shall mean, as of any date, the Remarketing Agreement between the Company and the then Remarketing Agent.

Renewal Fund shall mean the special trust fund so designated, established pursuant to Section 5.01 of the Indenture.

Requested Document Deliverables shall have the meaning set forth in Section 8.9(a).

Required Disclosure Statement shall mean that certain Required Disclosure Statement in the form of Exhibit E — “Form of Required Disclosure Statement”.

S&P shall mean Standard & Poor’s Ratings Services, a division of The McGraw Hill Companies, Inc., a corporation organized and existing under the laws of the State, its successors and their assigns, and, if such corporation shall be dissolved or liquidated or shall no longer perform the functions of a securities rating agency, “S&P” shall be deemed to refer to any other nationally recognized securities rating agency designated by the Trustee, by notice to the other Notice Parties.

Securities Depository shall mean any securities depository that is a clearing Issuer under federal law operating and maintaining, with its participants or otherwise, a book-entry system to record ownership of book-entry interests in the Bonds, and to effect transfers of book-entry interests in the Bonds in book-entry form, and includes and means initially DTC.

Security Documents shall mean, collectively, this Agreement, the Promissory Note, the Pledge and Security Agreement, the Indenture, the Bond Guaranty Agreement, the Project Completion Guaranty Agreement, the Tax Regulatory Agreement, the Building Loan Agreement and the Mortgage.

Series shall mean all of the Bonds designated as being of the same series authenticated and delivered on original issuance in a simultaneous transaction, and any Bonds thereafter authenticated and delivered in lieu thereof or in substitution therefor pursuant to the Indenture.

Sinking Fund Installment shall mean an amount so designated and which is established for mandatory redemption on a date certain of the Bonds of any Series of Bonds pursuant to the Indenture. The portion of any such Sinking Fund Installment of a Series of Bonds remaining after the deduction of any amounts credited pursuant to the Indenture toward the same (or the original amount of any such Sinking Fund Installment if no such amounts shall have been credited toward the same) shall constitute the unsatisfied balance of such Sinking Fund Installment for the purpose of calculation of Sinking Fund Installments of such Series of Bonds due on a future date.

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Sinking Fund Installment Account shall mean the special trust account of the Bond Fund so designated, which is established pursuant to Section 5.01 of the Indenture.

Sign shall have the meaning specified in Section 7.4.

State shall mean the State of New York.

Successor Company shall have the meaning specified in Section 7.19(b)(ii).

Supplemental Indenture shall mean any indenture supplemental to or amendatory of the Indenture, executed and delivered by the Issuer and the Trustee in accordance with Article XI of the Indenture.

Tax Prohibited Uses shall mean rental of residential property for family units, any private or commercial golf course, any airplane, skybox or other private luxury box, health club facility, country club, massage parlor, hot tub facility, suntan facility, racetrack or other facility used for gambling, or any store the principal business of which is the sale of alcoholic beverages for consumption off premises, or any other use as shall not constitute a permitted use for recovery zone facility bonds under the Code.

Tax Regulatory Agreement shall mean the Tax Regulatory Agreement, dated the Closing Date, from the Issuer and the Company to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Tender Agent shall mean initially, The Bank of New York Mellon, New York, New York, and any successor tender agent appointed pursuant to Section 9.11 of the Indenture.

Termination Date shall mean such date on which this Agreement may terminate pursuant to its terms and conditions prior to the Expiration Date.

Transfer shall have the meaning specified in Section 7.19(a)(iv).

Trust Estate shall mean all property, interest, revenues, funds, contracts, rights and other security granted to the Trustee under the Security Documents.

Trustee shall mean The Bank of New York Mellon, New York, New York in its capacity as trustee under the Indenture, and its successors in such capacity and their assigns hereafter appointed in the manner provided in the Indenture.

VENDEX shall mean such background information as the Company is required to provide the City and as is required to establish that the relevant party is not a “Prohibited Person”, as such term is generally defined by the City.

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Section 1.2. Construction. In this Agreement, unless the context otherwise requires:

(a) The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar terms, as used in this Agreement, refer to this Agreement, and the term “hereafter” shall mean after, and the term “heretofore” shall mean before, the Commencement Date.

(b) Words of the masculine gender shall mean and include correlative words of the feminine and neuter genders and words importing the singular number shall mean and include the plural number and vice versa.

(c) Words importing persons shall include firms, associations, partnerships (including limited partnerships and limited liability partnerships), trusts, corporations, limited liability companies and other legal entities, including public bodies, as well as natural persons.

(d) Any headings preceding the texts of the several Articles and Sections of this Agreement, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this Agreement, nor shall they affect its meaning, construction or effect.

(e) Unless the content indicates otherwise, references to designated “Exhibits”, “Articles”, “Sections”, “Subsections”, “clauses” and other subdivisions are to the designated Exhibits, Articles, Sections, Subsections, clauses and other subdivisions of or to this Agreement.

(f) The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

(g) The word “will” shall be construed to have the same meaning and effect as the word “shall”.

(h) Any definition of or reference to any agreement, instrument or other document herein shall be construed to refer to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth therein).

(i) Any reference to any Person, or to any Person in a specified capacity, shall be construed to include such Person’s successors and assigns or such Person’s successors in such capacity, as the case may be.

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ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1. Representations and Warranties by Issuer. The Issuer makes the following representations and warranties:

(i) The Issuer is a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State at the direction of the Mayor of the City, and is duly organized and validly existing under the laws of the State.

(ii) Assuming the accuracy of representations made by the Company and by the Parent, the Issuer is authorized and empowered to enter into the transactions contemplated by this Agreement and any other Project Documents to which the Issuer is a party, to carry out its obligations hereunder and thereunder, and to issue and sell the Initial Bonds.

(iii) By proper action of its board of directors, the Issuer has duly authorized the execution and delivery of this Agreement and each of the other Project Documents to which the Issuer is a party.

(iv) In order to finance a portion of the cost of the Project, the Issuer proposes to issue the Initial Bonds in the Authorized Principal Amount. The Initial Bonds will mature, bear interest, be redeemable and have the other terms and provisions set forth in the Indenture.

(v) The Facility is located in a recovery zone designated by the Issuer and ratified by the Mayor of the City.

(vi) The Mayor of the City has confirmed the findings of the Issuer as required under the Issuer’s Organizational Documents.

(vii) The Issuer has all requisite power, authority and legal right to execute and deliver the Project Documents to which it is a party and all other instruments and documents to be executed and delivered by the Issuer pursuant hereto and thereto and to perform its obligations under the Project Documents and all such other instruments and documents to which it is a party. All corporate action on the part of the Issuer which is required for the execution, delivery, performance and observance by the Issuer of the Project Documents and all such other instruments and documents to which it is a party has been duly authorized and effectively taken, and such execution, delivery, performance and obser vance by the Issuer do not contravene the Issuer’s Organizational Documents or any applicable Legal Requirements or any contractual restriction binding on or affecting the Issuer.

(viii) There is no action or proceeding before any court, governmental agency or arbitrator pending or, to the knowledge of the Issuer, threatened against the Issuer which seeks (i) to restrain or enjoin the issuance or delivery of the Initial Bonds, the pledge and grant of the Trust Estate or the collection of any revenues pledged under the Indenture, (ii) to contest or affect in any way the authority for the issuance of the Initial Bonds or the validity of any of the Project Documents, or (iii) to contest in any way the existence or powers of the Issuer.

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Section 2.2. Representations and Warranties by the Company. The Company makes the following representations and warranties:

(a) The Company is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, is duly qualified to do business and in good standing under the laws of the State, is not in violation of any provision of any of the Company’s Organizational Documents, has the requisite power and authority to own its property and assets, to carry on its business as now being conducted by it and to execute, deliver and perform this Agreement and each other Project Document to which it is or shall be a party.

(b) This Agreement and the other Project Documents to which the Company is a party (x) have been duly authorized by all necessary action on the part of the Company, (y) have been duly executed and delivered by the Company, and (z) constitute the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms.

(c) The execution, delivery and performance of this Agreement and each other Project Document to which the Company is or shall be a party and the consummation of the transactions herein and therein contemplated will not (x) violate any provision of law, any order of any court or agency of government, or any of the Company’s Organizational Documents, or any indenture, agreement or other instrument to which the Company is a party or by which it or any of its property is bound or to which it or any of its property is subject, (y) be in conflict with or result in a breach of or constitute (with due notice and/or lapse of time) a default under any such indenture, agreement or other instrument or (z) result in the imposition of any lien, charge or encumbrance of any nature whatsoever other than Permitted Encumbrances.

(d) There is no action or proceeding pending or, to the best of the Company’s knowledge, after diligent inquiry, threatened, by or against the Company by or before any court or administrative agency that would adversely affect the ability of the Company to perform its obligations under this Agreement or any other Project Document to which it is or shall be a party.

(e) The financial assistance provided by the Issuer to the Company as contemplated by this Agreement is necessary to induce the Company to proceed with the Project.

(f) The transactions contemplated by this Agreement shall not result in the removal of any facility or plant of the Company or any other occupant or user of the Facility from one area of the State outside of the City to within the City or in the abandonment of one or more facilities or plants of the Company or any other occupant or user of the Facility located within the State, but outside of the City; provided, however, that neither restriction shall apply if the Issuer shall determine on the basis of the application before it that the Project is reasonably necessary to discourage the Facility occupant or user from removing such other plant or facility to a location outside the State or is reasonably nec essary to preserve the competitive position of the Facility occupant or user in its respective industry.

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(g) Undertaking the Project is anticipated to serve the corporate purposes of the Issuer by increasing the overall number of permanent, private sector jobs in the State.

(h) No funds of the Issuer shall be used by the Company in connection with the transactions contemplated by this Agreement for the purpose of preventing the establishment of an industrial or manufacturing plant or for the purpose of advertising or promoting materials which depict elected or appointed government officials in either print or electronic media, nor shall any funds of the Issuer be given hereunder to any group or organization which is attempting to prevent the establishment of an industrial or manufacturing plant within the State.

(i) No Person other than the Company and Facility Tenants (and their respective invitees) is or will be in use, occupancy or possession of any portion of the Facility.

(j) The Company has obtained all authorizations, consents and approvals of governmental bodies or agencies required to be obtained by it as of the Commencement Date in connection with the execution and delivery of this Agreement and each other Project Document to which it shall be a party or in connection with the performance of its obligations hereunder and under each of the Project Documents.

(k) The Project will be designed, and the operation of the Facility will be, in compliance with all applicable Legal Requirements.

(l) The Company is in compliance, and will continue to comply, with all applicable Legal Requirements relating to the Project, the Project Work and the operation of the Facility.

(m) The Company has delivered to the Issuer a true, correct and complete copy of the Environmental Audit.

(n) The Company has not used Hazardous Materials on, from, or affecting the Facility in any manner that violates any applicable Legal Requirements governing the use, storage, treatment, transportation, manufacture, refinement, handling, production or disposal of Hazardous Materials, and except as set forth in the Environmental Audit, to the best of the Company’s knowledge, no prior owner or occupant of the Facility has used Hazardous Materials on, from, or affecting the Facility in any manner that violates any applicable Legal Requirements.

(o) The estimated cost of the Project is $24,220,000. Expenses for supervision by the officers or employees of the Company or its Affiliates and expenses for work done by such officers or employees in connection with the Project will be included as a Project Cost only to the extent that such Persons dedicated their time exclusively for such particular purpose, the expenses do not exceed the actual cost thereof and are to be treated on the books of the Company as a capital expenditure in conformity with GAAP. Any costs incurred with respect to that part of the Project paid from the proceeds of the sale of the Initial Bonds shall be treated on the books of the Company as capital expend itures in conformity with GAAP.

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(p) The total cost of the Project Work being funded with the Initial Bonds is not less than the Authorized Principal Amount. That portion of the cost of the Project as shall not derive from the proceeds of the Initial Bonds shall be provided from equity on the part of the Company and/or the Parent. The amounts provided to the Company from the proceeds of the Initial Bonds, together with other moneys available to the Company and/or the Parent, are sufficient to pay all costs in connection with the completion of the Project.

(q) All of the Land comprises one complete tax lot and no portion of any other tax lot that is not part of the Land.

(r) Subject to Section 3.5 and Article V, no property constituting part of the Facility shall be located at any site other than at the Facility.

(s) The Completed Improvements Rentable Square Footage and the Land Square Footage (as each are set forth in Section 1.1) are true and correct.

(t) The Fiscal Year (as set forth in Section 1.1) is true and correct.

(u) None of the Company, the Principals of the Company, or any Person that directly or indirectly Controls, is Controlled by, or is under common Control with the Company:

(i) is in default or in breach, beyond any applicable grace period, of its obligations under any written agreement with the Issuer, the NYCIDA, the NYCEDC or the City, unless such default or breach has been waived in writing by the Issuer, the NYCIDA, the NYCEDC or the City, as the case may be;

(ii) has been convicted of a felony and/or any crime involving moral turpitude in the ten (10) preceding years;

(iii) has received written notice of default in the payment to the City of any taxes, sewer rents or water charges in excess of $5,000 that has not been cured or satisfied, unless such default is then being contested with due diligence in proceedings in a court or other appropriate forum; or

(iv) has, at any time in the three (3) preceding years, owned any property which, while in the ownership of such Person, was acquired by the City by in rem tax foreclosure, other than a property in which the City has released or is in the process of releasing its interest to such Person pursuant to the Administrative Code of the City.

(v) The Project Application Information was true, correct and complete as of the date submitted to the Issuer, and no event has occurred or failed to occur since such date of submission which would cause any of the Project Application Information to include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make such statements not misleading.

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(w) The Principals of the Company and of the Parent, and their respective ownership interests in and titles to the Company and the Parent, as set forth in Exhibit C — “Principals of Company and Parent”, are true, correct and complete.

(x) The representations, warranties, covenants and statements of expectation of the Company set forth in the Tax Regulatory Agreement are by this reference incorporated in this Agreement as though fully set forth herein.

(y) The property included in the Project is either property of the character subject to the allowance for depreciation under Section 167 of the Code, or land.

(z) Except as may be expressly permitted under the Tax Regulatory Agreement, no part of the proceeds of the Initial Bonds will be used to finance inventory or will be used for operational or non-capital costs or for working capital, or will be used for any other property not constituting part of the Facility.

(aa) No Project Cost to be reimbursed from the proceeds of the Initial Bonds relates to property constructed, reconstructed, renovated or acquired by purchase by the Company (or any of its Affiliates) prior to July 17, 2009.

(bb) The original use of any of the property to comprise part of the Facility commenced with the Company.

(cc) Substantially all of the use of the property comprising the Facility is within a “Recovery Zone” designated by the Issuer (and ratified by the Mayor of the City), and the Facility will be used by the Company in such “Recovery Zone” in the active conduct of a “qualified business” (as defined in Section 1400U-3(c) of the Code) by the Company.

(dd) No portion of the proceeds of the Initial Bonds is intended to be used to provide any “profit” to an Entity affiliated with, or related to, the Company.

(ee) No portion of the Facility is intended to be used or otherwise made available for a Tax Prohibited Use or for use by a not-for-profit corporation.

(ff) The Ground Lease continues in full force and effect as the legal, valid and binding obligation of the Company without default by the Company or, to the knowledge of the Company, by the City thereunder. The Company has neither received nor delivered any notice of default or termination thereunder, and the initial term of the Ground Lease expires on August 26, 2078. Pursuant to the Ground Lease, the Company has a valid leasehold estate in the Facility.

(gg) No Facility Leases exist as of the Closing Date.

(hh) The Company does not intend to engage in any business or enterprise other than (x) the design, acquisition, construction, renovation, equipping, furnishing, leasing, operation, maintenance and management of the Facility, (y) the performance of its obligations under the Ground Lease and all other Project Documents to which it is a party, and all other agreements relating to the Facility and its financing, construction, equipping, leasing, management, maintenance, repair, restoration, improvement and operation, and (z) activities in furtherance thereof or ancillary or reasonably related thereto.

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(ii) The Company has obtained all consents, approvals, authorizations, permits, licenses, certificates and orders of any governmental or regulatory authority that are required for the construction, leasing, operation and maintenance of the Facility, including, without limitation, any and all required building permits, except for any other thereof that cannot be (or, in accordance with prevailing industry practices, are not customarily) obtained until a later stage of construction of the Facility or completion of the Facility, none of which the Company has any reason to believe will not be granted or will be unduly delayed.

(jj) The Company has no present intention to sell, directly or indirectly, in whole or in part, its interest in the Facility.

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ARTICLE III

THE PROJECT; MAINTENANCE; REMOVAL OF PROPERTY

AND TITLE INSURANCE

Section 3.1. Agreement to Undertake Project.

The Company covenants and agrees to undertake and complete the Project Work in accordance with the Ground Lease and this Agreement, including, without limitation:

(i) effecting the Project Work,

(ii) making, executing, acknowledging and delivering any contracts, orders, receipts, writings and instructions with any other Persons, and in general doing all things which may be requisite or proper, all for the purposes of undertaking the Project Work,

(iii) paying all fees, costs and expenses incurred in the Project Work from funds made available therefor in accordance with or as contemplated by this Agreement and the Indenture, and

(iv) asking, demanding, suing for, levying, recovering and receiving all such sums of money, debts due and other demands whatsoever that may be due, owing and payable to the Company under the terms of any contract, order, receipt or writing in connection with the Project Work and to enforce the provisions of any contract, agreement, obligation, bond or other performance security entered into or obtained in connection with the Project Work.

Section 3.2. Manner of Project Completion.

(a) The Company will substantially complete the Project Work, or cause the Project Work to be substantially completed, and effect “Complete Construction of the Building” (as defined in the Ground Lease) by the Completion Date, in accordance with this Agreement, the Plans and Specifications and the Ground Lease, in a first class workmanlike manner, substantially free of defects in materials and workmanship (including latent defects); provided, however, that subject to the Ground Lease, the Company may revise the scope of the Project Work, subject to the prior written consents of the Issuer and the Trustee (which consents shall not be unreasonably withheld, delayed or conditioned).

(b) In undertaking the Project Work, the Company shall take such action and institute such proceedings as shall be necessary to cause and require all contractors, manufacturers and suppliers to complete their agreements relating to the Project Work in accordance with the terms of the contracts therefor including the correction of any defective work. Upon request, the Company will extend to the Issuer and the Trustee all vendors’ warranties received by the Company in connection with the Project, including any warranties given by contractors, manufacturers or service organizations who perform Project Work.

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(c) Project Costs shall be paid from the Project Fund or other funds provided by the Company or the Parent. In the event that moneys in the Project Fund are not sufficient to pay the costs necessary to complete the Project in full, the Company shall pay that portion of such costs of the Project as may be in excess of the moneys therefor in the Project Fund and shall not be entitled to any reimbursement therefor from the Issuer, the Trustee or the Holders of any of the Bonds (except from the proceeds of Additional Bonds which may be issued for that purpose), nor shall the Company be entitled to any diminution of the loan payments payable or other payments to be made under this Agreement, under t he Promissory Note, under the Bond Guaranty Agreement or under any other Project Document. All expenses incurred by the Company or the Issuer in connection with the performance of its obligations under this Section to be considered a Project Cost. Any amounts recovered by way of damages, refunds, adjustments or otherwise in connection with the foregoing, after deduction of expenses incurred in such recovery, if recovered prior to the date of completion of the Project, shall be deposited into the Construction Account of the Project Fund and made available for payment of Project Costs, or if recovered after such date of completion, be deposited in the Redemption Account of the Bond Fund.

(d) The Company shall pay all taxes and charges payable in connection with the Project Work, including all shipping and delivery charges and other expenses or claims incurred in connection with the Project Work.

(e) The Company will perform or cause to be performed the Project Work in accordance with the Plans and Specifications, the Ground Lease and all applicable Legal Requirements and with the conditions and requirements of all policies of insurance with respect to the Facility and the Project Work. Promptly upon finishing of the Project Work and the completion of the Improvements, the Company will obtain or cause to be obtained all required permits, authorizations and licenses from appropriate authorities, if any be required, authorizing the occupancy, operation and use of the Facility as an Approved Facility and shall furnish copies of same to the Trustee immediately after the receipt thereof upon demand by the Trustee and to the Issuer immediately upon demand therefor.

(f) Upon completion of the Project Work, the Company shall evidence completion of the Project by delivering to the Issuer and the Trustee a certificate of an Authorized Representative of the Company in substantially the form set forth in Exhibit F – “Form of Project Completion Certificate”, together with all attachments required thereunder.

(g) Upon request by the Issuer or the Trustee, the Company shall make available to the Issuer and the Trustee copies of any bills, invoices or other evidences of costs as shall have been incurred in the effectuation of the Project Work.

Section 3.3. Maintenance. a) During the term of this Agreement, the Company will:

(i) keep the Facility in good and safe operating order and condition, ordinary wear and tear excepted,

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(ii) cause the Facility to be occupied, used and operated, as the Approved Facility, and

(iii) make or cause to be made all replacements, renewals and repairs thereto (whether ordinary or extraordinary, structural or nonstructural, foreseen or unforeseen) necessary to ensure that (x) the interest on the Bonds shall not cease to be excludable from gross income for federal income tax purposes, (y) the operations of the Company at the Facility shall not be materially impaired or diminished, and (z) the security for the Bonds shall not be materially impaired.

(b) All replacements, renewals and repairs shall be similar in utility to the original work and be made and installed in compliance with all applicable Legal Requirements.

(c) The Issuer shall be under no obligation to replace, service, test, adjust, erect, maintain or effect replacements, renewals or repairs of the Facility, to effect the replacement of any inadequate, obsolete, worn out or unsuitable parts of the Facility, or to furnish any utilities or services for the Facility, and the Company hereby agrees to assume full responsibility therefor.

Section 3.4. Alterations and Improvements.

(a) The Company shall have the privilege of making such alterations of or additions to the Facility (“Additional Improvements”) or any part thereof from time to time as it in its discretion may determine to be desirable for its uses and purposes, provided that:

(i) as a result of the Additional Improvements, the fair market value of the Facility is not reduced below its value before the Additional Improvements are made and the usefulness, structural integrity or operating efficiency of the Facility is not materially impaired,

(ii) the Additional Improvements are effected with due diligence, in a good and workmanlike manner and in compliance with all applicable Legal Requirements,

(iii) the Additional Improvements are promptly and fully paid for by the Company (or on its behalf) in accordance with the terms of the applicable contract(s) therefor,

(iv) the Additional Improvements do not change the nature of the Facility so that it would not constitute the Approved Facility, and

(v) the Additional Improvements are effected in accordance with the Ground Lease.

(b) All Additional Improvements shall constitute a part of the Facility, subject to the Ground Lease, this Agreement and the Mortgage.

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(c) The Company shall have the right to install or permit to be installed at the Facility, machinery, equipment and other personal property at the Company’s own cost and expense (the “Company’s Property”). Once so installed, the Company’s Property shall not constitute part of the Facility or of the Pledged Collateral and shall not be subject to this Agreement, nor constitute part of the Facility, or subject to the lien and security interest of the Mortgage or of the Pledge and Security Agreement, provided that the same is not made fixtures appurtenant to the Facility. The Company shall have the righ t to create or permit to be created any mortgage, encumbrance, lien or charge on, or conditional sale or other title retention agreement with respect to, the Company’s Property, without the consent of or notice to the Issuer or the Trustee.

Section 3.5. Removal of Property of the Facility.

(a) Subject to the Ground Lease, the Company shall have the right from time to time to remove from the Facility any fixture constituting part of the Facility (in any such case, the “Existing Facility Property”) and thereby removing such Existing Facility Property from this Agreement, and the lien and security interest of the Mortgage, provided, however:

(i) such Existing Facility Property is substituted or replaced by property (y) having equal or greater fair market value, operating efficiency and utility and (z) free of all mortgages, liens, charges, encumbrances, claims and security interests other than Permitted Encumbrances, or

(ii) if such Existing Facility Property is not to be substituted or replaced by other property but is instead to be sold, scrapped, traded-in or otherwise disposed of in an arms’-length bona fide transaction for consideration, the Company shall pay to the Trustee for deposit in the Redemption Account of the Bond Fund and thereby cause a redemption of Bonds to be effected in an amount (to the nearest integral multiple of Authorized Denomination) equal to the amounts derived from such sale or scrapping, the trade-in value credit received or the proceeds received from such other disposition; provided that no such redemption shall be required when such amount received in connection with any removal or series of removals does not exceed, in the aggregate, $25,000.

No such removal set forth in paragraph (i) or (ii) above shall be effected if (v) such removal would cause the interest on the Bonds to cease to be excludable from gross income for federal income tax purposes, (w) such removal would change the nature of the Facility as the Approved Facility, (x) such removal would materially impair the usefulness, structural integrity or operating efficiency of the Facility, (y) such removal would materially reduce the fair market value of the Facility below its value immediately before such removal (except by the amount by which the Bonds are to be redeemed as provided in paragraph (ii) above), or (z) there shall exist and be continuing an Event of Default hereunder. Any amounts received pursuant to paragraph (ii) above in connection with any removal or series of re movals, which are not in excess of $25,000, shall be retained by the Company.

(b) The removal from the Facility of any Existing Facility Property pursuant to the provisions of Section 3.5(a) shall not entitle the Company to any abatement or reduction in the loan payments and other amounts payable by the Company under this Agreement, under the Promissory Note or under any other Project Document.

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Section 3.6. Implementation of Additional Improvements and Removals.

(a) The Company agrees to pay all costs and expenses (including reasonable counsel fees) in subjecting to, or releasing from, this Agreement and the lien and security interest of the Mortgage, any property installed or placed on, or removed from, the Facility as part of the Facility pursuant to Section 3.4 or 3.5.

(b) Reference is made to Section 7.14(d) and (e) pursuant to which the Company has agreed to furnish a report or certificate to the Issuer of any action taken by the Company pursuant to the provisions of Section 3.4 or 3.5.

Section 3.7. Title Insurance. On or prior to the Closing Date, the Company will obtain and deliver (y) to the Trustee a mortgagee title insurance policy in an amount not less than the Authorized Principal Amount insuring the Trustee’s interest under the Mortgage as holder of mortgage liens on the Facility, subject only to Permitted Encumbrances, and (z) a current or updated survey of each of the Land and the Improvements certified to the Issuer and the Trustee and to the title company issuing such title insurance policies. The title insurance policy shall be subject only to Permitted Encumbrances and shall provide for, among other things, the following: (1) full coverage against mechanics’ liens; (2) no exceptions other than those approved by the Issuer and the Trustee; (3) an undertaking by the title insurer to provide the notice of title continuation or endorsement; and (4) such other matters as the Issuer and/or the Trustee shall request. Any proceeds of such mortgagee title insurance (subject to the provisions of the Ground Lease) shall be paid to the Trustee for deposit in the Renewal Fund and applied to remedy the applicable defect in title in respect of which such proceeds shall be derived (including the reimbursement to the Company for any costs incurred by the Company in remedying such defect in title). If not so capable of being applied or if a balance remains after such application, the amounts in the Renewal Fund shall be transferred by the Trus tee to the Redemption Account of the Bond Fund and used to redeem an equivalent principal amount of the Initial Bonds to the nearest integral multiple of Authorized Denominations.

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ARTICLE IV

LOAN; PAYMENT PROVISIONS

Section 4.1. Loan of Proceeds. The Issuer agrees, upon the terms and conditions contained in this Agreement and the Indenture, to make the Loan and lend to the Company an amount equal to the principal amount of the Initial Bonds. The loan shall be made by depositing on the Closing Date the proceeds from the sale of the Initial Bonds into the Project Fund in accordance with Section 4.01 of the Indenture. Such proceeds shall be disbursed to or on behalf of the Company as provided in Section 3.2(c) and Section ;5.02 of the Indenture. The Company’s obligation to repay the Loan shall be evidenced by this Agreement and the Promissory Note.

Section 4.2. Duration of Term. The term of this Agreement shall commence on the Commencement Date and shall expire at 11:58 p.m. (New York City time) on the earlier of the Expiration Date or the Termination Date, if any; provided, however, that neither the occurrence of the Expiration Date or the Termination Date shall by itself release the Company from its obligations under the Promissory Note or this Agreement.

Section 4.3. Loan Payments; Pledge of this Agreement and of the Promissory Note.

(a) The Company covenants to pay the Promissory Note and repay the Loan made pursuant to this Agreement by making loan payments which the Issuer agrees shall be paid in immediately available funds by the Company directly to the Trustee for deposit in the Bond Fund (except to the extent that amounts are on deposit in the applicable Account of the Bond Fund and available therefor) in an amount equal to the sum of:

(i) with respect to interest due and payable on the Initial Bonds, on each Loan Payment Date, an amount equal to the interest next becoming due on the Initial Bonds on the immediately succeeding Interest Payment Date;

(ii) with respect to principal due on the Initial Bonds (other than such principal amount as shall become due as a mandatory Sinking Fund Installment payment), on that Loan Payment Date as shall immediately precede the final maturity date of the Initial Bonds, an amount sufficient to pay the principal of the Initial Bonds Outstanding becoming due on such final maturity date of the Initial Bonds; provided, however, that in the event of the acceleration of the principal of the Initial Bonds, a loan payment in the amount of the principal amount of the Bonds Outstanding (together with all interest accrued thereon to the date of payment), shall be due and payable on such date of acceleration;

(iii) with respect to Sinking Fund Installment payments due on the Initial Bonds, on each Loan Payment Date an amount equal to the Sinking Fund Installment of the Initial Bonds Outstanding next becoming due on the immediately succeeding Sinking Fund Installment payment date;

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(iv) on each Redemption Date, with respect to the Redemption Price (other than by Sinking Fund Installments) due and payable on the Initial Bonds, whether as an optional or mandatory redemption, an amount equal to the Redemption Price together with accrued interest on the Initial Bonds being redeemed on such redemption date; and

(v) with respect to interest due and payable on the Initial Bonds, the Company shall further pay such additional amounts as set forth in the Indenture in the event of the occurrence of a Determination of Taxability with respect to the Initial Bonds or an Event of Default under the Indenture.

(b) In the event the Company should fail to make or cause to be made any of the payments required under the foregoing provisions of this Section, the item or installment not so paid shall continue as an obligation of the Company until the amount not so paid shall have been fully paid.

(c) The Company has the option to make advance loan payments for deposit in the Bond Fund to effect the retirement, defeasance or redemption of the Bonds in whole or in part, all in accordance with the terms of the Indenture; provided, however, that unless the Holders of one hundred percent (100%) of the Bonds Outstanding shall have consented thereto, no partial redemption of the Bonds may be effected through advance loan payments hereunder if there shall exist and be continuing an Event of Default. In making any such advance loan payments, the Company shall have the right to direct the Trustee in crediting Sinking Fund Installments, all in accordance with the Indenture. The Company shall exercise its option to make such advance loan payments by delivering a written notice of an Authorized Representative of the Company to the Trustee in accordance with the Indenture, with a copy to the Issuer, setting forth (i) the amount of the advance loan payment, (ii) the principal amount of Bonds Outstanding requested to be redeemed with such advance loan payment (which principal amount shall be in such minimum amount or integral Authorized Denomination as shall be permitted in the Indenture), and (iii) the date on which such principal amount of Bonds are to be redeemed (which date shall be not earlier than forty-five (45) days after the date of such notice). In the event the Company shall exercise its option to make advance loan payments to effect the redemption in whole of the Bonds, and such redemption is expressly permitted under the Indenture as a result of the damage, destruction or condemnation of the Facility, or changes in law, or executive or judicial action, the Company shall further deliver to the Issuer and the Trustee a certificate of an Authorized Representative of the Company stating that, as a result of the occurrence of the event giving rise to such redemption, the Company has discontinued, or at the earliest practicable date will discontinue, its operation of the Facility for its intended purposes. Such advance loan payment shall be paid to the Trustee in legal tender, for deposit in the Redemption Account of the Bond Fund on or before the Redemption Date and shall be an amount which, when added to the amounts on deposit in the Bond Fund and available therefor, will be sufficient to pay the Redemption Price of the Bonds to be redeemed, together with interest to accrue to the date of redemption and all expenses of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent in connection with such redemption. In the event the Bonds are to be redeemed in whole or otherwise retired, the Company shall further pay on or before such Redemption Date, in legal tender, to the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent, all fees and expenses owed such party or any other party entitled thereto under this Agreement or the Indenture together with (i) all other amounts due and payable under this Agreement and the other Security Documents, and (ii) any amounts required to be rebated to the Federal government pursuant to the Indenture or the Tax Regulatory Agreement.

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(d) At its option, to be exercised on or before the forty-fifth (45th) day next preceding the date any Bonds of a Series are to be redeemed from mandatory Sinking Fund Installments, the Company may deliver to the Trustee Bonds of such Series which are subject to mandatory Sinking Fund Installment redemption in an aggregate principal amount not in excess of the principal amount of Bonds of such Series to be so redeemed on such date. Each such Bond so delivered shall be credited by the Trustee at one hundred percent (100%) of the principal amount thereof against the obligation of the Issuer on such Sinking Fund Installment payment date and any excess over such Sinking Fund Installment shall be cr edited on future Sinking Fund Installments in direct chronological order, and the principal amount of Bonds to be redeemed by operation of the mandatory Sinking Fund Installments shall be accordingly reduced.

(e) In the event Defaulted Interest (as defined in Section 2.02(f) of the Indenture) shall become due on any Initial Bond, the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on such Initial Bond and the date of the proposed payment (which date shall be such as will enable the Trustee to comply with Section 2.02(e) of the Indenture), and shall deposit with the Trustee at the time of such notice an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the d ate of the proposed payment.

(f) No further loan payments need be made to the Issuer on account of the Bonds during the term of this Agreement when and so long as the amount of cash and/or Defeasance Obligations on deposit in the Bond Fund is sufficient to satisfy and discharge the obligations of the Issuer under the Indenture and pay the Bonds as provided in Article X of the Indenture.

(g) Any amounts remaining in the Earnings Fund, the Rebate Fund, the Bond Fund, the Advance Interest Deposit Fund, the Project Fund or the Renewal Fund upon the expiration or sooner termination of the term of this Agreement as provided in this Agreement, after payment in full of (i) the Bonds (in accordance with Article X of the Indenture), (ii) the fees, charges and expenses of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent in accordance with the Indenture, (iii) all loan payments and all other amounts payable hereunder and under the Promissory Note, and after all a mounts required to be rebated to the Federal government pursuant to the Tax Regulatory Agreement or the Indenture, and (iv) all amounts required to be paid under any Project Document (other than the Ground Lease), shall have been so paid, shall belong to and be paid to the Company by the Trustee as overpayment of the Loan.

(h) In the event that the Company fails to make any loan payment required in this Section 4.3, the installment so in default shall continue as an obligation of the Company until the amount in default shall have been fully paid.

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(i) Notwithstanding anything in the foregoing to the contrary, if the amount on deposit and available in the Bond Fund is not sufficient to pay the principal of, Sinking Fund Installments for, redemption premium, if any, and interest on the Bonds when due (whether at maturity or by redemption or acceleration or otherwise as provided in the Indenture), the Company shall forthwith pay the amount of such deficiency in immediately available funds to the Trustee for deposit in the Bond Fund.

Section 4.4. Payment of Purchase Price. b) The Company agrees, as provided in Section 2.03 of the Indenture, to pay loan payments to the Tender Agent, for the account of the Issuer, equal to all amounts necessary for the purchase of Initial Bonds pursuant to such Section but not deposited with the Tender Agent by the Remarketing Agent from the proceeds of the remarketing of the Initial Bonds under Section 2.03 of the Indenture. Each such payment by the Company to the Tender Agent in accordance with this Section shall be in immediately available funds and paid to the Tender Agent at its principal office by 2:30 p.m., New York City time, on each Purchase Date. The Company further agrees to pay such immediately available funds to the Tender Agent at the times and in the manner specified in the Indenture.

(b) The Company acknowledges that it and its Affiliates shall have no title to or interest in, beneficial or otherwise, and no right to control, any proceeds of the remarketing of Initial Bonds, all of which shall be held in trust by the Trustee or the Tender Agent for the sole benefit of the Holders of the Initial Bonds.

(c) The Company hereby approves and agrees to be bound by the provisions of the Indenture regarding the purchase, offer, sale and delivery of Initial Bonds tendered for purchase thereunder, including particularly those set forth in Articles II, V and IX of the Indenture. The Company shall have all of the rights and obligations provided in the Indenture with respect to the Company in connection with such transactions and the appointment of the Tender Agent and the Remarketing Agent thereunder. The Issuer shall have no obligation or responsibility with respect to the purchase of Initial Bonds or any related arrangements, except that the Issuer at the expense of the Company shall cooperate in the making of any such arrangements.

(d) Upon the occurrence of an Interest Rate Change pursuant to Section 2.03 of the Indenture, the Company shall deliver or cause to be delivered the notice, the Favorable Opinion of Bond Counsel (if so required under the Indenture) and such other documents required under the Indenture in connection with such re-set, all as provided in Section 2.03 of the Indenture

Section 4.5. Loan Payments and Other Payments Payable Absolutely Net. The obligation of the Company to pay the loan payments and other payments under this Agreement and the Promissory Note shall be absolutely net to the Issuer and to the Trustee without any abatement, recoupment, diminution, reduction, deduction, counterclaim, set-off or offset whatsoever, so that this Agreement and the Promissory Note shall yield, net, to the Issuer and to the Trustee, the loan payments and other payments provided for herein, and all costs, expenses and charges of any kind and nature relating to the Facility, arising or becoming due and payable during or after the term of this Agreement, shall be paid by the Company and the Indemnified Parties shall be indemnified by the Company for, and the Company shall hold the Indemnified Parties harmless from, any such costs, expenses and charges.

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Section 4.6. Nature of Company’s Obligation Unconditional. The Company’s obligation under this Agreement and the Promissory Note to pay the loan payments and all other payments provided for in this Agreement and in the Promissory Note shall be absolute, unconditional and a general obligation of the Company, irrespective of any defense or any rights of set-off, recoupment or counterclaim or deduction and without any rights of suspension, deferment, diminution or reduction it might otherwise have against the Issuer, the Trustee or the Holder of any Bond and the obligation of the Company shall arise whether or not (y) the Project has been completed as provided in this Agreement, or (z) any provider of a credit facility or liquidity facility with respect to the Bonds shall be honoring its obligations thereunder. The Company will not suspend or discontinue any such payment or terminate this Agreement (other than such termination as is provided for hereunder), or suspend the performance or observance of any covenant or agreement required on the part of the Company hereunder, for any cause whatsoever, and the Company waives all rights now or hereafter conferred by statute or otherwise to quit, terminate, cancel or surrender this Agreement or any obligation of the Company under this Agreement except as provided in this Agreement or to any abatement, suspension, deferment, diminution or reduction in the loan payments or other payments hereunder or under the Promissory Note.

Section 4.7. Advances by the Trustee. In the event the Company fails to make any payment or to perform or to observe any obligation required of it under this Agreement, under the Promissory Note or under any other Security Document, the failure of which payment, or performance or observance of which obligation, would materially adversely affect the security for the Bonds, the Trustee, after first notifying the Company in writing of any such failure on its part (except that no prior notification of the Company shall be required in the even t of an emergency condition that, in the reasonable judgment of the Trustee, necessitates immediate action), may (but shall not be obligated to), and without waiver of any of the rights of the Trustee under this Agreement or any other Security Document to which the Trustee is a party, make such payment or otherwise cure any failure by the Company to perform and to observe its other obligations hereunder or thereunder. All amounts so advanced therefor by the Trustee shall become an additional obligation of the Company to the Trustee, which amounts, together with interest thereon at the rate of twelve percent (12%) per annum, compounded daily, from the date advanced, the Company will pay upon demand therefor by the Trustee. Any remedy vested in the Trustee herein or in any other Security Document for the collection of the loan payments or other payments or amounts due hereunder, under the Promissory Note or under any other Security Document shall also be available to the Trustee for the c ollection of all such amounts so advanced. No advance shall be made by the Trustee except upon the written direction of the Majority Holders.

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Section 4.8. No Warranty of Condition or Suitability. THE ISSUER HAS MADE AND MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MERCHANTABILITY, CONDITION, FITNESS, DESIGN, OPERATION OR WORKMANSHIP OF ANY PART OF THE FACILITY, ITS FITNESS FOR ANY PARTICULAR PURPOSE, THE QUALITY OR CAPACITY OF THE MATERIALS IN THE FACILITY, OR THE SUITABILITY OF THE FACILITY FOR THE PURPOSES OR NEEDS OF THE COMPANY OR THE FACILITY TENANTS OR THE EXTENT TO WHICH PROCEEDS DERIVED FROM THE SALE OF THE INITIAL BONDS WILL BE SUFFICIENT TO PAY THE COST OF COMPLETION OF THE PROJECT. THE COMPANY IS SATISFIED THAT THE FACILITY IS SUITABLE AND FIT FOR PURPOSES OF THE COMPANY AND THE FACILITY TENANTS. THE ISSUER SHALL NOT BE LIABLE IN ANY MANNER WHATSOEVER TO THE COMPANY OR ANY OTHER PERSON FOR ANY LOSS, DAMAGE OR EXPENSE OF ANY KIND OR NATURE CAUSED, DIRECTLY OR INDIRECTLY, BY THE PROPERTY OF THE FACILITY OR THE USE OR MAINTENANCE THEREOF OR THE FAILURE OF OPERATION THEREOF, OR THE REPAIR, SERVICE OR ADJUSTMENT THEREOF, OR BY ANY DELAY OR FAILURE TO PROVIDE ANY SUCH MAINTENANCE, REPAIRS, SERVICE OR ADJUSTMENT, OR BY ANY INTERRUPTION OF SERVICE OR LOSS OF USE THEREOF OR FOR ANY LOSS OF BUSINESS HOWSOEVER CAUSED.

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ARTICLE V

DAMAGE, DESTRUCTION AND CONDEMNATION

Section 5.1. Damage, Destruction and Condemnation. In the event that at any time during the term of this Agreement the whole or part of the Facility shall be damaged or destroyed, or taken or condemned by a competent authority for any public use or purpose, or by agreement to which the Company and those authorized to exercise such right are parties, or if the temporary use of the Facility shall be so taken by condemnation or agreement (a “Loss Event”):

(i) the Issuer shall have no obligation to rebuild, replace, repair or restore the Facility or to advance funds therefor,

(ii) there shall be no abatement, postponement or reduction in the loan payments or other amounts payable by the Company under this Agreement or the Promissory Note or any other Security Document to which it is a party, and the Company hereby waives, to the extent permitted by law, any provisions of law which would permit the Company to terminate this Agreement or eliminate or reduce its payments hereunder, and

(iii) the Company will promptly give written notice of such Loss Event to the Issuer and the Trustee, generally describing the nature and extent thereof.

Section 5.2. Loss Proceeds.

(a) The Issuer, the Trustee and the Company shall cooperate and consult with each other in all matters pertaining to the settlement, compromise, arbitration or adjustment of any claim or demand on account of any Loss Event, and the settlement, compromise, arbitration or adjustment of any such claim or demand shall, as between the Issuer and the Company, be subject to the written approval of the Company and the Trustee (such approvals not to be unreasonably withheld).

(b) Subject to the terms and provisions of the Ground Lease, the Net Proceeds with respect to the Facility shall be paid to the Trustee (who shall constitute the “Depositary” under the Ground Lease) and deposited in the Renewal Fund (except as provided in Section 3.12 of the Bond Guaranty Agreement). Pending the disbursement or transfer thereof, the Net Proceeds in the Renewal Fund shall be applied, and may be invested, as provided in the Indenture. The Company shall be entitled to the Net Proceeds of any insurance proceeds or condemnation award, compensation or damages attributable to the Company’s P roperty.

Section 5.3. Election to Rebuild or Terminate.

(a) In the event a Loss Event shall occur, the Company shall either:

(i) at its own cost and expense (except to the extent paid from the Net Proceeds), within one (1) year of the Loss Event, promptly and diligently rebuild, replace, repair or restore the Facility to substantially its condition immediately prior to the Loss Event, or to a condition of at least equivalent value, operating efficiency and function, regardless of whether or not the Net Proceeds derived from the Loss Event shall be sufficient to pay the cost thereof, and the Company shall not by reason of payment of any such excess costs be entitled to any reimbursement from the Issuer, the Trustee or any Bondholder, nor shall the loan payments or other amounts payable by the Company under this Agreement or the Promissory Note or any other Security Document be abated, postponed or reduced, or

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(ii) to the extent and upon the conditions permitted to do so under Sections 9.1 and 9.2 and under the Indenture, exercise its option to terminate this Agreement and cause the Bonds to be redeemed in whole;

provided that if all or substantially all of the Facility shall be taken or condemned, or if the taking or condemnation renders the Facility unsuitable for use by the Company and the Facility Tenants as contemplated hereby, the Company shall exercise its option to terminate this Agreement pursuant to Sections 9.1 and 9.2.

Not later than ninety (90) days after the occurrence of a Loss Event, the Company shall advise the Issuer and the Trustee in writing of the action to be taken by the Company under this Section 5.3(i), a failure to so timely notify being deemed an election in favor of Section 5.3(a)(i) to be exercised in accordance with the provisions of Section 5.3(b).

(b) If the Company shall elect to or shall otherwise be required to rebuild, replace, repair or restore the Facility as set forth in Section 5.3(a)(i), the Trustee shall disburse the Net Proceeds from the Renewal Fund in the manner set forth in Section 5.04 of the Indenture to pay or reimburse the Company, at the election of the Company, either as such work progresses or upon the completion thereof, provided, however, the amounts so disbursed by the Trustee to the Company shall not exceed the actual cost of such work. If the Company shall exercise its option in Section 5.3(a)(ii), the amount of the Net Proceeds so recov ered shall be transferred from the Renewal Fund and deposited in the Redemption Account of the Bond Fund, and the Company shall thereupon pay to the Trustee for deposit in the Redemption Account of the Bond Fund an amount which, when added to any amounts then in the Bond Fund and available for that purpose, shall be sufficient to retire and redeem the Bonds in whole at the earliest possible date (including, without limitation, principal and interest to the maturity or Redemption Date and redemption premium, if any), and shall pay the expenses of redemption, the fees and expenses of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent, together with all other amounts due under the Indenture, under this Agreement and under each other Security Document, as well as any amounts required to be rebated to the Federal government pursuant to the Indenture or the Tax Regulatory Agreement, and such amount so deposited shall be applied, together with such other avail able amounts in the Bond Fund, if applicable, to such redemption or retirement of the Bonds on said redemption or maturity date.

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Section 5.4. Effect of Election to Build.

(a) All rebuilding, replacements, repairs or restorations of the Facility in respect of or occasioned by a Loss Event shall:

(i) automatically be deemed a part of the Facility and be subject to the Ground Lease and the terms of this Agreement, and be subject to the lien and security interest of the Mortgage,

(ii) be effected only if the Company shall deliver to the Issuer and the Trustee a certificate of an Authorized Company Representative acceptable to the Issuer and the Trustee to the effect that such rebuilding, replacement, repair or restoration shall not change the nature of the Facility as the Approved Facility,

(iii) be effected with due diligence in a good and workmanlike manner, in compliance with the Ground Lease and all applicable Legal Requirements and be promptly and fully paid for by the Company in accordance with the terms of the applicable contract(s) therefor,

(iv) restore the Facility to substantially its condition immediately prior to the Loss Event, or to a condition of at least equivalent value, operating efficiency and function, and to a state and condition that will permit the Company and the Facility Tenants to use and operate the Facility as the Approved Facility,

(v) be effected only if the Company shall have complied with Section 7.1(c), and

(vi) unless such rebuilding is done by the original contractor (or an Affiliate thereof) who performed the Project Work, be preceded by the furnishing by the Company to the Trustee of a labor and materials payment bond, or other security, satisfactory to the Trustee.

(b) The date of completion of the rebuilding, replacement, repair or restoration of the Facility shall be evidenced to the Issuer and the Trustee by a certificate of an Authorized Representative of the Company stating (i) the date of such completion, (ii) that all labor, services, machinery, equipment, materials and supplies used therefor and all costs and expenses in connection therewith have been paid for or arrangement for payment, reasonably satisfactory to the Trustee, has been made, (iii) that the Facility has been rebuilt, replaced, repaired or restored to substantially its condition immediately prior to the Loss Event, or to a condition of at least equivalent value, operating effici ency and function, (iv) that all property constituting part of the Facility is subject to the Ground Lease and this Agreement, and the mortgage liens and security interests of the Mortgage, subject to Permitted Encumbrances, (v) the Rebate Amount (as defined in the Indenture) applicable with respect to the Net Proceeds and the earnings thereon (with a statement as to the determination of the Rebate Amount and a direction to the Trustee of any required transfer to the Rebate Fund), and (vi) that the restored Facility is ready for occupancy, use and operation for its intended purposes. Notwithstanding the foregoing, such certificate shall state (x) that it is given without prejudice to any rights of the Company against third parties which exist at the date of such certificate or which may subsequently come into being, (y) that it is given only for the purposes of this Section and Section 5.04 of the Indenture and (z) that no Person other than the Issuer or the Trus tee may benefit therefrom.

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(c) The certificate delivered pursuant to Section 5.4(b) shall be accompanied by (i) a certificate of occupancy (either temporary or permanent, provided that if it is a temporary certificate of occupancy, the Company will proceed with due diligence to obtain a permanent certificate of occupancy), if required, and any and all permissions, licenses or consents required of governmental authorities for the occupancy, operation and use of the Facility for the purposes contemplated by the Ground Lease and this Agreement; and (ii) a certificate of an Authorized Representative of the Company that all contracts relating to the rebuilding, repair, restoration and reconstruction of the Facility have been p aid (or will promptly be paid) in full, together with releases of mechanics’ liens by all contractors and materialmen who supplied work, labor, services, materials or supplies in connection with the rebuilding, repair, restoration and reconstruction of the Facility (or, to the extent that any such costs shall be the subject of a bona fide dispute, evidence to the Trustee that such costs have been appropriately bonded or that the Company shall have posted a surety or security at least equal to the amount of such costs).

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ARTICLE VI

COVENANTS OF THE ISSUER

Section 6.1. Issuance of Initial Bonds. On the Closing Date, subject to the satisfaction of the conditions to the issuance of the Initial Bonds, the Issuer will sell and deliver the Initial Bonds in the principal amount of $20,000,000 under and pursuant to the Bond Resolution and under and pursuant to the Indenture. The proceeds of sale of the Initial Bonds shall be deposited and applied in accordance with the provisions of the Indenture.

Section 6.2. Issuance of Additional Bonds. The Issuer and the Company recognize that under the provisions of and subject to the conditions set forth in the Indenture, the Issuer is authorized to enter into a Supplemental Indenture and issue one or more series of Additional Bonds on a parity with the Initial Bonds for the purpose of (w) completing the Project, (x) providing funds in excess of the Net Proceeds of insurance or eminent domain to repair, relocate, replace, rebuild or restore the Facility in the event of damage, destr uction or taking by eminent domain, (y) providing extensions, additions or improvements to the Facility, or (z) refunding Outstanding Bonds. If the Company is not in default hereunder, the Issuer will consider the issuance of a Series of Additional Bonds in a principal amount as is specified in a written request in accordance with the applicable provisions set forth in the Indenture.

Section 6.3. Pledge and Assignment to Trustee. As security for the payment of the Bonds and the obligations of the Company under the Security Documents, the Issuer shall pledge and assign to the Trustee pursuant to the Indenture all of the Issuer’s right, title and interest in the Promissory Note and all (except for the Issuer’s Reserved Rights) of the Issuer’s right, title and interest in this Agreement, including all loan payments hereunder and under the Promissory Note, and in furtherance of said pledge the Issuer wil l unconditionally assign such loan payments to the Trustee for deposit in the Bond Fund in accordance with the Indenture. The Company consents to the pledge and assignment of this Agreement and the Promissory Note described in this Section 6.3.

Section 6.4. Issuer to Make Bond Registration Books Available. The Issuer shall at all times make available or cause to be made available to the Company its registration books (maintained at the designated corporate trust office of the Trustee) containing the names and addresses of the Bondholders if known.

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ARTICLE VII

COVENANTS OF THE COMPANY

Section 7.1. Insurance.

(a) Definitions. For purposes of this Section 7.1, the following terms shall have the meanings specified below:

Certificate means an ACORD certificate evidencing insurance.

CGL means commercial general liability insurance.

Contractor(s) means, individually or collectively, a contractor or subcontractor providing materials and/or labor and/or other services in connection with any Construction, but not including a GC, CM or any architect or engineer providing professional services.

CM means a construction manager providing construction management services in connection with any Construction.

Construction means any construction, reconstruction, restoration, renovation, alteration and/or repair on, in, at or about the Facility, including the Project Work or any other construction, reconstruction, restoration, alteration and/or repair required under this Agreement or the Ground Lease in connection with the Facility, provided, that, one or both of the following conditions applies to the foregoing: (i) the cost thereof, labor and materials combined, is $500,000 or greater, or (ii) the work being performed, whether in whole or in part, is roof work or work that is performed at a height of more than eight (8) feet above the ground.

GC means any general contractor providing general contracting services in connection with any Construction.

Insured means the Company.

Insurer means any entity writing issuing a Policy.

ISO means the Insurance Services Office or its successor.

ISO Form CG-0001 means the CGL form published by ISO at the Commencement Date.

Policy(ies) means, collectively or individually, the policies required to be obtained and maintained pursuant to Section 7.1(b) and (c).

SIR means self-insured retention.

U/E means Umbrella or Excess Liability insurance.

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Workers’ Compensation means Workers’ Compensation, disability and employer liability insurance.

(b) Required Insurance. Throughout the term of this Agreement, except during periods of Construction, the Insured shall obtain and maintain for itself as a primary insured the following insurance:

(i) CGL with $1,000,000 minimum per occurrence; $2,000,000 minimum in the aggregate; and per-location aggregate. This Policy shall contain coverage for contractual liability, premises operations, and products and completed operations.

(ii) U/E with $4,000,000 minimum per occurrence on terms consistent with CGL. The excess coverage provided under U/E shall be incremental to the CGL to achieve minimum required coverage of $5,000,000 per occurrence; such incremental coverage must also apply to auto liability (see Section 7.1(b)(iii)), whether auto liability coverage is provided by endorsement to the Insured’s CGL or by a stand-alone policy.

(iii) Auto liability insurance with $1,000,0000 combined single limit and $1,000,000 for uninsured or under-insured vehicles. If the Insured does not own any vehicles, the Insured shall obtain auto liability insurance in the foregoing amounts for hired and non-owned vehicles. Coverage should be at least as broad as ISO Form CA0001, ed. 10/01.

(iv) Workers Compensation satisfying State statutory limits. Coverage for employer liability shall be in respect of any work or operations in, on or about the Facility.

(c) Required Insurance During Periods of Construction. In connection with any Construction and throughout any period of such Construction, the Company shall cause the following insurance requirements to be satisfied:

(i) The Insured shall obtain and maintain for itself Policies in accordance with all requirements set forth in Section 8.1(b), except that CGL and U/E shall be in an aggregate minimum amount of $10,000,000 per project aggregate.

(ii) Any GC or CM shall obtain and maintain for itself as a primary insured the following Policies:

(A) CGL and U/E in accordance with the requirements in Section 7.1(b), subject to the following modifications: (x) coverage shall be in an aggregate minimum amount of $10,000,000 per project aggregate, and (y) completed operations coverage shall extend (or be extended) for an additional five (5) years after completion of the Construction;

(B) Auto liability insurance in accordance with the requirements in Section 7.1(b); and

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(iii) Each Contractor shall obtain and maintain for itself as a primary insured the following insurance:

(A) CGL and U/E in accordance with the requirements in Section 7.1(b) except that, in addition, completed operations coverage shall extend (or be extended) for an additional five (5) years after completion of the Construction;

(B) Auto Liability insurance in accordance with the requirements in Section 7.1(b); and

(d) Required Policy Attributes. Except as the Issuer and the Trustee shall expressly otherwise agree in writing in their sole and absolute discretion:

(i) The Company shall cause each Policy (other than Worker’s Compensation insurance) to name the Issuer and the Trustee as additional insureds on a primary and non-contributory basis as more particularly required in Section 7.1(f)(i).

(ii) No Policy shall have a deductible in excess of $25,000.

(iii) CGL shall not be subject to SIR in excess of $10,000.

(iv) CGL shall be written on either ISO Form CG-0001 or on such other form that the Company may request provided that any requested substitute shall provide an additional insured with substantially equivalent coverage to that enjoyed by an additional insured in a policy written on ISO Form CG-0001 and provided further that the substitute is reasonably approved by the Issuer. If the Insured intends to renew its CGL on a form that is not ISO Form CG-0001, the Insured shall provide the Issuer and the Trustee with a copy of the substitute form at least sixty (60) days prior to the intended date on which the renewal Policy is to be effective.

(v) The Company acknowledges that the Issuer and the Trustee are materially relying upon the content of ISO Form CG-0001 to implement the Issuer’s insurance requirements under this Section 7.1; accordingly, the Company agrees that non-standard exclusions and other modifications to ISO Form CG-0001 are prohibited under the terms and conditions of this Section 7.1. In the event that ISO either ceases to exist or discontinues ISO Form CG-0001, the Issuer or the Trustee shall have the right to require, for all purposes hereunder, a different CGL form, provided that the replacement is substantially similar to ISO Form CG-0001.

(vi) Without limiting Section 7.1(d)(v) or the application of any other requirement under this Section 7.1, no Policy delivered hereunder shall limit (whether by exception, exclusion, endorsement, script or other modification) any of the following coverage attributes:

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(A) contractual liability coverage insuring the contractual obligations of the Insured;

(B) the right of the Insured to name additional insureds including the Issuer and the Trustee;

(C) the applicability of CGL coverage to the Issuer and the Trustee as additional insureds in respect of liability arising out of any of the following claims: (x) claims against the Issuer and/or the Trustee by employees of the Insured, or (y) claims against the Issuer and/or the Trustee by any GC, CM, Contractor, architect or engineer or by the employees of any of the foregoing, or (z) claims against the Issuer and/or the Trustee arising out of any work performed by a GC, CM, Contractor, architect or engineer.

(vii) U/E shall follow the form of CGL except that U/E may be broader.

(viii) Each Policy shall provide primary insurance and the issuing Insurer shall not have a right of contribution from any other insurance policy insuring the Issuer and/or the Trustee.

(ix) In each Policy, the Insurer shall waive, as against any Person insured under such Policy including any additional insured, the following: (x) any right of subrogation, (y) any right to set-off or counterclaim against liability incurred by a primary insured or any additional insured, and (z) any other deduction, whether by attachment or otherwise, in respect of any liability incurred by any primary insured or additional insured.

(x) Policies shall not be cancellable without at least thirty (30) days’ prior written notice to the Issuer and the Trustee as additional insureds.

(xi) Each Policy under which the Issuer and the Trustee is an additional insured shall provide that the Issuer and the Trustee will not be liable for any insurance premium, commission or assessment under or in connection with any Policy.

(e) Required Insurer Attributes. All Policies must be issued by Insurers satisfying the following requirements:

(i) Insurers shall have a minimum AM Best rating of A minus.

(ii) Each Insurer must be an authorized insurer in accordance with Section 107(a) of the New York State Insurance Law.

(iii) Insurers must be admitted in the State; provided, however, that if the Insured requests the Issuer to accept a non-admitted Insurer, and if the Issuer reasonably determines that for the kind of operations performed by the Insured an admitted Insurer is commercially unavailable to issue a Policy or is non-existent, then the Issuer shall provide its written consent to a non-admitted Insurer. For purposes of this paragraph, an “admitted” Insurer means that the Insurer’s rates and forms have been approved by the State Insurance Department and that the Insurer’s obligations are entitled to be insured by the State’s insurance guaranty fund.

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(f) Required Evidence of Compliance. The Company shall deliver or cause to be delivered, throughout the term of this Agreement, evidence of all Policies required hereunder as set forth in this Section 7.1(f):

(i) All Policies. With respect to all Policies on which the Insured is to be a primary insured, the Insured shall deliver to the Issuer and the Trustee a Certificate or Certificates evidencing all Policies required by this Section 7.1, (x) at the Commencement Date, (y) prior to the expiration or sooner termination of Policies, and (z) prior to the commencement of any Construction. If the Certificate in question evidences CGL, such Certificate shall name the Issuer and the Trustee as additional insureds in the following manner:

New York City Capital Resource Corporation and The Bank of New York Mellon, as Trustee, are additional insureds on a primary and non-contributory basis. The referenced CGL is written on ISO Form CG-0001 without modification to the contractual liability provisions thereof, covering the following premises: 1 DeKalb Avenue, Brooklyn, New York;

For purposes of the foregoing, the phrase “at appropriate times” shall mean: (i) at the Commencement Date; and (ii) prior to the expiration or sooner termination of Policies; and (iii) prior to the commencement of any Construction.

(ii) CGL. With respect to CGL on which the Insured is to be a primary insured, the Insured shall additionally deliver to the Issuer and the Trustee the following:

(A) Prior to the Commencement Date the Insured shall deliver to the Issuer and the Trustee the declarations page and the schedule of forms and endorsements pertinent thereto.

(B) Upon the expiration or sooner termination of any CGL, the Insured shall deliver to the Issuer and the Trustee a declarations page and schedule of forms and endorsements pertinent to the new or replacement CGL.

(C) Prior to the commencement of any Construction, the Insured shall deliver to the Issuer and the Trustee a declarations page and a schedule of forms and endorsements pertinent to the CGL under which the Insured is to be the primary insured during the period of such Construction.

(iii) Insurance to be obtained by GCs and CMs. Prior to the commencement of any Construction that entails the services of a GC or CM, the Company shall provide to the Issuer and the Trustee, in a form satisfactory to the Issuer and the Trustee, evidence that the GC or CM (as the case may be) has obtained the Policies that it is required to obtain and maintain in accordance with Section 7.1(c).

(iv) Insurance to be obtained by Contractors. In connection with any Construction, the Company shall, upon the written request of the Issuer or the Trustee, cause any or all Contractors to provide evidence satisfactory to the Issuer and the Trustee, that such Contractors have obtained and maintain the Policies that they are required to obtain and maintain in accordance with the requirements of Section 7.1(c).

(g) Notice. The Company shall immediately give the Issuer and the Trustee notice of each occurrence that is reasonably probable to give rise to a claim under the insurance required to be maintained by this Section 7.1.

(h) Miscellaneous.

(i) If, in accordance with the terms and conditions of this Section 7.1, an Insured is required to obtain the consent of the Issuer and/or the Trustee, the Company shall request such consent in a writing provided to the Issuer and/or the Trustee at least thirty (30) days in advance of the commencement of the effective period (or other event) to which the consent pertains.

(ii) Throughout the term of this Agreement, the delivery by the Insured of a Certificate evidencing auto liability insurance for hired and non-owned vehicles shall, unless otherwise stated by the Company to the contrary, constitute a representation and warranty from the Insured to the Issuer and the Trustee that the Insured does not own vehicles.

(iii) The Insured shall neither do nor omit to do any act, nor shall it suffer any act to be done, whereby any Policy would or might be terminated, suspended or impaired.

(iv) If, throughout the term of this Agreement, insurance industry standards applicable to properties similar to the Facility and/or operations similar to the operations of the Company and/or any of the Facility Tenants, materially change; and if, as a consequence of such change, the requirements set forth in this Section 7.1 become inadequate in the reasonable judgment of the Issuer or the Trustee for the purpose of protecting the Issuer and the Trustee against third-party claims, then the Issuer or the Trustee shall have the right to supplement and/or otherwise modify such requirements, provided, however, that such supplements or modifications shall be commercially reasonable.

(v) THE ISSUER AND THE TRUSTEE DO NOT REPRESENT THAT THE INSURANCE REQUIRED IN THIS SECTION 7.1, WHETHER AS TO SCOPE OR COVERAGE OR LIMIT, IS ADEQUATE OR SUFFICIENT TO PROTECT THE INSURED AND ITS OPERATIONS AGAINST CLAIMS AND LIABILITY.

(vi) The Issuer, in its sole discretion and without obtaining the consent of the Trustee or any Guarantor or any other party to the transactions contemplated by this Agreement, may make exceptions to the requirements under this Section 7.1 by a written instrument executed by the Issuer. In the event the Company shall request the Issuer to make any exception to the requirements under this Section 7.1, the Issuer shall not unreasonably withhold its consent. The Company acknowledges that the Issuer’s decision in this respect will be deemed reasonable if made in furtherance of protecting the Issuer from liability.

Section 7.2. Indemnity.

(a) The Company shall at all times indemnify, defend, protect and hold the Issuer, the Trustee, the Tender Agent, the Bond Registrar, the Paying Agents and the Remarketing Agent, and any director, member, officer, employee, servant, agent (excluding for this purpose the Company, which is not obligated hereby to indemnify its own employees, Affiliates or affiliated individuals) thereof and persons under the Issuer’s control or supervision (collectively, the “Indemnified Parties” and each an “Indemnified Party”) harmless of, from and against any and all claims (whethe r in tort, contract or otherwise), taxes (of any kind and by whomsoever imposed), demands, penalties, fines, liabilities, lawsuits, actions, proceedings, settlements, costs and expenses, including attorney and consultant fees, investigation and laboratory fees, court costs, and litigation expenses (collectively, “Claims”) of any kind for losses, damage, injury and liability (collectively, “Liability”) of every kind and nature and however caused (except, with respect to any Indemnified Party, Liability arising from the gross negligence or willful misconduct of such Indemnified Party), arising during the period commencing on the Indemnification Commencement Date, and continuing throughout the term of this Agreement, arising upon, about, or in any way connected with the Facility, the Project, or any of the transactions with respect thereto, including:

(i) the financing of the costs of the Facility or the Project and the marketing, offering, issuance, sale and remarketing of the Bonds for such purpose,

(ii) the planning, design, acquisition, site preparation, Project Work, construction, renovation, equipping, installation or completion of the Project or any part thereof or the effecting of any work done in or about the Facility, or any defects (whether latent or patent) in the Facility,

(iii) the maintenance, repair, replacement, restoration, rebuilding, construction, renovation, upkeep, use, occupancy, ownership, leasing, subletting or operation of the Facility or any portion thereof,

(iv) the execution and delivery by an Indemnified Party, the Company, the Parent or any other Person of, or performance by an Indemnified Party, the Company or any other Person, as the case may be, of, any of their respective obligations under, this Agreement or any other Project Document, or other document or instrument delivered in connection herewith or therewith or the enforcement of any of the terms or provisions hereof or thereof or the transactions contemplated hereby or thereby,

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(v) any damage or injury to the person or property of any Person in or on the premises of the Facility,

(vi) any imposition arising from, burden imposed by, violation of, or failure to comply with any Legal Requirement, including failure to comply with the requirements of the City’s zoning resolution and related regulations, or

(vii) the presence, disposal, release, or threatened release of any Hazardous Materials that are on, from, or affecting the Facility; any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to such Hazardous Materials; any lawsuit brought or threatened, settlement reached, or government order relating to such Hazardous Materials, and/or any violation of Legal Requirements, including demands of government authorities, or any policies or requirements of the Issuer, which are based upon or in any way related to such Hazardous Materials.

(b) The Company releases each Indemnified Party from, and agrees that no Indemnified Party shall be liable to the Company or its Affiliates for, any Claim or Liability arising from or incurred as a result of action taken or not taken by such Indemnified Party with respect to any of the matters set forth in Section 7.2(a) including any Claim or Liability arising from or incurred as a result of the gross negligence or willful misconduct of such Indemnified Party, or at the direction of the Company, the Parent or any Facility Tenant with respect to any of such matters above referred to.

(c) An Indemnified Party shall promptly notify the Company in writing of any claim or action brought against such Indemnified Party in which indemnity may be sought against the Company pursuant to this Section 7.2; such notice shall be given in sufficient time to allow the Company to defend or participate in such claim or action, but the failure to give such notice in sufficient time shall not constitute a defense hereunder nor in any way impair the obligations of the Company under this Section 7.2.

(d) Anything to the contrary in this Agreement notwithstanding, the covenants of the Company contained in this Section 7.2 shall be in addition to any and all other obligations and liabilities that the Company may have to any Indemnified Party in any other agreement or at common law, and shall remain in full force and effect after the termination of this Agreement until the later of (i) the expiration of the period stated in the applicable statute of limitations during which a claim or cause of action may be brought and (ii) payment in full or the satisfaction of such claim or cause of action and of all expenses and charges incurred by the Indemnified Party relating to the enforcement of the provisions he rein specified.

Section 7.3. Compensation and Expenses of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents and the Remarketing Agent; Administrative and Project Fees.

(a) The Company shall pay the fees, costs and expenses of the Issuer together with any fees and disbursements incurred by lawyers or other consultants in performing services for the Issuer in connection with this Agreement or any other Project Document, together with all fees and costs incurred in connection with complying with Section 7.11(b) (including fees and disbursements of lawyers and other consultants).

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(b) On the Commencement Date, the Company shall pay to the Issuer the following amounts: (i) the Initial Annual Administrative Fee, and (ii) the Project Fee.

(c) The Company further agrees to pay the Annual Administrative Fee to the Issuer on each July 1 following the Commencement Date until the earlier of the Expiration Date or the Termination Date. In the event the Company shall fail to pay the Annual Administrative Fee on the date due, the Issuer shall have no obligation to deliver notice of such failure to the Company.

(d) The Company shall, to the extent not paid out of the proceeds of the Bonds as financing expenses, pay the following fees, charges and expenses and other amounts: (i) the initial and annual fees of the Trustee for the ordinary services of the Trustee rendered and its ordinary expenses incurred under the Indenture, including fees and expenses as Bond Registrar and in connection with preparation of new Bonds upon exchanges or transfers or making any investments in accordance with the Indenture, (ii) the reasonable fees and charges of the Trustee and any Paying Agents on the Bonds for acting as paying agents as provided in the Indenture, including the reasonable fees of its counsel, (iii) t he reasonable fees, charges, and expenses of the Trustee for extraordinary services rendered by it under the Indenture, including reasonable counsel fees, and (iv) the reasonable fees, costs and expenses of the Bond Registrar, the Tender Agent and the Remarketing Agent.

Section 7.4. Signage at Facility Site. Upon commencement of the Project renovations and/or construction of the Improvements at the Facility (including the commencement of any demolition and/or excavation), the Company shall erect on the Facility site, at its own cost and expense, within easy view of passing pedestrians and motorists, a large and readable sign with the following information upon it (hereinafter, the “Sign”):

FINANCIAL ASSISTANCE PROVIDED

THROUGH THE

NEW YORK CITY CAPITAL RESOURCE CORPORATION

Mayor Michael Bloomberg

In addition, the Sign shall satisfy the following requirements: (x) format and appearance generally shall be stipulated by the Issuer in writing or electronically; (y) the minimum size of the Sign shall be four (4) feet by eight (8) feet; and (z) the Sign shall have no other imprint upon it other than that of the Issuer. The Sign shall remain in place at the Facility until completion of the renovations and/or construction. The Company may erect other signs in addition to the Sign.

Section 7.5. Environmental Matters.

(a) The Company has provided, and the Issuer acknowledges receipt of, a letter from the Environmental Auditor addressed to the Issuer, stating that the Issuer may rely upon the Environmental Audit as if it was prepared for the Issuer in the first instance.

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(b) The Company shall not cause or permit the Facility or any part thereof to be used to generate, manufacture, refine, transport, treat, store, handle, dispose, transfer, produce or process Hazardous Materials, except in compliance with all applicable Legal Requirements, nor shall the Company cause or permit, as a result of any intentional or unintentional act or omission on the part of the Company or any occupant or user of the Facility, a release of Hazardous Materials onto the Facility or onto any other property.

(c) The Company shall comply with, and require and enforce compliance by, all occupants and users of the Facility (including, without limitation, all Facility Tenants) with all applicable Legal Requirements pertaining to Hazardous Materials, whenever and by whomever triggered, and shall obtain and comply with, and ensure that all occupants and users of the Facility (including, without limitation, all Facility Tenants) obtain and comply with, any and all approvals, registrations or permits required thereunder.

(d) The Company shall conduct and complete all investigations, studies, sampling, and testing, and all remedial, removal and other actions necessary to clean up and remove all Hazardous Materials, on, from, or affecting the Facility in accordance with all applicable Legal Requirements.

(e) In the event the Mortgage is foreclosed, or a deed in lieu of foreclosure is tendered, or this Agreement is terminated as provided in Article VIII, the Company shall deliver the Facility so that the conditions of the Facility with respect to any and all Hazardous Materials shall conform with all applicable Legal Requirements affecting the Facility.

(f) The parties hereto agree that the reference in Section 2.2(n) to the Environmental Audit is not intended, and should not be deemed to intend, to modify, qualify, reduce or diminish the Company’s obligations to carry out and perform all of the covenants stated throughout this Section 7.5 and in Section 7.2.

Section 7.6. Employment Matters.

(a) Except as is otherwise provided by collective bargaining contracts or agreements, new employment opportunities created by the Company as a result of the Project shall be listed with the New York State Department of Labor Community Services Division, and with the administrative entity of the service delivery area created by the Workforce Investment Act of 1998 (29 U.S.C. §2801) in which the Facility is located. Except as is otherwise provided by collective bargaining contracts or agreements, the Company agrees, where practicable, to consider first, and cause each of its Affiliates at the Facility, to consider first, persons eligible to participate in the Workforce Investment Act of 1998 (29 U.S.C. §2801) programs who shall be referred by administrative entities of service delivery areas created pursuant to such Act or by the Community Services Division of the New York State Department of Labor for such new employment opportunities.

(b) Upon the Issuer’s written request, the Company shall provide to the Issuer any employment information in the possession of the Company which is pertinent to the Company and the Facility Tenants and the employees of the Company and of the Facility Tenants to enable the Issuer and/or NYCEDC to comply with its reporting requirements required by City Charter §1301 and any other applicable laws, rules or regulations.

(c) The Company hereby authorizes any private or governmental entity, including The New York State Department of Labor (“DOL”), to release to the Issuer and/or NYCEDC, and/or to the successors and assigns of either (collectively, the “Information Recipients”), any and all employment information under its control and pertinent to the Company or the Facility Tenants and the employees of the Company or of the Facility Tenants to enable the Issuer and/or NYCEDC to comply with its reporting requirements required by City Charter §1301 and any other applicable laws, rules o r regulations. Information released or provided to Information Recipients by DOL, or by any other governmental entity, or by any private entity, or by the Company or by the Facility Tenants, or any information previously released as provided by all or any of the foregoing parties (collectively, “Employment Information”) may be disclosed by the Information Recipients in connection with the administration of the programs of the Issuer, and/or NYCEDC, and/or the successors and assigns of either, and/or the City, and/or as may be necessary to comply with law; and, without limiting the foregoing, the Employment Information may be included in (x) reports prepared by the Information Recipients pursuant to City Charter §1301, (y) other reports required of the Issuer, and (z) any other reports required by law. This authorization shall remain in effect throughout the term of this Agreement.

(d) Upon the request of the Issuer, the Company shall cooperate with the Issuer in the development of programs for the employment and/or training of members of minority groups in connection with performing work at the Facility.

(e) Nothing in this Section shall be construed to required the Company to violate any existing collective bargaining agreement with respect to hiring new employees.

Section 7.7. Non-Discrimination.

(a) At all times during the maintenance and operation of the Facility, the Company shall not discriminate nor permit any of its Affiliates to discriminate against any employee or applicant for employment because of race, color, creed, age, sex or national origin. The Company shall use its best efforts to ensure that employees and applicants for employment with any Facility Tenant are treated without regard to their race, color, creed, age, sex or national origin. As used herein, the term “treated” shall mean and include the following: recruited, whether by advertising or other means; compensated, whether in the form of rates of pay or other forms of compensatio n; selected for training, including apprenticeship; promoted; upgraded; downgraded; demoted; transferred; laid off; and terminated.

(b) The Company shall, in all solicitations or advertisements for employees placed by or on behalf of the Company, state that all qualified applicants will be considered for employment without regard to race, color, creed or national origin, age or sex.

(c) The Company shall furnish to the Issuer all information required by the Issuer pursuant to this Section and will cooperate with the Issuer for the purposes of investigation to ascertain compliance with this Section.

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Section 7.8. Assignment or Sublease.

(a) The Company shall not at any time (y) except as permitted by Section 7.19, assign or transfer this Agreement, or (z) sublet all or substantially all of the Facility (a “Transfer Equivalent Sublease”), without the prior written consents of the Issuer and the Trustee (which consents may be withheld by the Issuer or the Trustee in their absolute discretion); provided further, that, the Company shall deliver to the Issuer and the Trustee a letter of an Authorized Representative of the Company requesting such consent at least thirty (30) days prior to the execution of the proposed assignment, transfer or Transfer Equivalent Sublease, which letter (the “Request Letter” ) shall be accompanied by the following documentation:

(i) the name, phone number and address of, and the name of a contact person for, the proposed assignee, transferee or sublessee under the Transfer Equivalent Sublease (the “Transfer Equivalent Sublessee”);

(ii) a description of the business activities and operations to be conducted at the Facility by the proposed assignee, transferee or Transfer Equivalent Sublessee, if any such business activities and operations are to be different from the Approved Project Operations;

(iii) a copy of the Organizational Documents for the proposed assignee, transferee or Transfer Equivalent Sublessee, certified by an authorized officer of such Entity, together with a certificate of good standing with respect to such Entity from the Secretary of State of the State of New York dated not earlier than sixty (60) days prior to the date of the Request Letter;

(iv) a certificate of an authorized officer of such assignee, transferee or Transfer Equivalent Sublessee to the effect that such assignment or transfer of this Agreement, or Transfer Equivalent Sublease, as the case may be, and any resultant effects, will not result in the removal of a plant or facility of such Entity or of any other occupant or user of the Facility located outside of the City (but within the State) to the Facility or in the abandonment of one or more of such plants or facilities of such Entity or of any other occupant or user of the Facility located outside of the City (but within the State); provided however, that if such Entity shall be unable as a factually correct basis to make suc h certification, (y) such Entity shall instead certify that such Entity’s location at the Facility is reasonably necessary to discourage such Entity from removing its business to a location outside of the State or is reasonably necessary to preserve the competitive position of such Entity in its industry, and (z) an Authorized Representative of the Company shall request the Issuer to make a determination in writing as to whether the Issuer concurs in such latter certification (any failure of the Issuer to so determine being deemed a failure of the Issuer to consent to the proposed assignment, transfer or Transfer Equivalent Sublease);

(v) evidence reasonably satisfactory to the Issuer and the Trustee that the proposed assignee, transferee or Transfer Equivalent Sublessee is subject to service of process in the State;

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(vi) the same documentation required of the Company under the Ground Lease with respect to the proposed assignee, transferee or Transfer Equivalent Sublessee with results satisfactory to the Issuer;

(vii) to the extent required under the Ground Lease, evidence of approval of the landlord under the Ground Lease;

(viii) a certificate of an Authorized Representative of the Company acceptable to the Issuer and the Trustee to the effect that the assignment, transfer or Transfer Equivalent Sublease shall not cause the Facility to cease being the Approved Facility;

(ix) written evidence satisfactory to the Issuer and the Trustee (which may be a letter to such effect from the Company’s insurance brokers) that the insurance coverage provided by the Company and the Parent under this Agreement, the Bond Guaranty Agreement and the Ground Sublease shall in no manner be diminished or impaired by reason of such assignment, transfer or Transfer Equivalent Sublease;

(x) a Required Disclosure Statement of the assignee, transferee or Transfer Equivalent Sublessee in form and substance reasonably satisfactory to the Issuer acting in its sole discretion, in the form annexed hereto as Exhibit E-1;

(xi) a certificate of an authorized officer of the assignee, transferee or Transfer Equivalent Sublessee to the effect that such Entity does not intend to use the Facility or any portion thereof, or allow the Facility or any portion thereof to be used, for a Tax Prohibited Use or by a not-for-profit corporation; and

(xii) a certificate of an Authorized Representative of the Company to the effect that all consents and approvals required under the Ground Lease, if any, in connection with such assignment, transfer or Transfer Equivalent Sublease have been obtained, copies of which shall accompany such certificate, together with any other documentation provided to the landlord under the Ground Lease.

If the Issuer and the Trustee shall consent to such assignment, transfer or Transfer Equivalent Sublease, such consent shall be conditioned upon:

(A) the Company and the Parent remaining primarily liable to the Issuer for the payment of all loan and other payments and for the full performance of all of the terms, covenants and conditions of this Agreement and of any other Project Document to which the Company or the Parent shall be a party, provided, however, that if, in connection with the assignment or transfer of this Agreement, the Company shall have requested the release of the Company and of the Parent under the Security Documents and the Issuer Indemnification Agreement, and the Issuer and the Trustee shall have consented to such release, the Company and the Parent shall not be required to remain so liable; provided, however, that unless th e transferee or assignee of this Agreement (or any guarantor thereof) shall have assumed, subject to the approval of the Issuer and the Trustee, any accrued or unpaid payment or performance obligations of the Company, together with any indemnifications with respect to events occurring prior to any such transfer or assumption, and the Company shall have paid over to the transferee or assignee any insurance or other moneys held by the Company under this Agreement or any other Project Document, the Company and the Parent shall be required to remain liable to the extent of any accrued or unpaid payment or performance obligations, the application of such insurance or other moneys, and for any indemnified liabilities with respect to events occurring prior to any such release;

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(B) the execution and delivery by the assignee, transferee or Transfer Equivalent Sublessee of a written assumption (the “Assumption”), in form and substance acceptable to the Issuer and the Trustee, pursuant to which such Entity shall assume in writing and agree to keep and perform all of the terms of this Agreement and each other Project Document on the part of the Company to be kept and performed, and shall be jointly and severally liable with the Company for the performance thereof;

(C) any assignee, transferee or Transfer Equivalent Sublessee shall agree within the Assumption to utilize the Facility as the Approved Facility;

(D) such assignment, transfer or Transfer Equivalent Sublease not violating any provision of this Agreement or of any other Project Document;

(E) the delivery to the Issuer and the Trustee of an Opinion of Counsel addressed to the Issuer and the Trustee to the effect that (x) the Assumption shall constitute the legally valid, binding and enforceable obligation of the assignee, transferee or Transfer Equivalent Sublessee, and, unless a release of the Company and of the Parent shall have been effected as provided in Section 7.8(a)(A) above, shall not legally impair in any respect the obligations of the Company or of the Parent for the making of all payments nor for the full performance of all of the terms, covenants and conditions of this Agreement or of any other Project Document to which the Company or the Parent shall be a party, and (y) , unless a release of the Company and of the Parent shall have been effected as provided in Section 7.8(a)(A) above, this Agreement and each of the other Project Documents to which the Company or the Parent is a party continue to constitute the legally valid, binding and enforceable obligation of the Company and of the Parent, as applicable;

(F) such assignment, transfer or Transfer Equivalent Sublease in no way diminishing or impairing the insurance coverage provided under Section 3.12 of the Bond Guaranty Agreement or under Section 7.1;

(G) the delivery to the Issuer and the Trustee of an opinion of Nationally Recognized Bond Counsel addressed to the Issuer and the Trustee, to the effect that such assignment, transfer or Transfer Equivalent Sublease shall not affect the exclusion of the interest on any Bonds then Outstanding from gross income for federal income tax purposes; and

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(H) such assignment, transfer or Transfer Equivalent Sublease containing such other provisions as the Issuer or the Trustee may reasonably require.

(b) Subject to Section 7.8(a), the Company shall not at any time enter into a Facility Lease without the prior written consent of the Issuer (which consent shall not be reasonably withheld, such consent to be requested by the Company of the Issuer in the form prescribed by the Issuer); provided, further, that, the Company shall deliver to the Issuer (with a copy to the Trustee) a letter of an Authorized Representative of the Company requesting such consent of the Issuer at least ten (10) Business Days prior to the execution of the proposed Facility Lease, which letter (the “Request Letter”) shall be accompanied by the following documentation (a copy of which shall be delivered to the Trus tee):

(i) the name, phone number and address of, and the name of a contact person for, the proposed Facility Tenant;

(ii) a description of the business activities and operations to be conducted at the Facility by the proposed Facility Tenant together with a statement of the aggregate rentable square footage to be the subject of the Facility Lease as both a fixed number and as a percentage of total rentable square footage at the Facility, and the balance, if any, of rentable square footage at the Facility which shall not be the subject of any Facility Lease;

(iii) a certificate of an Authorized Representative of the Company to the effect that the use or occupancy by such Facility Tenant of the Facility will not result in the removal of a plant or facility of such Entity or of any other occupant or user of the Facility located outside of the City (but within the State) to the Facility or in the abandonment of one or more of such plants or facilities of such Entity or of any other occupant or user of the Facility located outside of the City (but within the State); provided however, that if the Company shall be unable as a factually correct basis to make such certification, (y) an authorized officer of such Entity shall instead certify that such EntityR 17;s location at the Facility is reasonably necessary to discourage such Entity from removing its business to a location outside of the State or is reasonably necessary to preserve the competitive position of such Entity in its industry, and (z) an Authorized Representative of the Company shall request the Issuer to make a determination in writing as to whether the Issuer concurs in such latter certification (any failure of the Issuer to so determine being deemed a failure of the Issuer to consent to the proposed Facility Lease);

(iv) a certificate of an Authorized Representative of the Company acceptable to the Issuer and the Trustee to the effect that the Facility Tenant shall use or occupy the Facility only for the Approved Project Operations;

(v) written evidence satisfactory to the Issuer and the Trustee (which may be a letter to such effect from the Company’s insurance brokers) that the insurance coverage provided by the Company and the Parent under this Agreement, the Bond Guaranty Agreement and the Ground Sublease shall in no manner be diminished or impaired by reason of such Facility Lease;

(vi) a Required Disclosure Statement of the Facility Tenant in form and substance satisfactory to the Issuer acting in its sole discretion in the form annexed hereto as Exhibit E-2;

(vii) a certificate of an Authorized Representative of the Company to the effect that all consents and approvals required under the Ground Lease, if any, in connection with such Facility Lease have been obtained, copies of which shall accompany such certificate; and

(viii) a certificate of an Authorized Representative of the Company to the effect that the Facility Lease will obligate the Facility Tenant (x) to provide to the Company the applicable information that the Company needs in order to satisfy the reporting requirements of Sections 7.6, 7.7, 7.13, 7.14 and 7.15; (y) to acknowledge and agree that the Facility Lease, together with all rentals, charges and amounts payable thereunder, have been pledged and assigned to the Trustee pursuant to the Mortgage as security for the Bonds; and (z) to agree to use that portion of the Facility subject to the Facility Lease for Approved Project Operations.

If, within ten (10) Business Days following the receipt by the Issuer of the Request Letter accompanied by the documentation required in paragraphs (i) through (viii), inclusive, above, the Issuer shall fail to request any clarification or completion of any of such documentation or to state that upon the basis of such documentation that no consent of the Issuer will be forthcoming to the entering into by the Company of such Facility Lease, then, the Issuer shall, subject to the next sentence, be deemed to have consented to the Company’s entering into of such Facility Lease. If the Issuer shall consent (or be deemed to have consented) to such Facility Lease, such consent (or deemed consent) shall be conditioned upon:

(A) the Company and the Parent remaining liable for the making of all loan and other payments and for the full performance of all of the terms, covenants and conditions of this Agreement and of any other Project Document to which the Company or the Parent shall be a party;

(B) such Facility Lease not violating any provision of this Agreement or any other Project Document;

(C) such Facility Lease in no way diminishing or impairing the obligation of the Company or the Parent to carry the insurance required under Section 3.12 of the Bond Guaranty Agreement or under Section 7.1; and

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(D) the delivery to the Issuer and the Trustee within thirty (30) days of the delivery by the Issuer of its consent (or deemed consent) to the Facility Lease of an executed copy of the Facility Lease.

(c) Any consent by the Issuer or the Trustee to any assignment, transfer, Transfer Equivalent Sublease or Facility Lease shall be held to apply only to the specific transaction thereby authorized. Such consent shall not be construed as a waiver of the duty of the Company, or the successors or assigns of the Company, to obtain from the Issuer and the Trustee consent to any other or subsequent assignment, transfer, Transfer Equivalent Sublease or Facility Lease, or as modifying or limiting the rights of the Issuer or the Trustee under the foregoing covenant by the Company.

(d) If the Facility or any part thereof is sublet or occupied by any Facility Tenant or any other Person not constituting the Company or the Trustee, in the event of the Company’s default in the payment of loan payments or other payments hereunder may, and is hereby empowered to, collect rentals from any such Facility Tenant or other occupant or tenant during the continuance of any such default. In case of such events, the Issuer or the Trustee may apply the net amount received by it to the loan or other payments herein provided, and no such collection shall be deemed a waiver of the covenant herein against assignments, transfers, Transfer Equivalent Subleases or Facility Leases or consti tute the acceptance of the undertenant or occupant as Facility Tenant, or a release of the Company from the further performance of the covenants herein contained on the part of the Company.

(e) For purposes of this Section 7.8, any license or other right of possession or occupancy granted by the Company with respect to the Facility shall be deemed subject to the provisions of this Section 7.8.

(f) Upon request of the Company to the Trustee, prior to the execution of any Facility Lease, the Trustee, the Company and the Facility Tenant shall execute a subordination and non-disturbance agreement in substantially the form set forth in Exhibit H attached hereto.

Section 7.9. Retention of Interest in Facility; Grant of Easements; Release of Portions of Facility.

(a) The Company shall not sell, assign, encumber (other than Permitted Encumbrances), convey or otherwise dispose of its leasehold estate in the Facility under the Ground Lease, including the Improvements, or any part of the Facility or interest therein during the term of this Agreement, except as set forth in Section 3.5, Article V, Section 7.8, Section 7.31 or Section 8.2 or in this Section, without the prior written consents of the Issuer and of the Trustee, and any purported disposition without such consents shall be void.

(b) The Company may, so long as there exists no Event of Default hereunder, grant such rights of way or easements over, across, or under, its leasehold interest in the Facility, or grant such permits or licenses in respect to the use thereof, free from this Agreement and the lien and security interest of the Mortgage, as shall be necessary or convenient in the opinion of the Company for the operation or use of the Facility, or required by any utility company for its utility business, provided that, in each case, such rights of way, easements, permits or licenses shall not adversely affect the use or operation of the Facility as the Approved Facility, and provided, further, that any consideration received by the Company from the granting of said rights-of-way, easements, permits or licenses shall be paid to the Trustee and deposited in the Redemption Account of the Bond Fund.

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(c) So long as there exists no Event of Default hereunder, and the Company delivers to the Trustee and the Issuer an opinion of Nationally Recognized Bond Counsel to the effect that the following action will not affect the exclusion of the interest on any Bonds then Outstanding from gross income for federal income tax purposes, the Company may from time to time request in writing to the Issuer and the Trustee the release of and removal from this Agreement and from the lien and security interest of the Mortgage, of any unimproved part of the Land (on which none of the Improvements, including the buildings, structures, major appurtenances, fixtures or other property comprising the Facility, is situated) pro vided that such release and removal will not adversely affect the use or operation of the Facility as the Approved Facility and such release is effected simultaneously with the release of such unimproved Land under the Ground Lease. Upon any such request by the Company, the Issuer shall, at the sole cost and expense of the Company, direct the Trustee to execute and deliver any and all instruments necessary or appropriate to so release and remove such unimproved Land from this Agreement and from the lien and security interest of the Mortgage, subject to the following: (i) any liens, easements, encumbrances and reservations to which title to said property was subject on the Commencement Date; (ii) any liens, easements and encumbrances created at the request of the Company or the City or to the creation or suffering of which the Company or the City consented; (iii) any liens and encumbrances or reservations resulting from the failure of the Company or the City to perform or observe any of the agreements on its respective part contained in this Agreement or any other Project Document; (iv) Permitted Encumbrances (other than the liens of the Mortgage); and (v) any liens for taxes or assessments not then delinquent; provided, that, no such release shall be effected unless there shall be deposited with the Trustee the following:

(1) a certificate of an Independent Engineer, dated not more than sixty (60) days prior to the date of the release, stating that, in the opinion of the person signing such certificate, the unimproved Land and the release thereof so proposed to be made is not needed for the operation of the Facility, will not adversely affect the use or operation of the Facility as the Approved Facility and will not destroy the means of ingress thereto and egress therefrom; and

(2) an amount of cash for deposit in the Redemption Account of the Bond Fund equal to greater of (A) the fair market value of such unimproved Land, such value to be determined by the appraisal of an independent real estate brokerage firm of recognized standing within the City, and (B) if such unimproved Land is released in connection with its sale, the amount received by the Company upon such sale.

(d) No conveyance or release effected under the provisions of this Section 7.9 shall entitle the Company to any abatement or diminution of the loan payments or other amounts payable under Section 4.3 or any other payments required to be made by the Company under this Agreement, the Promissory Note or any other Security Document to which it shall be a party.

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Section 7.10. Discharge of Liens and Claims.

(a) If any lien, encumbrance or charge is filed or asserted (including any lien for the performance of any labor or services or the furnishing of materials), or any judgment, decree, order, levy or process of any court or governmental body is entered, made or issued (such liens, encumbrances, charges, judgments, decrees, orders, levies and processes being herein collectively called “Liens”), whether or not valid, is made against the Trust Estate, the Facility or any part thereof or the interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or against any of the loan payments or other amounts payable under thi s Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, other than Liens for Impositions not yet payable, Permitted Encumbrances, or Liens being contested as permitted by Section 7.10(b), the Company forthwith upon receipt of notice of the filing, assertion, entry or issuance of such Lien (regardless of the source of such notice) shall give written notice thereof to the Issuer and the Trustee and take all action (including the payment of money and/or, to the extent applicable, the securing of a bond, with respect to any such Lien) at its own cost and expense as may be necessary or appropriate to obtain the discharge in full of such Lien and to remove or nullify the basis therefor. Nothing contained in this Agreement shall be construed as constituting the express or implied consent to or permission of the Issuer for the performance of any labor or services or the furnishing of any materials that would give rise to any Lien not permitted under this Section 7.10(a).

(b) The Company may at its sole cost and expense contest (after prior written notice to the Issuer and the Trustee), by appropriate action conducted in good faith and with due diligence, the amount or validity or application, in whole or in part, of any Lien, if (i) such proceeding shall suspend the execution or enforcement of such Lien against the Trust Estate, the Facility or any part thereof or the interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or against any of the loan payments or other amounts payable under this Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, (ii) neither the Facility nor any part thereof or interest therein, nor the Trust Estate or any portion thereof would be in any danger of being sold, forfeited or lost, (iii) neither the Company, the Parent, the Issuer nor the Trustee would be in any danger of any criminal liability or any material civil liability, other than normal accrual of interest, for failure to comply therewith, and (iv) the Company or the Parent shall have furnished such security, if any, as may be required in such proceedings or as may be reasonably requested by the Issuer or the Trustee to protect the security intended to be offered by the Security Documents.

Section 7.11. Filing.

(a) The security interest granted by the Issuer to the Trustee pursuant to the Indenture in the rights and other intangible interests described therein, shall be perfected by the filing of financing statements at the direction of the Issuer (at the sole cost and expense of the Company) in the office of the Secretary of State of the State in the City of Albany, New York, and in the appropriate office of the Register of the City, which financing statements shall be in accordance with the New York State Uniform Commercial Code-Secured Transactions.

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(b) The Issuer and the Company acknowledge that, as of the Closing Date,

(i) Section 9-515 of the New York State Uniform Commercial Code-Secured Transactions provides that an initial financing statement filed in connection with a “public-financed transaction” is effective for a period of thirty (30) years after the date of filing if such initial financing statement indicates that it is filed in connection with a public financed transaction,

(ii) Section 9-102(67) of the New York State Uniform Commercial Code-Secured Transactions defines a public-finance transaction as a secured transaction in connection with which, in substance, (x) bonds are issued, (y) all or a portion of the bonds have an initial stated maturity of at least twenty (20) years, and (z) the debtor, obligor, secured party or assignee with respect to the collateral or secured obligation is a governmental unit of a state, and

(iii) subject to any future change in law, the initial financing statement as shall be filed with respect to the security interest described above shall therefore have an effective period of thirty (30) years after the date of filing, for the purpose of determining the date by which continuation statements shall be filed.

(c) The parties hereto acknowledge and agree that, because the foregoing financing statements evidence collateral for the Initial Bonds, and because the Initial Bonds are municipal securities with a term that is at least twenty (20) years in duration, there is no need under the Uniform Commercial Code of the State of New York to re-file such financing statements in order to preserve the liens and security interests that they create for the period commencing with the Closing Date and terminating on the thirtieth anniversary of the Closing Date.

Subsequent to the foregoing recordation and filings, if in the Opinion of Counsel to the Company (described hereinbelow), to preserve (after the thirtieth (30th) anniversary of the Closing Date) the lien and security interest of the Indenture, it is necessary to re-record and/or reindex documents, re-file financing statements and/or file continuation statements and/or take any other actions (individually or collectively, the “Continuation Action(s)”), then, the Company in a timely manner shall: (A) as applicable, (i) prepare and deliver to the Trustee all necessary instruments and filing papers, together with remittances equal to the cost of required filing fees and other charges, so that the Trustee may perform the Continuation Actions, or (ii) electronically pe rform the Continuation Actions and deliver to the Trustee written certification (upon which the Trustee may conclusively rely) that such performance has occurred, specifying the Continuation Actions performed, or (iii) perform some of the Continuation Actions in the manner described in clause “(i)” and the others in the manner described in clause “(ii)”; and (B) deliver or cause to be delivered to the Issuer and the Trustee the Opinion of Counsel to the Company as described below. The Trustee may conclusively rely upon (y) when applicable, the certification referred to in clause “(A)(ii),” and (z) in all instances, the Opinion of Counsel to the Company. In the event the Company chooses to have the Trustee perform all or some of the Continuation Actions, as provided in clause “(A)(i)” hereinabove, the Trustee shall reasonably promptly perform such Continuation Actions at the Company’s sole expense. The Company shall perform the obliga tions described hereinabove in clauses “(A)” and “(B)” no later than ten (10) days prior to (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) each fifth (5th) anniversary thereafter, and/or (ii) the date (not covered by clause “(i)”) on which a Continuation Action is to be taken to preserve the lien and security interest of the Indenture.

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The Opinion of Counsel to the Company shall be addressed to the Company, the Issuer and the Trustee. Counsel shall deliver successive Opinions of Counsel in respect of (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) every five-year period thereafter through the term of the Initial Bonds, and/or (ii) the date of any required Continuation Action not covered by clause “(i),” in each case not later than fifteen (15) days prior to the date on which a Continuation Action is required to be taken. In the Opinion of Counsel to the Company, counsel shall opine as to: (i) what Continuation Actions are necessary; and (ii) the deadline dates for the required Continuation Actions; and (iii) the jurisdictions in which the Continuation Actions must be effected. Counsel in such opinion shall additionally opine that, upon performance of the Continuation Actions by, as the case may be, (i) the Trustee with instruments and papers prepared by the Company, or (ii) the Company through electronic filing, or (iii) the Trustee as to some Continuation Actions, and the Company as to the others through electronic filings, all appropriate steps shall have been taken on the part of the Company, the Issuer and the Trustee then requisite to the maintenance of the perfection of the security interest of the Trustee in and to all property and interests which by the terms of the Indenture are to be subjected to the lien and security interest of the Indenture.

(d) Any filings with respect to the Uniform Commercial Code financing statements may be made electronically, and the Issuer shall have the right to designate a company (which shall be reasonably acceptable to the Trustee) to facilitate the filing of the Uniform Commercial Code financing statements.

(e) The Company acknowledges and agrees that neither the Issuer nor the Trustee, nor any of their respective directors, members, officers, employees, servants, agents, persons under its control or supervision, or attorneys (including Bond Counsel to the Issuer), shall have any responsibility or liability whatsoever related in any way to the filing or re-filing of any Uniform Commercial Code financing statements or continuation statements, or the perfection or continuation of perfection of any security interests, or the recording or rerecording of any document, or the failure to effect any act referred to in this Section, or the failure to effect any such act in all appropriate filing or recording offices, or the failure of sufficiency of any such act so effected.

(f) The Company agrees to perform all other acts (including the payment of all fees and expenses) necessary in order to enable the Issuer and the Trustee to comply with this Section and with Section 7.07 of the Indenture, including but not limited to, providing prompt notice to the Trustee of any change in either of the name or address of the Company. The Company agrees that the Issuer and the Trustee, if permitted by applicable law, may provide for the re-recording of the Indenture or any other Security Document or the filing or re-filing of continuation statements without the cooperation of the Company as necessary at the sole cost and expense of the Company.

Section 7.12. No Further Encumbrances Permitted. The Company shall not create, permit or suffer to exist any mortgage, encumbrance, lien, security interest, claim or charge against the Trust Estate, the Facility or any part thereof, or the interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or the interest of the Company in any Project Document, except for Permitted Encumbrances. The Company covenants that it shall take or cause to be taken all action, including all filing and recording, as may be necessary to ensure that there are no mortgage liens on, or security interests in, the Mortgaged Property (as defined in the Mortgage) prior to the mortgage liens thereon, and security interests therein, granted by the Mortgage.

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Section 7.13. Documents Automatically Deliverable to the Issuer.

(a) The Company shall immediately notify the Issuer of the occurrence of any Event of Default, or any event that with notice and/or lapse of time would constitute an Event of Default under any Project Document. Any notice required to be given pursuant to this subsection shall be signed by an Authorized Representative of the Company and set forth a description of the default and the steps, if any, being taken to cure said default. If no steps have been taken, the Company shall state this fact on the notice.

(b) The Company shall promptly provide written notice to the Issuer if any representation or warranty made by the Company pursuant to Section 2.2(u) would, if made on any date during the term of the Agreement and deemed made as of such date, be false, misleading or incorrect in any material respect.

(c) Within ten (10) Business Days after receipt from the Issuer of any subtenant survey and questionnaire pertaining to the Facility, the Company shall complete and execute such survey and questionnaire and return the same to the Issuer.

(d) The Company shall deliver all insurance-related documents required by Sections 7.1(f) and 7.1(g).

(e) Within 120 days after the close of each Fiscal Year during which action was taken by the Company pursuant to Section 3.4, the Company shall deliver written notice of the Additional Improvement(s) to the Issuer.

(f) If a removal involving property having a value in the aggregate exceeding $25,000 was taken by the Company pursuant to Section 3.5(a), the Company shall deliver written notice of such removal to the Issuer within five (5) Business Days following such removal.

(g) Promptly following completion of the Project, but no later than thirty (30) days following the receipt of a temporary or permanent certificate of occupancy with respect to the Facility, the Company shall deliver to the Issuer the certificate as to Project completion in substantially the form set forth in Exhibit F – “Form of Project Completion Certificate”, together with all attachments required thereunder.

(h) If the Company shall request the consent of the Issuer under Section 7.8 to any assignment, transfer, Transfer Equivalent Sublease or Facility Lease, the Company shall submit such request to the Issuer in the form prescribed by the Issuer.

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Section 7.14. Requested Documents. Upon request of the Issuer, the Company shall deliver or cause to be delivered to the Issuer within five (5) Business Days of the date so requested:

(a) a copy of the most recent compiled financial statements of the Company and of the most recent annual audited consolidated combined and combining financial statements reflecting the financial condition of the Parent (including balance sheets as of the end of the Fiscal Year and the related statement of revenues, expenses and changes in fund balances and, if applicable, income, earnings, and changes in financial position) for such Fiscal Year, prepared in accordance with GAAP and certified by an Independent Accountant;

(b) a certificate of an Authorized Representative of the Company that the insurance the Company maintains complies with the provisions of Section 7.1, that such insurance has been in full force and effect at all times during the preceding Fiscal Year, and that duplicate copies of all policies or certificates thereof have been filed with the Issuer and are in full force and effect and the evidence required by Section 7.1(f);

(c) copies of any (x) bills, invoices or other evidences of cost as shall have been incurred in connection with the Project Work, and (y) permits, authorizations and licenses from appropriate authorities relative to the occupancy, operation and use of the Facility;

(d) if no action was taken by the Company pursuant to Section 3.4 or no action involving the removal of property having a value in the aggregate exceeding $25,000 was taken by the Company pursuant to Section 3.5(a), a certificate of an Authorized Representative of the Company certifying to the fact that no such action was taken by the Company pursuant to such Section 3.4 or 3.5(a) during such preceding Fiscal Year;

(e) if action was taken by the Company pursuant to Section 3.4 or involving the removal of property having a value in the aggregate exceeding $25,000 pursuant to Section 3.5(a), a written report of an Authorized Representative of the Company summarizing the action taken by the Company and stating that, in his/her opinion, such action complied with the provisions of Section 3.4 or 3.5(a), as applicable;

(f) a certificate of an Authorized Representative of the Company as to whether or not, as of the close of the immediately preceding Fiscal Year, and at all times during such Fiscal Year, the Company was in compliance with all the provisions that relate to the Company in this Agreement and in any other Project Document to which it shall be a party, and if such Authorized Representative shall have obtained knowledge of any default in such compliance or notice of such default, he shall disclose in such certificate such default or defaults or notice thereof and the nature thereof, whether or not the same shall constitute an Event of Default hereunder, and any action proposed to be taken by the Company with re spect thereto;

(g) upon twenty (20) days prior request by the Issuer, a certificate of an Authorized Representative of the Company either stating that to the knowledge of such Authorized Representative after due inquiry there is no default under or breach of any of the terms hereof that, with the passage of time or the giving of notice or both, would constitute an Event of Default hereunder, exists or specifying each such default or breach of which such Authorized Representative has knowledge;

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(h) employment information requested by the Issuer pursuant to Section 7.6(b); and

(i) information regarding non-discrimination requested by the Issuer pursuant to Section 7.7.

Section 7.15. Periodic Reporting Information for the Issuer.

(a) The Company shall not assert as a defense to any failure of the Company to deliver to the Issuer any reports specified in this Section 7.15 that the Company shall not have timely received any of the forms from or on behalf of the Issuer unless, (i) the Company shall have requested in writing such form from the Issuer not more than thirty (30) days nor less than fifteen (15) days prior to the date due, and (ii) the Company shall not have received such form from the Issuer at least one (1) Business Day prior to the due date. For purposes of this Section 7.15, the Company shall be deemed to have “received” any such form if it shall have been directed by the Issuer to a website at which such form shall be available. In the event the Issuer, in its sole discretion, elects to replace one or more of the reports required by this Agreement with an electronic or digital reporting system, the Company shall make its reports pursuant to such system.

(b) Annually, by August 1 of each year, commencing on the August 1 immediately following the Commencement Date, until the termination of this Agreement, the Company shall submit to the Issuer the Annual Employment and Benefits Report (as such report is so characterized, in substance, by the Issuer) with respect to the Company and all Facility Tenants relating to the period commencing July 1 of the previous year and ending June 30 of the year of the obligation of the filing of such report, in the form prescribed by the Issuer, certified as to accuracy by an officer of the Company. Upon termination of this Agreement, the Company shall submit to the Issuer the Annual Employment and Benefits Report with respect to the Company and all Facility Tenants relating to the period commencing the date of the last such Report submitted to the Issuer and ending on the last payroll date of the preceding month in the form prescribed by the Issuer, certified as to accuracy by the Company. Nothing herein shall be construed as requiring the Company or any Facility Tenant to maintain a minimum number of employees on its respective payroll.

(c) If there shall have been a Facility Tenant at any time during the immediately preceding calendar year, the Company shall file with the Issuer by the next following February 1, a certificate of an Authorized Representative of the Company with respect to all Facility Leases in effect at the Facility, in the form prescribed by the Issuer.

(d) If there shall have been a Facility Tenant at any time during the twelve-month period terminating on the immediately preceding June 30, the Company shall deliver to the Issuer by the next following August 1, a completed Subtenant’s Employment and Benefits Report with respect to such twelve-month period, in the form prescribed by the Issuer.

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(e) If the Company shall have had the benefit of a Business Incentive Rate (i.e., discounted energy) at any time during the twelve-month period terminating on the immediately preceding June 30, the Company shall deliver to the Issuer by the next following August 1, a completed Business Incentive Rate Report (as such report is so characterized, in substance, by the Issuer) with respect to such twelve-month period, in the form prescribed by the Issuer.

(f) The Company shall deliver to the Issuer on August 1 of each year, commencing on the August 1 immediately following the Commencement Date, a completed location and contact information report in the form prescribed by the Issuer.

Section 7.16. Taxes, Assessments and Charges.

(a) The Company shall pay when the same shall become due all taxes and assessments, general and specific, if any, levied and assessed upon or against the Trust Estate, the Facility or any part thereof or interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or against any of the loan payments or other amounts payable under this Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, during the term of this Agreement, and all water and sewer charges, special district charges, assessments and other governmental charges and impositions whatsoever, foreseen or unforeseen, ordinary or extraordinary, under any p resent or future law, and charges for public or private utilities or other charges incurred in the occupancy, use, operation, maintenance or upkeep of the Facility, all of which are herein called “Impositions”. The Company may pay any Imposition in installments if so payable by law, whether or not interest accrues on the unpaid balance. The Issuer shall forward, as soon as practicable, to the Company any notice, bill or other statement received by the Issuer concerning any Imposition.

(b) The Company may at its sole cost and expense contest (after prior written notice to the Issuer and the Trustee), by appropriate action conducted in good faith and with due diligence, the amount or validity or application, in whole or in part, of any Imposition, if (i) such proceeding shall suspend the execution or enforcement of such Imposition against the Trust Estate, the Facility or any part thereof or interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or against any of the loan payments or other amounts payable under this Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, (ii) non e of the Trust Estate, the Facility or any part thereof or interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or any of the loan payments or other amounts payable under this Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, would be in any danger of being sold, forfeited or lost, (iii) neither the Company, the Parent, the Issuer nor the Trustee would be in any danger of any civil or any criminal liability, other than normal accrual of interest, for failure to comply therewith, and (iv) the Company or the Parent shall have furnished such security, if any, as may be required in such proceedings or as may be reasonably requested by the Issuer or the Trustee to protect the security intended to be offered by the Security Documents.

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Section 7.17. Compliance with Legal Requirements.

(a) The Company shall not occupy, use or operate the Facility, or allow the Facility or any part thereof to be occupied, used or operated, for any unlawful purpose or in violation of any certificate of occupancy affecting the Facility or for any use which may constitute a nuisance, public or private, or make void or voidable any insurance then in force with respect thereto.

(b) Throughout the term of this Agreement and at its sole cost and expense, the Company shall promptly observe and comply with all applicable Legal Requirements, whether foreseen or unforeseen, ordinary or extraordinary, that shall now or at any time hereafter be binding upon or applicable to the Company, the Facility, any occupant, user or operator of the Facility or any portion thereof, and will observe and comply with all conditions, requirements, and schedules necessary to preserve and extend all rights, licenses, permits (including zoning variances, special exception and non conforming uses), privileges, franchises and concessions. The Company will not, without the prior written consent of the Issuer and the Trustee (which consents shall not be unreasonably withheld or delayed), initiate, join in or consent to any private restrictive covenant, zoning ordinance or other public or private restrictions limiting or defining the uses that may be made of the Facility or any part thereof.

(c) The Company may at its sole cost and expense contest in good faith the validity, existence or applicability of any of the matters described in Section 7.17(b) if (i) such contest shall not result in the Trust Estate, the Facility or any part thereof or interest of the Company in the Facility, in the Ground Lease or in a Facility Lease, or any of the loan payments or other amounts payable under this Agreement, the Promissory Note or any of the other Project Documents, or the interest of the Company in any Project Document, being in any danger of being sold, forfeited or lost, (ii) such contest shall not result in the Company, the Parent, the Issuer or the Trustee being in any danger of any civil or any criminal liability for failure to comply therewith, and (iii) the Company or the Parent shall have furnished such security, if any, as may be reasonably requested by the Issuer or the Trustee to protect the security intended to be offered by the Security Documents for failure to comply therewith.

Section 7.18. Operation as Approved Facility.

(a) The Company will not take any action, or suffer or permit any action, if such action would cause the Facility not to be the Approved Facility.

(b) The Company will not fail to take any action, or suffer or permit the failure to take any action, if such failure would cause the Facility not to be the Approved Facility.

(c) The Company will permit the Trustee and its duly authorized agents, at all reasonable times upon written notice to enter upon the Facility and to examine and inspect the Facility and exercise its rights hereunder, under the Indenture and under the other Security Documents with respect to the Facility. The Company will further permit the Issuer, or its duly authorized agent, upon reasonable notice, at all reasonable times, to enter the Facility, but solely for the purpose of assuring that the Company is operating the Facility, or is causing the Facility to be operated, as the Approved Facility consistent with the Approved Project Operations and with the corporate purposes of the Issuer.

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Section 7.19. Restrictions on Dissolution and Merger.

(a) The Company covenants and agrees that at all times during the term of this Agreement, it will

(i) maintain its existence as a limited liability company,

(ii) continue to be subject to service of process in the State,

(iii) continue to be organized under the laws of, or qualified to do business in, the State,

(iv) not liquidate, wind up or dissolve or otherwise dispose of all or substantially all of its property, business or assets (“Transfer”) remaining after the Commencement Date, except as provided in Section 7.19(b),

(v) not consolidate with or merge into another Entity or permit one or more Entities to consolidate with or merge into it (“Merge”), except as provided in Section 7.19(b), and

(vi) not change or permit the change of any Principal of the Company and/or the Parent, or a change in the relative ownership and/or Control of the Company and/or the Parent of any of the existing Principals, except in each case as provided in Section 7.19(c).

(b) Notwithstanding Section 7.19(a), the Company may Merge or participate in a Transfer if the following conditions are satisfied on or prior to the Merger or Transfer, as applicable:

(i) when the Company is the surviving, resulting or transferee Entity,

(1) the Company shall not have a negative net worth (as determined by an Independent Accountant in accordance with GAAP),

(2) the Company shall deliver to the Issuer and the Trustee an opinion of Nationally Recognized Bond Counsel to the effect that such action will not cause the interest on the Bonds to become includable in gross income for federal income tax purposes, and

(3) the Company shall deliver to the Issuer a Required Disclosure Statement with respect to itself as surviving Entity in form and substance reasonably satisfactory to the Issuer; or

(ii) when the Company is not the surviving, resulting or transferee Entity (the “Successor Company”),

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(1) the predecessor Company (the “Predecessor Company”) shall not have been in default under this Agreement or under any other Project Document,

(2) the Issuer and the Trustee shall have consented in writing to the transaction,

(3) the Successor Company shall be solvent and subject to service of process in the State and organized under the laws of the State, or under the laws of any other state of the United States and duly qualified to do business in the State,

(4) the Successor Company shall have assumed in writing (or by operation of law) all of the obligations of the Predecessor Company contained in this Agreement and in all other Project Documents to which the Predecessor Company shall have been a party,

(5) the Successor Company shall have delivered to the Issuer a Required Disclosure Statement in form and substance acceptable to the Issuer acting in its sole discretion,

(6) each Principal of the Successor Company shall have delivered to the Issuer a Required Disclosure Statement in form and substance acceptable to the Issuer acting in its sole discretion,

(7) the Successor Company shall have delivered to the Issuer and the Trustee, in form and substance acceptable to the Issuer and the Trustee, an Opinion of Counsel to the effect that (y) this Agreement and all other Project Documents to which the Predecessor Company shall be a party constitute the legal, valid and binding obligations of the Successor Company and each is enforceable in accordance with their respective terms to the same extent as it was enforceable against the Predecessor Company, and (z) such action does not legally impair the security for the Holders of the Bonds afforded by the Security Documents,

(8) the Parent shall have delivered to the Issuer and the Trustee, in form and substance acceptable to the Issuer and the Trustee, an opinion of an Independent Accountant to the effect that the Parent has a net worth (as determined in accordance with GAAP) after the Merger or Transfer at least equal to the Parent Closing Date Net Worth, and

(9) the Successor Company delivers to the Issuer and the Trustee an opinion of Nationally Recognized Bond Counsel to the effect that such action will not cause the interest on the Bonds to become includable in gross income for federal income tax purposes.

(c) If there is a change in Principals of the Company and/or the Parent, or a change in the relative ownership and/or Control of the Company and/or the Parent or any of the existing Principals, the Company shall deliver to the Issuer prompt written notice thereof (including all details that would result in a change to Exhibit C — “Principals of Company and Parent”) to the Issuer together with a Required Disclosure Statement in form and substance acceptable to the Issuer acting in its sole discretion.

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Section 7.20. Security Interest and Further Assurances. c) The Issuer shall pledge and assign to the Trustee pursuant to the Indenture all of the Issuer’s right, title and interest in the Promissory Note and all (except for the Issuer’s Reserved Rights) of the Issuer’s right, title and interest in this Agreement, including all loan payments hereunder and under the Promissory Note, and in furtherance of said pledge the Issuer will unconditionally assign such loan payments to the Trustee for deposit in the Bond Fund in accordance with the Indenture.

(b) The Company will do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered such further acts, instruments, conveyances, transfers and assurances, including Uniform Commercial Code financing statements, at the sole cost and expense of the Company, as the Issuer or the Trustee deems reasonably necessary or advisable for the implementation, effectuation, correction, confirmation or perfection of the Trust Estate and any rights of the Issuer or the Trustee hereunder, under the Indenture or under any other Security Document.

Section 7.21. Continuing Disclosure. The Company shall, if required by the initial purchaser or underwriter of the Bonds in accordance with Securities and Exchange Commission Rule 15c2-12(b)(5), enter into and comply with and carry out all of the provisions of a continuing disclosure agreement. Notwithstanding any other provision of this Agreement, failure of the Company to comply with such continuing disclosure agreement shall not be considered an Event of Default; however, the Trustee may (and, at the request of any participating underwr iter or the Holders of at least twenty-five percent (25%) aggregate principal amount in Outstanding Bonds, shall, upon receipt of reasonable indemnification for its fees and costs acceptable to it), and any Holder or Beneficial Owner may, take such actions as may be necessary and appropriate, including seeking specific performance by court order, to cause the Company to comply with its obligations under this Section 7.21. The Company agrees that the Issuer shall have no continuing disclosure obligations.

Section 7.22. Tax Regulatory Agreement.

(a) The Company shall comply with all of the terms, provisions and conditions set forth in the Tax Regulatory Agreement, including, without limitation, the making of any payments and filings required thereunder.

(b) Promptly following receipt of notice from the Trustee as provided in Section 5.08 of the Indenture that the amount on deposit in the Rebate Fund is less than the Rebate Amount, the Company shall deliver the amount necessary to make up such deficiency to the Trustee for deposit in the Rebate Fund.

Section 7.23. Compliance with the Indenture. The Company will comply with the provisions of the Indenture with respect to the Company. The Trustee shall have the power, authority, rights and protections provided in the Indenture. The Company will use its best efforts to cause there to be obtained for the Issuer any documents or opinions of counsel required of the Issuer under the Indenture.

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Section 7.24. Reporting Information for the Trustee.

(a) The Company shall furnish or cause to be furnished to the Trustee, (i) as soon as available and in any event within one hundred twenty (120) days after the close of each Fiscal Year, a copy of the annual compiled financial statements of the Company and the most recent annual audited consolidated combined and combining financial statements reflecting the financial condition of the Parent, including balance sheets as at the end of each such Fiscal Year, and the related statements of income, balances, earnings, retained earnings and changes in financial position for each such Fiscal Year, as compiled by the Company’s and the Parent’s respective Independent Accountant and prepared in acco rdance with GAAP, and (ii) as soon as available and in any event within sixty (60) days after the close of each quarter of each Fiscal Year, a copy of the compiled financial statements of the Company, and the unaudited consolidated combined and combining financial statements reflecting the financial condition of the Parent, including balance sheets as at the end of such quarter, and the related statements of income, balances, earnings, retained and changes in financial position for such quarter, prepared in accordance with GAAP, certified by an Authorized Representative of the Company and an Authorized Representative of the Parent, respectively.

(b) The Company shall deliver to the Trustee with each delivery of annual financial statements required by Section 7.24(a)(i), (i) a certificate of an Authorized Representative of the Company as to whether or not, as of the close of such preceding Fiscal Year, and at all times during such Fiscal Year, the Company was in compliance with all the provisions which relate to the Company in this Agreement and in any other Project Document to which it shall be a party, and as to whether or not a Determination of Taxability has occurred, and if such Authorized Representative shall have obtained knowledge of any default in such compliance or notice of such default or Determination of Taxability, he shall disc lose in such certificate such default or defaults or notice thereof and the nature thereof, whether or not the same shall constitute an Event of Default hereunder, and any action proposed to be taken by the Company with respect thereto, and (ii) a certificate of an Authorized Representative of the Company that the insurance it maintains complies with the provisions of Section 7.1 of this Agreement and Section 3.12 of the Bond Guaranty Agreement, that such insurance has been in full force and effect at all times during the preceding Fiscal Year, and that duplicate copies of all policies or certificates thereof have been filed with the Issuer and the Trustee and are in full force and effect. In addition, upon twenty (20) days prior request by the Trustee, the Company will execute, acknowledge and deliver to the Issuer and the Trustee a certificate of an Authorized Representative of the Company either stating that to the knowledge of such Authorized Representative after due inquiry no defau lt or breach exists hereunder or specifying each such default or breach of which such Authorized Representative has knowledge.

(c) The Company shall immediately notify the Trustee of the occurrence of any Event of Default or any event which with notice and/or lapse of time would constitute an Event of Default under any Project Document. Any notice required to be given pursuant to this subsection shall be signed by an Authorized Representative of the Company and set forth a description of the default and the steps, if any, being taken to cure said default. If no steps have been taken, the Company shall state this fact on the notice.

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(d) The Company shall deliver to the Trustee all insurance-related documents required by Sections 7.1(f)(i), 7.1(f)(ii), 7.1(f)(iii) and 7.1(g).

Section 7.25. Contracts with Affiliates. The Company shall not enter into any contract or transaction with any Affiliate of the Company, including, without limitation, any Facility Lease, except upon such terms as are customarily acceptable to a bona fide third party in an arms’-length transaction.

Section 7.26. Business of Company. The Company shall engage in no business or enterprise other than (i) the design, acquisition, construction, renovation, equipping, furnishing, leasing, operation, maintenance, repair, restoration, improvement and management of the Facility, (ii) the performance of its obligations under the Ground Lease and all other Project Documents to which it is a party, and all other agreements relating to the Facility and its financing, construction, leasing, maintenance and operation, and (iii) activities in furtherance thereof or a ncillary or reasonably related thereto.

Section 7.27. No Material Impairment of Value. The Company shall not take any action that would impair, in any material respect, the value or utility of the Facility as intended for the purposes of this Agreement or the Facility Revenues to be derived from the operation of the Facility.

Section 7.28. Certain Covenants with Respect to the Ground Lease. i) At least ten (10) days prior to the execution by the Company of any amendment, supplement or modification to the Ground Lease, the Company shall deliver a copy of same in substantially final form to each of the Issuer and the Trustee. Promptly upon the execution thereof, the Company shall furnish certified copies of such amendment, supplement or modification to the Issuer and the Trustee. Prior to the completion of the Project in accordance with this Agree ment and the Ground Lease, the Company shall not enter into any amendment, supplement or modification to the Ground Lease without the prior written consent of the Parent.

(b) The Company shall immediately transmit to each of the Issuer and the Trustee (y) notice of any default by the Company under the Ground Lease including a full description of the nature of the default and the amount or act necessary to cure the same, and (z) copies of any termination or default notice it shall receive or deliver under the Ground Lease.

Section 7.29. Certain Covenants with Respect to the Facility Leases.

ii) Prior to commencing its broadly marketing efforts to seek tenants for the Facility, the Company covenants and agrees to use its best efforts to identify and locate former tenants from the Gallery at Fulton Street in Brooklyn, New York and offer to such tenants suitable retail space within the Facility (taking into account the amount of available retail space within the Facility and the location of such space within the Facility) on a competitive market basis.

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(b) Upon the execution by the Company of any amendment, supplement or modification to any of the Facility Leases, the Company shall promptly deliver a certified copy of same to each of the Issuer and the Trustee.

(c) The Company shall immediately transmit to each of the Issuer and the Trustee copies of any termination or default notice it shall receive or deliver under any Facility Lease.

Section 7.30. Waiver of Defenses. The Company covenants and agrees, for the benefit of the Issuer, the Trustee and the Holders of the Bonds, not to assert that any inconsistency between the terms, covenants, conditions and provisions of the Ground Lease with the Mortgage or any of the other Security Documents shall have the effect of modifying, releasing, impairing or otherwise limiting any of the obligations, covenants and agreements of the Company under the Mortgage or under any of the other Security Documents.

Section 7.31. Leasehold Condominium. Pursuant to the General Lease, the Company has reserved for itself the right to subject the Facility to a condominium regime of ownership pursuant to the provisions of Article 9-B of the New York Real Property Law and, in connection therewith, request the landlord under the Ground Lease to enter into a separate lease with the owners of each condominium unit created thereunder. However, the Company agrees that it shall not effect any sale, transfer or other disposition of any such separate lease or condominium unit so created without the prior written consent of the Trustee, and the delivery to the Issuer and the Trustee of an opinion of Nationally Recognized Bond Counsel to the effect that such action will not affect the exclusion of the interest on any Bonds then Outstanding from gross income for federal income tax purposes.

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ARTICLE VIII

REMEDIES AND EVENTS OF DEFAULT

Section 8.1. Events of Default. Any one or more of the following events shall constitute an “Event of Default” hereunder:

(a) Failure of the Company to pay or cause to be paid any loan payment that has become due and payable by the terms of Section 4.3(a) or (e), or to pay any other payment that has become due and payable under Section 4.4, which in any case results in an Event of Default under the Indenture;

(b) Failure of the Company to pay any amount (except as set forth in Section 8.1(a) hereof) that has become due and payable or to observe and perform any covenant, condition or agreement on its part to be performed under Sections 5.1, 5.2, 5.3, 5.4, 7.1, 7.2, 7.3, 7.4, 7.8, 7.10. 7.11, 7.12, 7.16, 7.17, 7.19, 7.24, 7.25, 7.28, 7.29, 7.31, 8.7, 8.8, 8.9, 10.2, 10.3, 10.5, 11.2 or 11.3 and continuance of such failure for more than thirty (30) days after written notice of such failure has been given to the Company specifying the nature of such failure by the Issuer or the Trustee or the Holders of more than twenty-five per cent (25%) in aggregate principal amount of the Bonds Outstanding;

(c) Failure of the Company to observe and perform any covenant, condition or agreement hereunder on its part to be performed (except as set forth in Section 8.1(a) or (b)) and (i) continuance of such failure for more than thirty (30) days after written notice of such failure has been given to the Company specifying the nature of same by the Issuer or the Trustee or the Holders of more than twenty-five per cent (25%) in aggregate principal amount of the Bonds Outstanding, or (ii) if by reason of the nature of such failure the same can be remedied, but not within the said thirty (30) days, the Company fails to commence and thereafter proceed with reasonable diligence after receipt of said not ice to cure such failure or fails to continue with reasonable diligence its efforts to cure such failure;

(d) The Company or the Parent shall (i) apply for or consent to the appointment of or the taking of possession by a receiver, liquidator, custodian or trustee of itself or of all or a substantial part of its property, (ii) admit in writing its inability, or be generally unable, to pay its debts as such debts generally become due, (iii) make a general assignment for the benefit of its creditors, (iv) commence a voluntary case under the Federal Bankruptcy Code (as now or hereafter in effect), (v) file a petition seeking to take advantage of any other law relating to bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of debts, (vi) fail to controver t in a timely or appropriate manner or acquiesce in writing to, any petition filed against itself in an involuntary case under the Federal Bankruptcy Code, (vii) take any action for the purpose of effecting any of the foregoing, or (viii) be adjudicated a bankrupt or insolvent by any court;

(e) A proceeding or case shall be commenced, without the application or consent of the Company or the Parent, in any court of competent jurisdiction, seeking, (i) liquidation, reorganization, dissolution, winding-up or composition or adjustment of debts, (ii) the appointment of a trustee, receiver, liquidator, custodian or the like of the Company or the Parent, or of all or any substantial part of its respective assets, or (iii) similar relief under any law relating to bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts, and such proceeding or case shall continue undismissed, or an order, judgment or decree approving or ordering any of the foregoing shal l be entered and continue unstayed and in effect, for a period of ninety (90) days; or any order for relief against the Company or the Parent shall be entered in an involuntary case under such Bankruptcy Code; the terms “dissolution” or “liquidation” of the Company or the Parent as used above shall not be construed to prohibit any action otherwise permitted by Section 7.19, Section 3.6 of the Bond Guaranty Agreement or Section 3.4 of the Issuer Indemnification Agreement;

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(f) Any representation or warranty made by the Company or the Parent (i) in the application and related materials submitted to the Issuer or the initial purchaser(s) of the Bonds for approval of the Project or its financing, or (ii) herein or in any other Project Document, or (iii) in the Letter of Representation and Indemnity Agreement, or (iv) in the Tax Regulatory Agreement, or (v) by or on behalf of the Company or the Parent or any other Person in any Required Disclosure Statement, or (vi) in any report, certificate, financial statement or other instrument furnished pursuant hereto or any of the foregoing, shall in any case prove to be false, misleading or incorrect in an y material respect as of the date made;

(g) The commencement of proceedings to appoint a receiver or to foreclose any mortgage lien on or security interest in the Ground Lease including the Mortgage;

(h) If any Required Disclosure Statement delivered to the Issuer under any Project Document is not acceptable to the Issuer acting in its sole discretion; or

(i) An “Event of Default” under the Indenture or under any other Security Document shall occur and be continuing.

Section 8.2. Remedies on Default. d) Whenever any Event of Default referred to in Section 8.1 shall have occurred and be continuing, the Issuer, to the extent specifically authorized herein or in the Issuer Indemnification Agreement, or the Trustee where so provided, may, take any one or more of the following remedial steps:

(i) The Trustee, as and to the extent provided in Article VIII of the Indenture, may cause all principal installments of loan payments payable under Section 4.3(a) for the remainder of the term of this Agreement to be immediately due and payable, whereupon the same, together with the accrued interest thereon, shall become immediately due and payable, without presentment, demand, protest or any other notice whatsoever, all of which are hereby expressly waived by the Company; provided, however, that upon the occurrence of an Event of Default under Section 8.1(d) or (e), all principal installments of loan payments payable under Section 4.3(a) for the remainder of the term of this Agreeme nt, together with the accrued interest thereon, shall immediately become due and payable without any declaration, notice or other action of the Issuer, the Trustee, the Holders of the Bonds or any other Person being a condition to such acceleration;

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(ii) The Issuer or the Trustee may take whatever action at law or in equity as may appear necessary or desirable to collect the loan payments then due and thereafter to become due, or to enforce performance or observance of any obligations, agreements or covenants of the Company under this Agreement; and

(iii) The Trustee may take any action permitted under the Indenture with respect to an Event of Default thereunder.

(b) Upon the occurrence of a default with respect to any of the Issuer’s Reserved Rights, the Issuer, without the consent of the Trustee or any other Person, may proceed to enforce the Issuer’s Reserved Rights by

(i) bringing an action for damages, injunction or specific performance, or

(ii) taking whatever action at law or in equity as may appear necessary or desirable to collect payment of amounts due by the Company under the Issuer’s Reserved Rights or to enforce the performance or observance of any obligations, covenants or agreements of the Company under the Issuer’s Reserved Rights,

(c) No action taken pursuant to this Section 8.2 (including termination of this Agreement) or by operation of law or otherwise shall, except as expressly provided herein, relieve the Company from the Company’s obligations hereunder, all of which shall survive any such action.

Section 8.3. Bankruptcy Proceedings. In case proceedings shall be pending for the bankruptcy or for the reorganization of the Company or the Parent under the federal bankruptcy laws or any other applicable law, or in case a receiver or trustee (other than the Trustee under the Indenture) shall have been appointed for the property of the Company or the Parent or in the case of any other similar judicial proceedings relative to the Company or the Parent or the creditors or property of the Company or the Parent, then the Trustee shall be ent itled and empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims for the whole amount owing and unpaid pursuant to this Agreement and the Promissory Note, irrespective of whether the principal of the Bonds (and the loan payments payable pursuant to the Promissory Note and Section 4.3(a)) shall have been accelerated by declaration or otherwise, and irrespective of whether the Trustee shall have made any demand for payment hereunder or thereunder, and, in case of any judicial proceedings, to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee allowed in such judicial proceedings relative to the Company or the Parent, the creditors or property of the Company or the Parent, and to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute such amounts as provided in the Indenture after the deduction of its charges and expenses. Any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized to make such payments to the Trustee, and to pay to the Trustee any amount due it for compensation and expenses, including expenses and fees of counsel incurred by it up to the date of such distribution.

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Section 8.4. Remedies Cumulative. The rights and remedies of the Issuer or the Trustee under this Agreement shall be cumulative and shall not exclude any other rights and remedies of the Issuer or the Trustee allowed by law with respect to any default under this Agreement. Failure by the Issuer or the Trustee to insist upon the strict performance of any of the covenants and agreements herein set forth or to exercise any rights or remedies upon default by the Company hereunder shall not be considered or taken as a waiver or reli nquishment for the future of the right to insist upon and to enforce by mandatory injunction, specific performance or other appropriate legal remedy the strict compliance by the Company with all of the covenants and conditions hereof, or of the rights to exercise any such rights or remedies, if such default by the Company be continued or repeated.

Section 8.5. No Additional Waiver Implied by One Waiver. In the event any covenant or agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. No waiver shall be binding unless it is in writing and signed by the party making such waiver. No course of dealing between the Issuer and/or the Trustee and the Company or any delay or omission o n the part of the Issuer and/or the Trustee in exercising any rights hereunder or under the Indenture or under any other Security Document shall operate as a waiver. To the extent permitted by applicable law, the Company hereby waives the benefit and advantage of, and covenants not to assert against the Issuer or the Trustee, any valuation, inquisition, stay, appraisement, extension or redemption laws now existing or which may hereafter exist which, but for this provision, might be applicable to any sale or reletting made under the judgment, order or decree of any court or under the powers of sale and reletting conferred by this Agreement or otherwise.

Section 8.6. Effect on Discontinuance of Proceedings. In case any proceeding taken by the Issuer or the Trustee under the Indenture or this Agreement or under any other Security Document on account of any Event of Default hereunder or thereunder shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Issuer or the Trustee, then, and in every such case, the Issuer, the Trustee and the Holders of the Bonds shall be restored, respectively, to their former positions and rights hereunder and ther eunder, and all rights, remedies, powers and duties of the Issuer and the Trustee shall continue as in effect prior to the commencement of such proceedings.

Section 8.7. Agreement to Pay Fees and Expenses of Attorneys and Other Consultants. In the event the Company should default under any of the provisions of this Agreement, and the Issuer or the Trustee should employ outside attorneys or other consultants or incur other expenses for the collection of loan payments or other amounts payable hereunder or the enforcement of performance or observance of any obligation or agreement on the part of the Company herein contained or contained in any other Security Document, the Company agrees that it will on demand therefor pay to the Issuer or the Trustee, as the case may be, the reasonable fees and disbursements of such attorneys or other consultants and such other expenses so incurred.

Section 8.8. Certain Continuing Representations. If at any time during the term of this Agreement, any representation or warranty made by the Company pursuant to Section 2.2(u) would, if made on any date during the term of this Agreement and deemed made as of such date, be false, misleading or incorrect in any material respect, then, the Company shall be deemed to be in default under this Agreement unless the Issuer shall, upon written request by the Company, either waive such default in writing or consent in writing to an exception to such rep resentation or warranty so that such representation or warranty shall no longer be false, misleading or incorrect in a material respect. Upon the occurrence of any such default, the Issuer shall have the right to require the redemption of the Bonds in accordance with Section 10.3(a).

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Section 8.9. Late Delivery Fees.

(a) In the event the Company shall fail:

(i) to pay the Annual Administrative Fee on the date required under Section 7.3,

(ii) to file and/or deliver any of the documents required of the Company under Section 7.13 or Section 7.15 by the date therein stated (collectively, the “Fixed Date Deliverables”), or

(iii) to deliver to the Issuer any of the documents as shall have been requested by the Issuer of the Company under Section 7.14 within five (5) Business Days of the date so requested (collectively, the “Requested Document Deliverables”),

then the Issuer may charge the Company a daily calendar basis commencing with the day immediately following the date on which the payment, filing or delivery was due (the “Due Date”), the Per Diem Late Fee.

(b) If the Issuer shall deliver written notice (a “Notification of Failure to Deliver”) to the Company of such failure to deliver on the Due Date the Annual Administrative Fee, a Fixed Date Deliverable and/or a Requested Document Deliverable, and such payment or document shall not be delivered to the Issuer within ten (10) Business Days following delivery by the Issuer to the Company of the Notification of Failure to Deliver, then, commencing from and including the eleventh (11th) Business Day following the delivery by the Issuer to the Company of the Notificat ion of Failure to Deliver, the Issuer may charge the Company on a daily calendar basis the Per Diem Supplemental Late Fee in respect of each noticed failure which shall be in addition to, and be imposed concurrently with, the applicable Per Diem Late Fee.

(c) The Per Diem Late Fee and the Per Diem Supplemental Late Fee shall each, if charged by the Issuer, (i) accrue until the Company delivers to the Issuer the Annual Administrative Fee, the Fixed Date Deliverable(s) and/or the Requested Document Deliverable(s), as the case may be, and (ii) be incurred on a daily basis for each such Annual Administrative Fee, Fixed Date Deliverable and/or Requested Document Deliverable as shall not have been delivered to the Issuer on the Due Date.

(d) No default on the part of the Company under Section 7.3, 7.13, 7.14, or 7.15 to deliver to the Issuer an Annual Administrative Fee, a Fixed Date Deliverable or a Requested Document Deliverable shall be deemed cured unless the Company shall have delivered same to the Issuer and paid to the Issuer all accrued and unpaid Per Diem Fees in connection with the default.

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ARTICLE IX

OPTIONS TO TERMINATE

Section 9.1. Termination of this Agreement.

(a) The Company shall have the option to terminate this Agreement by causing the redemption or defeasance in whole of all Outstanding Bonds in accordance with the terms set forth in the Indenture.

(b) i) After full payment of the Bonds or provision for the payment in full thereof having been made in accordance with Article X of the Indenture, but not later than the receipt by the Company of ten (10) days prior written notice from the Issuer directing termination of this Agreement, the Company shall terminate this Agreement by giving the Issuer notice in writing of such termination and thereupon such termination shall forthwith become effective, subject, however, to (x) the delivery of those documents referred to in Section 9.2 , and (y) the survival of those obligations of the Company set forth in Section 9.3.

(ii) In the event the Company does not terminate this Agreement (including taking all actions required to be taken by the Company pursuant to Sections 9.1(b)(i) and 9.2 within such ten (10) day period), then, commencing on the eleventh (11th) day after transmittal of the notice directing termination as provided in Section 9.1(b)(i), the Company shall, in addition to all other payment obligations due to the Issuer hereunder, make additional loan payments to the Issuer in the amount of the Per Diem Holdover Amount until the Company shall have terminated this Agreement in accordance with the provisions thereof and hereof.

(c) The Company shall not, at any time, assign or transfer its option to terminate this Agreement as contained in this Section 9.1 separate and apart from a permitted assignment of this Agreement pursuant to Section 7.8, without the prior written consents of the Issuer and the Trustee.

Section 9.2. Actions on Termination. e) As a condition precedent to the termination of this Agreement, the Company shall

(i) pay to the Trustee

(A) the expenses of redemption, the fees and expenses of the Trustee, the Bond Registrar and the Paying Agents and all other amounts due and payable under this Agreement and the other Security Documents;

(B) any amounts required to be rebated to the Federal government pursuant to the Indenture or the Tax Regulatory Agreement; and

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(ii) pay to the Issuer

(A) the fees and expenses of the Issuer, and

(B) all other amounts due and payable under this Agreement and the other Security Documents, and

(iii) perform all accrued obligations hereunder or under any other Project Document,

(b) Upon the termination of this Agreement in accordance with Section 9.1, the Issuer will deliver or cause to be delivered, at the sole cost and expense of the Company, to the Company (i) a termination of this Agreement, and (ii) all necessary documents releasing all of the Issuer’s rights and interests in and to any rights of action under this Agreement (other than as against the Company or the Parent or any insurer of the insurance policies under Section 7.1), or any insurance proceeds (other than liability insurance proceeds for the benefit of the Issuer) or condemnation awards, with respect to the Facility or any portion thereof. Concurrently with the delivery of such instr uments, there shall be delivered by the Issuer (at the sole cost and expense of the Company), to the Trustee any instructions or other instruments required by Article X of the Indenture to defease and pay the Outstanding Bonds, together with a direction to the Trustee that the Trustee deliver to the Company a release, satisfaction or termination of the Indenture and, except as provided in Section 8.19 of the Mortgage, of the mortgage lien and security interest of the Mortgage.

Section 9.3. Survival of Company Obligations. Upon compliance with Section 9.2, this Agreement and all obligations of the Company hereunder shall be terminated except the obligations of the Company under Sections 7.2, 7.22, 8.2, 8.7, 8.9, 10.2, 11.4, 11.5, 11.6, 11.11, 11.13 and 11.14 shall survive such termination.

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ARTICLE X

CERTAIN PROVISIONS RELATING TO THE BONDS

Section 10.1. Issuance of Additional Bonds. If a Series of Additional Bonds are to be issued pursuant to the Indenture, the Issuer and the Company shall enter into an amendment to the Promissory Note and this Agreement, providing, among other things, for the payment by the Company of such additional loan payments as are necessary in order to amortize in full the principal of and interest on such Series of Additional Bonds and any other costs in connection therewith.

Any such completion, repair, relocation, replacement, rebuilding, restoration, additions, extensions or improvements shall become a part of the Facility and shall be included under this Agreement to the same extent as if originally included hereunder.

Section 10.2. Determination of Taxability. f) If any Holder of Bonds receives from the Internal Revenue Service a notice of assessment and demand for payment with respect to interest on any Bond (except a notice and demand based upon the assertion that the Bondholder is a “substantial user”, as defined in Section 147 of the Code, or a “related person”, as defined in the Tax Regulatory Agreement), an appeal may be taken by such Holder at the option of either such Holder or the Company. If such appeal is taken at the option of the Company (exercised in accordance with the procedures set forth in the definition of “Determination of Taxability”), all expenses of the appeal including reasonable counsel fees shall be paid by the Company, and the Company shall control the procedures and terms relating to such appeal, and such Holder and the Company shall cooperate and consult with each other in all matters pertaining to any such appeal which the Company has elected to take, except that no Holder of Bonds shall be required to disclose or furnish any non-publicly disclosed information, including without limitation, financial information and tax returns. Before the taking of any appeal which the Company has elected to take, however, the Bondholder shall have the right to require the Company to pay the tax assessed and conduct the appeal as a contest for reimbursement.

(b) Not later than one hundred twenty (120) days following a Determination of Taxability, the Company shall pay to the Trustee an amount sufficient, when added to the amounts then in the Bond Fund and available for such purpose, to retire and redeem all Bonds then Outstanding, in accordance with the Indenture. The Bonds shall be redeemed in whole unless redemption of a portion of the Bonds Outstanding would have the result that interest payable on the Bonds remaining Outstanding after such redemption would not be includable in the gross income of any Holder of a Bond (other than a Holder who is a “substantial user” of the Facility or a “related person”, within the meanin g of the Code). In such event, the Bonds shall be redeemed in such amount as is deemed necessary in the opinion of Nationally Recognized Bond Counsel to accomplish that result.

(c) The obligation of the Company to make the payments provided for in this Section shall be absolute and unconditional, and the failure of the Issuer, the Trustee or any other Person to execute or deliver or cause to be delivered any documents or to take any action required under this Agreement or otherwise shall not relieve the Company of its obligation under this Section.

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Section 10.3. Mandatory Redemption of Bonds as Directed by the Issuer.

g) Upon the determination by the Issuer that (w) the Company is operating the Facility or any portion thereof, or is allowing the Facility or any portion thereof to be operated, not as a qualified “project” in accordance with the Act and the failure of the Company within thirty (30) days of the receipt by the Company of written notice of such noncompliance from the Issuer to cure such noncompliance together with a copy of such resolution (a copy of which notice shall be sent to the Trustee), (x) the Company, any Principal of the Company or any Person that directly or indirectly Controls, is Controlled by or is under common Control with the Company has committed a material violation of a material Legal Requirement and the failure of the Company within thirty (30) days of the receipt by the Company of written notic e of such determination from the Issuer to cure such material violation (which cure, in the case of a Principal who shall have committed the material violation of a material Legal Requirement, may be effected by the removal of such Principal), (y) as set forth in Section 8.8, any Conduct Representation is false, misleading or incorrect in any material respect at any date, as if made on such date, or (z) a Required Disclosure Statement delivered to the Issuer under any Project Document is not acceptable to the Issuer acting in its sole discretion, the Company covenants and agrees that it shall, no later than ten (10) days following the termination of such thirty (30) day period, pay to the Trustee advance loan payments in immediately available funds in an amount sufficient to redeem the Bonds Outstanding in whole at the Redemption Price of 100% of the aggregate principal amount of the Outstanding Bonds together with interest accrued thereon to the redemption date. The Issuer shall gi ve prior written notice of the meeting at which the Board of Directors of the Issuer are to consider such resolution to the Company and the Trustee, which notice shall be no less than fifteen (15) days prior to such meeting.

(b) In the event the Company fails to obtain or maintain the public liability insurance with respect to the Facility required under Section 7.1, and the Company shall fail to cure such circumstance within ten (10) days of the receipt by the Company of written notice of such noncompliance from the Issuer and a demand by the Issuer on the Company to cure such noncompliance, upon notice or waiver of notice as provided in the Indenture, the Company shall pay to the Trustee advance loan payments in immediately available funds in an amount sufficient to redeem the Bonds Outstanding in whole at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Bonds, together with inte rest accrued thereon to the date of redemption.

Section 10.4. Right to Cure Issuer Defaults. The Issuer hereby grants the Company full authority for account of the Issuer to perform any covenant or obligation the non-performance of which is alleged to constitute a default in any notice received by the Company, in the name and stead of the Issuer, with full power of substitution.

Section 10.5. Option to Purchase or Invite Tenders of Bonds. The Company shall have the option, at any time during the term of this Agreement, to purchase Bonds for its own account, whether by direct negotiation, through a broker or dealer, or by making a tender offer to the Holders thereof. The Bonds so purchased by the Company or by any Affiliate of the Company (including the Parent) shall be delivered to the Trustee for cancellation within ninety (90) days of the date of purchase unless the Company shall deliver to t he Trustee and the Issuer an opinion of Nationally Recognized Bond Counsel to the effect that the failure to surrender such Bonds by such date will not affect the exclusion of the interest on any Bonds then Outstanding from gross income for federal income tax purposes.

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Section 10.6. Investment of Funds. Any moneys held as part of the Rebate Fund, the Earnings Fund, the Project Fund, the Bond Fund, the Additional Interest Deposit Fund or the Renewal Fund or in any special fund provided for in this Agreement or in the Indenture to be invested in the same manner as in any said Fund shall, at the written request of an Authorized Representative of the Company, be invested and reinvested by the Trustee as provided in the Indenture (but subject to the provisions of the Tax Regulatory Agreement). Neither the Issuer nor the Trustee nor any of their members, directors, officers, agents, servants or employees shall be liable for any depreciation in the value of any such investments or for any loss arising therefrom.

Interest and profit derived from such investments shall be credited and applied as provided in the Indenture, and any loss resulting from such investments shall be similarly charged.

Section 10.7. Deposit to Additional Interest Deposit Fund. On or prior to the Commencement Date, the Company shall pay or cause to be paid to the Trustee the amount of $4,000,000 for deposit in the Advance Interest Deposit Fund.

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ARTICLE XI

MISCELLANEOUS

Section 11.1. Force Majeure. In case by reason of force majeure either party hereto shall be rendered unable wholly or in part to carry out its obligations under this Agreement, then except as otherwise expressly provided in this Agreement, if such party shall give notice and full particulars of such force majeure in writing to the other party within a reasonable time after occurrence of the event or cause relied on, the obligations of th e party giving such notice (other than (i) the obligations of the Company to make (or cause to be made) the loan payments or other payments required under the terms hereof and under the Promissory Note, or (ii) the obligations of the Company to comply with Sections 7.1 or 7.2), so far as they are affected by such force majeure, shall be suspended during the continuance of the inability then claimed, which shall include a reasonable time for the removal of the effect thereof, but for no longer period, and such party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term “force majeure” shall mean acts of God, strikes, lockouts or other industrial disturbances, acts of the public enemy, orders of any kind of the Government of the United States or of the State or any civil or military authority, insurrections, riots, epidemics, lan dslides, lightning, earthquakes, fires, hurricanes, storms, floods, washouts, droughts, arrest, restraining of government and people, war, terrorism, civil disturbances, explosions, partial or entire failure of utilities, shortages of labor, material, supplies or transportation, or any other similar or different cause not reasonably within the control of the party claiming such inability. Notwithstanding anything to the contrary herein, in no event shall the Company’s financial condition or inability to obtain financing constitute a force majeure. It is understood and agreed that the requirements that any force majeure shall be reasonably beyond the control of the party and shall be remedied with all reasonable dispatch shall be deemed to be satisfied in the event of a strike or other industrial disturbance even though existing or impending strikes or other industrial disturbances could have been settled by the party claiming a force majeure hereunder by acceding to the demands of the opposing person or persons.

The Company shall promptly notify the Issuer and the Trustee upon the occurrence of each force majeure, describing such force majeure and its effects in reasonable detail. The Company shall also promptly notify the Issuer and the Trustee upon the termination of each such force majeure. The information set forth in any such notice shall not be binding upon the Issuer or the Trustee, and the Issuer or the Trustee shall be entitled to dispute the existence of any force majeure and any of the contentions contained in any such notice received from the Company.

Section 11.2. Pledge under Indenture and Mortgage. Pursuant to the Mortgage, the Company will mortgage its interest in the Facility under the Ground Lease to the Trustee as security for the Bonds and the obligations of the Company and of the Parent under the Security Documents. Pursuant to the Indenture, the Issuer will pledge and assign the Promissory Note and the loan payments and certain other moneys receivable under this Agreement to the Trustee as security for the payment of the principal or Redemption Price, if applicable, of, Sinkin g Fund Installments for, Purchase Price and interest on the Bonds.

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Section 11.3. Amendments. This Agreement may be amended only with the concurring written consent of the Trustee given in accordance with the provisions of the Indenture and only by a written instrument executed by the parties hereto.

Section 11.4. Service of Process. The Company represents that it is subject to service of process in the State and covenants that it will remain so subject until all obligations, covenants and agreements of the Company under this Agreement shall be satisfied and met. If for any reason the Company should cease to be so subject to service of process in the State, the Company hereby irrevocably consents to the service of all process, pleadings, notices or other papers in any judicial proceeding or action by designating and appointing General Counsel, at Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605, as its agent upon whom may be served all process, pleadings, notices or other papers which may be served upon the Company as a result of any of its obligations under this Agreement. If such appointed agent shall cease to act or otherwise cease to be subject to service of process in the State, the Company hereby irrevocably designates and appoints the Secretary of State of the State of New York as its agent upon whom may be served all process, pleadings, notices or other papers which may be served upon the Company as a result of any of its obligations under this Agreement; provided, however, that the service of such process, pleadings, notices or other papers shall not constitute a condition to the Company’s obligations hereunder.

For such time as any of the obligations, covenants and agreements of the Company under this Agreement remain unsatisfied, the Company’s agent(s) designated in this Section 11.4 shall accept and acknowledge on the Company’s behalf each service of process in any such suit, action or proceeding brought in any such court. The Company agrees and consents that each such service of process upon such agents and written notice of such service to the Company in the manner set forth in Section 11.5 shall be taken and held to be valid personal service upon the Company whether or not the Company shall then be doing, or at any time shall have done, business within the State and that each such service of process shall be of the same force and validity as if service were made upon the Company according to the laws governin g the validity and requirements of such service in the State, and waives all claim of error by reason of any such service.

Such agents shall not have any power or authority to enter into any appearance or to file any pleadings in connection with any suit, action or other legal proceedings against the Company or to conduct the defense of any such suit, action or any other legal proceeding except as expressly authorized by the Company.

Section 11.5. Notices. All notices, certificates or other communications hereunder shall be sufficient if sent (i) by registered or certified United States mail, return receipt requested and postage prepaid, (ii) by a nationally recognized overnight delivery service for overnight delivery, charges prepaid or (iii) by hand delivery, addressed, as follows:

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(1) if to the Issuer, to

New York City Capital Resource Corporation

110 William Street

New York, New York 10038

Attention: General Counsel (with a copy to the

Executive Director of the Issuer at the

same address)

(2) if to the Company, to

Albee Retail Development LLC

c/o Acadia Realty Trust

1311 Mamaroneck Avenue

Suite 260

White Plains, New York 10605

Attention: General Counsel

with a copy to

Washington Square Partners

675 Third Avenue, 25th Floor

New York, New York 10017

Attention: Paul Travis

and

Akerman Senterfitt LLP

335 Madison Avenue, 26th Floor

New York, New York 10017

Attention: Steven Polivy, Esq., and

(3) if to the Trustee, to

The Bank of New York Mellon

101 Barclay Street, Floor 7W

New York, New York 10286

Attention: Corporate Trust Administration

The Issuer, the Company and the Trustee may, by like notice, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Any notice, certificate or other communication hereunder shall, except as may expressly be provided herein, be deemed to have been delivered or given (i) three (3) Business Days following posting if transmitted by mail, (ii) one (1) Business Day following sending if transmitted for overnight delivery by a nationally recognized overnight delivery service, or (iii) upon delivery if given by hand delivery, with refusal by an Authorized Representative of the intended recipient party to accept delivery of a notice given as prescribed above to constitute delivery hereunder.

Section 11.6. Consent to Jurisdiction. The Company irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of this Agreement or any other Project Document, the Facility, the Project, the relationship between the Issuer and the Company, the Company’s leasehold, use or occupancy of the Facility and/or any claim for injury or damages may be brought in the courts of record of the State in New York County or the United States District Court for the Southern District of New York; (ii) consents to the jurisdict ion of each such court in any such suit, action or proceeding; (iii) waives any objection which it may have to the venue of any such suit, action or proceeding in such courts; and (iv) waives and relinquishes any rights it might otherwise have (w) to move to dismiss on grounds of forum non conveniens, (x) to remove to any federal court other than the United States District Court for the Southern District of New York, and (y) to move for a change of venue to a New York State Court outside New York County.

If the Company commences any action against the Issuer or the Trustee in a court located other than the courts of record of the State in New York County or the United States District Court for the Southern District of New York, the Company shall, upon request of the Issuer or the Trustee, either consent to a transfer of the action or proceeding to a court of record of the State in New York County or the United States District Court for the Southern District of New York, or, if the court where the action or proceeding is initially brought will not or cannot transfer the action, the Company shall consent to dismiss such action without prejudice and may thereafter reinstitute the action in a court of record of the State in New York County or the United States District Court for the Southern District of New York.

Section 11.7. Prior Agreements Superseded. This Agreement shall completely and fully supersede all other prior understandings or agreements, both written and oral, between the Issuer and the Company relating to the Facility, other than any other Project Document.

Section 11.8. Severability. If any one or more of the provisions of this Agreement shall be ruled illegal or invalid by any court of competent jurisdiction, the illegality or invalidity of such provision(s) shall not affect any of the remaining provisions hereof, but this Agreement shall be construed and enforced as of such illegal or invalid provision had not been contained herein.

Section 11.9. Effective Date; Counterparts. The date of this Agreement shall be for reference purposes only and shall not be construed to imply that this Agreement was executed on the date first above written. This Agreement was delivered on the Commencement Date. This Agreement shall become effective upon its delivery on the Commencement Date. It may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

Section 11.10. Binding Effect. This Agreement shall inure to the benefit of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Paying Agents, the Remarketing Agent, the Indemnified Parties and the Holders of the Bonds, and shall be binding upon the Issuer and the Company and their respective successors and assigns.

Section 11.11. Third Party Beneficiaries. h) The Issuer and the Company agree that this Agreement is executed in part to induce the purchase by others of the Bonds and for the further securing of the Bonds, and accordingly all covenants and agreements on the part of the Issuer and the Company as set forth in this Agreement are hereby declared to be for the benefit of the Holders from time to time of the Bonds and may be enforced as provided in Article VIII of the Indenture on behalf of the Bondholders by the Trustee.

xci

(b) Nothing in this Agreement expressed or implied is intended or shall be construed to confer upon, or to give to, any Person, other than the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Company, the Paying Agents, the Remarketing Agent and the Holders of the Bonds any right, remedy or claim under or by reason of this Agreement or any covenant, condition or stipulation thereof. All the covenants, stipulations, promises and agreements herein contained by and on behalf of the Issuer shall be for the sole and exclusive benefit of the Issuer, the Trustee, the Bond Registrar, the Tender Agent, the Company, the Paying Agents, the Remarketing Agent and the Holders of the Bonds.

Section 11.12. Law Governing. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without regard or giving effect to the principles of conflicts of laws thereof.

Section 11.13. Waiver of Trial by Jury. The Company does hereby expressly waive all rights to a trial by jury on any cause of action directly or indirectly involving the terms, covenants or conditions of this Agreement or any matters whatsoever arising out of or in any way connected with this Agreement, the Company’s obligations hereunder, the Facility, the Project, the relationship between the Issuer and the Company, the Company’s leasehold, use or occupancy of the Facility and/or any claim for injury or damages.

The provision of this Agreement relating to waiver of a jury trial shall survive the termination or expiration of this Agreement.

Section 11.14. Recourse Under This Agreement. All covenants, stipulations, promises, agreements and obligations of the Issuer or the Company contained in this Agreement shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Issuer or the Company, as the case may be, and not of any member (other than the Parent), director, officer, employee or agent of the Issuer or the Company, respectively, or any natural person executing this Agreement on behalf of either of them in such person’s individual capacity, and no recourse shal l be had for any reason whatsoever hereunder against any member (other than the Parent), director, officer, employee or agent of the Issuer or the Company, respectively, or any natural person executing this Agreement on behalf of the Issuer or the Company. No recourse shall be had for the payment of the principal of, redemption premium, if any, Sinking Fund Installments for, Purchase Price or interest on the Bonds or for any claim based thereon or hereunder against any member (other than the Parent), director, officer, employee or agent of the Issuer or the Company, respectively, or any natural person executing the Bonds. In addition, in the performance of the agreements of the Issuer herein contained, any obligation the Issuer may incur for the payment of money shall not subject the Issuer to any pecuniary or other liability or create a debt of the State or the City, and neither the State nor the City shall be liable on any obligation so incurred and any such obligation shall be payabl e solely out of amounts payable to the Issuer by the Company hereunder and under the Promissory Note.

xcii

IN WITNESS WHEREOF, the Issuer has caused its corporate name to be subscribed unto this Loan Agreement by its duly authorized Chairman, Vice Chairman, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs and the Company has caused its name to be hereunto subscribed by its duly Authorized Representative, all being done as of the year and day first above written.

	NEW YORK CITY CAPITAL RESOURCE CORPORATION



	By:	/s/ Kyle Kimball
		Kyle Kimball
		Executive Director

	ALBEE RETAIL DEVELOPMENT LLC



	By:	/s/ Robert Masters
		Robert Masters
		Senior Vice President

xciii

STATE OF NEW YORK	)
	: ss.:
COUNTY OF NEW YORK	)

On the 29th day of June, in the year two thousand two, before me, the undersigned, personally appeared Kyle Kimball, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.



		/s/ Carol M. Hyde
		Notary Public/Commissioner of Deeds

		Carol M. Hyde
		Notary Public, State of New York
		No. 4977270
		Qualified in Queens County
		Commission Expires Jan. 20, 2011

STATE OF NEW YORK	)
	: ss.:
COUNTY OF NEW YORK	)

On the 30th day of June, in the year two thousand ten, before me, the undersigned, personally appeared Robert Masters, personally known to me or proved to me on the basis of satisfactory evidence to me the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.



		/s/ Kara A. Lobdell
		Notary Public

		Kara A. Lobdell
		Notary Public, State of New York
		No. 02LO6031220
		Qualified in New York County
		Commission Expires Sept. 27, 2013

APPENDICES

EXHIBIT A

DESCRIPTION OF THE LAND

(Block 149, Lot 103)

ALL that certain plot piece or parcel of land situate, lying and being in the Borough of Brooklyn,

County of Kings, City and State of New York, bounded and described as follows:

BEGINNING at the corner formed by the intersection of the northerly side of Dekalb Avenue

with the easterly side of Gold Street;

RUNNING THENCE easterly, along the easterly side of Gold Street, 114 feet to a point;

RUNNING THENCE easterly, at right angles to the easterly side of Gold Street, 129.12 feet to

the northwesterly side of Fleet Street

RUNNING THENCE southwesterly, along the northwesterly side of Fleet Street, 132.02 feet to

the corner formed by the intersection of the northwesterly side of Fleet Street, with the northerly

side of Dekalb Avenue;

RUNNING THENCE westerly, along the northerly side of Dekalb Avenue, 63.76 feet to the

point or place of BEGINNING.

END OF SCHEDULE A

EXHIBIT B

AUTHORIZED REPRESENTATIVE

(i) of the Company:

Name	Title
Kenneth F. Bernstein	President and CEO
Michael L. Nelsen	Senior Vice President and Treasurer
Robert Masters	Senior Vice President and Secretary

(ii) of the Parent:

Name	Title
Kenneth F. Bernstein	President and CEO
Michael L. Nelsen	Senior Vice President and Treasurer
Robert Masters	Senior Vice President and Secretary

EXHIBIT C

SEE ATTACHED ORGANIZATIONAL CHART

EXHIBIT D

[Reserved]

EXHIBIT E-1

[FORM OF REQUIRED DISCLOSURE STATEMENT

FOR OTHER THAN FACILITY TENANTS]

The undersigned, an authorized representative of ___________________________, a _________________________ organized and existing under the laws of the State of _________, DOES HEREBY CERTIFY, REPRESENT AND WARRANT to the New York City Capital Resource Corporation (the “Issuer”) pursuant to [Section 7.19] [Section 7.8] of that certain Loan Agreement, dated as of July 1, 2010, between the Issuer and Albee Retail Development LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Loan Agreement”) THAT:

[if being delivered pursuant to 7.19 of the Loan Agreement] None of the surviving, resulting or transferee Entity, any of the Principals of such Entity, or any Person that directly or indirectly Controls, is Controlled by, or is under common Control with such Entity:

[if being delivered pursuant to 7.8 of the Loan Agreement] None of the assignee, transferee, Transfer Equivalent Sublessee or Facility Tenant, any of the Principals of such Entity, or any Person that directly or indirectly Controls, is Controlled by, or is under common Control with such Entity:

(1) is in default or in breach, beyond any applicable grace period, of its obligations under any written agreement with the Issuer, the NYCIDA, the NYCEDC or the City, unless such default or breach has been waived in writing by the Issuer, the NYCIDA, the NYCEDC or the City, as the case may be;

(2) has been convicted of a felony and/or any crime involving moral turpitude in the preceding ten (10) years;

(3) has received written notice of default in the payment to the City of any taxes, sewer rents or water charges in excess of $5,000 that has not been cured or satisfied, unless such default is then being contested with due diligence in proceedings in a court or other appropriate forum; or

(4) has, at any time in the three (3) preceding years, owned any property which, while in the ownership of such Person, was acquired by the City by in rem tax foreclosure, other than a property in which the City has released or is in the process of releasing its interest to such Person pursuant to the Administrative Code of the City.

As used herein, the following capitalized terms shall have the respective meanings set forth below:

“City” shall mean The City of New York.

“Control” or “Controls” shall mean the power to direct the management and policies of a Person (x) through the ownership, directly or indirectly, of not less than a majority of its voting securities, (y) through the right to designate or elect not less than a majority of the members of its board of directors or trustees or other Governing Body, or (z) by contract or otherwise.

“Entity” shall mean any of a corporation, general partnership, limited liability company, limited liability partnership, joint stock company, trust, estate, unincorporated organization, business association, tribe, firm, joint venture, governmental authority or governmental instrumentality, but shall not include an individual.

“Governing Body” shall mean, when used with respect to any Person, its board of directors, board of trustees or individual or group of individuals by, or under the authority of which, the powers of such Person are exercised.

“Person” shall mean an individual or any Entity.

“Principal(s)” shall mean, with respect to any Entity, the most senior three officers of such Entity, any Person with a ten percent (10%) or greater ownership interest in such Entity, and any Person as shall have the power to Control such Entity, and “principal” shall mean any of such Persons.

IN WITNESS WHEREOF, the undersigned has hereunto set its hand this ____ day of _____________, 201_.

	[NAME OF CERTIFYING ENTITY]



	By:
		Name: Title:

EXHIBIT E-2

[FORM OF REQUIRED DISCLOSURE STATEMENT

FOR FACILITY TENANTS]

The undersigned, an authorized representative of ___________________________, a _________________________ organized and existing under the laws of the State of _________, DOES HEREBY CERTIFY, REPRESENT AND WARRANT to the New York City Capital Resource Corporation (the “Issuer”) pursuant to Section 7.8(b) of that certain Loan Agreement, dated as of July 1, 2010, between the Issuer and Albee Retail Development LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Loan Agreement”) THAT:

Neither the undersigned as Facility Tenant, nor any of the Principals of the undersigned:

(2) has been convicted of a felony and/or any crime involving moral turpitude in the preceding ten (10) years;

As used herein, the following capitalized terms shall have the respective meanings set forth below:

“City” shall mean The City of New York.

“Control” or “Controls” shall mean, with respect to a company that is not subject to the public reporting requirements of the Securities Act of 1933, as amended, the power to direct the management and policies of a Person through the direct ownership of not less than a majority of its voting securities.

“Person” shall mean an individual or any Entity.

“Principal(s)” shall mean, with respect to any Entity, the most senior three officers of such Entity or any Person as shall have the power to Control such Entity.

IN WITNESS WHEREOF, the undersigned has hereunto set its hand this ____ day of _____________, 201_.

	[NAME OF CERTIFYING ENTITY]



	By:
		Name: Title:

EXHIBIT F

PROJECT COMPLETION CERTIFICATE OF COMPANY AS

REQUIRED BY SECTIONS 3.2(f) AND 7.13(g) OF THE LOAN AGREEMENT

The undersigned, an Authorized Representative (as defined in the Loan Agreement referred to below) of Albee Retail Development LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Company”), HEREBY CERTIFIES that this Certificate is being delivered in accordance with the provisions of Section 3.2(f) and 7.13(g) of that certain Loan Agreement, dated as of July 1, 2010 (the “Loan Agreement”), between the New York City Capital Resource Corporation (the “Issuer”) and the Company, and FURTHER CERTIFIES THAT (capitalized terms used but not defined herein shall have the respective meanings assigned to such terms in the Loan Agreement):

(i) the Project Work has been completed substantially in accordance with the plans and specifications therefor, “Complete Construction of the Building” (as defined in the Ground Lease) has occurred under the Ground Lease and the date of completion of the Project was ____________________;

(ii) except for any Project costs not currently due and payable or the liability for payment of which is being contested or disputed by the Company in good faith, all labor, service, machinery, equipment, materials and supplies used therefor have been paid for;

(iii) all other facilities necessary in connection with the Project have been completed and all costs and expenses incurred in connection therewith have been paid;

(iv) all property constituting the Facility is subject to the Ground Lease and the Mortgage, subject only to Permitted Encumbrances;

(v) in accordance with all applicable laws, regulations, ordinances and guidelines, the Facility is ready for occupancy, use and operation for its intended purposes;

(vi) this Certificate is given without prejudice to any rights of the Company against third parties existing on the date hereof or which may subsequently come into being and no Person other than the Issuer may benefit from this Certificate; and

(vii) attached hereto are (a) releases of mechanics’ liens by the general contractor and by all contractors and materialmen who supplied work, labor, services, machinery, equipment, materials or supplies in connection with the Project Work, (b) a temporary or permanent certificate of occupancy and, (c) any and all permissions, approvals, licenses or consents required of governmental authorities for the occupancy, operation and use of the Facility for the purposes contemplated by the Ground Lease and the Loan Agreement.

IN WITNESS WHEREOF, the undersigned has hereunto set its hand this _____ day of _______________, ____.

	ALBEE RETAIL DEVELOPMENT LLC



	By:
		Name:
		Title:

EXHIBIT G

AFTER THE ENDORSEMENT AS HEREON PROVIDED AND PLEDGE OF THIS NOTE, THIS NOTE MAY NOT BE ASSIGNED, PLEDGED, ENDORSED OR OTHERWISE TRANSFERRED EXCEPT TO AN ASSIGNEE OR SUCCESSOR OF THE TRUSTEE IN ACCORDANCE WITH THE INDENTURE, BOTH OF WHICH ARE REFERRED TO HEREIN.

$20,000,000

July 1, 2010

PROMISSORY NOTE

FOR VALUE RECEIVED, ALBEE RETAIL DEVELOPMENT LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Borrower”), by this promissory note hereby promises to pay to the order of NEW YORK CITY CAPITAL RESOURCE CORPORATION (the “Issuer”) and THE BANK OF NEW YORK MELLON, as Trustee (the “Trustee”) the principal sum of Twenty Million Dollars ($20,000,000), together with interest on the unpaid principal amount hereof, from the date of the issuance and delivery of the Initial Bonds (as such term is hereinafter defined) until paid in full, at a rate per annum equal to the respective rates of interest borne from time to time by the Initial Bonds, together with all Sinking Fund Installments, Redemption Price and Purchase Price payments as and when due. A ll capitalized terms used but not defined in this Promissory Note shall have the respective meanings assigned such terms by the Indenture (as hereinafter defined) or by the Loan Agreement (as hereinafter defined). All such payments shall be made in funds which shall be immediately available on the due date of such payments and in lawful money of the United States of America and shall be paid at the designated corporate trust office of the Trustee or its successor under the Indenture.

The principal amount, interest, Sinking Fund Installments, Redemption Price, and Purchase Price shall be payable on the dates and in the amounts that principal of, interest, Sinking Fund Installments, Redemption Price and Purchase Price on the Initial Bonds are payable under the Loan Agreement (as defined below), subject to prepayments and credits to the extent provided in the Indenture and the Loan Agreement.

This promissory note is the “Promissory Note” referred to in the Loan Agreement, dated as of July 1, 2010 (the “Loan Agreement”), between the Borrower and the Issuer, the terms, conditions and provisions of which are hereby incorporated by reference.

This Promissory Note and the payments required to be made hereunder are irrevocably assigned, without recourse, representation or warranty, and pledged to the Trustee under the Indenture of Trust, dated as of July 1, 2010 (the “Indenture”), by and between the Issuer and the Trustee, and such payments will be made directly to the Trustee for the account of the Issuer pursuant to such assignment. Such assignment is made as security for the payment of the Issuer’s $20,000,000 in aggregate principal amount of Recovery Zone Facility Revenue Bonds (Albee Retail Development LLC Project), Series 2010 (the “Initial Bonds”) issued by the Issuer pursuant to the Indenture. All the terms, conditions and provisions of the Indenture, the Loan Agreement and the Initial Bonds are hereby incorpor ated as a part of this Promissory Note.

The Borrower may at its option, and may under certain circumstances be required to, prepay together with accrued interest, all or any part of the amounts due under this Promissory Note, as provided in the Loan Agreement and the Indenture.

Presentation, demand, protest and notice of dishonor are hereby expressly waived by the Borrower.

The Borrower hereby promises to pay costs of collection and attorneys’ fees in case of default on this Promissory Note.

This Promissory Note shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflicts of law principles thereof.

	ALBEE RETAIL DEVELOPMENT LLC



	By:
		Robert Masters
		Senior Vice President

ENDORSEMENT

Pay to the order of The Bank of New York Mellon, without recourse, as Trustee under the Indenture referred to in the within mentioned Loan Agreement, as security for the Initial Bonds issued under such Indenture. This endorsement is given without any warranty as to the authority or genuineness of the signature of the maker of the Promissory Note.

	NEW YORK CITY CAPITAL RESOURCE CORPORATION



	By:
		Kyle Kimball
		Executive Director

Dated: July 1, 2010

EXHIBIT H

[Form of Subordination and Non-Disturbance Agreement]

THE BANK OF NEW YORK-MELLON, AS TRUSTEE

and

(Tenant)

SUBORDINATION, NON-DISTURBANCE AND

ATTORNMENT AGREEMENT

Dated: _______________________, 20__

Location: City Point, Site 1A

1 DeKalb Avenue,

Brooklyn, New York 11201

UPON RECORDATION

RETURN TO:

Robert Masters, Esq.

Albee Retail Development LLC

1311 Mamaroneck Avenue, Suite 260

White Plains, NY 10605

SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENT

THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (the "Agreement") is made as of the _________ day of ____________________, 2010 by and between THE BANK OF NEW YORK-MELLON, AS TRUSTEE, having an address 101 Barclay Street, 7W, New York, New York 10286 ("Trustee") and________., having an address at ____________________________ ("Tenant").

RECITALS:

A. Tenant is the holder of a leasehold estate in a portion of the property known as City Point, Site 1A, located at 1 DeKalb Avenue, Brooklyn, New York, as more particularly described on Exhibit A (the "Property") under and pursuant to the provisions of a certain lease dated _________ between Albee Retail Development LLC, as landlord ("Landlord") and Tenant, as tenant (as amended through the date hereof, the "Lease");

B. The Property is or is to be encumbered by one or more mortgages, deeds of trust, deeds to secure debt or similar security agreements (collectively, the "Security Instrument") from Landlord, or its successor in interest, in favor of Trustee; and

C. Tenant has agreed to subordinate the Lease to the Security Instrument and to the lien thereof and Trustee has agreed to grant non-disturbance to Tenant under the Lease on the terms and conditions hereinafter set forth.

AGREEMENT:

NOW, THEREFORE, the parties hereto mutually agree as follows:

1. Subordination. The Lease shall be subject and subordinate in all respects to the lien and terms of the Security Instrument, to any and all advances to be made thereunder and to all renewals, modifications, consolidations, replacements and extensions thereof.

2. Nondisturbance. So long as Tenant pays all rents and other charges as specified in the Lease and is not otherwise in default (beyond the expiration of applicable notice and cure periods) of any of its obligations and covenants pursuant to the Lease, Trustee agrees for itself and its successors in interest and for any other person acquiring title to the Property through a foreclosure (an "Acquiring Party"), that Tenant's possession of the premises as described in the Lease will not be disturbed during the term of the Lease, as said term may be extended pursuant to the terms of the Lease or as said premises may be expanded as specified in the Lease, by reason of a foreclosure. For pur poses of this agreement, a "foreclosure" shall include (but not be limited to) a sheriff's or trustee's sale under the power of sale contained in the Security Instrument, the termination of any superior lease of the Property and any other transfer of the Landlord's interest in the Property under peril of foreclosure, including, without limitation, to the generality of the foregoing, an assignment or sale in lieu of foreclosure.

3. Attornment. Tenant agrees to attorn to, accept and recognize any Acquiring Party as the landlord under the Lease pursuant to the provisions expressly set forth therein for the then remaining balance of the term of the Lease, and any extensions thereof as made pursuant to the Lease. The foregoing provision shall be self-operative and shall not require the execution of any further instrument or agreement by Tenant as a condition to its effectiveness. Tenant agrees, however, to execute and deliver, at any time and from time to time, upon the request of the Trustee or any Acquiring Party any reasonable instrument which may be necessary or appropriate to evidence such attornme nt.

4. No Liability. Notwithstanding anything to the contrary contained herein or in the Lease, it is specifically understood and agreed that neither the Trustee, any receiver nor any Acquiring Party shall be:

(a) liable for any act, omission, negligence or default of any prior landlord (other than to cure defaults of a continuing nature with respect to the maintenance or repair of the demised premises or the Property); provided, however, that any Acquiring Party shall be liable and responsible for the performance of all covenants and obligations of landlord under the Lease accruing from and after the date that it takes title to the Property; or

(b) except as set forth in (a) above, liable for any failure of any prior landlord to construct any improvements;

(d) bound by any rent or additional rent which is payable on a monthly basis and which Tenant might have paid for more than one (1) month in advance to any prior landlord; or

(e) be liable to Tenant hereunder or under the terms of the Lease beyond its interest in the Property.

(f) liable or responsible for or with respect to the retention, application and or/return to the Tenant of any security deposit paid to Borrower or any prior Landlord, unless and until Trustee or such Acquiring Party has actually received for its own account as landlord the full amount of such security deposit.

Notwithstanding the foregoing, Tenant reserves its rights to any and all claims or causes of action against such prior landlord for prior losses or damages and against the successor landlord for all losses or damages arising from and after the date that such successor landlord takes title to the Property.

5. Rent. Tenant has notice that the Lease and the rents and all other sums due thereunder have been assigned to Trustee as security for the loan secured by the Security Instrument. In the event Trustee furnishes written notice to Tenant of the occurrence of a default under the Security Instrument and demands that Tenant pay its rents and all other sums due or to become due under the Lease directly to Trustee, Tenant shall honor such demand and pay its rent and all other sums due under the Lease directly to Trustee or as otherwise authorized in writing by Trustee. Landlord hereby irrevocably authorizes Tenant to make the foregoing payments to Trustee upon such notice and dema nd.

6. Trustee to Receive Notices. Tenant shall notify Trustee of any default by Landlord under the Lease which would entitle Tenant to cancel the Lease, and agrees that, notwithstanding any provisions of the Lease to the contrary, no notice of cancellation thereof shall be effective unless Trustee shall have received notice of default giving rise to such cancellation and shall have failed within sixty (60) days after receipt of such notice to cure such default, or if such default cannot be cured within sixty (60) days, shall have failed within sixty (60) days after receipt of such notice to commence and thereafter diligently pursue any action necessary to cure such default.

7. NOTICES. All notices hereunder shall be in writing and shall be deemed to have been properly given (i) upon delivery, if delivered in person with receipt acknowledged by the recipient thereof, (ii) one (1) Business Day (hereinafter defined) after having been deposited for overnight delivery with any reputable overnight courier service, or (iii) three (3) Business Days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed to the receiving party at its address set forth above, and:

if to Tenant, to

the attention of:

with duplicate copy to:

if to Trustee:

to the attention of:

The Bank of New York-Mellon, As Trustee

101 Barclay Street, 7W

New York, New York 10286

Fax: (212) 815-5595

Attention: Corporate Trust Group-(NYCCRC-Albee Retail Development LLC Project), Series 2010

or addressed as such party may from time to time designate by written notice to the other parties in accordance with this Paragraph 7. For purposes of this Paragraph 7, the term "Business Day" shall mean any day other than Saturday, Sunday or any other day on which banks are required or authorized to close in New York, New York.

Either party by notice to the other in accordance with this Paragraph 7 may designate additional or different addresses for subsequent notices or communications.

8. Successors. The obligations and rights of the parties pursuant to this Agreement shall bind and inure to the benefit of the successors, assigns, heirs and legal representatives of the respective parties. In addition, Tenant acknowledges that all references herein to Landlord shall mean the owner of the landlord's interest in the Lease, even if said owner shall be different than the Landlord named in the Recitals.

9. Duplicate Originals; Counterparts. This Agreement may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Agreement.

IN WITNESS WHEREOF, Trustee and Tenant have duly executed this Agreement as of the date first above written.

	TRUSTEE:

	THE BANK OF NEW YORK-MELLON, AS TRUSTEE

	By:
		Name:
		Authorized Signatory

	TENANT:

	By:
		Name:
		Title:

	The undersigned as the Landlord named in the Recitals or as successor thereto hereby accepts and agrees to be bound by the provisions of Paragraph 5 hereof.

	ALBEE RETAIL DEVELOPMENT LLC

	By:
		Name:
		Title:

STATE OF	)
	: ss.:
COUNTY OF	)

On the __________ day of ________________________ in the year 2010, before me, the undersigned, a Notary Public in and for said State, personally appeared _________________ _______________________, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.




		Notary Public

STATE OF	)
	: ss.:
COUNTY OF	)




		Notary Public

STATE OF NEW YORK	)
	: ss.:
COUNTY OF WESTCHESTER	)

On the __________ day of ________________________ in the year 2010, before me, the undersigned, a Notary Public in and for said State, personally appeared ______________, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.




		Notary Public

EXHIBIT A

The Property

$20,000,000

July 1, 2010

PROMISSORY NOTE

Presentation, demand, protest and notice of dishonor are hereby expressly waived by the Borrower.

The Borrower hereby promises to pay costs of collection and attorneys’ fees in case of default on this Promissory Note.

This Promissory Note shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflicts of law principles thereof.

	ALBEE RETAIL DEVELOPMENT LLC



	By:	/s/ Robert Masters
		Robert Masters
		Senior Vice President

ENDORSEMENT

	NEW YORK CITY CAPITAL RESOURCE CORPORATION



	By:	/s/ Kyle Kimball
		Kyle Kimball
		Executive Director

Dated: July 1, 2010

NEW YORK CITY CAPITAL RESOURCE CORPORATION,

a local development corporation created pursuant to the Not-for-Profit

Corporation Law of the State of New York at the direction of the Mayor of

The City of New York, having its principal office at 110 William Street,

New York, New York 10038,

as “Issuer”

THE BANK OF NEW YORK MELLON,

a banking corporation organized and existing under the laws of the State of

New York, having a corporate trust office at 101 Barclay Street, Floor 7W,

New York, New York 10286, together with any successor trustee at the time

serving as such under this Indenture of Trust,

as “Trustee”

INDENTURE OF TRUST

Dated as of July 1, 2010

$20,000,000

New York City Capital Resource Corporation

Recovery Zone Facility Revenue Bonds

(Albee Retail Development LLC Project), Series 2010

INDENTURE OF TRUST

THIS INDENTURE OF TRUST dated as of July 1, 2010, by and between the NEW YORK CITY CAPITAL RESOURCE CORPORATION, a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State of New York at the direction of the Mayor of The City of New York, having its principal office at 110 William Street, New York, New York 10038, party of the first part, to THE BANK OF NEW YORK MELLON, a New York banking corporation together with any successor trustee at the time serving as such under this Indenture of Trust, having a corporate trust office at 101 Barclay Street, Floor 7W, New York, New York 10286, party of the second part (capitalized terms used but not defined herein shall have the respective meanings assigned to such terms in Section 1.01),

WITNESSETH:

WHEREAS, the Company entered into negotiations with officials of the Issuer for the construction, renovation, equipping and furnishing of the Improvements as part of the Facility; and

WHEREAS, on July 17, 2009, the Mayor of the City ratified the designations made by the Issuer of the “Recovery Zones”; and

WHEREAS, the site for the Facility, including the improvements to be constructed thereon, will be subject to the Ground Lease; and

WHEREAS, to facilitate the Project and the issuance by the Issuer of its recovery zone facility revenue bonds to finance a portion of the costs of the Project, the Issuer and the Company have entered into negotiations pursuant to which (i) the Issuer will make the Loan of the proceeds of the Initial Bonds, in the original principal amount of the Initial Bonds, to the Company pursuant to the Loan Agreement, and (ii) the Company will execute the Promissory Note in favor of the Issuer and the Trustee to evidence the Company’s obligation under the Loan Agreement to repay the Loan; and

WHEREAS, concurrently with the execution hereof, in order to further secure the Initial Bonds, (i) the payment of the principal of, Sinking Fund Installments for, Purchase Price, redemption premium, if any, and interest on the Initial Bonds, and the payments, obligations, covenants and agreements of the Company under the Loan Agreement and under the Promissory Note, will be guaranteed by the Guarantors pursuant to the Bond Guaranty Agreement in favor of the Trustee; (ii) the completion of the Project will be guaranteed by the Guarantors pursuant to the Project Completion Guaranty Agreement in favor of the Trustee; (iii) the Company will grant a lien in Facility Revenues and the remainder of the Pledged Collateral pursuant to the Pledge and Security Agreement in fav or of the Trustee, subject only to the lien of the Mortgage; and (iv) the Company will grant mortgage liens on and security interests in its leasehold interest in the Facility under the Ground Lease, and an assignment of leases and rents, to the Trustee pursuant to the Mortgage; and

WHEREAS, additional moneys may be necessary to finance the cost of completing the Project, providing funds in excess of Net Proceeds to repair, relocate, replace, rebuild or restore the Facility in the event of damage, destruction or taking by eminent domain, or providing extensions, additions or improvements to the Facility or refunding outstanding Bonds and provision should therefore be made for the issuance from time to time of additional bonds; and

WHEREAS, the Initial Bonds and the Trustee’s Certificate to be endorsed thereon are all to be in substantially the form set forth in Exhibit C, with necessary and appropriate variations, omissions and insertions as permitted or required by this Indenture; and

WHEREAS, all things necessary to make the Bonds when authenticated by the Trustee and issued as in this Indenture provided, the valid, binding and legal special limited revenue obligations of the Issuer according to the import thereof, and to constitute this Indenture a valid pledge and assignment of the loan payments, revenues and receipts herein made to the payment of the principal of, Sinking Fund Installments for, Purchase Price, redemption premium, if any, and interest on the Bonds, have been done and performed, and the creation, execution and delivery of this Indenture, and the creation, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized;

NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, THIS INDENTURE WITNESSETH:

That the Issuer in consideration of the premises and of the acceptance by the Trustee of the trusts hereby created and of the purchase and acceptance of the Bonds by the Holders and owners thereof, and of the sum of One Dollar, lawful money of the United States of America, to it duly paid by the Trustee at or before the execution and delivery of these presents, and for other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to secure the payment of the principal of, Purchase Price, and Sinking Fund Installments for, the Bonds and the indebtedness represented thereby and the redemption premium, if any, and interest on the Bonds according to their tenor and effect and the performance and observance by the Issuer of all the covenants expressed or implied herein and in the Bonds, does hereby grant, bargain, convey, transfer, grant a security interest in, pledge and assign unto the Trustee, and unto its respective successors in trust, and to their respective assigns, forever for the securing of the performance of the obligations of the Issuer hereinafter set forth, the following:

GRANTING CLAUSES

All right, title and interest of the Issuer in and to the Loan Agreement, including all loan payments, revenues and receipts payable or receivable thereunder, excluding, however, the Issuer’s Reserved Rights, which Issuer’s Reserved Rights may be enforced by the Issuer and the Trustee, jointly or severally.

All right, title and interest of the Issuer in and to the Promissory Note.

III

All moneys and securities from time to time held by the Trustee under the terms of this Indenture including amounts set apart and transferred to the Earnings Fund, the Project Fund, the Purchase Fund, the Renewal Fund, the Bond Fund, the Advance Interest Deposit Fund or any special fund, and all investment earnings of any of the foregoing, subject to disbursements from the Earnings Fund, the Project Fund, the Renewal Fund, the Advance Interest Deposit Fund or any such special fund in accordance with the provisions of the Loan Agreement and this Indenture; provided, however, (i) there is hereby expressly excluded from any assignment, pledge, lien or security interest any amounts set apart and transferred to the Rebate Fund, and (ii) amounts held in the Purchase Fund shall be held in trust in favor of only those Persons entitled to amounts therein as provided in this Indenture.

Any and all other property of every kind and nature from time to time which was heretofore or hereafter is by delivery or by writing of any kind conveyed, mortgaged, pledged, assigned or transferred, as and for additional security hereunder, by the Issuer or by any other Person with or without the consent of the Issuer, to the Trustee which is hereby authorized to receive any and all such property at any time and at all times to hold and apply the same subject to the terms hereof.

TO HAVE AND TO HOLD all the same with all privileges and appurtenances hereby conveyed and assigned, or agreed or intended so to be, to the Trustee and its successors in said Trust and to them and their assigns forever;

IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the equal and proportionate benefit, security and protection of all Holders and owners of the Bonds issued under and secured by this Indenture, without privilege, priority or distinction as to lien or otherwise of any of the Bonds over any of the others of the Bonds, except as otherwise expressly provided in this Indenture, provided, however, that if the Issuer, its successors or assigns, shall well and truly pay, or cause to be paid, the principal and any applicable redemption premium, of the Bonds and the interest due or to become due thereon, at the times and in the manner provided in the Bonds according to the true intent and meaning thereof and shall make the payments into the Bond Fund as required under t his Indenture or shall provide, as permitted hereby, for the payment thereof by depositing or causing to be deposited with the Trustee sufficient amounts, and shall well and truly keep, perform and observe all the covenants and conditions pursuant to the terms of this Indenture to be kept, performed and observed by it, and shall pay to the Trustee all sums of money due or to become due to it in accordance with the terms and provisions hereof, then upon such final payments this Indenture and the rights hereby granted shall cease, determine and be void; otherwise, this Indenture to be and remain in full force and effect.

THIS INDENTURE FURTHER WITNESSETH, and it is expressly declared that, all the Bonds issued and secured hereunder are to be issued, authenticated and delivered and all said loan payments, revenues and receipts hereby pledged are to be dealt with and disposed of under, upon and subject to the terms, conditions, stipulations, covenants, agreements, trusts, uses and purposes as hereinafter expressed, and the Issuer has agreed and covenanted, and does hereby agree and covenant with the Trustee and with the respective Holders and owners, from time to time of the Bonds or any part thereof, as follows, that is to say:

ARTICLE I

DEFINITIONS

Section 1.01. Definitions. The following terms shall have the respective meanings in this Indenture, except as the context otherwise requires:

Additional Bonds shall mean one or more Series of additional bonds issued, executed, authenticated and delivered under the Indenture.

Adjustable Fixed Interest Rate shall mean the interest rate on the Initial Bonds as determined in accordance with Section 2.02, from and including the Closing Date through the Final Maturity Date of the Initial Bonds.

Adjustable Fixed Interest Rate Commencement Date shall mean the original date of issuance of the Initial Bonds.

Adjustable Fixed Interest Rate Term shall mean (i) the Initial Adjustable Fixed Interest Rate Term, and (ii) each period of years thereafter commencing on an Adjustment Date and continuing to but excluding the next succeeding Adjustment Date, with the final Adjustable Fixed Interest Rate Term to continue through but not including the Final Maturity Date.

Adjustment Date shall mean (i) the Initial Adjustment Date, (ii) the first day of each Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term) as shall constitute a November 1, provided that if any such date shall not be a Business Day, the Adjustment Date shall be the next succeeding Business Day.

Advance Interest Deposit Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

An Affiliate of a Person shall mean a Person that directly or indirectly through one or more intermediaries Controls, or is under common Control with, or is Controlled by, such Person.

Approved Project Operations shall mean, subject to the Loan Agreement, those uses and operations permitted under the Ground Lease, excluding, however, any Tax Prohibited Use or any use by a not-for-profit corporation.

Authorized Denomination shall mean, in the case of the Initial Bonds, $100,000 or any integral multiple of $5,000 in excess thereof.

Authorized Principal Amount shall mean, in the case of the Initial Bonds, $20,000,000.

Authorized Representative shall mean:

(ii) in the case of the Company, a person named in Exhibit B — “Authorized Representative” to the Loan Agreement, or any other officer or employee of the Company who is authorized to perform specific duties hereunder or under any other Project Document and of whom another Authorized Representative of the Company has given written notice from time to time to the Issuer and the Trustee; and

(iii) in the case of the Parent, a person named in Exhibit B — “Authorized Representative” to the Loan Agreement, or any other officer or employee of the Parent who is authorized to perform specific duties hereunder or under any other Project Document and of whom another Authorized Representative of the Parent has given written notice from time to time to the Issuer and the Trustee;

provided, however, that in each case for which a certification or other statement of fact or condition is required to be submitted by an Authorized Representative to any Person pursuant to the terms of this Indenture or any other Project Document, such certificate or statement shall be executed only by an Authorized Representative in a position to know or to obtain knowledge of the facts or conditions that are the subject of such certificate or statement.

Bond Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Bondholder, Holder of Bonds, Holder or holder shall mean any Person who shall be the registered owner of any Bond or Bonds.

Bond Payment Date shall mean, with respect to a Series of Bonds, each date upon which interest, principal and/or Sinking Fund Installments shall be scheduled to be paid under such Series of Bonds.

Bond Placement Agreement shall mean the Bond Placement Agreement, dated July 1, 2010, with respect to the placement of the Initial Bonds, among the Issuer, the Company and the Placement Agent.

Bond Registrar shall mean the Trustee acting as registrar as provided in Section 3.10.

Bond Resolution shall mean the resolution of the Issuer adopted on February 9, 2010, as amended on April 13, 2010, authorizing the issuance of the Initial Bonds.

Bonds shall mean the Initial Bonds and any Additional Bonds.

Business Day shall mean any day other than:

(i) a Saturday or Sunday or a legal holiday;

(ii) a day on which the Trustee, the Tender Agent, the Paying Agent or the Remarketing Agent is required or authorized by law or executive order to be closed;

(iii) a day on which banking institutions in the City are authorized by law or executive order to remain closed; or

(iv) a day on which The New York Stock Exchange or DTC is closed.

Capitalized Interest Account shall mean the special trust account of the Project Fund so designated, established pursuant to Section 5.01.

Capitalized Interest Period shall have the meaning assigned to such term in Section 5.02(b).

City shall mean The City of New York, New York.

Closing Date shall mean July 1, 2010, the date of the initial issuance and delivery of the Initial Bonds.

Commencement Date shall mean July 1, 2010, on which date the Loan Agreement was executed and delivered.

Company’s Property shall have the meaning specified in Section 3.4(c) of the Loan Agreement.

Company Purchase Account shall mean the special trust account of the Purchase Fund so designated, established pursuant to Section 5.01.

Computation Date shall have the meaning assigned to that term in the Tax Regulatory Agreement.

Computation Period shall have the meaning assigned to that term in the Tax Regulatory Agreement.

Conduct Representation shall mean any representation by the Company under Section 2.2(u) of the Loan Agreement, by the Parent under Section 2.1(h) of the Issuer Indemnification Agreement, or by any other Person in any Required Disclosure Statement delivered to the Issuer.

Construction Account shall mean the special trust account of the Project Fund so designated, established pursuant to Section 5.01.

Default Rate shall mean fifteen percent (15%) per annum.

Defaulted Interest shall have the meaning specified in Section 2.02(f).

Defeasance Obligations shall mean Government Obligations that are not subject to redemption prior to maturity.

Determination Date shall mean, for any Adjustable Fixed Interest Rate Term other than the Initial Adjustable Fixed Interest Rate Term, the seventh (7th) Business Day immediately preceding the Adjustment Date for such Adjustable Fixed Interest Rate Term.

Determination of Taxability shall mean;

DTC shall mean The Depository Trust Company, a limited purpose trust company organized under the laws of the State, and its successors and assigns.

Earnings Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Event of Default shall have the meaning specified in Section 8.01(a).

Facility shall mean, collectively, the Land and the Improvements.

Facility Lease Payments shall have the meaning specified in Section 4.1 of the Mortgage.

Facility Tenants shall mean all Persons as shall use, possess or occupy all or any portion of the Facility pursuant to a Facility Lease.

Final Maturity Date shall mean, in the case of the Initial Bonds, November 1, 2042.

First Optional Redemption Date shall have the meaning assigned to that term by Section 2.04(a)(ii).

Government Obligations shall mean the following:

(i) direct and general obligations of, or obligations unconditionally guaranteed by, the United States of America;

(ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America, the payment of which is unconditionally guaranteed as a full faith and credit obligation of the United States of America for the timely payment thereof; or

(iii) securities or receipts evidencing ownership interests in obligations or specified portions (such as principal or interest) of obligations described in clauses (i) or (ii) above.

Guarantors shall mean, collectively, the Company and the Parent, and their respective successors and assigns.

Improvements shall mean:

(i) all buildings, structures, foundations, related facilities, fixtures and other improvements existing on the Commencement Date and erected or situated on the Land;

(ii) any other buildings, structures, foundations, related facilities, fixtures and other improvements constructed or erected on the Land throughout the term of the Loan Agreement (including any improvements or demolitions made as part of the Project Work pursuant to Section 3.2 of the Loan Agreement); and

(iii) all replacements, improvements, additions, extensions, substitutions, restorations and repairs to any of the foregoing.

Indenture shall mean this Indenture of Trust, dated as of April 1, 2010, between the Issuer and the Trustee, as from time to time amended or supplemented by Supplemental Indentures in accordance with Article XI.

Initial Adjustable Fixed Interest Rate Term shall mean the period commencing on the original date of issuance of the Initial Bonds and continuing to but excluding the Initial Adjustment Date (or, if such day is not a Business Day, the next succeeding Business Day).

Initial Adjustment Date shall mean November 1, 2014 (or, if such day shall not be a Business Day, the next succeeding Business Day).

Initial Purchase Date shall mean November 1, 2014 (or, if such day shall not be a Business Day, the next succeeding Business Day).

Interest Account shall mean the special trust account of the Bond Fund so designated, established pursuant to Section 5.01.

Interest Rate Change shall mean the establishment of an Adjustable Fixed Interest Rate for an Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term).

Issuer’s Reserved Rights shall mean, collectively,

(ii) the right of the Issuer to grant or withhold any consents or approvals required of the Issuer under the Loan Agreement;

(iii) the right of the Issuer to enforce in its own behalf the obligation of the Company under the Loan Agreement to complete the Project;

(v) the right of the Issuer in its own behalf to declare a default with respect to any of the Issuer’s Reserved Rights and exercise the remedies set forth in Section 8.2(b) of the Loan Agreement.

Liens shall have the meaning specified in Section 7.10(a) of the Loan Agreement.

Loan shall mean the loan made by the Issuer to the Company pursuant to the Loan Agreement as described in Section 4.1 of the Loan Agreement.

Loan Agreement shall mean the Loan Agreement, dated as of even date herewith, between the Issuer and the Company, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Loan Payment Date shall mean the fifth (5th) Business Day immediately preceding each Bond Payment Date.

Loss Event shall have the meaning specified in Section 5.1 of the Loan Agreement.

Notice Parties shall mean the Issuer, the Company, the Parent, the Bond Registrar, the Paying Agents, the Trustee, the Tender Agent and the Remarketing Agent.

Outstanding, when used with reference to a Bond or Bonds, as of any particular date, shall mean all Bonds which have been issued, executed, authenticated and delivered under the Indenture, except:

(i) Bonds cancelled by the Trustee because of payment or redemption prior to maturity or surrendered to the Trustee under the Indenture for cancellation;

(ii) any Bond (or portion of a Bond) for the payment or redemption of which, in accordance with Article X, there has been separately set aside and held in the Redemption Account of the Bond Fund either:

(A) moneys, and/or

(B) Defeasance Obligations in such principal amounts, of such maturities, bearing such interest and otherwise having such terms and qualifications as shall be necessary to provide moneys,

(iii) Bonds in exchange for or in lieu of which other Bonds shall have been authenticated and delivered under Article III,

Permitted Encumbrances shall mean:

(i) the Ground Lease, the Mortgage, the Pledge and Security Agreement, the Building Loan Agreement, all Facility Leases and any other Project Document;

(ii) liens for real estate taxes, if any, payments in lieu of real estate taxes, assessments, levies and other governmental charges, the payment of which is not yet due and payable;

(vi) those exceptions to title to the Facility enumerated in the title insurance policy delivered pursuant to Section 3.7 of the Loan Agreement insuring the Trustee’s mortgagee interest under the Mortgage in the Facility, a copy of which is on file at the offices of the Issuer and at the designated corporate trust office of the Trustee;

(ix) any judgment lien against the Company, so long as the finality of such judgment is being contested in good faith and execution thereon is stayed;

(x) any purchase money security interest in movable personal property, including equipment leases and financing;

(xi) liens on property due to rights of governmental entities or third party payors for recoupment of excess reimbursement paid;

(xiv) any lien, security interest, encumbrances or charge which exists in favor of the Trustee or to which the Trustee shall consent in writing.

Person shall mean an individual or any Entity.

Placement Agent shall mean, in the case of the Initial Bonds, Roosevelt & Cross, Incorporated, New York, New York.

Plans and Specifications shall mean the plans and specifications prepared for the Project by or on behalf of the Company, as amended from time to time by or on behalf of the Company to reflect any remodeling or relocating of the Project or substitutions, additions, modifications and improvements to the Project made by the Company in compliance with the Loan Agreement, said plans and specifications being duly certified by an Authorized Representative of the Company and filed in the designated corporate trust office of the Trustee and available to the Issuer.

Pledged Collateral shall have the meaning specified in Section 3.1 of the Pledge and Security Agreement.

Principal Account shall mean the special trust account of the Bond Fund so designated, established pursuant to Section 5.01.

Principal Office of the Remarketing Agent shall mean the office designated by the Remarketing Agent in a written notice delivered to the other Notice Parties.

Principal Office of the Tender Agent shall mean The Bank of New York Mellon, 101 Barclay Street, Floor 7W, New York, New York 10286, Attention: Corporate Trust Administration, or such other office to which the Tender Agent shall have delivered written notice to the other Notice Parties.

Project shall mean the construction, renovation, equipping and furnishing of an approximately 50,000 square foot facility to be leased to retail commercial tenants.

Project Costs shall mean:

(i) all costs of engineering and architectural services with respect to the Project, including the cost of test borings, surveys, estimates, permits, Plans and Specifications and for supervising demolition, construction and renovation, as well as for the performance of all other duties required by or consequent upon the proper construction of, and the making of alterations, renovations, additions and improvements in connection with, the completion of the Project;

(iii) the interest on the Bonds during the construction and renovation of the Project until the completion of the Project;

(iv) payments pursuant to the Ground Lease during the construction and renovation of the Project until the completion of the Project;

(v) all costs of contract bonds and of insurance that may be required or necessary during the period of Project construction and renovation;

(vi) all costs of title insurance as provided in Section 3.7 of the Loan Agreement;

(vii) that portion of the mortgage recording tax payable upon the recording of the Mortgage as specified in the Tax Regulatory Agreement as eligible to be financed from the proceeds of the Bonds;

(viii) the payment of the Costs of Issuance with respect to the Initial Bonds;

(ix) the payment of the fees and expenses of the Trustee during the period of construction and renovation of the Project;

(xi) all other costs and expenses relating to the completion of the Project or the issuance of a Series of Additional Bonds.

“Project Costs” shall not include (i) fees or commissions of real estate brokers; (ii) moving expenses; (iii) amounts payable as rent under the Ground Lease; or (iv) operational costs.

Project Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Project Work shall mean the design and construction of the Improvements in accordance with the Plans and Specifications.

Promissory Note shall mean, with respect to the Initial Bonds, that certain Promissory Note in substantially the form of Exhibit G to the Loan Agreement, and, with respect to any Series of Additional Bonds, that certain Promissory Note in substantially the form of any related Exhibit to an amendment to the Loan Agreement, and shall include in each case any and all amendments thereof and supplements thereto made in conformity with the Loan Agreement and herewith.

Purchase Date shall mean each Adjustment Date, commencing on the Initial Purchase Date, on which the Initial Bonds are required to be mandatorily tendered for purchase at the Purchase Price pursuant to this Indenture.

Purchase Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Rating Agency shall mean any of S&P, Moody’s or Fitch and such other nationally recognized securities rating agency as shall have awarded a rating to the Initial Bonds.

Rating Category shall mean one of the generic rating categories of a Rating Agency without regard to any refinement or gradation of such rating by a numerical modifier or otherwise.

Rebate Amount shall have the meaning assigned to that term in the Tax Regulatory Agreement.

Rebate Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Record Date shall mean, with respect to any Interest Payment Date for the Initial Bonds, the close of business on the fifteenth (15th) day of the month next preceding such Interest Payment Date, or, if such day is not a Business Day, the next preceding Business Day.

Redemption Account shall mean the special trust account of the Bond Fund so designated, established pursuant to Section 5.01.

Redemption Date shall mean the date fixed for redemption of Bonds subject to redemption in any notice of redemption given in accordance with the terms of the Indenture.

Refunding Bonds shall have the meaning assigned to that term in Section 2.08(c).

Related Security Documents shall mean all Security Documents other than the Indenture.

Remarketing Account shall mean the special trust account of the Purchase Fund so designated, established pursuant to Section 5.01.

Remarketing Agreement shall mean, as of any date, the Remarketing Agreement between the Company and the then Remarketing Agent.

Renewal Fund shall mean the special trust fund so designated, established pursuant to Section 5.01.

Representations Letter shall mean the Blanket Agency Letter of Representations from the Issuer and the Trustee to DTC with respect to the Initial Bonds.

Responsible Officer shall mean, with respect to the Trustee, any officer within the corporate trust office of the Trustee, including any vice-president, any assistant vice-president, any secretary, any assistant secretary, the treasurer, any assistant treasurer or other officer of the corporate trust office of the Trustee customarily performing functions similar to those performed by any of the above designated officers, who has direct responsibility for the administration of the trust granted in the Indenture, and shall also mean, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of that officer’s knowledge of and familiarity with the particular subject.

Securities Depository shall mean any securities depository that is a clearing agency under federal law operating and maintaining, with its participants or otherwise, a book-entry system to record ownership of book-entry interests in the Bonds, and to effect transfers of book-entry interests in the Bonds in book-entry form, and includes and means initially DTC.

Security Documents shall mean, collectively, the Loan Agreement, the Promissory Note, the Pledge and Security Agreement, this Indenture, the Bond Guaranty Agreement, the Project Completion Guaranty Agreement, the Tax Regulatory Agreement, the Building Loan Agreement and the Mortgage.

Sinking Fund Installment Account shall mean the special trust account of the Bond Fund so designated, which is established pursuant to Section 5.01.

Special Record Date shall have the meaning specified in Section 2.02(f).

State shall mean the State of New York.

Supplemental Indenture shall mean any indenture supplemental to or amendatory of the Indenture, executed and delivered by the Issuer and the Trustee in accordance with Article XI.

Taxable Rate shall mean thirteen percent (13%) per annum.

Tender Agent shall mean initially, The Bank of New York Mellon, New York, New York, and any successor tender agent appointed pursuant to Section 9.11.

Trustee shall mean The Bank of New York Mellon, New York, New York, in its capacity as trustee under this Indenture, and its successors in such capacity and their assigns hereafter appointed in the manner provided in the Indenture.

Trust Estate shall mean all property, interests, revenues, funds, contracts, rights and other security granted to the Trustee under the Security Documents.

Yield shall have the meaning assigned to such term in the Tax Regulatory Agreement.

Section 1.02. Construction.

(a) The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar terms, as used in this Indenture, refer to this Indenture, and the term “hereafter” shall mean after, and the term “heretofore” shall mean before, the Closing Date.

(d) Any headings preceding the texts of the several Articles and Sections of this Indenture, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this Indenture, nor shall they affect its meaning, construction or effect.

(f) The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

(g) The word “will” shall be construed to have the same meaning and effect as the word “shall”.

ARTICLE II

AUTHORIZATION AND ISSUANCE OF BONDS

Section 2.01. Authorized Amount of Bonds; Pledge Effected by this Indenture. i) No Bond may be authenticated and delivered under the provisions of this Indenture except in accordance with this Article. Except as provided in Sections 2.08 and 3.07, the total aggregate principal amount of Bonds that may be authenticated and delivered hereunder is limited to the Authorized Principal Amount.

(b) The proceeds of the Bonds deposited in the Project Fund and certain of the loan payments, receipts and revenues derived from or in connection with the Facility, including moneys which are required to be set apart, transferred and pledged to the Earnings Fund, to the Bond Fund, to the Purchase Fund, to the Advance Interest Deposit Fund, to the Renewal Fund or to certain special funds, including the investments, if any, thereof (subject to disbursements from such Funds in accordance with the provisions of this Indenture) are pledged by this Indenture for the payment of the principal or Redemption Price, if any, of, Sinking Installments for, Purchase Price, and interest on, the Bonds. All such Funds shall be held by the Trustee in trust for the benefit of the Bondholders, and while held by the Trustee constitute part of the Trust Estate and be subject to the lien hereof. The Rebate Fund (including amounts on deposit therein) shall not be subject to any assignment, pledge, lien or security interest in favor of the Trustee or any Bondholder or any other Person. The Purchase Fund shall be held in trust only in favor of those Persons entitled thereto as provided in this Indenture. The Bonds shall be the special limited revenue obligations of the Issuer and shall be payable by the Issuer as to the principal or Redemption Price, if any, of the Bonds, Sinking Fund Installments for the Bonds, Purchase Price, and interest on the Bonds only from the Funds, special funds and loan payments, revenues and receipts pledged therefor. The Bonds are additionally secured by a pledge and assignment of (y) the Promissory Note, and (z) substantially all of the Issu er’s right, title and interest in and to the Loan Agreement. The payment of the principal of, Sinking Fund Installments for, redemption premium, if any, and interest on the Initial Bonds, and the payments, obligations, covenants and agreements of the Company under the Loan Agreement, have been guaranteed by the Guarantors pursuant to the Bond Guaranty Agreement. The completion of the Project, in accordance with the Ground Lease and the Loan Agreement, has been guaranteed by the Guarantors pursuant to the Project Completion Guaranty Agreement. Further, the Company has granted a first lien in Facility Revenues and the remainder of the Pledged Collateral to the Trustee pursuant to the Pledge and Security Agreement. In addition, the Company has granted mortgage liens on and security interests in its leasehold interest in the Facility under the Ground Lease, and an assignment of leases and rents, to the Trustee pursuant to the Mortgage.

In no event shall any obligations of the Issuer under this Indenture or the Bonds or under the Loan Agreement or under any other Security Document or related document for the payment of money create a debt of the State or the City and neither the State nor the City shall be liable on any obligation so incurred, but any such obligation shall be a special limited revenue obligation of the Issuer secured and payable solely as provided in this Indenture.

Section 2.02. Issuance and Terms of the Initial Bonds. ii) The Initial Bonds in the Authorized Principal Amount shall be issued under and secured by this Indenture. The Initial Bonds shall be issuable in fully registered form without coupons substantially in the form set forth in Exhibit C and shall be dated as provided in Section 3.01.

(b) The Initial Bonds shall mature on the Final Maturity Date, and shall bear interest at the Adjustable Fixed Interest Rate, all as provided in this Article II. Interest shall be payable on each Interest Payment Date and shall be computed on the basis of a 360-day year of twelve 30-day months. Notwithstanding anything herein to the contrary, the interest rate borne by the Initial Bonds shall not exceed the Maximum Interest Rate.

(c) If there shall occur an Event of Default (other than by reason of a failure to redeem the Initial Bonds in whole if there shall occur a Determination of Taxability), the rate of interest on the Initial Bonds shall be the Default Rate commencing with the date of the occurrence of the Event of Default and any additional interest thereby due with respect to a period of time for which interest has already been paid shall be payable on the Interest Payment Date next following the Event of Default. Any former Bondholder who was a Bondholder commencing on or after the date of the occurrence of the Event of Default, but who subsequent to such date sold or otherwise disposed of its Initial Bonds or whose Initial Bonds were redeemed or matured, shall be entitled to receive from the Company under the Loan Agreement the following, in an amount allocable to such period during which it held the Initial Bonds subsequent to the Event of Default and the date upon the Initial Bonds were sold, or otherwise disposed of, or redeemed or matured: the difference between the rate of interest borne by the Initial Bonds prior to the Event of Default and the rate borne by the Initial Bonds on and subsequent to such date.

(d) If there shall occur a Determination of Taxability, the rate of interest on the Initial Bonds shall be the Taxable Rate commencing with the date of the Event of Taxability and any additional interest thereby due with respect to a period of time for which interest has already been paid shall be payable on the Interest Payment Date next following the Determination of Taxability. Any former Bondholder who was a Bondholder commencing on or after the date of the occurrence of an Event of Taxability, but who subsequent to such date sold or otherwise disposed of its Initial Bonds or whose Initial Bonds were redeemed or matured, shall be entitled to receive from the Company under the Loan Agreement the following, in an amount allocable to such period during which it held the Initial Bonds subsequent to the Event of Taxability and the date upon which the Initial Bonds were sold, or otherwise disposed of, or redeemed or matured: the difference between the rate of interest borne by the Initial Bonds prior to the Event of Taxability and the rate borne by the Initial Bonds on and subsequent to such date.

(e) The Initial Bonds shall be numbered from R-1 upward in consecutive numerical order. Initial Bonds issued upon any exchange or transfer hereunder shall be numbered in such manner as the Trustee in its discretion shall determine.

(f) The principal of, Sinking Fund Installments for, and the Redemption Price, if applicable, on all Initial Bonds shall be payable by check or draft at maturity or upon earlier redemption to the Persons in whose names such Initial Bonds are registered on the bond registration books maintained by the Trustee as Bond Registrar at the maturity or redemption date thereof, upon presentation and surrender of such Initial Bonds, at the designated corporate trust office of the Trustee or of any Paying Agent.

The interest payable on each Initial Bond on any Interest Payment Date shall be paid by the Trustee to the registered owner of such Initial Bond as shown on the bond registration books of the Trustee as Bond Registrar at the close of business on the Regular Record Date for such interest, (1) by check or draft mailed to such registered owner at his address as it appears on the bond registration books or at such other address as is furnished to the Trustee in writing by such owner, or (2) if such Initial Bonds are held by a Securities Depository or, at the written request addressed to the Trustee by any registered owner of Initial Bonds in the aggregate principal amount of at least $1,000,000 that all such payments be made by wire transfer, by electronic transfer in immediately available funds to the bank for credit to the ABA rout ing number and account number filed with the Trustee no later than five (5) Business Days before an Interest Payment Date, but no later than a Regular Record Date for any interest payment.

Interest on any Initial Bond that is due and payable but not paid on the date due (“Defaulted Interest”) shall cease to be payable to the owner of such Initial Bond on the relevant Regular Record Date and shall be payable to the owner in whose name such Initial Bond is registered at the close of business on a special record date (the “Special Record Date”) for the payment of such Defaulted Interest, which Special Record Date shall be fixed in the following manner. It is provided in the Loan Agreement that the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Initial Bond and the date of the proposed payment (which date shall be such as will enable the Trustee to comply with the next sentence hereof), and shall deposit with the Trustee at the time of such notice an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment. Money deposited with the Trustee on account of Defaulted Interest shall be held in trust for the benefit of the owners of the Initial Bonds entitled to such Defaulted Interest as provided in this Section. Following receipt of such funds the Trustee shall fix the Special Record Date for the payment of such Defaulted Interest which shall be not more than fifteen (15) nor less than ten (10) days prior to the date of the proposed payment and not less than ten (10) days after the receipt of such funds by the Trustee. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Co mpany, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first class postage prepaid, to each owner of an Initial Bond entitled to such notice at the address of such owner as it appears on the bond registration books not less than ten (10) days prior to such Special Record Date.

Subject to the foregoing provisions of this Section, each Initial Bond delivered under this Indenture upon transfer of or in exchange for or in lieu of any other Initial Bond shall carry all the rights to interest accrued and unpaid, and to accrue, which were carried by such other Initial Bond and each such Initial Bond shall bear interest from such date, so that neither gain nor loss in interest shall result from such transfer, exchange or substitution.

(g) The Initial Bonds are issuable in the form of fully registered bonds in the Authorized Denominations.

(h) Anything in the Initial Bonds or in this Indenture to the contrary notwithstanding, the obligations of the Issuer hereunder and under the Initial Bonds shall be subject to the limitation that payments of interest or other amounts on the Initial Bonds shall not be required to the extent that receipt of any such payment by a Holder of an Initial Bond would be contrary to the provisions of law applicable to such Holder which would limit the maximum rate of interest which may be charged or collected by such Holder of an Initial Bond.

Section 2.03. Determination of Adjustable Fixed Interest Rate. iii) For the Initial Adjustable Fixed Interest Rate Term, the Initial Bonds shall bear interest at seven and one-quarter percent (7¼%) per annum. The interest rate payable on the Initial Bonds shall be adjusted on each Adjustment Date in accordance with the provisions of this Indenture and the Initial Bonds.

(b) Each Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term which shall commence on the Closing Date) shall commence on the Adjustment Date immediately following the end of the preceding Adjustable Fixed Interest Rate Term and will continue to but excluding the next succeeding Adjustment Date. For each Adjustable Fixed Interest Rate Term after the Initial Adjustable Fixed Interest Rate Term, the Adjustable Fixed Interest Rate Term shall be a period determined at the direction of the Company which is equal to one (1) whole year or any integral multiple of whole years, but in no event shall any such Adjustable Fixed Interest Rate Term extend beyond the Final Maturity Date of the Initial Bonds. The Business Day immediately following the last day of each Adjustable Fixed Interest Rate Term as determined pursuant to this Section 2.03(b) shall be the Adjustment Date. The Initial Bonds are subject to mandatory purchase on each Adjustment Date pursuant to Section 2.03(h).

(c) Subject to subsection (e) below, the interest rate applicable to the Initial Bonds on and after each Adjustment Date shall be the interest rate determined by the Remarketing Agent on the Determination Date immediately preceding such Adjustment Date. The Adjustable Fixed Interest Rate applicable to the Initial Bonds shall be the lower of (i) the lowest rate which, in the best professional judgment of the Remarketing Agent (having due regard to the prevailing market conditions), would be necessary to enable the Initial Bonds to be sold at par on the Adjustment Date, provided that the Adjustable Fixed Interest Rate shall not exceed the Maximum Rate, or (ii) The Bond Buyer Revenue Bond Index (a s published in The Bond Buyer or any successor publication thereto) for the most recent period for which such information is available as of the date the Adjustable Fixed Interest Rate is established, plus two hundred fifty (250) basis points. Upon such determination of the Adjustable Fixed Interest Rate, the Remarketing Agent shall promptly notify the Trustee and the Company of the Adjustable Fixed Interest Rate. Not less than the fifth (5th) Business Day prior to the Adjustment Date, the Trustee shall promptly notify each Holder of the Initial Bonds of the Adjustable Fixed Interest Rate which will be applicable to the Initial Bonds during the next succeeding Adjustable Fixed Interest Rate Term.

(d) The interest rate on the Initial Bonds (other than for the Initial Adjustable Fixed Interest Rate Term) will not be reset on any Adjustment Date unless (i) at least thirty (30) days prior to such Adjustment Date and (ii) again on such Adjustment Date, the Company shall cause to be delivered at its expense to the Issuer, the Trustee and the Remarketing Agent, a Favorable Opinion of Bond Counsel. The Company shall use its best efforts to cause such Favorable Opinion of Bond Counsel to be delivered to the Issuer, the Trustee and the Remarketing Agent by such date. In the event that any such Favorable Opinion of Bond Counsel is not delivered when required, the interest rate on the Initial Bonds then in effect shall remain in effect as the Adjustable Fixed Interest Rate for the next succeeding Adjustable Fixed Interest Rate Term, and the term of the next Adjustable Fixed Interest Rate Term shall be the shorter of (i) the same period as the immediately preceding Adjustable Fixed Interest Rate Term, or (ii) the period until the Final Maturity Date of the Initial Bonds.

(e) If the Remarketing Agent is unable to remarket all of the Initial Bonds at the Adjustable Fixed Interest Rate determined by the Remarketing Agent pursuant to subsection (c) above, the Remarketing Agent may at any time prior to the Adjustment Date increase the Adjustable Fixed Interest Rate to that rate of interest which, as of the date of determination, is the lowest rate which, in the best professional judgment of the Remarketing Agent (having due regard to the prevailing market conditions), would be necessary to enable the Initial Bonds to be sold at par on the Adjustment Date; provided, however, that such re-determined Adjustable Fixed Interest Rate shall not exceed the Maximum Interest Rate. No more than five (5) days prior to the Adjustment Date, the Trustee shall notify by mail the Company and the Holders of the Initial Bonds of any such revision in the Adjustable Fixed Interest Rate. The Remarketing Agent shall not increase the Adjustable Fixed Interest Rate later than five (5) days prior to the Adjustment Date (except with the consent of the Company) and notice of the increased Adjustable Fixed Interest Rate shall in that event be given by the Remarketing Agent concurrently to the Trustee and the Company.

(f) If, for any reason, the Adjustable Fixed Interest Rate for the Initial Bonds is not or cannot be determined by the Remarketing Agent in the manner specified above, the Adjustable Fixed Interest Rate will be equal to the closing yield, plus two hundred fifty (250) basis points, for Treasury Bills, Notes or Bonds, as applicable, of the maturity closest to, without exceeding, the term of the Adjustable Fixed Interest Rate Term determined in accordance with Section 2.03(b), as such yield is published in the table captioned “U.S. Securities Prices” in the edition of The Bond Buyer (or if The Bond Buyer or such table is no longer published, any other published similar rate as is determined by th e Trustee in its sole discretion to be appropriate) published on the day on which such Adjustable Fixed Interest Rate is determined, or if such yield or other similar rate is not published on that day, the day of the most recent publication of such yield or other similar rate.

(g) The determination in accordance with the Indenture of the Adjustable Fixed Interest Rate to be borne by the Initial Bonds shall, in the absence of manifest error, be conclusive and binding on the Holders of the Initial Bonds and the Notice Parties. Failure by the Trustee to give any notice required hereunder, or any defect therein, shall not affect the interest rate borne by the Initial Bonds.

(h) On each Purchase Date, the Initial Bonds shall be subject to mandatory tender for purchase by the Tender Agent at the Purchase Price.

IN THE EVENT OF A FAILURE BY HOLDERS OF INITIAL BONDS TO TENDER INITIAL BONDS FOR PURCHASE ON A PURCHASE DATE AS PROVIDED ABOVE, SAID HOLDERS OF INITIAL BONDS SHALL NOT BE ENTITLED TO ANY PAYMENT (INCLUDING ANY INTEREST TO ACCRUE SUBSEQUENT TO THE PURCHASE DATE) OTHER THAN THE PURCHASE PRICE FOR SUCH UNTENDERED INITIAL BONDS, AND THE HOLDERS OF ANY UNTENDERED INITIAL BONDS SHALL NO LONGER BE ENTITLED TO THE BENEFITS OF THIS INDENTURE, EXCEPT FOR THE PURPOSE OF PAYMENT OF THE PURCHASE PRICE THEREOF, AND SHALL BE DEEMED PURCHASED, CANCELLED AND NO LONGER OUTSTANDING UNDER THIS INDENTURE.

(i) The Trustee shall give notice to the Notice Parties and the registered Holders of the Initial Bonds, not later than ten (10) Business Days prior to each Purchase Date, which notice shall state:

(A) the Purchase Date;

(B) that an Interest Rate Change on the Initial Bonds will occur on the Adjustment Date;

(D) the commencement and termination dates of the next Adjustable Fixed Interest Rate Term; and

(E) that all Initial Bonds will be deemed sold to the Tender Agent on the Purchase Date at the Purchase Price, that such Initial Bonds should be delivered to the Principal Office of the Tender Agent by no later than 11:30 a.m., New York City time, on the Purchase Date, and that said Holders of Initial Bonds deemed sold shall not be entitled to any payment (including any interest to accrue subsequent to the Purchase Date) other than the Purchase Price for such untendered Initial Bonds.

(j) Funds for the payment of the Purchase Price of Initial Bonds shall be derived solely from the following sources in the order of priority indicated and none of the Issuer, the Tender Agent, the Trustee nor the Remarketing Agent shall be obligated to provide funds from any other source:

(A) immediately available funds on deposit in the Remarketing Account of the Purchase Fund; and

(B) moneys of the Company on deposit in the Company Purchase Account.

Section 2.04. Redemption of Initial Bonds. iv) General Optional Redemption. (1) During the Initial Adjustable Fixed Interest Rate Term, the Initial Bonds shall be subject to redemption, on or after May 1, 2012, in whole at any time or in part on any Interest Payment Date (but if in part in integral multiples of $5,000 and in the minimum principal amount of $100,000) at the option of the Issuer (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agr eement pursuant to Section 4.3(c) thereof), at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Initial Bonds to be redeemed, plus accrued interest to the date of redemption.

(ii) During any Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term), the Initial Bonds shall be subject to redemption, in whole at any time or in part on any Interest Payment Date (but if in part in integral multiples of $5,000 and in the minimum principal amount of $100,000) at the option of the Issuer (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agreement pursuant to Section 4.3(c) thereof), at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Initial Bonds to be redeemed, plus accrued interest to the date of redemption, commen cing on or after that date (the “First Optional Redemption Date”) as determined below:

(A) if there shall be ten (10) or less years in such Adjustable Fixed Interest Rate Term, the First Optional Redemption Date shall be the second (2nd) anniversary of the date of commencement of such Adjustable Fixed Interest Rate Term, and

(B) if there shall be more than ten (10) years in such Adjustable Fixed Interest Rate Term, the First Optional Redemption Date shall be the fifth (5th) anniversary of the date of commencement of such Adjustable Fixed Interest Rate Term.

(b) Extraordinary Redemption. The Initial Bonds are also subject to redemption prior to maturity, at the option of the Issuer exercised at the direction of the Company (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agreement pursuant to Section 4.3(c) thereof), as a whole on any date, upon notice or waiver of notice as provided in this Indenture, at a Redemption Price of one hundred percent (100%) of the unpaid principal amount thereof plus accrued interest to the date of redemption if one or more of the following events shall have occ urred:

(i) The Facility shall have been damaged or destroyed to such extent that, as evidenced by a certificate of an Independent Engineer filed with the Issuer and the Trustee, (A) the Facility cannot be reasonably restored within a period of one year from the date of such damage or destruction to the condition thereof immediately preceding such damage or destruction, (B) the Company is thereby prevented or likely to be prevented from carrying on its normal operation at the Facility for a period of one year from the date of such damage or destruction, or (C) the restoration cost of the Facility would exceed the total amount of all insurance proceeds, including any deductible amount, in respect o f such damage or destruction; or

(ii) Title to, or the temporary use of, all or substantially all of the Facility shall have been taken or condemned by a competent authority which taking or condemnation results, or is likely to result, in the Company being thereby prevented or likely to be prevented from carrying on its normal operation at the Facility for a period of one year from the date of such taking or condemnation, as evidenced by a certificate of an Independent Engineer filed with the Issuer and the Trustee; or

(iii) As a result of changes in the Constitution of the United States of America or of the State or of legislative or executive action of the State or any political subdivision thereof or of the United States of America or by final decree or judgment of any court after the contest thereof by the Company, the Loan Agreement becomes void or unenforceable or impossible of performance in accordance with the intent and purpose of the parties as expressed therein or unreasonable burdens or excessive liabilities are imposed upon the Company by reason of the operation of the Facility.

If the Initial Bonds are to be redeemed in whole as a result of the occurrence of any of the events described above, the Company shall deliver to the Issuer and the Trustee a certificate of an Authorized Representative of the Company stating that, as a result of the occurrence of the event giving rise to such redemption, the Company has discontinued, or at the earliest practicable date will discontinue, its operation of the Facility for its intended purposes.

(c) Mandatory Sinking Fund Installment Redemption. The Initial Bonds shall be subject to mandatory redemption by the Issuer prior to maturity, in part by lot, at a Redemption Price equal to one hundred percent (100%) of the principal amount thereof, together with accrued interest to the date of redemption, from mandatory Sinking Fund Installments on the dates and in the principal amounts set forth below, provided that the amounts of such Sinking Fund Installments shall be reduced by the credits provided for in Sections 5.06(d) and (f):

Sinking Fund Installment Payment Date	Sinking Fund Installment

May 1, 2015	$115,000
November 1, 2015	120,000
May 1, 2016	125,000
November 1, 2016	125,000
May 1, 2017	130,000
November 1, 2017	135,000
May 1, 2018	140,000
November 1, 2018	145,000
May 1, 2019	150,000
November 1, 2019	155,000
May 1, 2020	165,000
November 1, 2020	170,000
May 1, 2021	175,000
November 1, 2021	180,000
May 1, 2022	190,000
November 1, 2022	195,000
May 1, 2023	200,000
November 1, 2023	210,000
May 1, 2024	215,000
November 1, 2024	225,000
May 1, 2025	235,000
November 1, 2025	240,000

Sinking Fund Installment

Payment Date

Sinking Fund

Installment

May 1, 2026	$250,000
November 1, 2026	260,000
May 1, 2027	270,000
November 1, 2027	280,000
May 1, 2028	290,000
November 1, 2028	300,000
May 1, 2029	310,000
November 1, 2029	320,000
May 1, 2030	335,000
November 1, 2030	345,000
May 1, 2031	355,000
November 1, 2031	370,000
May 1, 2032	385,000
November 1, 2032	400,000
May 1, 2033	410,000
November 1, 2033	425,000
May 1, 2034	440,000
November 1, 2034	460,000
May 1, 2035	475,000
November 1, 2035	490,000
May 1, 2036	510,000
November 1, 2036	530,000
May 1, 2037	545,000
November 1, 2037	565,000
May 1, 2038	590,000
November 1, 2038	610,000
May 1, 2039	630,000
November 1, 2039	655,000
May 1, 2040	680,000
November 1, 2040	700,000
May 1, 2041	730,000
November 1, 2041	755,000
May 1, 2042	780,000
November 1, 2042 (final maturity)	810,000

(d) Mandatory Redemption from Excess Proceeds and Certain Other Amounts. The Initial Bonds shall be redeemed at any time in whole or in part by lot prior to maturity in the event and to the extent

(i) excess Bond proceeds shall remain after the completion of the Project,

(ii) excess title insurance or property insurance proceeds or condemnation awards shall remain after the application thereof pursuant to the Loan Agreement and this Indenture, or

(iii) excess proceeds shall remain after the release or substitution of fixtures or other portions of the Facility,

in each case at a Redemption Price equal to one hundred percent (100%) of the principal amount of the Initial Bonds to be redeemed, together with interest accrued thereon to the date of redemption.

(e) Mandatory Redemption Upon Failure to Operate the Facility for Approved Project Operations, Material Violation of Material Legal Requirements, False Representation or Failure to Maintain Liability Insurance. The Initial Bonds are also subject to mandatory redemption prior to maturity, at the option of the Issuer, as a whole only, in the event (i) the Issuer shall determine that (w) the Company is operating the Facility or any portion thereof, or is allowing the Facility or any portion thereof to be operated, not for the Approved Project Operations, (x) the Company, any Principal of the Company or any Person that directly or indirectly Controls, is Controlled by or is under common Control with the Company has committed a material violation of a material Legal Requirement, (y) any Conduct Representation is false, misleading or incorrect in any material respect at any date, as if made on such date, or (z) a Required Disclosure Statement delivered to the Issuer under any Project Document is not acceptable to the Issuer acting in its sole discretion, or (ii) the Company shall fail to obtain or maintain the public liability insurance with respect to the Facility required under the Loan Agreement, and, in the case of clause (i) or (ii) above, the Company shall fail to cure any such default or failure within the applicable time periods set forth in the Loan Agreement following the receipt by the Company of written notice of such default or failure from the Issuer and a demand by the Issuer on the Company to cure the same. Any such redemption shall be made upon notice or waiver of notice to the Bondholders as provided in this Indenture, at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Initial Bonds, together with interest accrued thereon to the date of redemption.

(f) Mandatory Taxability Redemption. Upon the occurrence of a Determination of Taxability, the Initial Bonds shall be redeemed prior to maturity on any date within one hundred twenty (120) days following such Determination of Taxability, at a Redemption Price equal to one hundred percent (100%) of the principal amount thereof, together with accrued interest at the Taxable Rate from the occurrence of the Event of Taxability to the date of redemption. The Initial Bonds shall be redeemed in whole unless redemption of a portion of the Initial Bonds Outstanding would have the result that interest payable on the Initial Bonds remaining Outstanding after such redemption would not be includable in the gross income of any Holder of an Initial Bond (other than a Holder who is a “substantial user” of the Facility or a “related person”, within the meaning of the Code). In such event, the Initial Bonds shall be redeemed in such amount as is deemed necessary in the opinion of Nationally Recognized Bond Counsel to accomplish that result.

(g) Purchase in Lieu of Optional Redemption. In lieu of calling Initial Bonds for optional redemption, Initial Bonds shall be subject to mandatory tender for purchase at the direction of the Issuer, upon the direction of the Company, in whole or in part (and, if in part, in such manner as determined by the Company) on any date, at a Purchase Price equal to the applicable Redemption Price for any optional redemption of such Initial Bonds as provided in Section 2.04(a), plus accrued interest to the purchase date. Purchases of tendered Initial Bonds may be made without regard to any provision of the Indenture relating to t he selection of Initial Bonds in a partial optional redemption. Initial Bonds purchased pursuant to any mandatory tender(s) are not required to be cancelled (subject to Section 10.5 of the Loan Agreement), and if not so cancelled, shall, prior to any resale by or on behalf of the Company, not be deemed Outstanding in connection with any subsequent partial optional redemption solely for purposes of those provisions of the Indenture relating to the selection of Initial Bonds in a partial redemption.

Purchases in lieu of an optional redemption shall be permitted, with the consent of the Issuer, upon the delivery to the Issuer and the Trustee of (i) an opinion of Nationally Recognized Bond Counsel addressed to the Issuer and the Trustee substantially to the effect that (A) such purchases in lieu of optional redemption comply with the provisions of the Indenture and (B) neither such purchases in lieu of an optional redemption nor any transaction directly related thereto will adversely affect the exclusion from gross income of interest on the Initial Bonds for purposes of federal income taxation, and (ii) such other opinions, certificates or documentation as the Issuer may require.

(h) Redemption of Initial Bonds permitted or required by this Article II shall be made as follows, and the Trustee shall give the notice of redemption required by Section 6.03 in respect of each such redemption:

(1) Redemption shall be made pursuant to the general optional redemption provisions of Section 2.04(a) or (b) at such times as are permitted under such Section and, in the case of Section 2.04(a), in such principal amounts, as the Company shall request in a written notice to the Trustee in accordance with Section 4.3(c) of the Loan Agreement.

(2) Redemption shall be made pursuant to the mandatory Sinking Fund Installment redemption provisions of Section 2.04(c) as and when required by this Section without the necessity of any request by, or notification from the Issuer or from the Company, but subject to the provisions of Section 5.06(d) and (f).

(3) Redemption shall be made pursuant to the mandatory redemption provisions of Section 2.04(d) at the earliest possible date following the deposit of the excess proceeds or other amounts in the Redemption Account of the Bond Fund, without the necessity of any instructions or further act of the Issuer or the Company.

(4) Redemption shall be made pursuant to the mandatory redemption provisions of Section 2.04(e) on the date specified therein in the event redemption is required under such circumstances, without the necessity of any instructions or further act of the Company.

(5) Redemption shall be made pursuant to the mandatory taxability redemption provisions of Section 2.04(f) at the earliest possible date, but no later than one hundred twenty (120) days following the Determination of Taxability, without the necessity of any instructions or further act of the Issuer or the Company.

Section 2.05. Delivery of Initial Bonds. The Initial Bonds shall be executed in the form and manner set forth in this Indenture and shall be deposited with the Trustee and thereupon shall be authenticated by the Trustee. Upon payment to the Trustee of the proceeds of sale of the Initial Bonds including the interest, if any, accrued on the Initial Bonds to the Closing Date, the Initial Bonds shall be delivered by the Trustee on behalf of the Issuer to or upon the order of the purchaser(s) thereof, but only upon receipt by the Trustee of:

(a) a copy, duly certified by the Secretary, Assistant Secretary, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs of the Issuer, of the Bond Resolution;

(b) an original executed counterpart of all Security Documents;

(c) a written opinion by Nationally Recognized Bond Counsel to the effect that the issuance of the Initial Bonds and the execution thereof have been duly authorized and that all conditions precedent to the delivery thereof have been fulfilled; and

(d) the written order to the Trustee executed by an Authorized Representative of the Issuer to authenticate and deliver the Initial Bonds to the purchaser(s) therein identified upon payment to the Trustee for the account of the Issuer of the purchase price therein specified, plus accrued interest, if any.

Section 2.06. Execution of Bonds. The Bonds shall be executed on behalf of the Issuer by the manual or facsimile signature of the Chairman, Vice Chairman, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs of the Issuer, and the seal of the Issuer shall be affixed thereto or imprinted thereon and attested by the manual or facsimile signature of the Secretary, Assistant Secretary, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs of the Issuer. Any facsimile signatures shall have the same force and effect as if the ap propriate officers had personally signed each of said Bonds. In case one or any of the officers who shall have signed or attested the Bonds or whose reproduced facsimile signature appears thereon shall cease to be such officer or officers before the Bonds so signed and attested shall have been actually issued and delivered, the Bonds may be issued and delivered as though the person who signed or attested or whose reproduced facsimile signature appears on the Bonds had not ceased to be such officer. Neither the members, directors, officers or agents of the Issuer nor any person executing the Bonds shall be liable personally or be subject to any personal liability or accountability by reason of the issuance thereof.

Section 2.07. Authentication. Only such Bonds as shall have endorsed thereon a certificate of authentication, in substantially the form set forth in the Form of Initial Bond in Exhibit C, duly executed by the Trustee, shall be entitled to any right or benefit under this Indenture. No Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this Indenture unless and until such certificate of authentication on such Bond shall have been duly executed by the Trustee, and such certificate of the Trustee upon any such Bond shall be conclusive evidence that such Bond has been duly authenticated and delivered under this Indenture. The Trustee shall note, with respect to each Bond to be authenticated under this Indenture in the space provided in the certificate of authentication for such Bond, the date of the authentication and delivery of such Bond. The Trustee’s certificate of authentication on any Bond shall be deemed to have been duly executed if signed by an authorized officer or signatory of the Trustee, but it shall not be necessary that the same officer or signatory sign the certificate of authentication on all of the Bonds.

Section 2.08. Additional Bonds. v) So long as the Ground Lease, the Mortgage, the Loan Agreement, the Pledge and Security Agreement, the Promissory Note and the Bond Guaranty Agreement are each in effect, and the prior written consent of the Holders of at least sixty-six and two-thirds percent (66-2/3%) in aggregate principal amount of the Bonds shall have been obtained, one or more Series of Additional Bonds may be issued, authenticated and delivered upon original issuance for the purpose of (i) completing the Project , (ii) providing funds in excess of Net Proceeds to repair, relocate, replace, rebuild or restore the Facility in the event of damage, destruction or taking by eminent domain, (iii) providing extensions, additions or improvements to the Facility, the purpose of which shall be for the Approved Project Operations, or (iv) refunding Outstanding Bonds. Such Additional Bonds shall be payable from the loan payments, receipts and revenues of the Facility including such extensions, additions and improvements thereto. Prior to the issuance of a Series of Additional Bonds and the execution of a Supplemental Indenture in connection therewith, the Issuer and the Company shall enter into an amendment to the Loan Agreement, and the Company shall execute a new Promissory Note, which shall provide, among other things, that the loan payments payable under the Loan Agreement and the aggregate amount to be paid under all Promissory Notes, shall be increased and computed so as to amortize in full the principal of and interest on such Additional Bonds and any other costs in connection therewith. In addition, each of the Guarantors and the Issuer shall enter into an amendment to each Security Document with the Trustee which shall provide that the amounts guaranteed or otherwise secured thereunder be increased accordingly.

(b) Each such Series of Additional Bonds shall be deposited with the Trustee and thereupon shall be authenticated by the Trustee. Upon payment to the Trustee of the proceeds of sale of such Series of Additional Bonds, they shall be made available by the Trustee for pick-up by the order of the purchaser or purchasers thereof, but only upon receipt by the Trustee of:

(1) a copy of the resolution, duly certified by the Secretary, Assistant Secretary, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs of the Issuer, authorizing, issuing and awarding the Series of Additional Bonds to the purchaser or purchasers thereof and providing the terms thereof and authorizing the execution of any Supplemental Indenture and any amendments of or supplements to the Loan Agreement and any other Security Document to which the Issuer shall be a party;

(2) original executed counterparts of the Supplemental Indenture and an amendment of or supplement to the Loan Agreement expressly providing that, to the extent applicable, for all purposes of the Supplemental Indenture, the Loan Agreement and the Mortgage, the Facility referred to therein and the premises subject thereto shall include the buildings, structures, improvements, machinery, equipment or other facilities being financed, and the Bonds referred to therein shall mean and include the Series of Additional Bonds being issued as well as the Initial Bonds and any Series of Additional Bonds theretofore issued;

(3) a written opinion by Nationally Recognized Bond Counsel, to the effect that the issuance of the Series of Additional Bonds and the execution thereof have been duly authorized and that all conditions precedent to the delivery thereof have been fulfilled and that the issuance of the Series of Additional Bonds will not cause the interest on any Series of Bonds Outstanding to become includable in gross income for Federal income tax purposes;

(4) except in the case of a Series of Refunding Bonds (defined below) refunding all Outstanding Bonds, a certificate of an Authorized Representative of each Guarantor to the effect that each Security Document to which it is a party continues in full force and effect and that there is no Event of Default nor any event which upon notice or lapse of time or both would become an Event of Default;

(5) written evidence from each Rating Agency by which any Series of Outstanding Bonds are then rated, if any, to the effect that it has reviewed the documentation pertaining to the issuance of the Series of Additional Bonds, and that the issuance of such Series of Additional Bonds will not result in a withdrawal, a suspension or a reduction of the long and short-term ratings, if applicable, then assigned to any Series of Outstanding Bonds by such Rating Agency;

(6) an original, executed counterpart of the amendment to each Security Document; and

(7) a written order to the Trustee executed by an Authorized Representative of the Issuer to authenticate and make available for pick-up the Series of Additional Bonds to the purchaser or purchasers therein identified upon payment to the Trustee of the purchase price therein specified, plus accrued interest, if any.

(c) (a) Upon the request of the Company, one or more Series of Additional Bonds may be authenticated and made available for pick-up upon original issuance to refund (“Refunding Bonds”) all Outstanding Bonds or any Series of Outstanding Bonds or any part of one or more Series of Outstanding Bonds. Bonds of a Series of Refunding Bonds shall be issued in a principal amount sufficient, together with other moneys available therefor, to accomplish such refunding and to make such deposits required by the provisions of this Indenture and of the resolution authorizing said Series of Refunding Bonds. In the case of the r efunding under this Section 2.08 of less than all Bonds Outstanding of any Series or of any maturity within such Series, the Trustee shall proceed to select such Bonds in accordance with Section 6.02.

(2) A Series of Refunding Bonds may be authenticated and made available for pick-up only upon receipt by the Trustee (in addition to the receipt by it of the documents required by Section 2.08(b), as may be applicable) of:

(A) Irrevocable instructions from the Issuer to the Trustee, satisfactory to it, to give due notice of redemption pursuant to Section 6.03 to the Holders of all the Outstanding Bonds to be refunded prior to maturity on the redemption date specified in such instructions; and

(B) Either:

(i) moneys in an amount sufficient to effect payment at maturity or upon redemption at the applicable Redemption Price of the Bonds to be refunded, together with accrued interest on such Bonds to the maturity or redemption date, which moneys shall be held by the Trustee or any Paying Agent in a separate account irrevocably in trust for and assigned to the respective Holders of the Outstanding Bonds being refunded, or

(ii) Defeasance Obligations in such principal amounts, having such maturities, bearing such interest, and otherwise having such terms and qualifications, as shall be necessary to comply with the provisions of Article X, and any moneys required pursuant to said Section (with respect to all Outstanding Bonds or any part of one or more Series of Outstanding Bonds being refunded), which Defeasance Obligations and moneys shall be held in trust and used only as provided in Article X.

(3) The Company shall furnish to the Trustee and the Issuer at the time of delivery of the Series of Refunding Bonds a certificate of an independent certified public accountant stating that the Trustee and/or the Paying Agent (and/or any escrow agent as shall be appointed in connection therewith) hold in trust the moneys or such Defeasance Obligations and moneys required to effect such payment at maturity or earlier redemption.

(d) Each Series of Additional Bonds issued pursuant to this Section shall be equally and ratably secured under this Indenture with the Initial Bonds and all other Series of Additional Bonds, if any, issued pursuant to this Section, without preference, priority or distinction of any Bond over any other Bonds except as expressly provided in or permitted by this Indenture.

(e) No Series of Additional Bonds shall be issued unless the Ground Lease, the Loan Agreement, the Promissory Note, the Mortgage, the Pledge and Security Agreement and the Bond Guaranty Agreement are in effect and at the time of issuance there is no Event of Default nor any event which upon notice or lapse of time or both would become an Event of Default.

Section 2.09. CUSIP Numbers. The Issuer in issuing the Bonds may use CUSIP numbers (if then generally in use), and, if so, the Trustee shall use such CUSIP numbers in notices of redemption as a convenience to registered owners; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Bonds or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Bonds, and any such redemption shall not be affected by any defect in or omission of such numbers. The Issuer will pr omptly notify the Trustee of any change in the CUSIP numbers of which it has actual knowledge.

Section 2.10. Book Entry Bonds. vi) Except as provided in Section 2.10(c), the Initial Bonds shall be registered in the name of Cede & Co., as nominee for DTC. Payment of interest for any Initial Bond registered in the name of Cede & Co. shall be made by wire transfer of New York Clearing House or equivalent same day funds to the account of Cede & Co. on the Interest Payment Date for the Initial Bonds at the address indicated for Cede & Co. in the registration books of the Issuer kept by the Trustee. It is anticipated that during the term of the Initial Bonds, the Securities Depository will make book entry transfers among its Participants and receive and transmit payment of principal of, Sinking Fund Installments for, Purchase Price, redemption premium, if any, and interest on, the Initial Bonds to the Participants until and unless the Trustee authenticates and delivers replacement bonds to the Beneficial Owners as described in Section 2.10(c).

(b) The Initial Bonds shall be initially issued in the form of a separate single authenticated fully registered certificate for the single maturity thereof. Upon initial issuance, the ownership of such Initial Bonds shall be registered in the registration books of the Issuer kept by the Trustee in the name of Cede & Co., as nominee of DTC. The Trustee, the Tender Agent, the Bond Registrar, the Remarketing Agent, the Paying Agent and the Issuer shall treat DTC (or its nominee) as the sole and exclusive Holder of the Initial Bonds registered in its name for the purposes of payment of the principal, Sinking Fund Installments, Purchase Price, Redemption Price of or interest on the In itial Bonds, selecting the Initial Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Bondholders under this Indenture, registering the transfer of Initial Bonds, obtaining any consent or other action to be taken by Holders of the Initial Bonds and for all other purposes whatsoever; and neither the Trustee, the Tender Agent, the Bond Registrar, the Remarketing Agent, the Paying Agent, the Company, nor the Issuer shall be affected by any notice to the contrary. All notices with respect to the Initial Bonds shall be made and given to DTC as provided in the Representations Letter. Neither the Trustee, the Tender Agent, the Bond Registrar, the Remarketing Agent, the Paying Agent nor the Issuer shall have any responsibility or obligation to any Participant, any Person claiming a beneficial ownership interest in the Initial Bonds under or through DTC or any Participant, or any other Person that is not shown on the registration books of the Trustee as being a Holder, with respect to the accuracy of any records maintained by DTC or any Participant; the payment of DTC or any Participant of any amount in respect of the principal, Sinking Fund Installments, Purchase Price, Redemption Price of or interest on the Initial Bonds; any notice that is permitted or required to be given to Bondholders under this Indenture or any other Security Documents; the selection by DTC or any Participant of any Person to receive payment in the event of a partial redemption of the Initial Bonds; or any consent given or other action taken by DTC as Bondholder. The Trustee shall pay all principal of, Sinking Fund Installments, Purchase Price, redemption premium, if any, and interest on the Initial Bonds only to or “upon the order of” (as that term is used in the Uniform Commercial Code as adopted in the State) DTC, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer’s obligations with respect to the principal of, Sinking Fund Installments, Purchase Price, redemption premium, if any, and interest on the Initial Bonds to the extent of the sum or sums so paid. Except as otherwise provided in Section 2.10(c), no Person other than DTC shall receive an authenticated Initial Bond certificate evidencing the obligation of the Issuer to make payments of principal of, Sinking Fund Installments, Purchase Price, redemption premium, if any, and interest pursuant to this Indenture. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions of this Indenture with respect to transfers of Bonds, the word “Cede & Co.” in this Indenture shall refer to such new nominee of DTC.

(c) In the event the Issuer determines that it is in the best interest of the Beneficial Owners that they be able to obtain Initial Bond certificates, the Issuer may notify DTC and the Trustee, whereupon DTC will notify the Participants, of the availability through DTC of Initial Bond certificates. In such event, the Trustee shall issue, transfer and exchange Initial Bond certificates as requested by DTC in appropriate amounts within the guidelines set forth in this Indenture. DTC may determine to discontinue providing its services with respect to the Initial Bonds at any time by giving written notice to the Issuer and the Trustee and discharging its responsibilities with respect the reto under applicable law. Under such circumstances (if there is no successor securities depository), the Issuer and the Trustee shall be obligated to deliver Initial Bond certificates as described in this Indenture. In the event Initial Bond certificates are issued, the provisions of this Indenture shall apply to, among other things, the transfer and exchange of such certificates and the method of payment of principal of, Sinking Fund Installments, Purchase Price, redemption premium, if any, and interest on such certificates. Whenever DTC requests the Issuer and the Trustee to do so, the Issuer will direct the Trustee (at the sole cost and expense of the Company) to cooperate with DTC in taking appropriate action after reasonable notice (i) to make available one or more separate certificates evidencing the Initial Bonds to any DTC Participant having Initial Bonds credited to its DTC account or (ii) to arrange for another securities depository to maintain custody of certifica tes evidencing the Initial Bonds.

(d) In connection with any notice or other communication to be provided to Bondholders pursuant to this Indenture or any other Security Document by the Issuer or the Trustee with respect to any consent or other action to be taken by Bondholders, the Issuer or the Trustee, as the case may be, shall establish a record date for such consent or other action and give DTC notice of such record date not less than fifteen (15) calendar days in advance of such record date to the extent possible. Such notice to DTC shall be given only when DTC is the sole Bondholder.

(e) NEITHER THE ISSUER, THE COMPANY NOR THE TRUSTEE WILL HAVE ANY RESPONSIBILITY OR OBLIGATIONS TO THE PARTICIPANTS OR THE BENEFICIAL OWNERS WITH RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY PARTICIPANT; (2) THE PAYMENT BY DTC OR ANY PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL OWNER IN RESPECT OF THE PRINCIPAL AMOUNT, SINKING FUND INSTALLMENTS, PURCHASE PRICE, REDEMPTION PRICE OF OR INTEREST ON THE INITIAL BONDS; (3) THE DELIVERY BY DTC OR ANY PARTICIPANT OF ANY NOTICE TO ANY BENEFICIAL OWNER THAT IS REQUIRED OR PERMITTED UNDER THE TERMS OF THE INDENTURE TO BE GIVEN TO BONDHOLDERS; OR (4) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL REDEM PTION OF THE INITIAL BONDS.

(f) SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE INITIAL BONDS, AS NOMINEE OF DTC, REFERENCES HEREIN TO THE INITIAL BONDHOLDERS OR REGISTERED HOLDERS OF THE INITIAL BONDS SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE INITIAL BONDS.

(g) For so long as the Holder of all of the Initial Bonds shall be DTC, and all Initial Bonds shall be registered in the name of Cede & Co. as nominee for DTC, (i) only DTC may tender Initial Bonds for purchase or upon redemption or retirement in whole and (ii) unless all Initial Bonds are being redeemed or retired in whole, Initial Bonds shall not be required to be presented to the Trustee for payment of principal, Sinking Fund Installments, Purchase Price or Redemption Price except upon final maturity or redemption in whole.

(h) In the event the Securities Depository resigns, is unable to properly discharge its responsibilities, or is no longer qualified to act as a securities depository and registered clearing agency under the Securities and Exchange Act of 1934, as amended, the Issuer may appoint a successor Securities Depository provided the Trustee receives written evidence satisfactory to the Trustee with respect to the ability of the successor Securities Depository to discharge its responsibilities. Any such successor Securities Depository shall be a securities depository that is a registered clearing agency under the Securities and Exchange Act of 1934, as amended, or other applicable statute or regulation t hat operates a securities depository upon reasonable and customary terms. The Trustee upon its receipt of an Initial Bond or Bonds for cancellation shall cause the delivery of an Initial Bond or Bonds to the successor Securities Depository in appropriate Authorized Denominations and form as provided herein.

ARTICLE III

GENERAL TERMS AND PROVISIONS OF BONDS

Section 3.01. Date of Bonds. The Initial Bonds shall be dated their date of original issuance (subject to the provisions set forth below with respect to transfers and exchanges) and will bear interest from their date at the applicable rate or rates until the entire principal amount of the Initial Bonds has been paid. Bonds authenticated prior to the first Interest Payment Date shall bear interest from their date of original issuance. Bonds issued in exchange for or upon the registration of transfer of Bonds on or after the first Interest Payment Date thereon shall bear interest from and including the Interest Payment Date next preceding the date of the authentication thereof, unless the date of such authentication shall be an Interest Payment Date to which interest on the Bonds has been paid in full or duly provided for, in which case they shall bear interest from and including such Interest Payment Date; provided that if, as shown by the records of the Trustee, interest on the Bonds shall be in default, Bonds issued in exchange for or upon the registration of transfer of Bonds shall bear interest from the date to which interest has been paid in full on the Bonds, or if no interest has been paid on the Bonds, the date of the first delivery of fully executed and authenticated Bonds hereunder.

Section 3.02. Form and Denominations. Bonds shall be issued in fully registered form, without coupons, in any authorized denomination not exceeding the aggregate principal amount of Bonds of the same series, maturity and interest rate as the Bond for which the denomination is to be specified. Subject to the provisions of Section 3.03, the Initial Bonds shall be in substantially the form set forth in Exhibit C, with such variations, omissions and insertions as are permitted or required by this Indenture.

Section 3.03. Legends. Each Bond shall contain on the face thereof a statement to the effect that “THIS BOND SHALL NEVER CONSTITUTE A DEBT OR INDEBTEDNESS OF THE STATE OF NEW YORK OR OF THE CITY OF NEW YORK, AND NEITHER THE STATE OF NEW YORK NOR THE CITY OF NEW YORK SHALL BE LIABLE HEREON, NOR SHALL THIS BOND BE PAYABLE OUT OF ANY FUNDS OF THE NEW YORK CITY CAPITAL RESOURCE CORPORATION OTHER THAN THOSE PLEDGED THEREFOR.” The Bonds may in addition contain or have endorsed thereon such provisions, specifications and descriptive words not inconsistent with the provisions of this Indenture as may be necessary or de sirable to comply with custom or otherwise as may be determined by the Issuer prior to the delivery thereof.

Section 3.04. Medium of Payment. The principal or Redemption Price, if any, of, Sinking Fund Installments for, Purchase Price, and interest on the Bonds shall be payable in any coin or currency of the United States of America which, on the respective dates of payment thereof, is legal tender for the payment of public and private debts. Such payment may be made as provided in Section 2.02.

Section 3.05. Bond Details. Subject to the provisions hereof, the Bonds shall be dated, shall mature in such years and such amounts, shall bear interest at such rate or rates per annum, shall be subject to redemption on such terms and conditions and shall be payable as to principal or Redemption Price, if any, Sinking Fund Installments, Purchase Price, and interest at such place or places as shall be specified in this Indenture.

Section 3.06. Interchangeability, Transfer and Registry. vii) Each Bond shall be transferable only upon compliance with the restrictions on transfer set forth on such Bond and only upon the books of the Issuer, which shall be kept for the purpose at the designated corporate trust office of the Trustee, by the registered owner thereof in person or by his duly authorized attorney-in-fact, upon surrender of such Bond together with a written instrument of transfer in the form appearing on such Bond duly executed by the registered owner or his duly authorized attorney-in-fact with a guaranty of the signature thereon by a m ember of the Stock Exchange Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15. Upon the transfer of any Bond the Trustee shall prepare and issue in the name of the transferee one or more new Bonds of the same aggregate principal amount, related Series, maturity and interest rate as the surrendered Bond.

(b) Any Bond, upon surrender thereof at the designated corporate trust office of the Trustee in the City with a written instrument of transfer in the form appearing on such Bond, duly executed by the registered owner or his duly authorized attorney-in-fact, with a guaranty of the signature thereon by a member of the Stock Exchange Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15, may, at the option of the owner thereof, be exchanged for an equal aggregate principal amount of Bonds of the same Series, maturity and interest rate of any other Authorized Denominations. However, the Trustee will not be required to (i) transfer or exchange any Bonds during the period between a Record Date and the following Interest Payment Date or during the period of fifteen (15) days next preceding any day for the selection of Bonds to be redeemed, (ii) transfer or exchange any Bonds selected, called or being called for redemption in whole or in part, or (iii) register any transfer of or exchange any Bond which is subject to mandatory purchase.

(c) The Issuer, the Bond Registrar, the Trustee, the Tender Agent, the Remarketing Agent and any Paying Agent may deem and treat the Person in whose name any Bond shall be registered as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal and Redemption Price, if any, of, Sinking Fund Installments for, Purchase Price, and interest on such Bond and for all other purposes, and all payments made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the Issuer, the Company, the Bond Regi strar, the Trustee, the Tender Agent, the Remarketing Agent nor any Paying Agent shall be affected by any notice to the contrary.

(d) In all cases in which the privilege of transferring or exchanging Bonds is exercised, the Issuer or the Trustee may make a charge sufficient to reimburse it for any expenses and any tax, fee or other governmental charge required to be paid in connection therewith; any such expenses shall be paid by the Company but any such tax, fee or other governmental charge shall be paid by the Holder requesting such transfer or exchange.

Section 3.07. Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall become mutilated or be destroyed, stolen or lost, the Issuer shall execute, and thereupon the Trustee shall authenticate and deliver, a new Bond of like Series, maturity, unpaid principal amount and interest rate as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond, upon surrender and cancellation of such mutilated Bond, or in lieu of and in substitution for the Bond destroyed, stolen or lost, upon filing with the Trustee evidence reasonably satisfactory to it that such Bond has been destroy ed, stolen or lost, and upon furnishing the Issuer and the Trustee with indemnity (an undertaking from an insurance company acceptable to the Trustee and the Issuer) satisfactory to the Trustee and to the Issuer and complying with such other reasonable regulations as the Trustee may prescribe and paying such expenses as the Issuer and the Trustee may incur. All Bonds so surrendered to the Trustee shall be cancelled by it. Every new Bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is destroyed, lost or stolen, shall, with respect to such Bond, constitute an additional contractual obligation of the Issuer whether or not the destroyed, lost or stolen Bond shall be found and shall be enforceable at any time, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Bonds duly issued hereunder. In the event any such destroyed, stolen or lost Bond shall have matured, or be about to mature , the Issuer may, instead of issuing a new Bond, cause the Trustee to pay the same without surrender thereof upon compliance with the condition in the first sentence of this Section out of moneys held by the Trustee and available for such purpose. All Bonds shall be held and owned upon the express condition (to the extent lawful) that the foregoing provisions are exclusive with respect to the replacement or payment of any mutilated, destroyed or lost or stolen Bond and shall preclude any and all other rights and remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender.

Section 3.08. Cancellation and Destruction of Bonds. All Bonds paid or redeemed, either at or before maturity, shall be delivered to the Trustee when such payment or redemption is made, and such Bonds together with all Bonds purchased by the Trustee, shall thereupon be promptly cancelled. Bonds so cancelled shall be destroyed by the Trustee.

Section 3.09. Requirements With Respect to Transfers. In all cases in which the privilege of transferring Bonds is exercised, the Issuer shall execute and the Trustee shall authenticate and deliver Bonds in accordance with the provisions of this Indenture. All Bonds surrendered in any such transfer shall forthwith be cancelled by the Trustee. For every such transfer of Bonds, the Issuer or the Trustee may, as a condition precedent to the privilege of making such transfer, make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such tra nsfer and may charge a sum sufficient to pay the cost of preparing each new Bond issued upon such transfer, which sum or sums shall be paid by the Person requesting such transfer.

Section 3.10. Bond Registrar. The Trustee shall also be Bond Registrar for the Bonds, and shall maintain a register showing the names of all registered Holders of Bonds, Bond numbers and amounts, and other information appropriate to the discharge of its duties hereunder. The Trustee shall make available to the Company for its inspection during normal business hours the registration books for the Bonds, as may be requested by the Company in connection with any purchase or tender offer by it with respect to the Bonds.

Section 3.11. Payments Due on Saturdays, Sundays and Holidays. In any case where any payment date of principal, Purchase Price, Sinking Fund Installment and/or interest on the Bonds, or the date fixed for redemption of any Bonds, shall be a day other than a Business Day, then payment of such principal, Purchase Price, Sinking Fund Installment and/or interest or the Redemption Price, if applicable, need not be made on such date but may be made on the next succeeding Business Day with the same force and effect as if made on the principal, Purchase Date, Sinking Fund Installment and/or Interest Payment Date or the date fixed for redemption, as the case may be, except that interest shall continue to accrue on any unpaid principal.

ARTICLE IV

APPLICATION OF BOND PROCEEDS AND OTHER AMOUNTS

Section 4.01. Application of Proceeds of Initial Bonds. Upon the receipt by the Trustee of the original proceeds of the sale and delivery of the Initial Bonds, including the amount received as accrued interest, if any, thereon, the Trustee shall apply such proceeds as follows:

(i) $0, being the amount received as accrued interest on the Initial Bonds, if any, shall be deposited in the Interest Account of the Bond Fund;

(ii) $2,456,944, being an amount equal to capitalized interest on the Initial Bonds from the Closing Date through March 1, 2012, shall be deposited in the Capitalized Interest Account of the Project Fund; and

(iii) $17,543,056, being the balance of the proceeds of the Initial Bonds, shall be deposited in the Construction Account of the Project Fund.

Section 4.02. Deposit in the Advance Interest Deposit Fund. Upon the Closing Date, and the receipt by the Trustee of $4,000,000 from the Company as provided in Section 10.7 of the Loan Agreement, the Trustee shall deposit such amount within the Advance Interest Deposit Fund.

ARTICLE V

CUSTODY AND INVESTMENT OF FUNDS

Section 5.01. Creation of Funds and Accounts. viii) The Issuer hereby establishes and creates the following special trust Funds and Accounts comprising such Funds:

(1) Project Fund

(a) Capitalized Interest Account

(b) Construction Account

(2) Bond Fund

(a) Principal Account

(b) Interest Account

(d) Sinking Fund Installment Account

(3) Advance Interest Deposit Fund

(4) Purchase Fund

(a) Remarketing Account

(b) Company Purchase Account

(5) Renewal Fund

(6) Earnings Fund

(7) Rebate Fund

(b) All of the Funds and Accounts created hereunder shall be held by the Trustee, except that the Purchase Fund shall be held by the Tender Agent. All moneys required to be deposited with or paid to the Trustee for the credit of any Fund or Account under any provision of this Indenture and all investments made therewith shall be held by the Trustee in trust and applied only in accordance with the provisions of this Indenture, and while held by the Trustee shall constitute part of the Trust Estate (subject to the granting clauses of this Indenture), other than the Rebate Fund, and, to the extent provided herein, the Purchase Fund, and be subject to the lien hereof.

Section 5.02. Project Fund. ix) There shall be deposited in the Project Fund any and all amounts required to be deposited therein pursuant to Sections 4.01, 5.07 and 5.08 or otherwise required to be deposited therein pursuant to the Loan Agreement or this Indenture.

The Trustee shall apply the amounts on deposit in the Project Fund to the payment, or reimbursement to the extent the same have been paid by or on behalf of the Company or the Issuer, of Project Costs (including interest on the Bonds during the period of Project construction and renovation) to the extent requisitioned under subsection (c) hereto.

(b) The Trustee shall apply the amounts in the Capitalized Interest Account of the Project Fund for the payment of interest on the Bonds as the same shall become due until the earlier of the Completion Date (as evidenced in accordance with the provisions of Section 3.2(f) of the Loan Agreement) or the exhaustion of amounts in such Account (the “Capitalized Interest Period”). On the seventh (7th) Business Day immediately preceding each Interest Payment Date during the Capitalized Interest Period, the Trustee shall transfer from the Capitalized Interes t Account of the Project Fund to the Interest Account of the Bond Fund an amount which, together with any amounts on deposit in such Interest Account and available therefor, shall be sufficient to pay the interest on the Bonds becoming due on such Interest Payment Date. Upon the Completion Date, the Trustee shall transfer any balance remaining in the Capitalized Interest Account of the Project Fund, first, to the extent of the amount of interest accrued on the Bonds from the Interest Payment Date immediately preceding the Completion Date through but not including the Completion Date, to the Interest Account of the Bond Fund, and second, the balance to the Construction Account of the Project Fund to pay any remaining Project Costs.

(c) The Trustee is hereby authorized to disburse from the Construction Account of the Project Fund amounts required to pay (in whole or in part) the Project Costs and is directed to issue its checks (or, at the direction of the Company, make wire transfers) for each disbursement from the Construction Account of the Project Fund for the Project Costs, upon a requisition submitted to the Trustee, signed by an Authorized Representative of the Company; provided, however, that the Trustee shall retain in the Construction Account of the Project Fund an amount equal to $100,000, until an Authorized Representative of the Company shall have delivered the completion certificate and other documents required by Secti on 3.2(f) of the Loan Agreement.

The requisition from the Construction Account of the Project Fund shall be accompanied by bills or invoices (stamped “paid” by the Person to whom payment was due or with other evidence of payment if reimbursement is to be made to the Company), including evidence that the bill, invoice or other evidence was not incurred on a date prior to sixty (60) days prior to the date of adoption by the Issuer of its Preliminary Resolution for the Project. Such requisition shall be as set forth in Exhibit D — “Form of Requisition from the Construction Account of the Project Fund” and shall be submitted to the Trustee. The Trustee shall disburse amounts from the Construction Account of the Project Fund not later than five (5) Business Days following the receipt of the executed requisition and accompanying bills or invoices, except that any such requisition and accompanying bills or invoices submitted on the Closing Date shall have disbursements made by the Trustee on such Closing Date. The Trustee shall be entitled to conclusively rely on the correctness and accuracy of such requisition as well as the propriety of the signature thereon.

(d) The Trustee shall keep and maintain adequate records pertaining to each Account of the Project Fund and all disbursements therefrom and shall furnish copies of same to the Issuer or the Company upon reasonable written request.

(e) The Trustee shall on written request furnish to the Issuer and the Company within a reasonable time period a written statement of disbursements from each Account of the Project Fund, enumerating, among other things, item, cost, amount disbursed, date of disbursement and the person to whom payment was made, together with copies of all bills, invoices or other evidences submitted to the Trustee for such disbursement.

(f) The completion of the Project shall be evidenced as set forth in Section 3.2(f) of the Loan Agreement including the filing of the certificate of an Authorized Representative of the Company referred to therein. Upon the filing of such certificate, the balance in the Project Fund in excess of the amount, if any, stated in such certificate for the payment of any remaining part of the costs of the Project, shall, after making any transfer to the Rebate Fund as directed pursuant to Section 7.5 of the Tax Regulatory Agreement and Section 5.08, be deposited by the Trustee in the Redemption Account of the Bond Fund. &# 160;Upon payment of all the costs and expenses incident to the completion of the Project, any balance of such remaining amount in the Project Fund, together with any amount on deposit in the Earnings Fund derived from transfers made thereto from the Project Fund, shall, after making any such transfer to the Rebate Fund, be deposited in the Redemption Account of the Bond Fund to be applied to the redemption of Bonds at the earliest practicable date. The Trustee shall promptly notify the Company of any amounts so deposited in the Redemption Account of the Bond Fund pursuant to this Section 5.02(f).

(g) In the event the Company shall be required to or shall elect to cause the Bonds to be redeemed in whole pursuant to the Loan Agreement, the balance in the Project Fund, in the Earnings Fund (in excess of any amount the Trustee is directed to transfer to the Rebate Fund pursuant to Section 7.5 of the Tax Regulatory Agreement and Section 5.08) shall be deposited in the Redemption Account of the Bond Fund. In the event the unpaid principal amount of the Bonds shall be accelerated upon the occurrence of an Event of Default hereunder, the balance in the Project Fund, in the Earnings Fund (in excess of any amount the Trustee is directed to transfer to the Rebate Fund pursuant to Section 7.5 of the Tax Regulatory Agreement and Section 5.08) shall be deposited in the Bond Fund as provided in Section 8.03.

(h) Except as provided in Section 5.07, all earnings on amounts held in the Project Fund shall be transferred by the Trustee and deposited in the Earnings Fund. Any transfers by the Trustee of amounts to the Rebate Fund shall first be drawn by the Trustee from the Earnings Fund prior to drawing any amounts from the Project Fund.

Section 5.03. Application of Advance Interest Deposit Fund. Commencing with that Interest Payment Date with respect to which insufficient amounts are on deposit in the Capitalized Interest Account of the Project Fund to pay into the Interest Account of the Bond Fund that amount required to pay the interest on the Bonds next coming due on such Interest Payment Date, the Trustee shall apply the amounts on deposit in the Advance Interest Deposit Fund to the payment of interest on the Bonds by transferring such amount as is so required for such purpose to the Interest Account of the Bond Fund on the seventh (7th) Business Day immediately preceding such Interest Payment Date.

Section 5.04. Payments into Renewal Fund; Application of Renewal Fund.

x) The Net Proceeds resulting from any Loss Event with respect to the Facility, together with any other amounts so required to be deposited therein under the Loan Agreement, the Bond Guaranty Agreement or the Mortgage, shall be deposited in the Renewal Fund (except as otherwise provided in Section 3.12 of the Bond Guaranty Agreement).

(b) In the event the Bonds shall be subject to redemption in whole (either by reason of such Loss Event or otherwise) pursuant to the terms thereof or this Indenture, and the Company shall have so directed the Trustee in writing within ninety (90) days of the occurrence of such Loss Event, the Trustee shall, after making any transfer to the Rebate Fund as directed pursuant to Section 7.5 of the Tax Regulatory Agreement and Section 5.08, transfer the amounts deposited in the Renewal Fund to the Redemption Account of the Bond Fund.

If, on the other hand,

(1) the Bonds shall not be subject to optional redemption in whole (whether by reason of such Loss Event or otherwise), or

(2) the Bonds shall be subject to optional redemption in whole (whether by reason of such Loss Event or otherwise) and the Company shall have failed to take action to effect such redemption, or

(3) the Company shall have notified the Trustee of its intent to rebuild, replace, repair and restore the Facility,

the Trustee shall apply the amounts on deposit in the Renewal Fund, after making any transfer to the Rebate Fund as directed pursuant to Section 7.5 of the Tax Regulatory Agreement and Section 5.08, to such rebuilding, replacement, repair and restoration.

(c) If an Event of Default shall exist at the time of the receipt by the Trustee of the Net Proceeds in the Renewal Fund, the Trustee shall promptly request the written direction of the Majority Holders and shall thereupon apply such Net Proceeds, after making any transfer to the Rebate Fund as directed pursuant to the Tax Regulatory Agreement and Section 5.08, to the rebuilding, replacement, repair and restoration of the Facility, or for deposit in the Redemption Account of the Bond Fund, as directed by the Majority Holders (or if no such direction shall be received within ninety (90) days after request therefor by the Trustee shall have been made, for deposit in the Redemption Account of the Bond F und).

(d) The Trustee is hereby authorized to apply the amounts in the Renewal Fund to the payment (or reimbursement to the extent the same have been paid by or on behalf of the Company or the Issuer) of the costs required for the rebuilding, replacement, repair and restoration of the Facility upon written instructions from the Company. The Trustee is further authorized and directed to issue its checks for each disbursement from the Renewal Fund upon a requisition submitted to the Trustee and signed by an Authorized Representative of the Company. Each such requisition shall be accompanied by bills, invoices or other evidences or documentation (including, without limitation, a title continu ation or other evidence that no mechanics or other liens have been filed) satisfactory to the Trustee. The Trustee shall be entitled to rely on such requisition. The Trustee shall keep and maintain adequate records pertaining to the Renewal Fund and all disbursements therefrom and shall furnish copies of same to the Issuer and the Company upon reasonable written request therefor.

(e) The date of completion of the restoration of the Facility shall be evidenced to the Issuer and the Trustee by a certificate of an Authorized Representative of the Company stating (i) the date of such completion, (ii) that all labor, services, machinery, equipment, materials and supplies used therefor and all costs and expenses in connection therewith have been paid for or arrangement for payment, reasonably satisfactory to the Trustee, has been made, (iii) that the Facility has been rebuilt, replaced, repaired or restored to substantially its condition immediately prior to the Loss Event, or to a condition of at least equivalent value, operating efficiency and function, (iv) that t he Company has a good and valid leasehold interest in all property constituting part of the Facility, and all property constituting part of the Facility is subject to the Ground Lease and the Loan Agreement, and the mortgage liens and security interests of the Mortgage, subject to Permitted Encumbrances, (v) the Rebate Amount applicable with respect to the Net Proceeds and the earnings thereon (with a statement as to the determination of the Rebate Amount and a direction to the Trustee of any required transfer to the Rebate Fund), and (vi) that the restored Facility is ready for occupancy, use and operation for its intended purposes. Notwithstanding the foregoing, such certificate shall state (x) that it is given without prejudice to any rights of the Company against third parties which exist at the date of such certificate or which may subsequently come into being, (y) that it is given only for the purposes of this Section and Section 5.4 of the Loan Agreement, and (z) th at no Person other than the Issuer or the Trustee may benefit therefrom. Such certificate shall be accompanied by (i) a certificate of occupancy (either temporary or permanent, provided that if is a temporary certificate of occupancy, the Company will proceed with due diligence to obtain a permanent certificate of occupancy), if required, and any and all permissions, licenses or consents required of governmental authorities for the occupancy, operation and use of the Facility for the purposes contemplated by the Loan Agreement and the Ground Lease; (ii) a certificate of an Authorized Representative of the Company that all costs of rebuilding, repair, restoration and reconstruction of the Facility have been paid in full, together with releases of mechanics’ liens by all contractors and materialmen who supplied work, labor, services, materials or supplies in connection with the rebuilding, repair, restoration and reconstruction of the Facility (or, to the extent that any such costs shall be the subject of a bona fide dispute, evidence to the Trustee that such costs have been appropriately bonded or that the Company shall have posted a surety or security at least equal to the amount of such costs); and (iii) a search prepared by a title company, or other evidence satisfactory to the Trustee, indicating that there has not been filed with respect to the Facility any mechanic’s, materialmen’s or any other lien in connection with the rebuilding, replacement, repair and restoration of the Facility and that there exist no encumbrances other than those encumbrances consented to by the Issuer and the Trustee.

(f) All earnings on amounts on deposit in the Renewal Fund shall be transferred by the Trustee and deposited in the Earnings Fund. Any transfers by the Trustee of amounts to the Rebate Fund shall first be drawn by the Trustee from the Earnings Fund prior to drawing any amounts from the Renewal Fund.

(g) Any surplus remaining in the Renewal Fund after the completion of the rebuilding, replacement, repair and restoration of the Facility shall, after making any transfer to the Rebate Fund as directed pursuant to the Tax Regulatory Agreement and Section 5.08, be transferred by the Trustee to the Redemption Account of the Bond Fund.

Section 5.05. Payments into Bond Fund. The Trustee shall promptly deposit the following receipts into the Bond Fund:

(a) The interest accruing on any Series of Bonds from the date of original issuance thereof to the date of delivery, which shall be credited to the Interest Account of the Bond Fund and applied to the payment of interest on such Series of Bonds.

(b) Amounts disbursed from the Capitalized Interest Account of the Project Fund for the payment of interest on the Bonds during the Capitalized Interest Period, which shall be credited to the Interest Account of the Bond Fund and applied to the payment of interest on the Bonds;

(c) Amounts transferred from the Advance Interest Deposit Fund as provided in Section 5.03, which shall be credited to the Interest Account of the Bond Fund and applied to the payment of interest on the Bonds.

(d) Excess or remaining amounts in the Project Fund required to be deposited (subject to any transfer required to be made to the Rebate Fund in accordance with directions received pursuant to the Tax Regulatory Agreement and Section 5.08) (i) in the Redemption Account of the Bond Fund pursuant to Section 5.02(f) or the first sentence of Section 5.02(g), which shall be kept segregated from any other moneys within such Account, or (ii) in the Bond Fund pursuant to the second sentence of Section 5.02(g).

(e) Loan payments received by the Trustee pursuant to Section 4.3(a)(i), (ii), (iii), (iv) or (v) of the Loan Agreement, which shall be deposited in and credited, to the extent necessary, first to the Interest Account, second to the Principal Account, and third to the Sinking Fund Installment Account of the Bond Fund.

(f) Advance loan payments received by the Trustee pursuant to Section 4.3(c) of the Loan Agreement, which shall be deposited in and credited to the Redemption Account of the Bond Fund.

(g) Any amounts transferred from the Earnings Fund pursuant to Section 5.07, which shall be deposited in and credited to the Interest Account of the Bond Fund.

(h) The excess amounts referred to in Section 5.06(d), which shall be deposited in and credited to the Interest Account of the Bond Fund.

(i) Any amounts transferred from the Redemption Account pursuant to Section 5.06(h), which shall be deposited to the Interest Account, the Principal Account and the Sinking Fund Installment Account of the Bond Fund, as the case may be and in such order of priority, and applied solely to such purposes.

(j) Amounts in the Renewal Fund required by Section 5.04 or by the Mortgage to be deposited (subject to any transfer required to be made to the Rebate Fund in accordance with directions received pursuant to the Tax Regulatory Agreement and Section 5.08) to the Redemption Account of the Bond Fund pursuant to Section 5.04(g).

(k) All other receipts when and if required by the Loan Agreement or by this Indenture or by any other Security Document to be paid into the Bond Fund, which shall be credited (except as provided in Section 8.03) to the Redemption Account of the Bond Fund.

Section 5.06. Application of Bond Fund Moneys. xi) The Trustee shall (i) on each Interest Payment Date pay or cause to be paid out of the Interest Account in the Bond Fund the interest due on the Bonds, and (ii) further pay out of the Interest Account of the Bond Fund any amounts required for the payment of accrued interest upon any purchase or redemption (including any mandatory Sinking Fund Installment redemption) of Bonds.

(b) The Trustee shall on each principal payment date on the Bonds pay or cause to be paid to the respective Paying Agents therefor out of the Principal Account of the Bond Fund, the principal amount, if any, due on the Bonds (other than such as shall be due by mandatory Sinking Fund Installment redemption), upon the presentation and surrender of the requisite Bonds.

(c) There shall be paid from the Sinking Fund Installment Account of the Bond Fund to the Paying Agents on each Sinking Fund Installment payment date in immediately available funds the amounts required for the Sinking Fund Installment due and payable with respect to Bonds which are to be redeemed from Sinking Fund Installments on such date (accrued interest on such Bonds being payable from the Interest Account of the Bond Fund). Such amounts shall be applied by the Paying Agents to the payment of such Sinking Fund Installment when due. The Trustee shall call for redemption, in the manner provided in Article VI, Bonds for which Sinking Fund Installments are applicable in a princi pal amount equal to the Sinking Fund Installment then due with respect to such Bonds. Such call for redemption shall be made even though at the time of mailing of the notice of such redemption sufficient moneys therefor shall not have been deposited in the Bond Fund.

(d) Amounts in the Redemption Account of the Bond Fund shall be applied, at the written direction of the Company, as promptly as practicable, to the purchase of Bonds at prices not exceeding the Redemption Price thereof applicable on the earliest date upon which the Bonds are next subject to optional redemption, plus accrued interest to the date of redemption. Any amount in the Redemption Account not so applied to the purchase of Bonds by forty-five (45) days prior to the next date on which the Bonds are so redeemable shall be applied to the redemption of Bonds on such redemption date. Any amounts deposited in the Redemption Account and not applied within twelve (12) months of their date of deposit to the purchase or redemption of Bonds (except if held in accordance with Article X) shall be transferred to the Interest Account. Upon the purchase of any Bonds out of advance loan payments as provided in this subsection, or upon the redemption of any Bonds, an amount equal to the principal of such Bonds so purchased or redeemed shall be credited against the next ensuing and future Sinking Fund Installments for such Bonds in chronological order of the due dates of such Sinking Fund Installments until the full principal amount of such Bonds so purchased or redeemed shall have been so credited. The portion of any such Sinking Fund Installment remaining after the deduction of such amounts so credited shall constitute and be deemed to be the amount of such Sinking Fund Installment for the purposes of any calculation thereof under this Indenture. The Bonds to be purchased or redeemed shall be selected by the Trustee in the manner provided in Section 6.02 . Amounts in the Redemption Account to be applied to the redemption of Bonds shall be paid to the respective Paying Agents on or before the redemption date and applied by them on such redemption date to the payment of the Redemption Price of the Bonds being redeemed plus interest on such Bonds accrued to the redemption date.

(e) In connection with purchases of Bonds out of the Bond Fund as provided in this Section, the Company shall arrange and the Trustee shall execute such purchases (through brokers or otherwise, and with or without receiving tenders) at the written direction of the Company. The payment of the purchase price shall be made out of the moneys deposited in the Redemption Account of the Bond Fund and the payment of accrued interest shall be made out of moneys deposited in the Interest Account of the Bond Fund.

(f) The Issuer shall receive a credit in respect of Sinking Fund Installments for any Bonds which are subject to mandatory Sinking Fund Installment redemption and which are delivered by the Issuer or the Company to the Trustee on or before the forty-fifth (45th) day next preceding any Sinking Fund Installment payment date and for any Bonds which prior to said date have been purchased or redeemed (otherwise than through the operation of the Sinking Fund Installment Account) and cancelled by the Trustee and not theretofore applied as a credit against any Sinking Fund Installment (whether pursuant to Section 5.06(d) or otherwise). Each Bond so delivered, cancelled or previously purchased or r edeemed shall be credited by the Trustee at one hundred per cent (100%) of the principal amount thereof against the obligation of the Issuer on such Sinking Fund Installment payment date with respect to Bonds of such Series and maturity and the principal amount of such Bonds to be redeemed by operation of the Sinking Fund Installment Account on the due date of such Sinking Fund Installment shall be reduced accordingly, and any excess over such principal amount shall be credited on future Sinking Fund Installments in direct chronological order, and the principal amount of Bonds to be redeemed by application of Sinking Fund Installment payments shall be accordingly reduced.

(g) The Company shall on or before the forty-fifth (45th) day next preceding each Sinking Fund Installment payment date furnish the Trustee with the certificate of an Authorized Representative of the Company indicating whether or not and to what extent the provisions of this Section are to be availed of with respect to such Sinking Fund Installment payment, stating, in the case of the credit provided for, that such credit has not theretofore been applied against any Sinking Fund Installment and confirming that immediately available cash funds for the balance of the next succeeding prescribed Sinking Fund Installment payment will be paid on or prior to the next succeeding Sinking Fund Installment payment d ate.

(h) Moneys in the Redemption Account of the Bond Fund which are not set aside or deposited for the redemption or purchase of Bonds shall be transferred by the Trustee to the Interest Account, to the Principal Account or to the Sinking Fund Installment Account of the Bond Fund.

Section 5.07. Payments into Earnings Fund; Application of Earnings Fund.

xii) All investment income or earnings on amounts held in the Project Fund, the Renewal Fund, the Advance Interest Deposit Fund or any other special fund (other than the Rebate Fund or the Bond Fund) shall be deposited upon receipt by the Trustee into the Earnings Fund. The Trustee shall keep separate accounts of all amounts deposited in the Earnings Fund and by journal entry indicate the Fund source of the income or earnings.

(b) On the first Business Day following each Computation Period, the Trustee shall withdraw from the Earnings Fund and deposit to the Rebate Fund an amount such that the amount held in the Rebate Fund after such deposit is equal to the Rebate Amount calculated as of the last day of the Computation Period. In the event of any deficiency, the balance required shall be provided by the Company pursuant to the Tax Regulatory Agreement. Computations of the amounts on deposit in each Fund and of the Rebate Amount shall be furnished to the Trustee by the Company in accordance with the Tax Regulatory Agreement.

The foregoing notwithstanding, the Trustee shall not be required to transfer amounts from the Earnings Fund to the Rebate Fund (and shall instead apply such amounts in the Earnings Fund as provided in the immediately following sentence), if the Company shall deliver to the Trustee a certificate of an Authorized Representative of the Company to the effect that (x) the applicable requirements of a spending exception to rebate has been satisfied as of the relevant semiannual period as set forth in the Tax Regulatory Agreement, (y) the proceeds of the Bonds have been invested in obligations the interest on which is not included in gross income for Federal income tax purposes under Section 103 of the Code or (z) the proceeds of the Bonds have been invested in obligations the Yield on which (calculated as set forth in th e Tax Regulatory Agreement) does not exceed the Yield on such Bonds (calculated as set forth in the Tax Regulatory Agreement). Any amounts on deposit in the Earnings Fund following the transfers to the Rebate Fund required by this Section shall be deposited in the Project Fund until the completion of the Project as provided in Section 3.2(f) of the Loan Agreement, and thereafter in the Interest Account of the Bond Fund.

Section 5.08. Payments into Rebate Fund; Application of Rebate Fund.

b) The Rebate Fund and the amounts deposited therein shall not be subject to a security interest, pledge, assignment, lien or charge in favor of the Trustee, any Bondholder or any other Person.

(b) The Trustee, upon the receipt of a certification of the Rebate Amount from an Authorized Representative of the Company, shall deposit in the Rebate Fund within sixty (60) days following each Computation Date, an amount such that the amount held in the Rebate Fund after such deposit is equal to the Rebate Amount calculated as of such Computation Date. If there has been delivered to the Trustee a certification of the Rebate Amount in conjunction with the completion of the Project pursuant to Section 3.2(f) of the Loan Agreement or the restoration of the Facility pursuant to Section 5.04, at any time during a Bond Year, the Trustee shall deposit in the Rebate Fund at that time an amo unt such that the amount held in the Rebate Fund after such deposit is equal to the Rebate Amount calculated at the completion of the Project or the restoration of the Facility as aforesaid. The amount deposited in the Rebate Fund pursuant to the previous sentences shall be withdrawn from the Earnings Fund. If the amount on deposit in the Rebate Fund following such deposit is less than the Rebate Amount, the Trustee shall promptly deliver a notice stating the amount of such deficiency to the Company. It is provided in the Loan Agreement that promptly upon receipt of such notice, the Company shall deliver the amount necessary to make up such deficiency to the Trustee for deposit in the Rebate Fund.

(c) If within sixty (60) days following any Computation Date, the amount on deposit in the Rebate Fund exceeds the Rebate Amount, the Trustee, upon the receipt of written instructions from an Authorized Representative of the Company, shall withdraw such excess amount and deposit it in the Construction Account of the Project Fund until the completion of the Project as provided in Section 3.2(f) of the Loan Agreement, or, after the completion of the Project, deposit it in the Interest Account of the Bond Fund.

(d) The Trustee, upon the receipt of written instructions from an Authorized Representative of the Company, shall pay to the United States, out of amounts in the Rebate Fund, (i) not less frequently than once each five (5) years after the Closing Date, an amount such that, together with prior amounts paid to the United States, the total paid to the United States is equal to 90% of the Rebate Amount with respect to the Initial Bonds as of the date of such payment and (ii) notwithstanding the provisions of Article X, not later than thirty (30) days after the date on which all Initial Bonds have been paid in full, 100% of the Rebate Amount as of the date of payment.

Section 5.09. Purchase Fund. c) The Purchase Fund shall consist of Accounts for the Initial Bonds to be designated respectively the “Remarketing Account” and the “Company Purchase Account”.

(b) The Tender Agent shall promptly deposit the following receipts into the respective Account of the Purchase Fund:

(i) Upon receipt of the proceeds of a remarketing of the Initial Bonds on the date the Initial Bonds are to be purchased, the Tender Agent shall deposit such proceeds in the Remarketing Account for application to the Purchase Price of the Initial Bonds.

(ii) Upon receipt of funds from the Company pursuant to Section 2.03(j)(B), the Tender Agent shall deposit such funds in the Company Purchase Account for application to the Purchase Price of the Initial Bonds. Any amounts deposited in the Company Purchase Account and not needed with respect to the Purchase Price for any Initial Bonds shall be immediately refunded to the Company.

(c) On each Purchase Date, the Tender Agent shall pay to the Holder of each Initial Bond tendered or deemed tendered for purchase pursuant to Section 2.03 on such Purchase Date the Purchase Price of such Initial Bond.

(d) No amounts held in the Purchase Fund shall be invested.

(e) The Tender Agent shall disburse moneys from the Remarketing Account or the Company Purchase Account, as applicable, to pay the Purchase Price of Initial Bonds tendered or deemed tendered for purchase upon surrender of such Initial Bonds.

(f) The funds held by the Tender Agent in the Purchase Fund shall not be subject to the lien of this Indenture. The moneys in the Purchase Fund shall be used solely to pay the Purchase Price of Initial Bonds as aforesaid and may not be used for any other purposes. It shall be the duty of the Tender Agent to hold the moneys in the Purchase Fund, without liability for interest thereon, for the benefit of the Holders of Initial Bonds that have been tendered or deemed tendered for purchase on the Purchase Date, and if sufficient funds to pay the Purchase Price for the Initial Bonds shall be held by the Tender Agent in the Purchase Fund for the benefit of the Holders thereof, each such Ho lder shall thereafter be restricted exclusively to the Purchase Fund for any claim of whatever nature on such Holder’s part under this Indenture or on, or with respect to, such Initial Bonds. Moneys in the Purchase Fund that remain unclaimed two years after the applicable Purchase Date shall, at the request of the Company, and if the Company is not, at the time, to the knowledge of the Tender Agent, in default with respect to any covenant in the Loan Agreement or any other Security Document, be paid to the Company, and the Holders of the Initial Bonds for which the deposit was made shall thereafter be limited to a claim against the Company.

Section 5.10. Transfer to Rebate Fund. The Trustee shall have no obligation under this Indenture to transfer any amounts to the Rebate Fund unless the Trustee shall have received specific written instructions from an Authorized Representative of the Company to make such transfer.

Section 5.11. Investment of Funds and Accounts. i) Amounts in any Fund or Account established under this Indenture may, if and to the extent then permitted by law, be invested only in Qualified Investments provided that any Qualified Investment shall not have a maturity date greater than five (5) years from the date of the making of such investment unless such Qualified Investment may be put at par at any time at the option of the owner thereof. Any investment herein authorized is subject to the condition that no portion of the proceeds derived from the sale of the Bonds shall be used, directly or indirectl y, in such manner as to cause any Bond to be an “arbitrage bond” within the meaning of Section 148 of the Code. In particular, unexpended Bond proceeds transferred from the Project Fund (or from the Earnings Fund with respect to amounts deposited therein from the Project Fund) to the Redemption Account of the Bond Fund pursuant to Section 5.02(f) may not be invested at a Yield which is greater than the Yield on the applicable Series of Bonds. Such investments shall be made by the Trustee only at the written request of an Authorized Representative of the Company; and if such investment is to be in one or more certificates of deposit, investment agreements or guaranteed investment contracts, then such written request shall include written assurance to the effect that such investment complies with the Tax Regulatory Agreement. Any investment hereunder shall be made in accordance with the Tax Regulatory Agreement, and the Company shall so certify to the Trus tee with each such investment direction as referred to below. Such investments shall mature in such amounts and at such times as may be necessary to provide funds when needed to make payments from the applicable Fund. Net income or gain received and collected from such investments shall be credited and losses charged to (i) the Rebate Fund with respect to the investment of amounts held in the Rebate Fund, (ii) the Bond Fund with respect to the investment of amounts held in the Bond Fund, and (iii) the Earnings Fund with respect to the investment of amounts held in any other Fund.

(b) At the written request of an Authorized Representative of the Company no sooner than ten (10) days prior to each Loan Payment Date under the Loan Agreement, the Trustee shall notify the Company of the amount of such net investment income or gain received and collected subsequent to the last such loan payment and the amount then available in the various Accounts of the Bond Fund.

(c) Upon the written direction of an Authorized Representative of the Company, the Trustee shall sell at the best price reasonably obtainable, or present for redemption or exchange, any obligations in which moneys shall have been invested to the extent necessary to provide cash in the respective Funds or Accounts, to make any payments required to be made therefrom, or to facilitate the transfers of moneys or securities between various Funds and Accounts as may be required from time to time pursuant to the provisions of this Article. The Trustee shall not be liable for losses incurred as a result of actions taken in good faith in accordance with this Section 5.11(c). As soon as p racticable after any such sale, redemption or exchange, the Trustee shall give notice thereof to the Issuer and the Company.

(d) Neither the Trustee nor the Issuer shall be liable for any loss arising from, or any depreciation in the value of any obligations in which moneys of the Funds and Accounts shall be invested in accordance with this Indenture. The investments authorized by this Section 5.09 shall at all times be subject to the provisions of applicable law, as amended from time to time.

(e) In computing the amount in any Fund or Account, obligations purchased as an investment of moneys therein shall be valued at fair market value as determined by the Trustee one month prior to each Interest Payment Date.

The fair market value of Qualified Investments shall be determined as follows:

(i) as to investments the bid and asked prices of which are published on a regular basis in The Wall Street Journal (or, if not there, then in The New York Times), the average bid and asked prices for such investments so published on or most recently prior to such time of determination;

(ii) as to investments the bid and asked prices of which are not published on a regular basis in The Wall Street Journal or The New York Times, the average bid price at such nationally recognized government securities dealers (selected by the Trustee in its absolute discretion) at the time making a market in such investments or as quoted in the Interactive Data Service; and

(iii) as to certificates of deposit and bankers acceptances and other investments, the face amount thereof, plus accrued interest.

If more than one provision of this definition of “fair market value” shall apply at any time to any particular investment, the fair market value thereof at such time shall be determined in accordance with the provision establishing the lowest value for such investment.

Section 5.12. Application of Moneys in Certain Funds for Retirement of Bonds. Notwithstanding any other provisions of this Indenture, if on any Interest Payment Date or redemption date the amounts held in the Funds established under this Indenture (other than the Purchase Fund, the Earnings Fund and the Rebate Fund) are sufficient to pay one hundred percent (100%) of the principal or Redemption Price, as the case may be, of all Outstanding Bonds and the interest accruing on such Bonds to the next date on which such Bonds are redeemable or payable, as the case may be, whichever is earlier, the Trustee shall so notify the Is suer and the Company. Upon receipt of written instructions from an Authorized Representative of the Company directing such redemption, the Trustee shall proceed to redeem all such Outstanding Bonds in the manner provided for redemption of such Bonds by this Indenture.

Section 5.13. Repayment to the Company from the Funds. After payment in full of the Bonds (in accordance with Article X) and the payment of all fees, charges and expenses of the Issuer, the Trustee, the Tender Agent, the Remarketing Agent, the Bond Registrar and the Paying Agents and all other amounts required to be paid hereunder and under each of the Security Documents, and the payment of any amounts which the Trustee is directed to rebate to the Federal government pursuant to this Indenture and the Tax Regulatory Agreement, all amounts remaining in any Fund shall be paid to the Company upon the expiration or sooner termination of the term of the Loan Agreement as provided in Section 4.3(g) of the Loan Agreement.

Section 5.14. Non-presentment of Bonds. In the event any Bond shall not be presented for payment when the principal thereof becomes due, either at maturity, or at the date fixed for redemption thereof, or otherwise, and funds sufficient to pay any such Bond shall have been made available to the Trustee for the benefit of the Holder or Holders thereof, together with interest to the date on which principal is due, all liability of the Issuer to the Holder thereof for the payment of such Bond shall forthwith cease, terminate and be completely discharged, and thereupon it shall be the duty of the Trustee to pay such funds to t he Person entitled thereto or if the Person is not known to the Trustee, to hold such funds, without liability for interest thereon, for the benefit of the Holder of such Bond, who shall thereafter be restricted exclusively to such funds, for any claim of whatever nature on his part under this Indenture or on, or with respect to, such Bond. Such amounts so held shall, pending payment to the Holder of such Bond, (y) be subject to any rebate requirement as set forth in the Tax Regulatory Agreement or this Indenture, and (z) shall be uninvested, or, if invested, invested or re-invested only in Government Obligations maturing within thirty (30) days. Funds remaining with the Trustee as above and unclaimed for the earlier of two (2) years or one month less than the applicable statutory escheat period shall be paid to the Company. After the payment of such unclaimed moneys to the Company, the Holder of such Bond shall thereafter look only to the Company for the payment th ereof, and all obligations of the Trustee or such Paying Agent with respect to such moneys shall thereupon cease.

ARTICLE VI

REDEMPTION OF BONDS

Section 6.01. Privilege of Redemption and Redemption Price. Bonds or portions thereof subject to redemption prior to maturity shall be redeemable, upon mailed notice as provided in this Article, at the times, at the Redemption Prices and upon such terms in addition to and consistent with the terms contained in this Article as shall be specified in this Indenture and in said Bonds.

Section 6.02. Selection of Bonds to be Redeemed. In the event of redemption of less than all the Outstanding Bonds of the same Series and maturity, the particular Bonds or portions thereof to be redeemed shall be selected by the Trustee in such manner as the Trustee in its discretion may deem fair, except that (i) Bonds of a Series to be redeemed from Sinking Fund Installments shall be redeemed by lot, and (ii) to the extent practicable, the Trustee shall select Bonds of a Series for redemption such that no Bond of such Series shall be of a denomination of less than the Authorized Denomination for such Series of Bonds. In the event of redemption of less than all the Outstanding Bonds of the same Series stated to mature on different dates, the principal amount of such Series of Bonds to be redeemed shall be applied in inverse order of maturity of the Outstanding Series of Bonds to be redeemed and by lot within a maturity. The portion of Bonds of any Series to be redeemed in part shall be in the principal amount of the minimum Authorized Denomination thereof or some integral multiple thereof and, in selecting Bonds of a particular Series for redemption, the Trustee shall treat each such Bond as representing that number of Bonds of such Series which is obtained by dividing the principal amount of such registered Bond by the minimum Authorized Denomination thereof (referred to below as a “unit”) then issuable rounded down to the integral multiple of such minimum Authorized Denomination. If it is determined that one or more, but not all, of the units of principal amount repres ented by any such Bond is to be called for redemption, then, upon notice of intention to redeem such unit or units, the Holder of such Bond shall forthwith surrender such Bond to the Trustee for (a) payment to such Holder of the Redemption Price of the unit or units of principal amount called for redemption and (b) delivery to such Holder of a new Bond or Bonds of such Series in the aggregate unpaid principal amount of the unredeemed balance of the principal amount of such Bond. New Bonds of the same Series and maturity representing the unredeemed balance of the principal amount of such Bond shall be issued to the registered Holder thereof, without charge therefor. If the Holder of any such Bond of a denomination greater than a unit shall fail to present such Bond to the Trustee for payment and exchange as aforesaid, such Bond shall, nevertheless, become due and payable on the date fixed for redemption to the extent of the unit or units of principal amount called for redemptio n (and to that extent only).

Section 6.03. Notice of Redemption. When redemption of any Bonds is requested or required pursuant to this Indenture, the Trustee shall give notice of such redemption in the name of the Issuer, specifying the name of the Series, CUSIP number, Bond numbers, the date of original issue of such Series, the date of mailing of the notice of redemption, maturities, interest rates and principal amounts of the Bonds or portions thereof to be redeemed, the redemption date, the Redemption Price, and the place or places where amounts due upon such redemption will be payable (including the name, address and telephone number of a contac t person at the Trustee) and specifying the principal amounts of the Bonds or portions thereof to be payable and, if less than all of the Bonds of any maturity are to be redeemed, the numbers of such Bonds or portions thereof to be so redeemed. Such notice shall further state that on such date there shall become due and payable upon each Bond or portion thereof to be redeemed the Redemption Price thereof together with interest accrued to the redemption date, and that from and after such date interest thereon shall cease to accrue and be payable. Such notice may set forth any additional information relating to such redemption. The Trustee, in the name and on behalf of the Issuer, (i) shall mail a copy of such notice by first class mail, postage prepaid, not more than sixty (60) nor less than thirty (30) days prior to the date fixed for redemption, to the registered owners of any Bonds which are to be redeemed, at their last addresses, if any, appearing upon the registrati on books, but any defect in such notice shall not affect the validity of the proceedings for the redemption of such Series of Bonds with respect to which proper mailing was effected; and (ii) cause notice of such redemption to be sent to at least two (2) of the national information services that disseminate redemption notices. Any notice mailed as provided in this Section shall be conclusively presumed to have been duly given, whether or not the registered owner receives the notice. In the event of a postal strike, the Trustee shall give notice by other appropriate means selected by the Trustee in its discretion. If any Bond shall not be presented for payment of the Redemption Price within sixty (60) days of the redemption date, the Trustee shall mail a second notice of redemption to such Holder by first class mail, postage prepaid. Any amounts held by the Trustee due to non-presentment of Bonds for payments on or after any redemption date shall be retained by the Trustee for a period of at least one year after the final maturity date of such Bonds. Further, if any Holders of Bonds shall constitute registered depositories, the notice of redemption described in the first sentence of this Section 6.03 shall be mailed to such Holders at least two (2) days prior to the mailing of such notice to all Holders.

If notice of redemption shall have been given as aforesaid, the Bonds of such Series called for redemption shall become due and payable on the redemption date, provided, however, that with respect to any optional redemption of the Bonds of a Series, such notice shall state that such redemption shall be conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of moneys sufficient to pay the principal of, redemption premium, if any, and interest on the Bonds of such Series to be redeemed, and that if such moneys shall not have been so received said notice shall be of no force and effect and the Issuer shall not be required to redeem the Bonds of such Series. In the event that such notice of optional redemption contains such a condition and such moneys are not so received, the redemption sh all not be made and the Trustee shall within a reasonable time thereafter give notice, in the manner in which the notice of redemption was given, that such moneys were not so received. If a notice of optional redemption shall be unconditional, or if the conditions of a conditional notice of optional redemption shall have been satisfied, then upon presentation and surrender of the Bonds of such Series so called for redemption at the place or places of payment, such Series of Bonds shall be redeemed.

Under no circumstances shall the Trustee be required to expend any of its own funds for any purpose for which funds are to be disbursed under this Indenture.

So long as the Securities Depository is effecting book entry transfers of the Bonds, the Trustee shall provide the notices specified above only to the Securities Depository. It is expected that the Securities Depository shall, in turn, notify its Participants and that the Participants, in turn, will notify or cause to be notified the Beneficial Owners. Any failure on the part of the Securities Depository or a Participant, or failure on the part of a nominee of a Beneficial Owner of a Bond (having been mailed notice from the Trustee, the Securities Depository, a Participant or otherwise) to notify the Beneficial Owner of the Bond so affected, shall not affect the validity of the redemption of such Bond.

Section 6.04. Payment of Redeemed Bonds. ii) Notice having been given in the manner provided in Section 6.03, the Bonds or portions thereof so called for redemption shall become due and payable on the redemption dates so designated at the Redemption Price, plus interest accrued and unpaid to the redemption date. If, on the redemption date, moneys for the redemption of all the Bonds or portions thereof to be redeemed, together with interest to the redemption date, shall be held by the Paying Agents so as to be available therefor on said date and if notice of redemption shall have been given as aforesaid , then, from and after the redemption date, (i) interest on the Bonds or portions thereof so called for redemption shall cease to accrue and become payable, (ii) the Bonds or portions thereof so called for redemption shall cease to be entitled to any lien, benefit or security under this Indenture, and (iii) the Holders of the Bonds or portions thereof so called for redemption shall have no rights in respect thereof, except to receive payment of the Redemption Price together with interest accrued to the redemption date. If said moneys shall not be so available on the redemption date, such Bonds or portions thereof shall continue to bear interest until paid at the same rate as they would have borne had they not been called for redemption.

(b) Payment of the Redemption Price plus interest accrued to the redemption date shall be made to or upon the order of the registered owner only upon presentation of such Bonds for cancellation and exchange as provided in Section 6.05; provided, however, that any Holder of at least $1,000,000 in original aggregate principal amount of the Initial Bonds may, by written request to the Trustee no later than five (5) days prior to the date of redemption, direct that payments of Redemption Price and accrued interest to the date of redemption be made by wire transfer as soon as practicable after tender of the Bonds in Federal funds at such wire transfer address as the owner shall specify to the Trustee in such w ritten request.

Section 6.05. Cancellation of Redeemed Bonds. iii) All Bonds redeemed in full under the provisions of this Article, shall forthwith be cancelled and returned to the Issuer and no Bonds shall be executed, authenticated or issued hereunder in exchange or substitution therefor, or for or in respect of any paid portion of a Bond.

(b) If there shall be drawn for redemption less than all of a Bond, as described in Section 6.02, the Issuer shall execute and the Trustee shall authenticate and deliver, upon the surrender of such Bond, without charge to the owner thereof, for the unredeemed balance of the principal amount of the Bond so surrendered, a Bond or Bonds of like Series and maturity in any of the authorized denominations.

Section 6.06. No Partial Redemption After Default. Anything in this Indenture to the contrary notwithstanding, if there shall have occurred and be continuing an Event of Default hereunder, there shall be no redemption of less than all of the Bonds Outstanding.

ARTICLE VII

PARTICULAR COVENANTS

Section 7.01. Payment of Principal and Interest. The Issuer covenants that it will from the sources herein contemplated promptly pay or cause to be paid the principal of, Sinking Fund Installments for, Purchase Price, and interest on the Bonds, and the Redemption Price, if any, together with interest accrued thereon to the date of redemption, at the place, on the dates and in the manner provided in this Indenture and in the Bonds according to the true intent and meaning thereof.

Section 7.02. Performance of Covenants; Authority. The Issuer covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Indenture, in any and every Bond executed, authenticated and delivered hereunder and in all proceedings pertaining thereto. The Issuer covenants that it is duly authorized under the Constitution and laws of the State, including particularly its Organizational Documents, to issue the Bonds authorized hereby and to execute this Indenture, to make the Loan to the Company pursuant to the Loan Agreement and the Promissor y Note, to assign the Loan Agreement and the Promissory Note, and to pledge the loan payments, revenues and receipts hereby pledged in the manner and to the extent herein set forth; that all action on its part for the issuance of the Bonds and the execution and delivery of this Indenture has been duly and effectively taken; and that the Bonds in the hands of the Holders thereof are and will be the valid and enforceable special limited revenue obligations of the Issuer according to the import thereof.

Section 7.03. Books and Records; Certificate as to Defaults. The Issuer and the Trustee each covenant and agree that, so long as any of the Bonds shall remain Outstanding, proper books of record and account will be kept showing complete and correct entries of all transactions relating to the Project and the Facility, and that the Holders of any of the Bonds shall have the right at all reasonable times to inspect all records, accounts and data relating thereto. In this regard, so long as the Loan Agreement is in full force and effect, records furnished by the Issuer and the Company to, or kept by, the Trustee in connection with its duties as such shall be deemed to be in compliance with the Issuer’s obligations under this Section 7.03. Within thirty (30) days after receiving the certificate from the Company as provided in Section 7.24(b) of the Loan Agreement, the Trustee shall render to the Issuer a statement that moneys received by the Trustee pursuant to the Loan Agreement were applied by it to the payment of the principal or Redemption Price, if any, of, Purchase Price, Sinking Fund Installments for, and interest on the Bonds, at the place, on the dates and in the manner provided in this Indenture and that the Trustee has no knowledge of any defaults under this Indenture or the Loan Agreement or any other Security Document or specifying the particulars of such defaults which may exist.

Upon reasonable written request, the Trustee shall make available to the Company for its inspection during normal business hours, its records with respect to the Project and the Facility.

The Trustee agrees that, upon the written request of the Issuer or the Company, it will, not more than twice in each calendar year, provide a statement to the requesting party setting forth the principal amount of Bonds Outstanding as of the date of such statement.

Section 7.04. Loan Agreement. Reference is hereby made to the Loan Agreement for a detailed statement of the terms and conditions thereof and for a statement of the rights and obligations of the parties thereunder. All covenants and obligations of the Company under the Loan Agreement shall be enforceable either by the Issuer or by the Trustee, to whom, in its own name or in the name of the Issuer, is hereby granted the right, to the extent provided therefor in this Section 7.04 and subject to the provisions of Section 9.02, to enforce all rights of the Issuer and all obligations of the Company under th e Loan Agreement, whether or not the Issuer is enforcing such rights and obligations. The Trustee shall take such action in respect of any matter as is provided to be taken by it in the Loan Agreement (including, without limitation, Sections 3.5, 5.3 and 7.9 thereof) upon compliance or noncompliance by the Company and the Issuer with the provisions of the Loan Agreement relating to the same.

Section 7.05. Creation of Liens; Indebtedness. It is the intention of the Issuer and the Trustee that the Mortgage is and will continue to be a mortgage lien upon the Company’s leasehold interest under the Ground Lease in the Facility (subject only to Permitted Encumbrances). The Issuer shall not create or suffer to be created, or incur or issue any evidences of indebtedness secured by, any lien or charge upon or pledge of the Trust Estate, except the lien, charge and pledge created by this Indenture and the other Security Documents.

Section 7.06. Ownership; Instruments of Further Assurance. The Trustee on behalf of the Company, subject to Section 7.04 and upon the written direction of any Bondholder, shall defend the interest of the Company in the Facility and every part thereof for the benefit of the Holders of the Bonds, to the extent permitted by law, against the claims and demands of all Persons whomsoever. The Issuer covenants that it will do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered, such Supplemental Indentures and such further acts, instruments and transfers as the Trustee may r easonably require for the better assuring, transferring, conveying, pledging, assigning and confirming unto the Trustee all and singular the property described herein and in the remainder of the Trust Estate, subject to the liens, pledge and security interests of this Indenture and of the other Security Documents, and the loan payments, revenues and receipts pledged hereby to the payment of the principal or Redemption Price, if any, of, Sinking Fund Installments for, Purchase Price, and interest on the Bonds. Any and all property hereafter acquired which is of the kind or nature herein provided to be and become subject to the lien, pledge and security interest hereof (other than the Company’s Property) and of the other Security Documents shall ipso facto, and without any further conveyance, assignment or act on the part of the Issuer or the Trustee, become and be subject to the lien, pledge and security interest of this Indenture and of the other Security Documents as fully and completely as though specifically described herein and therein, but nothing in this sentence contained shall be deemed to modify or change the obligations of the Issuer heretofore made by this Section 7.06.

Section 7.07. Security Agreement; Recording and Filing. d) This Indenture constitutes a “security agreement” within the meaning of the New York State Uniform Commercial Code-Secured Transactions. The Issuer shall cause this Indenture and all Supplemental Indentures to be recorded (at the sole cost and expense of the Company) as a lien encumbering an interest in real property through delivery hereof and thereof to a title insurance company engaged by the Company for due recordation, in the appropriate offices of the Register of The City of New York, or in such other offices as may be at the time provided by law as the proper place for the recordation thereof. In addition, the security interest of the Trustee, as created by this Indenture, in the rights and other intangible interests described herein, shall be perfected by the filing of a financing statement at the direction of the Issuer in the office of the Secretary of State of the State in the City of Albany, New York, which financing statement shall be in accordance with the New York State Uniform Commercial Code-Secured Transactions. Subsequent to the foregoing recordation and filings, this Indenture shall be re-recorded and re-indexed, and financing and continuation statements shall be filed and re-filed, by the Trustee whenever in the Opinion of Counsel to the Company (which opinion shall be reasonably acceptable to and addressed to the Trustee) such action is necessary to preserve the lien and security interest hereof. Any such re-recordings, re-indexings, filings or re-filings shall be prepared by the Company and delivered to the Trustee (if electronic filing is not elected by the Issuer) on a timely basis accompanied by any fees or requisite charges and the Opinion of Counsel referred to above. The Trustee will thereupon effect any such filings and re-filings of financing and continuation statements in said office of the Secretary of State, and promptly notify the Company of any such filings.

(b) The Issuer and the Trustee acknowledge that, as of the Closing Date,

Subsequent to the foregoing recordation and filings, if in the Opinion of Counsel to the Company (described hereinbelow), to preserve (after the thirtieth (30th) anniversary of the Closing Date) the lien and security interest of this Indenture, it is necessary to re-record and/or re-index documents, re-file financing statements and/or file continuation statements and/or take any other actions (individually or collectively, the “Continuation Action(s)”), then, the Company in a timely manner shall: (A) as applicable, (i) prepare and deliver to the Trustee all necessary instruments and filing papers, together with remittances equal to the cost of required filing fees and other charges, so that the Trustee may perform the Continuation Actions, or (ii) electronically perform the Continuation Actions and deliver to the Trustee written certification (upon which the Trustee may conclusively rely) that such performance has occurred, specifying the Continuation Actions performed, or (iii) perform some of the Continuation Actions in the manner described in clause “(i)” and the others in the manner described in clause “(ii)”; and (B) deliver or cause to be delivered to the Issuer and the Trustee the Opinion of Counsel to the Company as described below. The Trustee may conclusively rely upon (y) when applicable, the certification referred to in clause “(A)(ii),” and (z) in all instances, the Opinion of Counsel to the Company. In the event the Company chooses to have the Trustee perform all or some of the Continuation Actions, as provided in clause “(A)(i)” hereinabove, the Trustee shall reasonably promptly perform such Continuation Actions at the Company’s sole expense. The Company shall perform the obligations described hereinabove in clauses “(A)” and “(B)” no later than ten (10) days prior to (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) each fifth (5th) anniversary thereafter, and/or (ii) the date (not covered by clause “(i)”) on which a Continuation Action is to be taken to preserve the lien and security interest of this Indenture.

The Opinion of Counsel to the Company shall be addressed to the Company, the Issuer and the Trustee. Counsel shall deliver successive Opinions of Counsel in respect of (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) every five-year period thereafter through the term of the Initial Bonds, and/or (ii) the date of any required Continuation Action not covered by clause “(i),” in each case not later than fifteen (15) days prior to the date on which a Continuation Action is required to be taken. In the Opinion of Counsel to the Company, counsel shall opine as to: (i) what Continuation Actions are necessary; and (ii) the deadline dates for the required Continuation Actions; and (iii) the jurisdictions in which the Continuation Actions must be effected. Counsel in such opinion shall additionally opine that, upon performance of the Continuation Actions by, as the case may be, (i) the Trustee with instruments and papers prepared by the Company, or (ii) the Company through electronic filing, or (iii) the Trustee as to some Continuation Actions, and the Company as to the others through electronic filings, all appropriate steps shall have been taken on the part of the Company, the SubCompany, the Issuer and the Trustee then requisite to the maintenance of the perfection of the security interest of the Trustee in and to all property and interests which by the terms of this Indenture are to be subjected to the lien and security interest of this Indenture.

(d) Any filings with respect to Uniform Commercial Code financing statements may be made electronically, and the Issuer shall have the right to designate a company (which shall be reasonably acceptable to the Trustee) to facilitate the filing of Uniform Commercial Code financing statements.

(e) The Trustee acknowledges and agrees (on behalf of itself and the Bondholders) that neither the Issuer, nor any of its directors, members, officers, employees, servants, agents, persons under its control or supervision, or attorneys (including Nationally Recognized Bond Counsel to the Issuer), shall have any responsibility or liability whatsoever related in any way to the filing or re-filing of any Uniform Commercial Code financing statements or continuation statements, or the perfection or continuation of perfection of any security interests, or the recording or rerecording of any document, or the failure to effect any act referred to in this Section, or the failure to effect any such act in all appro priate filing or recording offices, or the failure of sufficiency of any such act so effected.

(f) All costs (including reasonable attorneys’ fees and expenses) incurred in connection with the effecting of the requirements specified in this Section shall be paid by the Company.

Section 7.08. Issuer Tax Covenant. The Issuer covenants that it shall not take any action within its control, nor refrain from taking any action reasonably requested by the Company or the Trustee, that would cause the interest on the Bonds to become includable in gross income for Federal income tax purposes; provided, however, the breach of this covenant shall not result in any pecuniary liability of the Issuer and the only remedy to which the Issuer shall be subject shall be specific performance.

ARTICLE VIII

EVENTS OF DEFAULT; REMEDIES OF BONDHOLDERS

Section 8.01. Events of Default; Acceleration of Due Date. i) Each of the following events is hereby defined as and shall constitute an “Event of Default”:

(1) Failure in the payment of the interest on any Bond when the same shall become due and payable;

(2) Failure in the payment of the principal or redemption premium, if any, of, or Sinking Fund Installment for, any Bonds, when the same shall become due and payable, whether at the stated maturity thereof or upon proceedings for redemption thereof or otherwise, or interest accrued thereon to the date of redemption after notice of redemption therefor or otherwise;

(3) Failure to duly and punctually pay the Purchase Price of any Initial Bond tendered or deemed tendered for purchase pursuant to Section 2.03;

(4) Failure of the Issuer to observe or perform any covenant, condition or agreement in the Bonds or hereunder on its part to be performed (except as set forth in Section 8.01(a)(1), (2) or (3) and (A) continuance of such failure for more than thirty (30) days after written notice of such failure has been given to the Issuer and the Company specifying the nature of same from the Trustee or the Holders of more than twenty-five percent (25%) in aggregate principal amount of the Bonds Outstanding, or (B) if by reason of the nature of such failure the same can be remedied, but not within the said thirty (30) days, the Issuer or the Company fails to commence and thereafter proceed with reasonab le diligence after receipt of said notice to cure such failure or fails to continue with reasonable diligence its efforts to cure such failure or fails to cure such failure within sixty (60) days of delivery of said notice; or

(5) The occurrence of an “Event of Default” under the Loan Agreement or any other Security Document.

(b) Upon the happening and continuance of any Event of Default, unless the principal of all the Bonds shall have already become due and payable, either the Trustee (by notice in writing to the Issuer and the Company) or the Holders of over twenty-five percent (25%) in aggregate principal amount of the Bonds Outstanding (by notice in writing to the Issuer, the Company and the Trustee) may declare the principal or Redemption Price, if any, of all the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon such declaration the same shall become and be immediately due and payable, anything in this Indenture or in any of the Bonds contained to the contrary notwiths tanding.

(c) If there shall occur an Event of Default under Section 8.1(d) or (e) of the Loan Agreement, the unpaid principal of all the Bonds (and all principal installments of loan payments under the Loan Agreement) and the interest accrued thereon shall be due and payable immediately without the necessity of any declaration or other action by the Trustee or any other Person.

(d) The right of the Trustee or of the Holders of over twenty-five percent (25%) in aggregate principal amount of the Bonds Outstanding to make any such declaration as aforesaid, however, is subject to the condition that if, at any time before such declaration, all overdue installments of principal of and interest on all of the Bonds which shall have matured by their terms and the unpaid Redemption Price of the Bonds or principal portions thereof to be redeemed has been paid by or for the account of the Issuer, and all other Events of Default have been otherwise remedied, and the reasonable and proper charges, expenses and liabilities of the Trustee, shall either be paid by or for the account of the Issue r or provision satisfactory to the Trustee shall be made for such payment and the Company’s interest in the Facility shall not have been sold or relet or otherwise encumbered, and all defaults have been otherwise remedied as provided in this Article VIII, then and in every such case any such default and its consequences shall ipso facto be deemed to be annulled, but no such annulment shall extend to or affect any subsequent default or impair or exhaust any right or power consequent thereon.

(e) Pursuant to the Loan Agreement, the Issuer has granted to the Company full authority for the account of the Issuer to perform any covenant or obligation the non-performance of which is alleged in any notice received by the Company to constitute a default hereunder, in the name and stead of the Issuer with full power to do any and all things and acts to the same extent that the Issuer could do and perform any such things and acts with power of substitution. The Trustee agrees to accept such performance by the Company as performance by the Issuer.

Section 8.02. Enforcement of Remedies. ii) Upon the occurrence and continuance of any Event of Default, then and in every case the Trustee may proceed, and upon the written request of the Holders of over twenty-five percent (25%) in aggregate principal amount of the Bonds Outstanding shall proceed, to protect and enforce its rights and the rights of the Bondholders under the Act, the Bonds, the Loan Agreement, this Indenture and under any other Security Document forthwith by such suits, actions or special proceedings in equity or at law, or by proceedings in the office of any board or officer having jurisdiction , whether for the specific performance of any covenant or agreement contained in this Indenture or in any other Security Document or in aid of the execution of any power granted in this Indenture or in any other Security Document or in the Act or for the enforcement of any legal or equitable rights or remedies as the Trustee, being advised by counsel, shall deem most effectual to protect and enforce such rights or to perform any of its duties under this Indenture or under any other Security Document. In addition to any rights or remedies available to the Trustee hereunder or elsewhere, upon the occurrence and continuance of an Event of Default the Trustee may take such action, without notice or demand, as it deems advisable.

(b) In the enforcement of any right or remedy under this Indenture, under any other Security Document or under the Act, the Trustee shall be entitled to sue for, enforce payment on and receive any or all amounts then or during any default becoming, and any time remaining, due from the Issuer, for principal, interest, Sinking Fund Installments, Purchase Price, Redemption Price, or otherwise, under any of the provisions of this Indenture, of any other Security Document or of the Bonds, and unpaid, with interest on overdue payments at the rate or rates of interest specified in the Bonds, together with any and all costs and expenses of collection and of all proceedings under this Indenture, under any such oth er Security Document and under the Bonds, without prejudice to any other right or remedy of the Trustee or of the Bondholders, and to recover and enforce judgment or decree against the Issuer, but solely as provided in this Indenture and in the Bonds, for any portion of such amounts remaining unpaid, with interest, costs and expenses, and to collect (but solely from the moneys in the Bond Fund and other moneys available therefor to the extent provided in this Indenture) in any manner provided by law, the moneys adjudged or decreed to be payable. The Trustee shall file proof of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Bondholders allowed in any judicial proceedings relative to the Company, the Parent or the Issuer or their creditors or property.

(c) Regardless of the occurrence of an Event of Default, the Trustee, if requested in writing by the Holders of over twenty-five percent (25%) in aggregate principal amount of the Bonds then Outstanding, and furnished with reasonable security and indemnity, shall institute and maintain such suits and proceedings as it may be advised shall be necessary or expedient to prevent any impairment of the security under this Indenture or under any other Security Document by any acts which may be unlawful or in violation of this Indenture or of such other Security Document or of any resolution authorizing any Bonds, and such suits and proceedings as the Trustee may be advised shall be necessary or expedient to pres erve or protect its interests and the interests of the Bondholders; provided, that such request shall not be otherwise than in accordance with the provisions of law and of this Indenture and shall not be unduly prejudicial to the interests of the Holders of the Bonds not making such request.

Section 8.03. Application of Revenues and Other Moneys After Default.

iii) All moneys received by the Trustee pursuant to any right given or action taken under the provisions of this Article or under any other Security Document shall, after payment of the cost and expenses of the proceedings resulting in the collection of such moneys and of the expenses, liabilities and advances incurred or made by the Trustee, be deposited in the Bond Fund and all moneys so deposited and available for payment of the Bonds shall be applied, subject to Section 9.04, as follows:

(A) Unless the principal of all of the Bonds shall have become or have been declared due and payable,

First -

To the payment to the Persons entitled thereto of all installments of interest then due on the Bonds, in the order of the maturity of the installments of such interest and, if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amounts due on such installment, to the Persons entitled thereto, without any discrimination or privilege; and

Second -

To the payment to the Persons entitled thereto of the unpaid principal or Redemption Price, if any, of any of the Bonds or principal installments which shall have become due (other than Bonds or principal installments called for redemption for the payment of which moneys are held pursuant to the provisions of this Indenture), in the order of their due dates, with interest on such Bonds, at the rate or rates expressed thereon, from the respective dates upon which they become due and, if the amount available shall not be sufficient to pay in full Bonds or principal installments due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal due on such date, to the Persons entitled thereto without any discrimination or privilege.

(B) If the principal of all the Bonds shall have become or have been declared due and payable, to the payment to the Bondholders of the principal and interest (at the rate or rates expressed in the Bonds) then due and unpaid upon the Bonds and if applicable to the Redemption Price of the Bonds without preference or priority of principal over interest or of interest over principal, Sinking Fund Installments, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the Persons entitled thereto without any discrimination or preference.

(C) If the principal of all the Bonds shall have been declared due and payable, and if such declaration shall thereafter have been rescinded and annulled under the provisions of this Article VIII, then, subject to the provisions of Section 8.03(a)(B) which shall be applicable in the event that the principal of all the Bonds shall later become due and payable, the moneys shall be applied in accordance with the provisions of Section 8.03(a)(A).

(b) Whenever moneys are to be applied pursuant to the provisions of this Section, such moneys shall be applied at such times, and from time to time, as the Trustee shall determine, having due regard to the amount of such moneys available for application and the likelihood of additional moneys becoming available for such application in the future. Whenever the Trustee shall apply such funds, it shall fix the date (which shall be an Interest Payment Date unless it shall deem another date more suitable) upon which such application is to be made and upon such date interest on the amounts of principal to be paid on such dates shall cease to accrue; provided, however, that if the principal or Redempt ion Price of the Bonds Outstanding, together with accrued interest thereon, shall have been declared to be due and payable pursuant to Section 8.01, such date of declaration shall be the date from which interest shall cease to accrue. The Trustee shall give such written notice to all Bondholders as it may deem appropriate of the deposit with it of any such moneys and of the fixing of any such date, and shall not be required to make payment to the Holder of any Bond until such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.

Section 8.04. Actions by Trustee. All rights of actions under this Indenture, under any other Security Document or under any of the Bonds may be enforced by the Trustee without the possession of any of the Bonds or the production thereof in any trial or other proceedings relating thereto and any such suit or proceeding instituted by the Trustee shall be brought in its name as Trustee without the necessity of joining as plaintiffs or defendants any Holders of the Bonds, and any recovery of judgment shall, subject to the provisions of Section 8.03, be for the equal benefit of the Holders of the Outstanding Bonds.< /font>

Section 8.05. Majority Holders Control Proceedings. Anything in this Indenture to the contrary notwithstanding, the Majority Holders shall have the right, at any time, by an instrument or instruments in writing executed and delivered to the Trustee, to direct the method and place of conducting all proceedings to be taken in connection with the enforcement of the terms and conditions of this Indenture, or for the appointment of a receiver or any other proceedings hereunder; provided, that such direction shall not be otherwise than in accordance with the provisions of law and of this Indenture.

Section 8.06. Individual Bondholder Action Restricted. iv) No Holder of any Bond shall have any right to institute any suit, action or proceeding at law or in equity for the enforcement of any provisions of this Indenture or of any other Security Document or the execution of any trust under this Indenture or for any remedy under this Indenture or under any other Security Document, unless such Holder shall have previously given to the Trustee written notice of the occurrence of an Event of Default as provided in this Article, and the Holders of over twenty-five percent (25%) in aggregate principal amount of the B onds then Outstanding shall have filed a written request with the Trustee, and shall have offered it reasonable opportunity either to exercise the powers granted in this Indenture or in such other Security Document or by the Act or by the laws of the State or to institute such action, suit or proceeding in its own name, and unless such Holders shall have offered to the Trustee adequate security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee shall have refused to comply with such request for a period of sixty (60) days after receipt by it of such notice, request and offer of indemnity, it being understood and intended that no one or more Holders of Bonds shall have any right in any manner whatever by his, its or their action to affect, disturb or prejudice the pledge created by this Indenture, or to enforce any right under this Indenture except in the manner herein provided; and that all proceedings at law or in equity to enforce any provision of t his Indenture shall be instituted, had and maintained in the manner provided in this Indenture and, subject to the provisions of Section 8.03, be for the equal benefit of all Holders of the Outstanding Bonds.

(b) Nothing in this Indenture, in any other Security Document or in the Bonds contained shall affect or impair the right of any Bondholder to payment of the principal or Redemption Price, if applicable, of, Sinking Fund Installments for, and interest on any Bond at and after the maturity thereof, or the obligation of the Issuer to pay the principal or Redemption Price, if applicable, of, Sinking Fund Installments for, and interest on each of the Bonds to the respective Holders thereof at the time, place, from the source and in the manner herein and in said Bonds expressed.

Section 8.07. Effect of Discontinuance of Proceedings. In case any proceedings taken by the Trustee on account of any Event of Default shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee, then and in every such case, the Company, the Issuer, the Trustee and the Bondholders shall be restored, respectively, to their former positions and rights hereunder, and all rights, remedies, powers and duties of the Trustee shall continue as in effect prior to the commencement of such proceedings.

Section 8.08. Remedies Not Exclusive. No remedy by the terms of this Indenture conferred upon or reserved to the Trustee or to the Holders of the Bonds is intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given under this Indenture or now or hereafter existing at law or in equity or by statute.

Section 8.09. Delay or Omission. No delay or omission of the Trustee or of any Holder of the Bonds to exercise any right or power arising upon any default shall impair any right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Article to the Trustee and the Holders of the Bonds, respectively, may be exercised from time to time and as often as may be deemed expedient by the Trustee or by the Bondholders.

Section 8.10. Notice of Default. The Trustee shall promptly mail to the Issuer, to registered Holders of Bonds and to the Company by first class mail, postage prepaid, written notice of the occurrence of any Event of Default. The Trustee shall not, however, be subject to any liability to any Bondholder by reason of its failure to mail any notice required by this Section.

Section 8.11. Waivers of Default. The Trustee shall waive any default hereunder and its consequences and rescind any declaration of acceleration only upon the written request of the Majority Holders; provided, however, that there shall not be waived without the consent of the Holders of all the Bonds Outstanding (a) any default in the payment of the principal of any Outstanding Bonds at the date specified therein or (b) any default in the payment when due of the interest on any such Bonds, unless, prior to such waiver, all arrears of interest, with interest (to the extent permitted by law) at the rate borne by the Bonds on overdue installments of interest in respect of which such default shall have occurred, and all arrears of payment of principal when due, as the case may be, and all expenses of the Trustee in connection with such default shall have been paid or provided for, or in case any proceeding taken by the Trustee on account of any such default shall have been discontinued or abandoned or determined adversely to the Trustee, then and in every such case the Company, the Issuer, the Trustee and the Bondholders shall be restored to their former positions and rights hereunder, respectively, but no such waiver or rescission shall extend to any subsequent or other default, or impair any right consequent thereon.

ARTICLE IX

TRUSTEE, BOND REGISTRAR, PAYING AGENTS, TENDER AGENT

AND REMARKETING AGENT

Section 9.01. Appointment and Acceptance of Duties of Trustee. The entity identified as the Trustee on the cover page hereof is hereby appointed as Trustee. The Trustee shall signify its acceptance of the duties and obligations of the Trustee hereunder and under each Security Document by executing this Indenture and agrees to perform said trusts as a corporate trustee ordinarily would under a corporate mortgage subject to the express terms and conditions herein. All provisions of this Article IX shall be construed as extending to and including all the rights, duties and obligations imposed upon the Trustee under the Loan Agreement and under any other Security Document to which it shall be a party as fully for all intents and purposes as if this Article IX were contained in the Loan Agreement and each such other Security Document.

Section 9.02. Indemnity of Trustee. The Trustee shall be under no obligation to institute any suit, or to take any remedial or legal action under this Indenture or under or pursuant to any other Security Document or to enter any appearance or in any way defend in any suit in which it may be made defendant, or to take any steps in the execution of the trusts hereby created or in the enforcement of any rights and powers or fulfillment of any extraordinary duties under this Indenture, or under any other Security Document, until it shall be indemnified to its satisfaction against any and all reasonable compensation for s ervices, costs and expenses, outlays, and counsel fees and other disbursements, and against all liability not due to its willful misconduct or gross negligence.

Section 9.03. Responsibilities of Trustee. v) The Trustee shall have no responsibility in respect of the validity or sufficiency of this Indenture or of any other Security Document or the security provided hereunder or thereunder or the due execution of this Indenture by the Issuer, or the due execution of any other Security Document by any party (other than the Trustee) thereto, or in respect of the title or the value of the Facility, or in respect of the validity of the Bonds authenticated and delivered by the Trustee in accordance with this Indenture or to see to the recording or filing of this Indenture or a ny other document or instrument whatsoever except as otherwise provided in Section 7.07. The recitals, statements and representations contained in this Indenture and in the Bonds shall be taken and be construed as made by and on the part of the Issuer and not by the Trustee, and the Trustee does not assume any responsibility for the correctness of the same; provided, however, that the Trustee shall be responsible for its representation contained in its certificate on the Bonds and for its responsibility as to filing, refiling, recording and re-recording as contained in Section 7.07.

(b) The Trustee shall not be liable or responsible because of the failure of the Issuer to perform any act required of it by this Indenture or by any other Security Document or because of the loss of any moneys arising through the insolvency or the act or default or omission of any depositary other than itself in which such moneys shall have been deposited under this Indenture or the Tax Regulatory Agreement. The Trustee shall not be responsible for the application of any of the proceeds of the Bonds or any other moneys deposited with it and paid out, invested, withdrawn or transferred in accordance with this Indenture or the Tax Regulatory Agreement or for any loss resulting from any such inve stment. The Trustee shall not be liable in connection with the performance of its duties under the Loan Agreement, under this Indenture or under any other Security Document except for its own willful misconduct or gross negligence. The immunities and exemptions from liability of the Trustee shall extend to its directors, officers, employees, agents and servants and persons under the Trustee’s control or supervision.

(c) The Trustee, prior to the occurrence of an Event of Default and after curing of all Events of Default which may have occurred, if any, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default has occurred (which has not been cured) the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise as a prudent man would exercise under the circumstances in the conduct of his own affairs. The Trustee shall not be charged with knowledge of the occurrence of an Event of Default unless, (i) the Trustee has not received any ce rtificate, financial statement, insurance notice or other document regularly required to be delivered to the Trustee under the Loan Agreement or any other Security Document, (ii) the Trustee has not received payment of any amount required to be remitted to the Trustee under the Loan Agreement or any other Security Document, (iii) a Responsible Officer of the Trustee has actual knowledge thereof, or (iv) the Trustee has received written notice thereof from the Company, the Issuer or any Bondholder. The Trustee shall not be charged with the knowledge of a Determination of Taxability unless the Trustee has received written notice thereof from the Internal Revenue Service, the Company, the Issuer or any Bondholder or former Bondholder.

(d) The Trustee shall not be liable or responsible for the failure of the Company to effect or maintain insurance on the Facility as provided in the Ground Lease, the Mortgage, the Loan Agreement or the Bond Guaranty Agreement nor shall it be responsible for any loss by reason of want or insufficiency in insurance or by reason of the failure of any insurer in which the insurance is carried to pay the full amount of any loss against which it may have insured the Issuer, the Company, the Trustee or any other Person.

(e) The Trustee shall execute and cause to be filed those continuation statements, any additional financing statements and all other instruments required by it by Section 7.07 at the expense of the Company.

(f) The Trustee shall on the same date as it shall render the statement required of it by Section 7.03, make annual reports to the Issuer and the Company of all moneys received and expended during the preceding year by it under this Indenture and of any Event of Default known to it under the Loan Agreement or this Indenture or under any other Security Document.

(g) With respect to the Tax Regulatory Agreement, the Trustee shall not be required to make any payment of a Rebate Amount or any transfer of funds or take any other action required to be taken thereunder except upon the receipt of a written certificate of direction of an Authorized Representative of the Company delivered to the Trustee in accordance with the terms of the Tax Regulatory Agreement. Notwithstanding any provision of the Tax Regulatory Agreement or any other Security Document, nothing in the Tax Regulatory Agreement, either expressed or implied, shall be deemed to impose upon the Trustee any responsibility for the legal sufficiency of the Tax Regulatory Agreement to effect complian ce with the Code nor any duty to independently review or verify any information or calculation furnished to the Trustee by the Company.

Section 9.04. Compensation of Trustee, Bond Registrar, Paying Agents, Tender Agent and Remarketing Agent. The Trustee, the Bond Registrar, the Paying Agents, the Tender Agent and the Remarketing Agent shall be entitled to receive and collect from the Company as provided in the Loan Agreement payment or reimbursement for reasonable fees for services rendered hereunder and under each other Security Document and all advances, counsel fees and other expenses reasonably and necessarily made or incurred by the Trustee, the Bond Registrar, the Paying Agents, the Tender Agent or the Remarketing Agent in connection therewith. Upon an Event of Default, but only upon an Event of Default, the Trustee shall have a first right of payment prior to payment on account of the principal of or interest on any Bonds, upon the revenues (but not including any amounts held by the Trustee under Section 5.12, 6.04 or Article X) for the foregoing advances, fees, costs and expenses incurred.

Section 9.05. Evidence on Which Trustee May Act. vi) In case at any time it shall be necessary or desirable for the Trustee to make any investigation respecting any fact preparatory to taking or not taking any action, or doing or not doing anything, as such Trustee, and in any case in which this Indenture provides for permitting or taking any action, it may rely upon any certificate required or permitted to be filed with it under the provisions of this Indenture, and any such certificate shall be evidence of such fact to protect it in any action that it may or may not take, or in respect of anything it may or ma y not do, in good faith, by reason of the supposed existence of such fact.

(b) The Trustee may conclusively rely and shall be fully protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Indenture, upon any resolution, order, notice, request, consent, waiver, certificate, statement, affidavit, requisition, bond or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper board or person, or to have been prepared and furnished pursuant to any of the provisions of this Indenture, or, at the sole cost and expense of the Company, and when determined necessary in the reasonable discretion of the Tr ustee, upon the written opinion of any attorney (who may be an attorney for the Issuer or an employee of the Company or the Parent), engineer, appraiser, architect or accountant believed by the Trustee to be qualified in relation to the subject matter.

Section 9.06. Trustee, Paying Agents, Tender Agent and Remarketing Agent May Deal in Bonds. Any national banking association, bank or trust company acting as a Trustee, Paying Agent, Tender Agent or Remarketing Agent, and its respective directors, officers, employees or agents, may in good faith buy, sell, own, hold and deal in any of the Bonds, and may join in any action which any Bondholder may be entitled to take with like effect as if such association, bank or trust company were not such Trustee, Paying Agent, Tender Agent or Remarketing Agent.

Section 9.07. Resignation or Removal of Trustee. The Trustee may resign and thereby become discharged from the trusts created under this Indenture for any reason by giving written notice by first class mail, postage prepaid, to the Issuer, to the Company and to the Holders of all Bonds not less than sixty (60) days before such resignation is to take effect, but such resignation shall not take effect until the appointment and acceptance thereof of a successor Trustee pursuant to Section 9.08.

The Trustee may be removed at any time by an instrument or concurrent instruments in writing filed with the Trustee and signed by the Issuer or the Majority Holders or their attorneys-in-fact duly authorized. Such removal shall become effective either upon the appointment and acceptance of such appointment by a successor Trustee or at the date specified in the instrument of removal. The Trustee shall promptly give notice of such filing to the Issuer and the Company. No removal shall take effect until the appointment and acceptance thereof of a successor Trustee pursuant to Section 9.08.

If the Trustee shall resign or shall be removed, such Trustee must transfer and assign to the successor Trustee, not later than the date of this acceptance by the successor Trustee of its appointment as such, or thirty (30) days from the date specified in the instrument of removal or resignation, if any, whichever shall last occur, (i) all amounts (including all investments thereof) held in any Fund or Account under this Indenture, together with a full accounting thereof, (ii) all records, files, correspondence, registration books, Bond inventory, all information relating to this Indenture and to Bond payment status (i.e., outstanding principal balances, principal payment and interest payment schedules, Sinking Fund Installment schedules, pending notices of redemption, payments made and to whom, delinquent payments, default or delinquency notices, deficiencies in any Fund or Account balance, etc.) and all such other information (in whatever form) relating to all Funds and Accounts in the possession of the Trustee being removed or resigning, and (iii) all Security Documents and other documents or agreements, including, without limitation, all Uniform Commercial Code Financing Statements, all insurance policies or certificates, letters of credit or other instruments provided to the Trustee being removed or resigning (clauses (i), (ii) and (iii), together with the Trust Estate, being collectively referred to as the “Trust Corpus”).

Section 9.08. Successor Trustee. vii) If at any time the Trustee shall be dissolved or otherwise become incapable of acting or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator or conservator thereof, or of its property, shall be appointed, or if any public officer shall take charge or control of the Trustee or of its property or affairs, the position of Trustee shall thereupon become vacant. If the position of Trustee shall become vacant for any of the foregoing reasons or for any other reason or if the Trustee shall resign, the Company shall cooperate with the Issuer and the Is suer shall appoint a successor Trustee and shall use its best efforts to obtain acceptance of such trust by the successor Trustee within sixty (60) days from such vacancy or notice of resignation. Within twenty (20) days after such appointment and acceptance, the Issuer shall notify in writing the Company and the Holders of all Bonds.

(b) In the event of any such vacancy or resignation and if a successor Trustee shall not have been appointed within sixty (60) days of such vacancy or notice of resignation, the Majority Holders, by an instrument or concurrent instruments in writing, signed by such Bondholders or their attorneys-in-fact thereunto duly authorized and filed with the Issuer, may appoint a successor Trustee which shall, immediately upon its acceptance of such trusts, and without further act, supersede the predecessor Trustee. If no appointment of a successor Trustee shall be made pursuant to the foregoing provisions of this Section 9.08, within ninety (90) days of such vacancy or notice of resignation, the Holder o f any Bond then Outstanding, the Issuer or any retiring Trustee or the Company may apply to any court of competent jurisdiction to appoint a successor Trustee. Such court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Trustee.

(c) Any Trustee appointed under this Section shall be a national banking association or a bank or trust company duly organized under the laws of any state of the United States authorized to exercise corporate trust powers under the laws of the State and authorized by law and its charter to perform all the duties imposed upon it by this Indenture and each other Security Document. At the time of its appointment, any successor Trustee shall (x) have a capital stock and surplus aggregating not less than $100,000,000 and (y) have an investment grade rating of at least “Baa3” or “P-3”.

(d) Any predecessor Trustee shall transfer to any successor Trustee appointed under this Section as a result of a vacancy in the position the Trust Corpus by a date not later than thirty (30) days from the date of the acceptance by the successor Trustee of its appointment as such. Where no vacancy in the position of the Trustee has occurred, the transfer of the Trust Corpus shall take effect in accordance with the provisions of Section 9.07.

(e) Every successor Trustee shall execute, acknowledge and deliver to its predecessor, and also to the Issuer, an instrument in writing accepting such appointment, and thereupon such successor Trustee, without any further act, deed, or conveyance, shall become fully vested with all moneys, estates, properties, rights, immunities, powers and trusts, and subject to all the duties and obligations, of its predecessor, with like effect as if originally named as such Trustee; but such predecessor shall, nevertheless, on the written request of its successor or of the Issuer, and upon payment of the compensation, expenses, charges and other disbursements of such predecessor which are due and payable pursuant to S ection 9.04, execute and deliver an instrument transferring to such successor Trustee all the estate, properties, rights, immunities, powers and trusts of such predecessor and the Trust Corpus; and every predecessor Trustee shall deliver all property and moneys, together with a full accounting thereof, held by it under this Indenture to its successor. Should any instrument in writing from the Issuer be required by any successor Trustee for more fully and certainly vesting in such Trustee the estate, properties, rights, immunities, powers and trusts vested or intended to be vested in the predecessor Trustee, any such instrument in writing shall, on request, be executed, acknowledged and delivered by the Issuer. Any successor Trustee shall promptly notify the Issuer and the Paying Agent of its appointment as Trustee.

(f) Any company into which the Trustee may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Trustee may sell or transfer all or substantially all of its corporate trust business, provided such company shall be a national banking association or a bank or trust company duly organized under the laws of any state of the United States and shall be authorized by law and its charter to perform all the duties imposed upon it by this Indenture and each other Security Document shall be the successor to such Trustee without the execution or filing of any paper or the performance o f any further act.

Section 9.09. Paying Agents. e) The Trustee is hereby appointed as Paying Agent for the Bonds. The Issuer may also from time to time appoint one or more other Paying Agents in the manner and subject to the conditions set forth in Section 9.09(b) for the appointment of a successor Paying Agent. Each Paying Agent shall signify its acceptance of the duties and obligations imposed upon it by this Indenture by executing and delivering to the Issuer, and in the case of all Paying Agents other than the Trustee, to the Trustee a written acceptance thereof. The principal offices of the Pa ying Agents are designated as the respective offices or agencies of the Issuer for the payment of the principal or Redemption Price, if any, of, Sinking Fund Installments for, and interest on the Bonds. Each Paying Agent shall not be liable in connection with the performance of its duties hereunder except for its own willful misconduct or gross negligence.

(b) Any Paying Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least sixty (60) days prior written notice to the Issuer and the Trustee. Any Paying Agent may be removed at any time by an instrument filed with such Paying Agent and the Trustee and signed by the Issuer. Any successor Paying Agent shall be appointed by the Issuer, with the approval of the Trustee, and shall be a commercial bank or trust company duly organized under the laws of any state of the United States or a national banking association, having a capital stock and surplus aggregating at least $40,000,000, having an investment grade rating of at leas t “Baa3” or “P-3”, and willing and able to accept the office on reasonable and customary terms and authorized by law and its charter to perform all the duties imposed upon it by this Indenture.

(c) In the event of the resignation or removal of any Paying Agent, such Paying Agent shall pay over, assign and deliver any moneys held by it as Paying Agent to its successor, or if there be no successor, to the Trustee. In the event that for any reason there shall be a vacancy in the office of any Paying Agent, the Trustee shall act as such Paying Agent.

Section 9.10. Appointment of Co-Trustee. i) It is the purpose of this Indenture that there shall be no violation of any law of any jurisdiction denying or restricting the right of banking corporations or associations to transact business as trustee in such jurisdiction. It is recognized that in case of litigation under this Indenture or under any other Security Document, and in particular in case of the enforcement of any on default, or in case the Trustee deems that by reason of any present or future law of any jurisdiction it may not exercise any of the powers, rights or remedies herein granted to t he Trustee or hold title to the properties, in trust, as herein granted, or take any other action which may be desirable or necessary in connection therewith, it may be necessary that the Trustee appoint an additional institution as a separate trustee or co-trustee. The following provisions of this Section are adapted to these ends.

(b) In the event that the Trustee appoints an additional institution as a separate trustee or co-trustee, each and every remedy, power, right, claim, demand, cause of action, immunity, estate, title, interest and lien expressed or intended by this Indenture to be exercised by or vested in or conveyed to the Trustee with respect thereto shall be exercisable by and vest in such separate trustee or co-trustee but only to the extent necessary to enable such separate trustee or co-trustee to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate trustee or co-trustee shall run to and be enforceable by either of them. Such co-tr ustee may be removed by the Trustee at any time, with or without cause.

(c) Should any instrument in writing from the Issuer be required by the separate trustee or co-trustee so appointed or removed by the Trustee for more fully and certainly vesting in and confirming to it such properties, rights, powers, trusts, duties and obligations, any and all such instruments in writing shall, on request, be executed, acknowledged and delivered by the Issuer. In case any separate trustee or co-trustee, or a successor to either, shall become incapable of acting, resign or be removed, all the estates, properties, rights, powers, trusts, duties and obligations of such separate trustee or co-trustee, so far as permitted by law, shall vest in and be exercised by the Trustee until the appointment of a new trustee or successor to such separate trustee or co-trustee.

(d) No trustee shall be liable for the acts or omissions of any other trustee hereunder.

Section 9.11. Tender Agent - Appointment, Acceptance and Successors.

(a) The Issuer hereby appoints The Bank of New York Mellon, New York, New York, as Tender Agent. The Tender Agent shall designate to the Trustee, if the Tender Agent is not also the Trustee, its principal office, and signify its acceptance of the duties and obligations imposed on it hereunder by a written instrument of acceptance delivered to the other Notice Parties. One or more additional Tender Agents may be appointed by the Issuer to the extent necessary to effectuate the rights of the Bondholders to tender Initial Bonds for purchase pursuant to Section 2.03.

(b) The Tender Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least sixty (60) days written notice to the other Notice Parties, except that such resignation shall not take effect until the appointment of a successor Tender Agent hereunder, and the acceptance of such appointment by the successor Tender Agent. The Tender Agent may be removed at any time by the Issuer by a written instrument filed with the other Notice Parties, but such removal shall not take effect until the appointment and acceptance of such appointment by the successor Tender Agent. Upon the resignation or removal of the Tender Agent, the Tender Age nt shall pay over, deliver and assign any moneys and Bonds held by it in such capacity to its successor.

(c) If the position of Tender Agent shall become vacant for any reason, or if any bankruptcy, insolvency or similar proceeding shall be commenced by or against the Tender Agent, the Issuer shall appoint a successor Tender Agent to fill the vacancy. A written acceptance of office shall be filed by the successor Tender Agent in the manner set forth in Section 9.11(a). Any successor Tender Agent shall be a national banking association, bank or trust Institution, in each case duly organized under the laws of the United States of America or any state or territory thereof, having a combined capital stock, surplus and undivided profits of at least $100,000,000, having an investment gra de rating of at least “Baa3” or “P-3”, and authorized by law to perform all of the duties imposed on it by this Indenture. If the position of Tender Agent shall become vacant, the Company shall cooperate with the Issuer, and the Issuer shall appoint a successor Tender Agent and shall use its best efforts to obtain acceptance of such office by the successor Tender Agent within sixty (60) days from such vacancy. Within twenty (20) days after such appointment and acceptance, the Issuer shall notify in writing the Holders of all Bonds then Outstanding and the other Notice Parties.

(d) In the event of any such vacancy and if a successor Tender Agent shall not have been appointed within sixty (60) days of such vacancy, the Majority Holders, by an instrument or concurrent instruments in writing, signed by such Bondholders or their attorneys-in-fact thereunto duly authorized and filed with the Issuer, may appoint a successor Tender Agent that shall, immediately upon its acceptance of such office, and without further act, supersede the predecessor Tender Agent. If no appointment of a successor Tender Agent shall have been made pursuant to the foregoing provisions of this Section 9.11, within 120 days of such vacancy, the Holder of any Bond then Outstanding, the Issuer, the Tr ustee or the Company may apply to any court of competent jurisdiction to appoint a successor Tender Agent. Such court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Tender Agent.

(e) Every successor Tender Agent shall execute, acknowledge and deliver to its predecessor, and also to the Issuer, an instrument in writing accepting such appointment, and thereupon such successor Tender Agent, without any further act, deed, or conveyance, shall become fully vested with all moneys, estates, properties, rights, immunities, powers and trusts, and subject to all the duties and obligations, of its predecessor, with like effect as if originally named as such Tender Agent; but such predecessor shall, nevertheless, on the written request of its successor or of the Issuer, execute and deliver an instrument transferring to such successor Tender Agent all the estate, properties, rights, immunities , powers and trusts of such predecessor; and every predecessor Tender Agent shall deliver all property and moneys held by it under this Indenture, together with a full accounting thereof, to its successor. Should any instrument in writing from the Issuer be required by any successor Tender Agent for more fully and certainly vesting in such Tender Agent the estate, properties, rights, immunities, powers and trusts vested or intended to be vested in the predecessor Tender Agent, any such instrument in writing shall, on request, be executed, acknowledged and delivered by the Issuer. Any successor Tender Agent shall promptly notify the other Notice Parties of its appointment as Tender Agent.

(f) Any Entity into which the Tender Agent may be merged or converted or with which it may be consolidated or any Entity resulting from any merger, conversion or consolidation to which it shall be a party or any Entity to which the Tender Agent may sell or transfer all or substantially all of its business, provided such Entity shall be a national banking association, a bank or trust company duly organized under the laws of the United States of America or any state or territory of the United States and shall be authorized by law and its charter to perform all the duties imposed upon it by this Indenture and each other Security Document shall be the successor to such Tender Agent without the execution or fi ling of any paper or the performance of any further act.

Section 9.12. Tender Agent - General Responsibilities. f) The Tender Agent shall perform the duties and obligations set forth in this Indenture, and in particular shall:

(1) hold all Initial Bonds delivered to it for purchase hereunder as agent and bailee of, and in escrow for the benefit of, the respective Bondholders that have so delivered such Initial Bonds, until moneys representing the Purchase Price of such Initial Bonds shall have been delivered to or for the account of or to the order of such Bondholders, provided the Tender Agent may deliver any of such Initial Bonds to the Remarketing Agent to be held as provided in Section 9.15;

(2) hold all moneys (other than moneys delivered to it by the Company for the purchase of Initial Bonds) delivered to it hereunder (without investment thereof) for the purchase of Initial Bonds as agent and bailee of, and in escrow for the benefit of, the Person that shall have so delivered such moneys, until the Initial Bonds purchased with such moneys shall have been delivered to or for the account of such Person;

(3) hold all moneys delivered to it hereunder by or on behalf of the Company for the purchase of Initial Bonds as agent and bailee of, and in escrow for the benefit of, Bondholders that shall deliver Initial Bonds to it for purchase (without investment thereof), until the Initial Bonds purchased with such moneys shall have been delivered to or for the account of the Company; except that if the Initial Bonds shall at any time become due and payable, the Tender Agent shall cause such moneys to be deposited with the Trustee for deposit in the Bond Fund on the date upon which the Initial Bonds become due and payable;

(4) keep such books and records as shall be consistent with prudent industry practice, and make such books and records available for inspection by the other Notice Parties;

(5) deliver any notices required by this Indenture to be delivered by the Tender Agent; and

(6) perform all other duties of the Tender Agent under this Indenture.

(b) In performing its duties and obligations hereunder, the Tender Agent shall use the same degree of care and skill as a prudent person would exercise under the same circumstances in the conduct of his own affairs. The Tender Agent, its officers, directors, employees and agents shall not be liable in connection with the performance of its duties hereunder except for its own willful misconduct, gross negligence or unlawful conduct.

(c) The Tender Agent may deal in Initial Bonds and with the Company to the same extent and with the same effect as provided in Section 9.06.

(d) The Tender Agent hereby waives any rights to, or Liens on, any funds or obligations held by or owing to it pursuant to this Indenture. The Tender Agent shall be reimbursed and compensated for its fees and expenses for acting under and pursuant to this Indenture only from payments to be made by the Company pursuant to Section 7.3 of the Loan Agreement.

Section 9.13. Remarketing Agent - Appointment, Acceptance and Successors. g) The Issuer hereby appoints Roosevelt & Cross Incorporated, New York, New York, as Remarketing Agent. The Remarketing Agent shall designate to the Trustee its principal office, and signify its acceptance of the duties and obligations imposed on it hereunder by a written instrument of acceptance delivered to the Notice Parties.

(b) Except as otherwise provided in the Remarketing Agreement (in which case the provisions of the Remarketing Agreement shall govern and shall supersede the provisions of this paragraph), the Remarketing Agent may at any time resign and be discharged of the duties and obligations created by this Indenture by giving at least sixty (60) days written notice to the other Notice Parties, except that such resignation shall not take effect until the appointment and acceptance of a successor Remarketing Agent hereunder; and (ii) the Remarketing Agent may be removed at any time by the Company by a written notice filed with the other Notice Parties, except that no such removal shall be effective until the app ointment of a successor Remarketing Agent hereunder and the acceptance of such appointment by the successor Remarketing Agent. Upon the resignation or removal of the Remarketing Agent, the Remarketing Agent shall pay over, deliver and assign any moneys and Initial Bonds held by it in such capacity to its successor.

(c) If the position of Remarketing Agent shall become vacant for any reason, or if any bankruptcy, insolvency or similar proceeding shall be commenced by or against the Remarketing Agent, the Issuer shall appoint a successor Remarketing Agent to fill the vacancy. A written acceptance of office shall be filed by the successor Remarketing Agent in the manner set forth in Section 9.13(a). Any successor Remarketing Agent shall be a corporation or other legal entity organized and doing business under the laws of the United States of America or of any state thereof, authorized under such laws to perform all duties imposed upon the Remarketing Agent by this Indenture, and having a principal office or agency located in the City, shall have a capitalization of at least $25,000,000, shall be acceptable to the Company, and shall be either (x) a member of the Financial Industry Regulatory Authority and registered as a Municipal Securities Dealer under the Securities Exchange Act of 1934, as amended, or (y) a national banking association, commercial bank or trust company. So long as the Initial Bonds are held in the book entry system, the Remarketing Agent must be a Participant in the book entry system with respect to the Initial Bonds.

(d) In the event of any such vacancy and if a successor Remarketing Agent shall not have been appointed by the Issuer within sixty (60) days of such vacancy, the Company may appoint a successor Remarketing Agent, which shall, immediately upon its acceptance of such office, and without further act, supersede the predecessor Remarketing Agent. If no appointment of a successor Remarketing Agent shall have been made pursuant to the foregoing provisions of this Section 9.13, within 120 days of such vacancy, the Issuer, the Holder of any Initial Bond then Outstanding or the Trustee may apply to any court of competent jurisdiction to appoint a successor Remarketing Agent. Such court may the reupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Remarketing Agent.

(e) If the Remarketing Agent shall resign, be removed, or be dissolved, or if the property or affairs of the Remarketing Agent shall be taken under control of any state or federal court or administrative body because of bankruptcy or insolvency, or for any other reason, and the Company shall not have appointed a successor as Remarketing Agent, the Tender Agent shall ipso facto be deemed to be such Remarketing Agent for all purposes of this Indenture until the appointment by the Issuer of a successor Remarketing Agent; provided, however, that the Tender Agent, in its capacity as Remarketing Agent, shall not be required to sell Initial Bonds or determine the interest rate on the Initial Bonds hereunder if the Tender Agent should be prohibited by law from conducting such activities. The Company will notify each Rating Agency then rating the Initial Bonds, if any, of any successor Remarketing Agent or co-Remarketing Agent.

(f) Every successor Remarketing Agent shall execute, acknowledge and deliver to its predecessor, and also to the Issuer, the Trustee and the Company, an instrument in writing accepting such appointment, and thereupon such successor Remarketing Agent, without any further act, deed, or conveyance, shall become fully vested with all moneys, estates, properties, rights, immunities and powers, and subject to all the duties and obligations, of its predecessor, with like effect as if originally named as such Remarketing Agent; but such predecessor shall, nevertheless, on the written request of its successor or of the Issuer, the Trustee or the Company, execute and deliver an instrument transferring to such succe ssor Remarketing Agent all the estate, properties, rights, immunities and powers of such predecessor; and every predecessor Remarketing Agent shall deliver all property, Initial Bonds, notices and moneys held by it under this Indenture, together with a full accounting thereof, to its successor. Should any instrument in writing from the Issuer or the Trustee be required by any successor Remarketing Agent for more fully and certainly vesting in such Remarketing Agent the estate, properties, rights, immunities and powers vested or intended to be vested in the predecessor Remarketing Agent, any such instrument in writing shall, on request, be executed, acknowledged and delivered by the Issuer or the Trustee. Any successor Remarketing Agent shall promptly notify the other Notice Parties of its appointment as Remarketing Agent.

(g) Any Entity into which the Remarketing Agent may be merged or converted or with which it may be consolidated or any Entity resulting from any merger, conversion or consolidation to which it shall be a party or any Entity to which the Remarketing Agent may sell or transfer all or substantially all of its securities business, provided such Entity shall otherwise qualify under Section 9.13(c), shall be the successor to such Remarketing Agent without the execution or filing of any paper or the performance of any further act.

Section 9.14. Remarketing Agent - General Responsibilities. h) The Remarketing Agent shall perform the duties and obligations set forth in this Indenture, subject to the provisions of the Remarketing Agreement, and in particular shall:

(1) hold any Initial Bonds delivered to it hereunder by the Tender Agent in trust for the benefit of the respective Holders of the Initial Bonds that shall have delivered or shall be deemed to have delivered such Initial Bonds to the Tender Agent, as the case may be, until moneys representing the Purchase Price of such Initial Bonds shall have been delivered to or for the account of or to the order of such Holders of the Initial Bonds or deposited with the Trustee, as the case may be, and to redeliver such Initial Bonds to the Tender Agent upon its request;

(2) solicit purchases of Initial Bonds from investors able to purchase municipal bonds, effectuate and process such purchases, bill and receive payment for Initial Bonds purchased, and perform related functions in connection with the remarketing of Initial Bonds hereunder;

(3) on each Purchase Date promptly transfer all moneys delivered to it hereunder for the purchase of Initial Bonds as agent and bailee of, and in escrow for the benefit of, the Person that shall have so delivered such moneys until the Initial Bonds purchased with such moneys shall have been delivered to or for the account of such Person, provided that such moneys shall be delivered to the Tender Agent for deposit in the Remarketing Account of the Purchase Fund;

(4) keep such books and records as shall be consistent with prudent industry practice and will document its action taken hereunder, and make such books and records available for inspection by the Notice Parties;

(5) comply at all times in all material respects with all applicable state and federal securities laws and other statutes, rules and regulations applicable to the offering and sale of the Initial Bonds;

(6) promptly determine the Adjustable Fixed Interest Rate on the Initial Bonds, and remarket the Initial Bonds, as provided in Section 2.03;

(7) use its best efforts to find purchasers for the Initial Bonds tendered or deemed tendered for purchase, any such sale to be made at the Purchase Price in accordance with the terms of this Indenture;

(8) deliver to the Tender Agent all Initial Bonds held by it in accordance with the terms of this Indenture and the Remarketing Agreement;

(9) deliver any notices by this Indenture to be delivered by the Remarketing Agent; and

(10) perform all other duties of the Remarketing Agent under this Indenture and the Remarketing Agreement.

(b) In performing its duties and obligations hereunder, the Remarketing Agent shall act in a manner consistent with prudent industry practice. The Remarketing Agent shall not be liable in connection with the performance of its duties hereunder except for its own willful misconduct, gross negligence or unlawful conduct.

(c) The Remarketing Agent may deal in Initial Bonds and with the Company to the same extent and with the same effect as provided in Section 9.06.

(d) The Remarketing Agent hereby waives any right to, or Lien on, any funds or obligations held by or owing to it pursuant to this Indenture. The Remarketing Agent shall be reimbursed and compensated for its fees and expenses for acting under and pursuant to this Indenture only from payments to be made by the Company pursuant to Section 7.3 of the Loan Agreement and the Remarketing Agreement.

Section 9.15. Cooperation Among Certain of the Notice Parties.

(a) The Trustee, the Remarketing Agent, the Bond Registrar and the Tender Agent shall each cooperate to cause the necessary arrangements to be made and to be thereafter continued whereby funds from the sources specified herein and in the Loan Agreement will be made available for the purchase of Initial Bonds presented at the designated corporate trust office of the Tender Agent, and to otherwise enable the Tender Agent to carry out its duties hereunder.

(b) The Tender Agent, the Trustee, the Remarketing Agent and the Bond Registrar shall cooperate to the extent necessary to permit the timely receipt by the Bond Registrar of tendered Initial Bonds and preparation, execution, issuance, authentication and delivery by the Bond Registrar of replacement Initial Bonds in connection with the tender and remarketing of Initial Bonds hereunder.

(c) The Tender Agent, the Remarketing Agent and the Bond Registrar shall each cooperate to cause the necessary arrangements to be made and thereafter continued whereby Initial Bonds prepared, executed, authenticated and issued hereunder shall be made available to the Remarketing Agent to the extent necessary for delivery pursuant to Section 9.14, and to otherwise enable the Remarketing Agent to carry out its duties hereunder.

ARTICLE X

DISCHARGE OF INDENTURE; DEFEASANCE

Section 10.01. Defeasance. i) If the Issuer shall pay or cause to be paid, or there shall otherwise be paid, to the Holders of all Bonds the principal or Redemption Price, if applicable, of, Sinking Fund Installments for, interest and all other amounts due or to become due thereon or in respect thereof, at the times and in the manner stipulated therein and in this Indenture, and all fees and expenses and other amounts due and payable under this Indenture and the Loan Agreement, and any other amounts required to be rebated to the Federal government pursuant to the Tax Regulatory Agreement or this Indenture, shall be paid in full, then the pledge of any loan payments, revenues or receipts from or in connection with the Security Documents or the Facility under this Indenture and the estate and rights hereby granted, and all covenants, agreements and other obligations of the Issuer to the Bondholders hereunder shall thereupon cease, terminate and become void and be discharged and satisfied and the Bonds shall thereupon cease to be entitled to any lien, benefit or security hereunder, except as to moneys or securities held by the Trustee or the Paying Agents as provided below in this subsection. At the time of such cessation, termination, discharge and satisfaction, (1) the Trustee shall cancel and discharge the lien of this Indenture and of the Mortgage and execute and deliver to the Company all such instruments as may be appropriate to satisfy such liens and to evidence such discharge and satisfaction, and (2) the Trustee and the Paying Agents shall pay over or deliver to the Company or on its order all moneys or se curities held by them pursuant to this Indenture which are not required (i) for the payment of the principal or Redemption Price, if applicable, Sinking Fund Installments for, or interest on Bonds not theretofore surrendered for such payment or redemption, (ii) for the payment of all such other amounts due or to become due under the Security Documents, or (iii) for the payment of any amounts the Trustee has been directed to pay to the Federal government under the Tax Regulatory Agreement or this Indenture.

(b) Bonds or interest installments for the payment or redemption of which moneys (or Defeasance Obligations which shall not be subject to call or redemption or prepayment prior to maturity and the full and timely payment of the principal of and interest on which when due, together with the moneys, if any, set aside at the same time, will provide funds sufficient for such payment or redemption) shall then be set aside and held in trust by the Trustee or Paying Agents, whether at or prior to the maturity or the redemption date of such Bonds, shall be deemed to have been paid within the meaning and with the effect expressed in subsection (a) of this Section, if (i) in case any such Bonds are to be redeemed prior to the maturity thereof, all action necessary to redeem such Bonds shall have been taken and notice of such redemption shall have been duly given or provision satisfactory under the requirements of this Indenture to the Trustee shall have been made for the giving of such notice, and (ii) if the maturity or redemption date of any such Bond shall not then have arrived, (y) provision shall have been made by deposit with the Trustee or other methods satisfactory to the Trustee for the payment to the Holders of any such Bonds of the full amount to which they would be entitled by way of principal or Redemption Price, Sinking Fund Installments, and interest and all other amounts then due under the Security Documents to the date of such maturity or redemption, and (z) provision satisfactory to the Trustee shall have been made for the mailing of a notice to the Holders of such Bonds that such moneys are so available for such payment on such maturity or redemption date.

Section 10.02. Defeasance Opinion and Verification. Prior to any defeasance becoming effective as provided in Section 10.01(b), there shall have been delivered to the Issuer and to the Trustee (A) an opinion of Nationally Recognized Bond Counsel to the effect that interest on any Bonds being discharged by such defeasance will not become subject to federal income taxation by reason of such defeasance, and (B) a verification from an independent certified public accountant or firm of independent certified public accountants (in each case reasonably satisfactory to the Issuer and the Trustee) to the effect that the moneys and/or Defeasance Obligations are sufficient, without reinvestment, to pay the principal of, Sinking Fund Installments for, interest on, and redemption premium, if any, of the Bonds to be defeased.

Section 10.03. No Limitation of Rights of Holders. No provision of this Article X, including any defeasance of Bonds, shall limit the rights of the Holder of any Bonds under Section 3.06, 3.07 or 3.09 until such Bonds shall have been paid in full.

ARTICLE XI

AMENDMENTS OF INDENTURE

Section 11.01. Limitation on Modifications. This Indenture shall not be modified or amended in any respect except as provided in and in accordance with and subject to the provisions of this Article.

Section 11.02. Supplemental Indentures Without Bondholders’ Consent.

ii) The Issuer and the Trustee may, from time to time and at any time, enter into Supplemental Indentures without the consent of the Bondholders for any of the following purposes:

(1) To cure any formal defect, omission or ambiguity in this Indenture or in any description of property subject to the lien hereof, if such action is not materially adverse to the interests of the Bondholders.

(2) To grant to or confer upon the Trustee for the benefit of the Bondholders any additional rights, remedies, powers, authority or security which may lawfully be granted or conferred and which are not contrary to or inconsistent with this Indenture as theretofore in effect.

(3) To add to the covenants and agreements of the Issuer in this Indenture other covenants and agreements to be observed by the Issuer which are not contrary to or inconsistent with this Indenture as theretofore in effect.

(4) To add to the limitations and restrictions in this Indenture other limitations and restrictions to be observed by the Issuer which are not contrary to or inconsistent with this Indenture as theretofore in effect.

(5) To confirm, as further assurance, any pledge under, and the subjection to any lien or pledge created or to be created by, this Indenture, of the properties of the Facility, or revenues or other income from or in connection with the Facility or of any other moneys, securities or funds, or to subject to the lien or pledge of this Indenture additional revenues, properties or collateral.

(6) To modify or amend such provisions of this Indenture as shall, in the opinion of Nationally Recognized Bond Counsel, be necessary to assure that the interest on the Bonds not be includable in gross income for Federal income tax purposes.

(7) To effect any other change herein which, in the judgment of the Trustee, is not to the material prejudice of the Trustee or the Bondholders.

(8) To modify, amend or supplement this Indenture or any Supplemental Indenture in such manner as to permit the qualification hereof and thereof under the Trust Indenture Act of 1939 or any similar federal statute hereafter in effect or to permit the qualification of the Bonds for sale under the securities laws of the United States of America or of any of the states of the United States of America, and, if they so determine, to add to this Indenture or any Supplemental Indenture such other terms, conditions and provisions as may be permitted by said Trust Indenture Act of 1939 or similar federal statute.

(9) To modify, amend or supplement any of the times, dates or other mechanical procedures for the setting of the Adjustable Fixed Interest Rate or the tender and remarketing of the Initial Bonds as set forth in Section 2.03, provided that such change is not to the material prejudice of the Bondholders.

(10) To evidence the appointment of a new Remarketing Agent or Tender Agent, and in connection therewith to change any times of day specified herein by which any action must be taken.

(11) To alter the manner in which the Remarketing Agent may, in the reasonable exercise of its judgment, act pursuant to Section 2.03 to increase the likelihood of achieving the lowest net interest cost during the term of the Initial Bonds, but only if the Institution provides to the Trustee and the Issuer a Favorable Opinion of Bond Counsel.

(12) To effect any modification, amendment or supplement to this Indenture to be made effective on a date after an Adjustment Date.

(b) Before the Issuer and the Trustee shall enter into any Supplemental Indenture pursuant to this Section, there shall have been filed with the Trustee an opinion of Nationally Recognized Bond Counsel stating that such Supplemental Indenture is authorized or permitted by this Indenture and complies with its terms, and that upon execution it will be valid and binding upon the Issuer in accordance with its terms.

Section 11.03. Supplemental Indentures With Bondholders’ Consent. iii) Subject to the terms and provisions contained in this Article, the Majority Holders shall have the right from time to time, to consent to and approve the entering into by the Issuer and the Trustee of any Supplemental Indenture as shall be deemed necessary or desirable by the Issuer for the purpose of modifying, altering, amending, adding to or rescinding, in any particular, any of the terms or provisions contained herein. Nothing herein contained shall permit, or be construed as permitting, (i) a change in the times, amounts or cur rency of payment of the principal of, Sinking Fund Installments for, Purchase Price, redemption premium, if any, or interest (except upon an Interest Rate Change) on any Outstanding Bonds, a change in the terms of redemption (except as provided in Section 2.04(a)) or maturity of the principal of or the interest on any Outstanding Bonds, or a reduction in the principal amount of or the Redemption Price of any Outstanding Bond or the rate of interest thereon, or any extension of the time of payment thereof, a change in the method of determining the rate of interest on any Bond (except as provided in Section 2.03), or a change in the terms of the purchase thereof by the Tender Agent, without the consent of the Holder of such Bond, (ii) the creation of a lien upon or pledge of the Trust Estate other than the liens or pledge created by this Indenture and the other Security Documents, except as provided in this Indenture with respect to Additional Bonds, (iii) a preference or priority of any Bo nd or Bonds over any other Bond or Bonds, (iv) a reduction in the aggregate principal amount of Bonds required for consent to such Supplemental Indenture, or (v) a modification, amendment or deletion with respect to any of the terms set forth in this Section 11.03(a), without, in the case of items (ii) through and including (v) of this Section 11.03(a), the written consent of one hundred percent (100%) of the Holders of the Outstanding Bonds.

(b) If at any time the Issuer shall determine to enter into any Supplemental Indenture for any of the purposes of this Section, it shall cause notice of the proposed Supplemental Indenture to be mailed, postage prepaid, to all Bondholders. Such notice shall briefly set forth the nature of the proposed Supplemental Indenture, and shall state that a copy thereof is on file at the offices of the Trustee for inspection by all Bondholders.

(c) Within one year after the date of such notice, the Issuer and the Trustee may enter into such Supplemental Indenture in substantially the form described in such notice only if there shall have first been filed with the Trustee (i) the written consents of the Majority Holders or the Holders of not less than 100%, as the case may be, in aggregate principal amount of the Bonds then Outstanding and (ii) an opinion of Nationally Recognized Bond Counsel stating that such Supplemental Indenture is authorized or permitted by this Indenture and complies with its terms, and that upon execution it will be valid and binding upon the Issuer in accordance with its terms. Each valid consent shal l be effective only if accompanied by proof of the holding, at the date of such consent, of the Bonds with respect to which such consent is given. A certificate or certificates by the Trustee that it has examined such proof and that such proof is sufficient in accordance with this Indenture shall be conclusive that the consents have been given by the Holders of the Bonds described in such certificate or certificates. Any such consent shall be binding upon the Holder of the Bonds giving such consent and upon any subsequent Holder of such Bonds and of any Bonds issued in exchange therefor (whether or not such subsequent Holder thereof has notice thereof), unless such consent is revoked in writing by the Holder of such Bonds giving such consent or a subsequent Holder thereof by filing such revocation with the Trustee prior to the execution of such Supplemental Indenture.

(d) If the Holders of not less than the percentage of Bonds required by this Section shall have consented to and approved the execution thereof as herein provided, no Holder of any Bond shall have any right to object to the execution of such Supplemental Indenture, or to object to any of the terms and provisions contained therein or the operation thereof, or in any manner to question the propriety of the execution thereof, or to enjoin or restrain the Issuer from executing the same or from taking any action pursuant to the provisions thereof.

(e) Upon the execution of any Supplemental Indenture pursuant to the provisions of this Section, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this Indenture of the Issuer, the Trustee and all Holders of Bonds then Outstanding shall thereafter be determined, exercised and enforced under this Indenture, subject in all respects to such modifications and amendments.

Section 11.04. Supplemental Indenture Part of this Indenture. Any Supplemental Indenture executed in accordance with the provisions of this Article shall thereafter form a part of this Indenture and all the terms and conditions contained in any such Supplemental Indenture as to any provisions authorized to be contained therein shall be deemed to be part of the terms and conditions of this Indenture for any and all purposes. The Trustee shall execute any Suppl emental Indenture entered into in accordance with the provisions of Section 11.02 or 11.03.

ARTICLE XII

AMENDMENTS OF RELATED SECURITY DOCUMENTS

Section 12.01. Rights of Company. Anything herein to the contrary notwithstanding, any Supplemental Indenture entered into pursuant to Article XI which affects any obligations, rights, powers and authority of the Company under the Loan Agreement or requires a revision of the Loan Agreement shall not become effective unless and until the Company shall have given its written consent to such Supplemental Indenture signed by an Authorized Representative of the Company.

Section 12.02. Amendments of Related Security Documents Not Requiring Consent of Bondholders. The Issuer and the Trustee may, without the consent of or notice to the Bondholders, consent (if required) to any amendment, change or modification of any of the Related Security Documents for any of the following purposes: (i) to cure any ambiguity, inconsistency, formal defect or omission therein; (ii) to grant to or confer upon the Trustee for the benefit of the Bondholders any additional rights, remedies, powers, authority or security which may be lawfully granted or conferred; (iii) to subject thereto addi tional revenues, properties or collateral; (iv) to evidence the succession of a successor Trustee or to evidence the appointment of a separate or co-Trustee or the succession of a successor separate or co-Trustee; (v) to make any change required in connection with a permitted amendment to a Related Security Document or a permitted Supplemental Indenture; and (vi) to make any other change that, in the judgment of the Trustee (which, in exercising such judgment, may conclusively rely, and shall be protected in relying, in good faith, upon an Opinion of Counsel or an opinion or report of engineers, accountants or other experts) does not materially adversely affect the Bondholders. The Trustee shall have no liability to any Bondholder or any other Person for any action taken by it in good faith pursuant to this Section. Before the Issuer or the Trustee shall enter into or consent to any amendment, change or modification to any of the Related Security Documents, there shall b e filed with the Trustee an opinion of Nationally Recognized Bond Counsel to the effect that such amendment, change or modification will not cause the interest on any of the Bonds to cease to be excluded from gross income for federal income tax purposes under the Code.

Section 12.03. Amendments of Related Security Documents Requiring Consent of Bondholders. Except as provided in Section 12.02, the Issuer and the Trustee shall not consent to any amendment, change or modification of any of the Related Security Documents, without mailing of notice and the written approval or consent of the Majority Holders given and procured as in Section 11.03 set forth; provided, however, there shall be no amendment, change or modification to (i) the obligation of the Company to make loan payments with respect to the Bonds under the Loan Agreement or the Promissory Note, (ii) the obligation of the Gua rantors to guarantee payment of the Bonds pursuant to the Bond Guaranty Agreement, or (iii) the Tax Regulatory Agreement without the delivery of an opinion of Nationally Recognized Bond Counsel to the effect that such amendment, change, modification, reduction or postponement will not cause the interest on any Series of Bonds to become includable in gross income for Federal income tax purposes. If at any time the Company shall request the consent of the Trustee to any such proposed amendment, change or modification, the Trustee shall cause notice of such proposed amendment, change or modification to be mailed in the same manner as is provided in Article XI with respect to Supplemental Indentures. Such notice shall briefly set forth the nature of such proposed amendment, change or modification and shall state that copies of the instrument embodying the same are on file at the principal office of the Trustee for inspection by all Bondholders. The Trustee may, but shal l not be obligated to, enter into any such amendment, change or modification to a Related Security Document which affects the Trustee’s own rights, duties or immunities under such Related Security Document or otherwise. Before the Trustee shall enter into or consent to any amendment, change or modification to any of the Related Security Documents, there shall be filed with the Trustee an opinion of Nationally Recognized Bond Counsel to the effect that such amendment, change or modification will not cause the interest on any of the Bonds to cease to be excluded from gross income for federal income tax purposes under the Code.

ARTICLE XIII

MISCELLANEOUS

Section 13.01. Evidence of Signature of Bondholders and Ownership of Bonds. iv) Any request, consent, revocation of consent, approval, objection or other instrument which this Indenture may require or permit to be signed and executed by the Bondholders may be in one or more instruments of similar tenor, and shall be signed or executed by any Bondholder in person or by his duly authorized attorney appointed in writing. Proof of the execution of any such instrument, or of an instrument appointing any such attorney, shall be sufficient for any purpose of this Indenture (except as otherwise therein expressly provided ) if made in the following manner, or in any other manner satisfactory to the Trustee, which may nevertheless in its discretion require further or other proof in cases where it deems the same desirable: the fact and date of the execution by any Bondholder or his attorney of such instruments may be proved by a guarantee of the signature thereon by a member of the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15, or by the certificate of any notary public or other officer authorized to take acknowledgments of deeds that the person signing such request or other instrument acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. For the purposes of the transfer or exchange of any Bond, the fact and date of the execution of the Bondholder or his attorney of the instrument of transfer shall be proved by a guarantee of the signature thereon by a member of the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15. Where such execution is by an officer of a corporation or association or a member of a partnership, on behalf of such corporation, association or partnership, such signature guarantee, certificate or affidavit shall also constitute sufficient proof of his authority.

(b) The ownership of Bonds and the amount, numbers and other identification shall be proved by the registry books.

(c) Except as otherwise provided in Section 11.03 with respect to revocation of a consent, any request or consent by the owner of any Bond shall bind all future owners of such Bond in respect of anything done or suffered to be done by the Issuer or the Trustee or any Paying Agent in accordance therewith.

Section 13.02. Notices. Any notice, demand, direction, certificate, Opinion of Counsel, request, instrument or other communication authorized or required by this Indenture to be given to or filed with the Issuer, the Company or the Trustee shall be sufficient if sent (i) by return receipt requested or registered or certified United States mail, postage prepaid, (ii) by a nationally recognized overnight delivery service for overnight delivery, charges prepaid or (iii) by hand delivery, addressed, as follows:

(1) if to the Issuer, to

New York City Capital Resource Corporation

110 William Street

New York, New York 10038

Attention: General Counsel (with a copy to the

Executive Director of the Issuer at the

same address)

(2) if to the Company, to

Albee Retail Development LLC

c/o Acadia Realty Trust

1311 Mamaroneck Avenue, Suite 260

White Plains, New York 10605

Attention: General Counsel

with a copy to

Washington Square Partners

675 Third Avenue, 25th Floor

New York, New York 10017

Attention: Paul Travis

and

Akerman Senterfitt LLP

335 Madison Avenue, 26th Floor

New York, New York 10017

Attention: Steven Polivy, Esq., and

(3) if to the Trustee, to

The Bank of New York Mellon

101 Barclay Street, Floor 7W

New York, New York 10286

Attention: Corporate Trust Administration

Section 13.03. Parties Interested Herein. Nothing in this Indenture expressed or implied is intended or shall be construed to confer upon, or to give to, any Person, other than the Issuer, the Company, the Trustee, the Tender Agent, the Remarketing Agent, the Bond Registrar, the Paying Agents and the Holders of the Bonds, any right, remedy or claim under or by reason of this Indenture or any covenant, condition or stipulation thereof. All covenants, stipulations, promises and agreements in this Indenture contained by and on behalf of the Issuer shall be for the sole and exclusive benefit of the Issuer, the Company, th e Trustee, the Tender Agent, the Remarketing Agent, the Bond Registrar, the Paying Agents and the Holders of the Bonds.

Section 13.04. Partial Invalidity. If any one or more of the provisions of this Indenture or of the Bonds shall be ruled illegal or invalid by any court of competent jurisdiction, the illegality or invalidity of such provision(s) shall not affect any of the remaining provisions hereof or of the Bonds, but this Indenture and the Bonds shall be construed and enforced as of such illegal or invalid provision had not been contained herein.

Section 13.05. Effective Date; Counterparts. The date of this Indenture shall be for reference purposes only and shall not be construed to imply that this Indenture was executed on the date first above written. This Indenture was delivered on the Closing Date. This Indenture shall become effective upon its delivery on the Closing Date. It may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

Section 13.06. Laws Governing Indenture. This Indenture shall be governed by, and construed and enforced in accordance with, the laws of the State, without regard or giving effect to the principles of conflicts of laws thereof.

Section 13.07. No Pecuniary Liability of Agency or Members; No Debt of the State or the City. Every agreement, covenant and obligation of the Issuer under this Indenture is predicated upon the condition that any obligation for the payment of money incurred by the Issuer shall not create a debt of the State or the City and neither the State nor the City shall be liable on any obligation so incurred, and the Bonds shall not be payable out of any funds of the Issuer other than those pledged therefor but shall be payable by the Issuer solely from the loan payments, revenues and receipts derived from or in connection with the Facilit y pledged to the payment thereof in the manner and to the extent in this Indenture specified and nothing in the Bonds, in the Loan Agreement, in the Mortgage, in this Indenture or in any other Security Document shall be considered as pledging any other funds or assets of the Issuer. The Issuer shall not be required under this Indenture or the Loan Agreement or any other Security Document to expend any of its funds other than (i) the proceeds of the Bonds, (ii) the loan payments, revenues and receipts, rental income and other moneys held or derived from or in connection with the Facility and pledged to the payment of the Bonds, (iii) any income or gains therefrom, and (iv) the Net Proceeds with respect to the Facility. No provision, covenant or agreement contained in this Indenture or in the Bonds or any obligations herein or therein imposed upon the Issuer or the breach thereof, shall constitute or give rise to or impose upon the Issuer a pecuniary liability or a cha rge upon its general credit.

All covenants, stipulations, promises, agreements and obligations of the Issuer contained herein shall be deemed to be covenants, stipulations, promises, agreements and obligations of the Issuer and not of any member, director, officer, employee or agent of the Issuer in his individual capacity, and no recourse shall be had for the payment of the principal or Redemption Price, if any, of, Purchase Price, Sinking Fund Installments for, or interest on the Bonds or for any claim based thereon or hereunder against any member, director, officer, employee or agent of the Issuer or any natural person executing the Bonds. Neither the Bonds, the interest thereon, the Sinking Fund Installments therefor, nor the Redemption Price thereof shall ever constitute a debt of the State or of the City and neither the State nor the City shall b e liable on any obligation so incurred, and the Bonds shall not be payable out of any funds of the Issuer other than those pledged therefor.

Section 13.08. Priority of Indenture Over Liens. This Indenture and the Mortgage are given in order to secure funds to pay for the Project and by reason thereof, it is intended that this Indenture and the Mortgage shall be superior to any laborers’, mechanics’ or materialmen’s liens which may be placed upon the Facility subsequent to the recordation thereof. In compliance with Section 13 of the Lien Law, the Issuer will receive the advances secured by this Indenture and the Mortgage and will hold the right to receive such advances as a trust fund to be applied first for the purpose of paying the cost of improvements and that the Issuer will apply the same first to the payment of the costs of improvements before using any part of the total of the same for any other purpose.

IN WITNESS WHEREOF, the New York City Capital Resource Corporation, New York, New York, has caused these presents to be executed in its name and behalf by its Chairman, Vice Chairman, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs and, to evidence its acceptance of the trust hereby created, the Trustee has caused these presents to be signed in its name and behalf by an authorized representative and its corporate seal to be hereunto affixed, all as of the day and year first above written.

	NEW YORK CITY CAPITAL RESOURCE CORPORATION



	By:	/s/ Kyle Kimball
		Kyle Kimball
		Executive Director


	THE BANK OF NEW YORK MELLON,
	as Trustee

	By:	/s/ Gaspare Mulé
		Gaspare Mulé
		Vice President

STATE OF NEW YORK	)
	:	ss.:
COUNTY OF NEW YORK	)

On the 29th day of June, of the year two thousand and ten, before me, the undersigned, personally appeared Kyle Kimball, known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon the behalf of whom the individual acted, executed the instrument.



		/s/ Carol M. Hyde
		Notary Public

		Carol M. Hyde
		Notary Public, State of New York
		No. 4977270
		Qualified in Queens County
		Commission Expires Jan. 20, 2011

STATE OF NEW YORK	)
	:	ss.:
COUNTY OF NEW YORK	)

On the 30 day of June, in the year two thousand and ten, before me, the undersigned, personally appeared Gaspare Mulé, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon the behalf of whom the individual acted, executed the instrument.



		/s/ Kara A. Lobdell
		Notary Public

		Kara A. Lobdell
		Notary Public, State of New York
		No. 02LO6031220
		Qualified in New York County
		Commission Expires Sept. 27, 2013

APPENDICES

EXHIBIT A

DESCRIPTION OF THE LAND

(Block 149, Lot 103)

ALL that certain plot piece or parcel of land situate, lying and being in the Borough of Brooklyn,

County of Kings, City and State of New York, bounded and described as follows:

BEGINNING at the corner formed by the intersection of the northerly side of Dekalb Avenue

with the easterly side of Gold Street;

RUNNING THENCE easterly, along the easterly side of Gold Street, 114 feet to a point;

RUNNING THENCE easterly, at right angles to the easterly side of Gold Street, 129.12 feet to

the northwesterly side of Fleet Street

RUNNING THENCE southwesterly, along the northwesterly side of Fleet Street, 132.02 feet to

the corner formed by the intersection of the northwesterly side of Fleet Street, with the northerly

side of Dekalb Avenue;

RUNNING THENCE westerly, along the northerly side of Dekalb Avenue, 63.76 feet to the

point or place of BEGINNING.

END OF SCHEDULE A

EXHIBIT B

FACILITY PERSONALTY

NONE

EXHIBIT C

FORM OF FULLY REGISTERED INITIAL BOND

THIS BOND SHALL NEVER CONSTITUTE A DEBT OR INDEBTEDNESS OF THE STATE OF NEW YORK OR OF THE CITY OF NEW YORK, AND NEITHER THE STATE OF NEW YORK NOR THE CITY OF NEW YORK SHALL BE LIABLE HEREON, NOR SHALL THIS BOND BE PAYABLE OUT OF ANY FUNDS OF THE NEW YORK CITY CAPITAL RESOURCE CORPORATION OTHER THAN THOSE PLEDGED THEREFOR

NEW YORK CITY CAPITAL RESOURCE CORPORATION

RECOVERY ZONE FACILITY REVENUE BONDS

(ALBEE RETAIL DEVELOPMENT LLC PROJECT), SERIES 2010

Bond Date:

Final Maturity Date:

Registered Owner:	Cede & Co.

Principal Amount:	$___________

Initial Adjustable Fixed Interest Rate: 7.25%

Bond Number: R-

CUSIP:	649437AH3

Promise to Pay. New York City Capital Resource Corporation, a local development corporation created pursuant to the Not-for-Profit Corporation Law of the State of New York at the direction of the Mayor of The City of New York (herein called the “Issuer”), for value received, hereby promises to pay as hereinafter provided, solely from the loan payments, revenues and receipts derived from or in connection with the Facility hereinafter referred to as provided in the Indenture of Trust hereinafter referred to, to the Registered Holder identified above or registered assigns, upon presentation and surrender hereof, on the Final Maturity Date set forth above, the Principal Amount set forth above, and in like manner to pay interest at the applicable Adjust able Fixed Interest Rate on the unpaid principal balance hereof from the Bond Date hereof until the Issuer’s obligation with respect to the payment of such Principal Amount shall be discharged. Interest shall be payable at the Adjustable Fixed Interest Rate on the first day of February, May, August and November (or if such day is not a Business Day, the immediately succeeding Business Day) commencing on August 1, 2010 and terminating on the Final Maturity Date, unless this bond is sooner redeemed or paid or otherwise discharged. Such interest shall be computed on the basis of a 360-day year of twelve 30-day months. In no event shall the interest rate payable hereon exceed (the “Maximum Interest Rate”) the lesser of (i) twelve percent (12%) per annum or (ii) the maximum permitted by, or enforceable under, applicable law.

C-1

This bond shall bear interest from the Bond Date indicated above, if authenticated prior to the first Interest Payment Date. If authenticated on or after the first Interest Payment Date, in exchange for or upon the registration of transfer of Bonds (as defined below), this bond shall bear interest from and including the Interest Payment Date next preceding the date of the authentication hereof, unless the date of such authentication shall be an Interest Payment Date to which interest hereon has been paid in full or duly provided for, in which case, this bond shall bear interest from and including such Interest Payment Date.

If there shall occur an Event of Default (other than by reason of a failure to redeem the Bonds in whole if there shall have occurred a Determination of Taxability), the rate of interest on the Bonds shall be fifteen percent (15%) per annum commencing with the date of the occurrence of the Event of Default and any additional interest thereby due with respect to a period of time for which interest has already been paid shall be payable on the Interest Payment Date next following the Event of Default. Any former Bondholder who was a Bondholder commencing on or after the date of the occurrence of the Event of Default, but who subsequent to such date sold or otherwise disposed of its Bonds or whose Bonds were redeemed or matured, shall be entitled to receive from the Company under the Loan Agreement (as such terms are hereinaft er defined) the following, in an amount allocable to such period during which it held the Bonds subsequent to the Event of Default and the date upon which the Bonds were sold, or otherwise disposed of, or redeemed or matured: the difference between the rate of interest borne by the Bonds prior to the Event of Default and the rate borne by the Bonds on and subsequent to such date.

If there shall occur a Determination of Taxability, the rate of interest on the Bonds shall be thirteen per centum (13%) per annum commencing with the date of the Event of Taxability and any additional interest thereby due with respect to a period of time for which interest has already been paid shall be payable on the Interest Payment Date next following the Determination of Taxability. Any former Bondholder who was a Bondholder commencing on or after the date of the occurrence of an Event of Taxability, but who subsequent to such date sold or otherwise disposed of its Bonds or whose Bonds were redeemed or matured, shall be entitled to receive from the Company under the Loan Agreement the following, in an amount allocable to such period during which it held the Bonds subsequent to the Event of Taxability and the date upon which the Bonds were sold, or otherwise disposed of, or redeemed or matured: the difference between the rate of interest borne by the Bonds prior to the Event of Taxability and the rate borne by the Bonds on and subsequent to such date.

Method of Currency. The principal of, Sinking Fund Installments for, Redemption Price, if applicable, Purchase Price and interest on the Bonds shall be payable in any coin or currency of the United States of America that on the respective dates of payment thereof is legal tender for the payment of public and private debts.

Payments. The principal of, Sinking Fund Installments for, and the Redemption Price, if applicable, on all Bonds shall be payable by check or draft at maturity or upon earlier redemption to the Persons in whose names such Bonds are registered on the bond registration books maintained by the Trustee as Bond Registrar at the maturity or redemption date thereof, upon the presentation and surrender of such Bonds at the designated corporate trust office of The Bank of New York Mellon in New York, New York, as trustee and paying agent (the “Paying Agent”), or at the corporate trust office of any successor Paying Agent.

C-2

The interest payable on each Bond on any Interest Payment Date shall be paid by the Trustee to the registered owner of such Bond as shown on the bond registration books of the Trustee as Bond Registrar at the close of business on the Regular Record Date for such interest, (1) by check or draft mailed to such registered owner at his address as it appears on the bond registration books or at such other address as is furnished to the Trustee in writing by such owner, or (2) if such Bonds are held by a Securities Depository or, at the written request addressed to the Trustee by any registered owner of Bonds in the aggregate principal amount of at least $1,000,000 that all such payments be made by wire transfer, by electronic transfer in immediately available funds to the bank for credit to the ABA routing number and account numb er filed with the Trustee no later than five (5) Business Days before an Interest Payment Date, but no later than a Regular Record Date for any interest payment.

Interest on any Bond that is due and payable but not paid on the date due (“Defaulted Interest”) shall cease to be payable to the owner of such Bond on the relevant Regular Record Date and shall be payable to the owner in whose name such Bond is registered at the close of business on a special record date (the “Special Record Date”) for the payment of such Defaulted Interest, which Special Record Date shall be fixed as provided in the Indenture.

Authorization and Purpose. This bond is one of an authorized issue of bonds designated as “New York City Capital Resource Corporation Recovery Zone Facility Revenue Bonds (Albee Retail Development LLC Project), Series 2010 (hereinafter called the “Bonds”) issued in the aggregate principal amount of $20,000,000. The Bonds are being issued under and pursuant to and in full compliance with the Constitution and laws of the State of New York, particularly the Not-for-Profit Corporation Law of the State of New York, and a resolution adopted by the members of the Issuer on February 9, 2010, as amended on April 13, 2010, authorizing the issuance of the Bonds and under and pursuant to an Indenture of Trust, dated as of July 1 , 2010 (as the same may be amended or supplemented, the “Indenture”), made and entered into by and between the Issuer and The Bank of New York Mellon, as trustee (said bank and any successor thereto under the Indenture being referred to herein as the “Trustee”), for the purpose of financing a portion of the cost of the construction, renovation, equipping and furnishing of an approximately 50,000 square foot facility (the “Facility”) to be leased to retail tenants (the “Project”). The site for the Facility, including the improvements to be constructed thereon, is subject to a certain Severance Lease (Site 1A), dated June 30, 2010 (as the same may be amended or supplemented, the “Ground Lease”), between The City of New York, as landlord, and Albee Development, LLC, a Delaware limited liability company (“Albee Development”), as assigned by Albee Development to, and assumed by, Albee Retail Development LLC, a limited liability com pany organized and existing under the laws of the State of Delaware (the “Company”), as tenant. In order to finance a portion of the costs of the Project, the Issuer has made a loan to the Company of the proceeds of the Bonds in the original amount pursuant to a certain Loan Agreement, dated as of July 1, 2010, between the Issuer and the Company (as the same may be amended or supplemented, the “Loan Agreement”), and the Company has executed a certain Promissory Note dated the date of original issuance of the Bonds in favor of the Issuer and the Trustee (as the same may be amended or supplemented, the “Promissory Note”) to evidence the Company’s obligation under the Loan Agreement to repay such loan. Each of the Loan Agreement and the Promissory Note requires the payment by the Company of loan payments sufficient to provide for the payment of the principal or Redemption Price, if any, of, Sinking Fund Installments for, Purchase Price, and in terest on the Bonds as the same become due. Copies of the Indenture, the Loan Agreement, the Promissory Note, the Pledge and Security Agreement hereinafter referred to, the Mortgage hereinafter referred to, the Project Completion Guaranty Agreement hereinafter referred to and the Bond Guaranty Agreement hereinafter referred to are on file at the designated corporate trust office of the Trustee in New York, New York, and reference is made to such documents for the provisions relating, among other things, to the terms and security of the Bonds, the charging and collection of loan payments, the custody and application of the proceeds of the Bonds, the rights and remedies of the holders of the Bonds, and the rights, duties and obligations of the Issuer, the Company, the Parent as hereinafter referred to and the Trustee.

C-3

Pledge and Security. Pursuant to the Indenture, the Issuer has assigned to the Trustee all of its right, title and interest in and to the Promissory Note and substantially all of its right, title and interest in and to the Loan Agreement, including all rights to receive loan payments sufficient to pay the principal or Redemption Price, if any, of, Sinking Fund Installments for, Purchase Price, and interest and all other amounts due on the Bonds as the same become due, to be made by the Company pursuant to the Loan Agreement and the Promissory Note. The Bonds are further secured by a first lien in Facility Revenues and the remainder of the Pledged Collateral pursuant to a certain Pledge and Security Agreement, dated as of July 1, 2010, from the Company to the Trustee (as the same may be amended or supplemented, the “Pledge and Security Agreement”). Further, the completion of the Project has been guaranteed by the Company and by Acadia Strategic Opportunity Fund II LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Parent”, and, together with the Company, being collectively, the “Guarantors”), pursuant to a Project Completion Guaranty Agreement, dated as of July 1, 2010, from the Guarantors to the Trustee (as the same may be amended or supplemented, the “Project Completion Guaranty Agreement”). The Bonds are also secured by mortgage liens on and security interests in the Company’s leasehold interest under the Ground Lease in the Facility, and an assignment of Facility leases and rents, pursuant to a Mortgage and Security Agreement and Assignment of Leases and Rents (Acquisition Loan), a Mortgage and Secu rity Agreement and Assignment of Leases and Rents (Building Loan) and a Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan), each dated as of July 1, 2010, and each from the Company to the Trustee (as each of the same may hereafter be amended or supplemented, collectively the “Mortgage”). The payment of the principal of, redemption premium, if any, Sinking Fund Installments for, Purchase Price, and the interest on the Bonds, and the payments, obligations, covenants and agreements of the Company under the Loan Agreement and under the Promissory Note, have been guaranteed by the Guarantors pursuant to a Bond Guaranty Agreement, dated as of July 1, 2010, from the Guarantors to the Trustee (as the same may hereafter be amended or supplemented, the “Bond Guaranty Agreement”).

The Bonds are special limited revenue obligations of the Issuer and shall never constitute a debt of the State of New York or of The City of New York, and neither the State of New York nor The City of New York shall be liable thereon, nor shall the Bonds be payable out of any funds of the Issuer other than those pledged therefor.

C-4

Reference is hereby made to the Indenture for the definition of any capitalized word or term used but not defined herein and for a description of the property pledged, assigned and otherwise available for the payment of the Bonds, the provisions, among others, with respect to the nature and extent of the security, the rights, duties and obligations of the Issuer, the Trustee and the holders of the Bonds, and the terms upon which the Bonds are issued and secured.

Additional Bonds. As provided in the Indenture, upon satisfying certain conditions including obtaining certain prescribed Bondholder consents, a Series of Additional Bonds may be issued from time to time in one or more series for the purpose of financing the cost of completing the Project, providing funds in excess of Net Proceeds to repair, relocate, replace, rebuild or restore the Facility in the event of damage, destruction or taking by eminent domain, providing extensions, additions or improvements to the Facility, or refunding outstanding Bonds (to the extent that such Bonds shall be subject to earlier redemption). All bonds issued and to be issued under the Indenture are and will be equally secured by the pledge and covenants made therein, exc ept as may otherwise be expressly provided in the Indenture.

Initial Adjustable Fixed Interest Rate. For the Initial Adjustable Fixed Interest Rate Term, the Bonds shall bear interest at seven and one-quarter percent (7¼%) per annum. The interest rate payable on the Bonds shall be adjusted on each Adjustment Date in accordance with the provisions of the Indenture and the Bonds.

Subsequent Adjustable Fixed Interest Rate Terms. Each Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term) shall commence on the Adjustment Date immediately following the end of the preceding Adjustable Fixed Interest Rate Term and will continue to but excluding the next succeeding Adjustment Date. For each Adjustable Fixed Interest Rate Term after the Initial Adjustable Fixed Interest Rate Term, the Adjustable Fixed Interest Rate Term shall be a period determined at the direction of the Company which is equal to one (1) whole year or any integral multiple of whole years, but in no event shall any such Adjustable Fixed Interest Rate Term extend beyond the Final Maturity Date of the Initial Bonds. 0;The Business Day immediately following the last day of each Adjustable Fixed Interest Rate Term as determined pursuant to the Indenture shall be the Adjustment Date. The Bonds are subject to mandatory purchase on each Adjustment Date.

Except as provided in the paragraph below, the interest rate applicable to the Bonds on and after each Adjustment Date shall be the interest rate determined by the Remarketing Agent on the Determination Date immediately preceding such Adjustment Date. The Adjustable Fixed Interest Rate applicable to the Bonds shall be the lower of (i) the lowest rate which, in the best professional judgment of the Remarketing Agent (having due regard to the prevailing market conditions), would be necessary to enable the Bonds to be sold at par on the Adjustment Date, provided that the Adjustable Fixed Interest Rate shall not exceed the Maximum Rate, or (ii) The Bond Buyer Revenue Bond Index (as published in The Bond Buyer or any successor publication thereto) for the most recent period for which such information is available as of the date the Adjustable Fixed Interest Rate is established, plus two hundred fifty (250) basis points. In the event that certain conditions to an Interest Rate Change required under the Indenture shall not be met, the interest rate on the Bonds then in effect shall remain in effect as the Adjustable Fixed Interest Rate for the next succeeding Adjustable Fixed Interest Rate Term, and the term of the next Adjustable Fixed Interest Rate Term shall be the shorter of (i) the same period as the immediately preceding Adjustable Fixed Interest Rate Term, or (ii) the period until the Final Maturity Date of the Bonds.

C-5

If the Remarketing Agent is unable to remarket all of the Bonds at the Adjustable Fixed Interest Rate determined by the Remarketing Agent as provided in the Indenture, the Remarketing Agent may at any time prior to the Adjustment Date increase the Adjustable Fixed Interest Rate to that rate of interest which, as of the date of determination, is the lowest rate which, in the best professional judgment of the Remarketing Agent (having due regard to the prevailing market conditions), would be necessary to enable the Bonds to be sold at par on the Adjustment Date; provided, however, that such re-determined Adjustable Fixed Interest Rate shall not exceed the Maximum Interest Rate.

Inability to Determine Adjustable Fixed Interest Rate. If, for any reason, the Adjustable Fixed Interest Rate for the Bonds is not or cannot be determined by the Remarketing Agent in the manner specified in the Indenture, the Adjustable Fixed Interest Rate will be equal to the closing yield, plus two hundred fifty (250) basis points, for Treasury Bills, Notes or Bonds, as applicable, of the maturity closest to, without exceeding, the term of the Adjustable Fixed Interest Rate Term determined in accordance with the Indenture, as such yield is published in the table captioned “U.S. Securities Prices” in the edition of The Bond Buyer (or if The Bond Buyer or such table is no longer published, any other published similar rate as is determined by the Tr ustee in its sole discretion to be appropriate) published on the day on which such Adjustable Fixed Interest Rate is determined, or if such yield or other similar rate is not published on that day, the day of the most recent publication of such yield or other similar rate.

Conclusiveness of Adjustable Fixed Interest Rate Determination. The determination in accordance with the Indenture of the Adjustable Fixed Interest Rate to be borne by the Bonds shall, in the absence of manifest error, be conclusive and binding on the holders of the Bonds.

Mandatory Tender of Bonds on each Purchase Date. On each Purchase Date, the Bonds shall be subject to mandatory tender for purchase by the Tender Agent at the Purchase Price.

IN THE EVENT OF A FAILURE BY HOLDERS OF BONDS TO TENDER BONDS FOR PURCHASE ON A PURCHASE DATE AS PROVIDED ABOVE, SAID HOLDERS OF BONDS SHALL NOT BE ENTITLED TO ANY PAYMENT (INCLUDING ANY INTEREST TO ACCRUE SUBSEQUENT TO THE PURCHASE DATE) OTHER THAN THE PURCHASE PRICE FOR SUCH UNTENDERED BONDS, AND THE HOLDERS OF ANY UNTENDERED BONDS SHALL NO LONGER BE ENTITLED TO THE BENEFITS OF THE INDENTURE, EXCEPT FOR THE PURPOSE OF PAYMENT OF THE PURCHASE PRICE THEREOF, AND SHALL BE DEEMED PURCHASED, CANCELLED AND NO LONGER OUTSTANDING UNDER THE INDENTURE.

C-6

Maximum Rate. In no event shall the Adjustable Fixed Interest Rate (notwithstanding any other provision of this bond) exceed the Maximum Interest Rate.

General Interest Rate Limitation. Anything herein or in the Indenture to the contrary notwithstanding, the obligations of the Issuer hereunder and under the Indenture shall be subject to the limitation that payments of interest or other amounts hereon shall not be required to the extent that receipt of any such payment by a holder of this bond would be contrary to the provisions of law applicable to such holder of this bond which would limit the maximum rate of interest which may be charged or collected by such holder of this bond.

Redemption of Bonds. (A) General Optional Redemption. (1) During the Initial Adjustable Fixed Interest Rate Term, the Bonds shall be subject to redemption, on or after May 1, 2012, in whole at any time or in part on any Interest Payment Date (but if in part in integral multiples of $5,000 and in the minimum principal amount of $100,000) at the option of the Issuer (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agreement), at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Bonds to be redeemed, plus accrued interest to the date of rede mption.

(ii) During any Adjustable Fixed Interest Rate Term (other than the Initial Adjustable Fixed Interest Rate Term), the Bonds shall be subject to redemption, in whole at any time or in part on any Interest Payment Date (but if in part in integral multiples of $5,000 and in the minimum principal amount of $100,000) at the option of the Issuer (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agreement), at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Initial Bonds to be redeemed, plus accrued interest to the date of redemption, commencing on or after that date (the “Firs t Optional Redemption Date”) as determined below:

(b) Extraordinary Redemption. The Bonds are also subject to redemption prior to maturity, at the option of the Issuer exercised at the direction of the Company (which option shall be exercised only upon the giving of notice by the Company of its intention to prepay loan payments due under the Loan Agreement), as a whole on any date, upon notice or waiver of notice as provided in the Indenture, at a Redemption Price of one hundred percent (100%) of the unpaid principal amount thereof plus accrued interest to the date of redemption, if one or more of the following events shall have occurred:

C-7

If the Bonds are to be redeemed in whole as a result of the occurrence of any of the events described above, the Company shall deliver to the Issuer and the Trustee a certificate of an Authorized Representative of the Company stating that, as a result of the occurrence of the event giving rise to such redemption, the Company has discontinued, or at the earliest practicable date will discontinue, its operation of the Facility for its intended purposes.

(c) Mandatory Sinking Fund Installment Redemption. The Bonds shall be subject to mandatory redemption by the Issuer prior to maturity, in part by lot, at a Redemption Price equal to one hundred percent (100%) of the principal amount thereof, together with accrued interest to the date of redemption, from mandatory Sinking Fund Installments on the dates and in the principal amounts set forth below, provided that the amounts of such Sinking Fund Installments shall be reduced by the credits provided for in the Indenture:

Sinking Fund Installment Payment Date	Sinking Fund Installment

May 1, 2015	$115,000
November 1, 2015	120,000
May 1, 2016	125,000
November 1, 2016	125,000
May 1, 2017	130,000
November 1, 2017	135,000
May 1, 2018	140,000
November 1, 2018	145,000
May 1, 2019	150,000

C-8

Sinking Fund Installment

Payment Date

Sinking Fund

Installment

November 1, 2019	155,000
May 1, 2020	165,000
November 1, 2020	$170,000
May 1, 2021	175,000
November 1, 2021	180,000
May 1, 2022	190,000
November 1, 2022	195,000
May 1, 2023	200,000
November 1, 2023	210,000
May 1, 2024	215,000
November 1, 2024	225,000
May 1, 2025	235,000
November 1, 2025	240,000
May 1, 2026	250,000
November 1, 2026	260,000
May 1, 2027	270,000
November 1, 2027	280,000
May 1, 2028	290,000
November 1, 2028	300,000
May 1, 2029	310,000
November 1, 2029	320,000
May 1, 2030	335,000
November 1, 2030	345,000
May 1, 2031	355,000
November 1, 2031	370,000
May 1, 2032	385,000
November 1, 2032	400,000
May 1, 2033	410,000
November 1, 2033	425,000
May 1, 2034	440,000
November 1, 2034	460,000
May 1, 2035	475,000
November 1, 2035	490,000
May 1, 2036	510,000
November 1, 2036	530,000
May 1, 2037	545,000
November 1, 2037	565,000
May 1, 2038	590,000
November 1, 2038	610,000
May 1, 2039	630,000
November 1, 2039	655,000
May 1, 2040	680,000
November 1, 2040	700,000
May 1, 2041	730,000
November 1, 2041	755,000
May 1, 2042	780,000
November 1, 2042 (final maturity)	810,000

(d) Mandatory Redemption from Excess Proceeds and Certain Other Amounts. The Bonds shall be redeemed at any time in whole or in part by lot prior to maturity in the event and to the extent

(i) excess Bond proceeds shall remain after the completion of the Project,

C-9

(ii) excess title insurance or property insurance proceeds or condemnation awards shall remain after the application thereof pursuant to the Loan Agreement and this Indenture, or

(iii) excess proceeds shall remain after the release or substitution of fixtures or other portions of the Facility,

in each case at a Redemption Price equal to one hundred percent (100%) of the principal amount of the Bonds to be redeemed, together with interest accrued thereon to the date of redemption.

(e) Mandatory Redemption Upon Failure to Operate the Facility for Approved Project Operations, Material Violation of Material Legal Requirements, False Representation or Failure to Maintain Liability Insurance. The Bonds are also subject to mandatory redemption prior to maturity, at the option of the Issuer, as a whole only, in the event (i) the Issuer shall determine that (w) the Company is operating the Facility or any portion thereof, or is allowing the Facility or any portion thereof to be operated, not for the Approved Project Operations, (x) the Company, any Principal of the Company or any Person that directly or indirectly Controls, is Controlled by or is under common Control with the Company has committed a material violation of a material Legal Requirement, (y) any Conduct Representation is false, misleading or incorrect in any material respect at any date, as if made on such date, or (z) a Required Disclosure Statement delivered to the Issuer under any Project Document is not acceptable to the Issuer acting in its sole discretion, or (ii) the Company shall fail to obtain or maintain the public liability insurance with respect to the Facility required under the Loan Agreement, and, in the case of clause (i) or (ii) above, the Company shall fail to cure any such default or failure within the applicable time periods set forth in the Loan Agreement following the receipt by the Company of written notice of such default or failure from the Issuer and a demand by the Issuer on the Company to cure the same. Any such redemption shall be made upon notice or waiver of notice to the Bondhol ders as provided in this Indenture, at the Redemption Price of one hundred percent (100%) of the unpaid principal amount of the Bonds, together with interest accrued thereon to the date of redemption.

(f) Mandatory Taxability Redemption. Upon the occurrence of a Determination of Taxability, the Bonds shall be redeemed prior to maturity on any date within one hundred twenty (120) days following such Determination of Taxability, at a Redemption Price equal to one hundred percent (100%) of the principal amount thereof, together with accrued interest at the annual rate of thirteen percent (13%) from the occurrence of the Event of Taxability to the date of redemption. The Bonds shall be redeemed in whole unless redemption of a portion of the Bonds Outstanding would have the result that interest payable on the Bonds remain ing Outstanding after such redemption would not be includable in the gross income of any Holder of a Bond (other than a Holder who is a “substantial user” of the Facility or a “related person”, within the meaning of the Code). In such event, the Bonds shall be redeemed in such amount as is deemed necessary in the opinion of Nationally Recognized Bond Counsel to accomplish that result.

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(g) Purchase in Lieu of Optional Redemption. In lieu of calling Bonds for optional redemption, Bonds shall be subject to mandatory tender for purchase at the direction of the Issuer, upon the direction of the Company, in whole or in part (and, if in part, in such manner as determined by the Company) on any date, at a Purchase Price equal to the applicable Redemption Price for any optional redemption of such Bonds as provided above, plus accrued interest to the purchase date. Purchases in lieu of an optional redemption shall be permitted, with the consent of the Issuer, upon the delivery to the Issuer and the Trustee of (i) an opinion of Nationally Recognized Bond Counsel addressed to the Issuer and the Trustee substantially to the effect that (A) such purchases in lieu of optional redemption comply with the provisions of the Indenture and (B) neither such purchases in lieu of an optional redemption nor any transaction directly related thereto will adversely affect the exclusion from gross income of interest on the Bonds for purposes of federal income taxation, and (ii) such other opinions, certificates or documentation as the Issuer may require.

Redemption Procedures. If any of the Bonds are to be called for redemption, the Indenture requires a copy of the redemption notice to be mailed at least thirty (30) days prior to such redemption date to the registered owner of each Bond to be redeemed at the address shown on the registration books. All Bonds so called for redemption will cease to bear interest after the date fixed for redemption if funds for their redemption are on deposit at the place of payment at that time. If notice of redemption shall have been given as aforesaid, the Bonds called for redemption shall become due and payable on the redemption date, provided, however, that with respect to any optional redemption of the Bonds as provided in this bond, such notice shall state that such redemption shall be conditional upon the receipt by the Trustee on or prior to the date fixed for such redemption of moneys sufficient to pay the principal of, redemption premium, if any, and interest on such Bonds to be redeemed, and that if such moneys shall not have been so received said notice shall be of no force and effect and the Issuer shall not be required to redeem such Bonds. In the event that such notice of optional redemption contains such a condition and such moneys are not so received, the redemption shall not be made and the Trustee shall within a reasonable time thereafter give notice, in the manner in which the notice of redemption was given, that such moneys were not so received. If a notice of optional redemption shall be unconditional, or if the conditions of a conditional notice of optional redemption shall have been satisfied, then upon presentation and surrender of Bonds so called for redemption at the place or places of payment, such Bonds shall be redeemed.

Remarketing Agent; Tender Agent. The initial Remarketing Agent under the Indenture is Roosevelt & Cross Incorporated, New York, New York. The initial Tender Agent under the Indenture is The Bank of New York Mellon, New York, New York. The Remarketing Agent and the Tender Agent may be changed at any time in accordance with the Indenture.

Amendment of Indenture. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the holders of the Bonds at any time by the Issuer with the consent of the holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstanding thereunder. Any such consent shall be conclusive and binding upon each such holder and upon all future holders of each Bond and of any such Bond issued upon the transfer thereof, whether or not notation of such consent is made thereon.

Denominations. The Bonds are issuable in the form of fully registered bonds in the denomination of $100,000 or any integral multiple of $5,000 in excess thereof.

C-11

Exchange of Bonds. The holder of this bond may surrender the same, at the designated corporate trust office of the Trustee, in exchange for an equal aggregate principal amount of Bonds of any of the Authorized Denominations of the same maturity and maturities and interest rate as this bond or the Bonds so surrendered, subject to the conditions and upon payment of the charges provided in the Indenture. However, the Trustee will not be required to (i) transfer or exchange any Bonds during the period between a Record Date and the following Interest Payment Date or during the period of fifteen (15) days next preceding any day for the selection of Bonds to be redeemed, (ii) transfer or exchange any Bonds selected, called or being called for red emption in whole or in part, or (iii) register any transfer of or exchange any Bond which is subject to mandatory purchase.

Transfer of Bonds. This bond is transferable, as provided in the Indenture, only upon the books of the Issuer kept for that purpose at the designated corporate trust office of the Trustee by the registered owner hereof in person, or by his duly authorized attorney-in-fact, upon surrender of this bond (together with a written instrument of transfer in the form appearing on this bond duly executed by the registered owner or his duly authorized attorney-in-fact with a guaranty of the signature thereon by a member of the Stock Exchange Medallion Program or the New York Stock Exchange, Inc. Medallion Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15, and thereupon a new fully registered Bond in the same aggregate principal amount and maturity and interest rate shall be issued to the transferee in exchange therefor as provided in the Indenture and upon payment of the charges therein prescribed. The Issuer, the Bond Registrar, the Trustee and any Paying Agent may deem and treat the Person in whose name this bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or Redemption Price hereof, the Sinking Fund Installments therefor, and interest due hereon and for all other purposes whatsoever, and all payments made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the Issuer, the Company, the Bond Registrar, the Trustee, the Tender Agent, the Remarketing Agent nor any Paying Agent shall be affected by any notice to the contrary.

In all cases in which the privilege of transferring or exchanging Bonds is exercised, the Issuer or the Trustee may make a charge sufficient to reimburse it for any expenses and any tax, fee or other governmental charge required to be paid in connection therewith; any such expenses shall be paid by the Company but any such tax, fee or other governmental charge shall be paid by the Holder requesting such transfer or exchange.

C-12

Book Entry System. The Bonds are being issued by means of a book entry system with no physical distribution of bond certificates to be made except as provided in the Indenture. One Bond certificate with respect to each date on which the Bonds are stated to mature, registered in the nominee name of the Securities Depository, is being issued and required to be deposited with the Securities Depository and immobilized in its custody or in the custody of its agent. The book entry system will evidence positions held in the Bonds by the Securities Depository’s Participants, beneficial ownership of the Bonds in Authorized Denominations being evidenced in the records of such Participan ts. Transfers of ownership shall be effected on the records of the Securities Depository and its Participants pursuant to rules and procedures established by the Securities Depository and its Participants. The Issuer and the Trustee will recognize the Securities Depository nominee, while the registered owner of this bond, as the owner of this bond for all purposes, including (i) payments of principal of, Sinking Fund Installments for, if any, Purchase Price, redemption premium, if any, and interest on, this bond, (ii) notices, and (iii) voting. Transfer of principal, Sinking Fund Installments, Purchase Price, interest and any redemption premium payments to Participants of the Securities Depository, and transfer of principal, Sinking Fund Installments, Purchase Price, interest and any redemption premium payments to Beneficial Owners of the Bonds by Participants of the Securities Depository will be the responsibility of such Participants and other nominees of suc h Beneficial Owners. The Issuer and the Trustee will not be responsible or liable for such transfers of payments or for maintaining, supervising or reviewing the records maintained by the Securities Depository, the Securities Depository nominee, its Participants or persons acting through such Participants. While the Securities Depository nominee is the owner of this bond, notwithstanding the provision hereinabove contained, payments of principal of, Sinking Fund Installments, if any, Purchase Price, redemption premium, if any, and interest on this bond shall be made in accordance with existing arrangements among the Issuer, the Trustee and the Securities Depository.

Acceleration of Bonds. In certain events, on the conditions, in the manner and with the effect set forth in the Indenture, the principal of all the Bonds and Additional Bonds issued under the Indenture and then Outstanding may be declared and may become due and payable before the stated maturities thereof, together with accrued interest thereon.

Limitation on Bondholder Enforcement Rights. The holder of this bond shall have no right to enforce the provisions of the Indenture, to institute action to enforce the provisions and covenants thereof or to institute, appear in or defend any suit or other proceedings with respect thereto, except as provided in the Indenture.

Special Obligation of the Issuer. This bond and the issue of which it forms a part are special limited revenue obligations of the Issuer, payable by the Issuer solely out of the loan payments, revenues or other receipts, funds or moneys of the Issuer pledged under the Indenture and from any amounts otherwise available under the Indenture for the payment of the Bonds.

Estoppel Clause. It is hereby certified, recited and declared that all conditions, acts and things required by law and the Indenture to exist, to have happened and to have been performed precedent to and in the issuance of this bond, exist, have happened and have been performed, and that the issuance of this bond and the issue of which it forms a part are within every debt and other limit prescribed by the laws of the State of New York.

No Personal Liability. Neither the members, directors, officers or agents of the Issuer nor any person executing this bond shall be liable personally or be subject to any personal liability or accountability by reason of the issuance hereof.

Authentication by Trustee. This bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Indenture until the certificate of authentication hereon shall have been signed by the Trustee.

C-13

IN WITNESS WHEREOF, the New York City Capital Resource Corporation has caused this bond to be executed in its name by the manual or facsimile signature of its Chairman, Vice Chairman, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs and its official seal or a facsimile thereof to be hereunto impressed or imprinted hereon and attested by the manual or facsimile signature of its Secretary, Assistant Secretary, Executive Director, Deputy Executive Director, General Counsel or Vice President for Legal Affairs, all as of the Bond Date indicated above.

	NEW YORK CITY CAPITAL RESOURCE CORPORATION



	By:
		Executive Director

(SEAL)

ATTEST:

______________________

Assistant Secretary

(FORM OF CERTIFICATE OF AUTHENTICATION)

CERTIFICATE OF AUTHENTICATION

This bond is one of the Bonds of the issue described in the within-mentioned Indenture.


	THE BANK OF NEW YORK MELLON,
	as Trustee

	By:
		Authorized Signatory

Date of Authentication: _______________________

C-14

(FORM OF ASSIGNMENT)

ASSIGNMENT

FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto

(Please print or typewrite name, address and taxpayer identification number of transferee)

the within bond and does hereby irrevocably constitute and appoint _____________________ Attorney to transfer such bond on the books kept for the registration thereof, with full power of substitution in the premises.

Dated: _____________________

____________________________________

NOTICE: The signature to this assignment must correspond with the name as it appears on the face of the within bond in every particular, without alteration or enlargement or any change whatever.

SIGNATURE GUARANTEED

MEDALLION GUARANTEED

__________________________________

Authorized Signature

(Signature Guarantee Program Name)

[Signature Guarantee by (must be by a member of the Stock Exchange Medallion Program or the New York Stock Exchange, Inc. Signature Program in accordance with Securities and Exchange Commission Rule 17Ad-15)]

[END OF FORM OF INITIAL BOND]

C-15

EXHIBIT D

Form of Requisition from the Construction Account of the Project Fund

REQUISITION NO.

TO:	The Bank of New York Mellon,
	as Trustee

FROM:	Albee Retail Development LLC

Ladies and Gentlemen:

You are requested to draw from the Construction Account of the Project Fund, established by Section 5.01 of the Indenture of Trust, dated as of July 1, 2010 (the “Indenture”), between the New York City Capital Resource Corporation (the “Issuer”) and yourself, a check or checks in the amounts, payable to the order of those persons and for the purpose of paying those costs set forth on Schedule A attached hereto. All capitalized terms used in this Requisition not otherwise defined herein shall have the meanings given such terms by the Indenture or by the Loan Agreement referred to in the Indenture.

I hereby certify that

(i) I am an Authorized Representative of Albee Retail Development LLC (the “Company”);

(ii) the number of this Requisition is ____;

(iii) the items of cost set forth on Schedule A attached hereto are correct and proper under Section 5.02 of the Indenture and under Section 3.2 of the Loan Agreement and each such item has been properly paid or incurred as an item of Project Cost;

(iv) none of the items for which this Requisition is made has formed the basis for any disbursement heretofore made from the Project Fund;

(v) the payees and amounts stated in Schedule A attached hereto are true and correct and each item of cost so stated is due and owing;

(vi) each such item stated in Schedule A attached hereto is a proper charge against the Project Fund;

(vii) each such item in Schedule A attached hereto represents the value of work actually furnished, or labor or services actually rendered and no item relates to materials, that are not incorporated into the improvement or deposits toward same;

(viii) each item of cost set forth in Schedule A attached hereto is consistent in all material respects with the Tax Regulatory Agreement;

D-1

(ix) if the payment herein requested is a reimbursement to the Company for costs or expenses of the Company incurred by reason of work performed or supervised by officers or employees of the Company or any Affiliate, such officers or employees were specifically employed for such purpose and the amount to be paid does not exceed the actual cost thereof to the Company and such costs or expenses will be treated by the Company on its books as a capital expenditure in conformity with generally accepted accounting principles applied on a consistent basis;

(x) no portion of the proceeds of the Bonds will be applied to reimburse the Company for Project Costs paid more than sixty (60) days prior to February 9, 2010, the date the Issuer adopted its authorizing resolution for the Project, except for amounts which do not exceed twenty percent (20%) of the Project Costs financed with the proceeds of the Bonds which were applied to finance certain preliminary expenses with respect to the Project. Preliminary expenses, for purposes of this exception, include architectural, engineering, surveying, soil testing and similar costs incurred prior to the commencement of construction or rehabilitation of the Project, but do not include land acquisition, s ite preparation and similar costs incident to the commencement of construction or rehabilitation of the Project. No portion of the proceeds of the Bonds will be applied to reimburse the Company for a cost (other than preliminary expenditures) paid more than eighteen (18) months prior to the date of this requisition or the date the Facility to which the cost relates was placed in service, whichever is later. In no event shall the proceeds of the Bonds be applied to reimburse the Company for a Project Cost paid more than three (3) years prior to the date of issuance of the Bonds, unless such cost is attributable to a preliminary expenditure, as described above;

(xi) no Determination of Taxability has occurred, and no Event of Default exists and is continuing under the Indenture or the Loan Agreement or any other Security Document nor any condition, event or act which, with notice or lapse of time or both, would constitute such an Event of Default;

(xii) I have no knowledge of any vendor’s lien, mechanic’s lien or security interest which should be satisfied or discharged before the payment herein requested is made or which will not be discharged by such payment or, to the extent that any such costs shall be the subject of a bona fide dispute, for which such costs have not been appropriately bonded or for which a surety or security has not been posted which is at least equal to the amount of such costs;

(xiii) each item which payment under this requisition is to be made when added to all other payments previously made from the Project Fund, will not result in less than 95% of the proceeds of the Bonds (exclusive of costs of issuance of the Bonds or any reasonably required reserve) (including any earnings thereon) being used for the acquisition, construction, reconstruction or improvement of land or property that is subject to the allowance for depreciation provided in section 167 of the Code;

(xiv) such item of cost for which payment is herein requested is chargeable to the capital account of the Facility for Federal income tax purposes, or would be so chargeable either with an election by the Company or but for the election of the Company to deduct the amount of such item;

D-2

(xv) none of the items being requisitioned constitute “profit” to any Entity affiliated with, or related to, the Company; and

(xvi) the representations and warranties made by the Company in the Security Documents are correct on and as of the date of such disbursement as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date.

Attached to this Requisition is a schedule of or a copy of bills, invoices or other documents evidencing and supporting this Requisition.

Dated: _________________

	ALBEE RETAIL DEVELOPMENT LLC



	By:
		Authorized Representative

D-3

SCHEDULE A TO REQUISITION NO. ___

Amount	Payee (with address)	Purpose

D-4

Receipt is hereby acknowledged of a payment in the amount of $___________ in connection with the submission of the attached Requisition.

	ALBEE RETAIL DEVELOPMENT LLC



	By:

Date: _______________

D-5

TABLE OF CONTENTS

Page

ARTICLE I

Section 1.01.	Definitions	5
Section 1.02.	Construction.	23

ARTICLE II

AUTHORIZATION AND ISSUANCE OF BONDS

Section 2.01.	Authorized Amount of Bonds; Pledge Effected by this Indenture	25
Section 2.02.	Issuance and Terms of the Initial Bonds	25
Section 2.03.	Determination of Adjustable Fixed Interest Rate	28
Section 2.04.	Redemption of Initial Bonds	30
Section 2.05.	Delivery of Initial Bonds	36
Section 2.06.	Execution of Bonds	36
Section 2.07.	Authentication	36
Section 2.08.	Additional Bonds	37
Section 2.09.	CUSIP Numbers	39
Section 2.10.	Book Entry Bonds	40

ARTICLE III

GENERAL TERMS AND PROVISIONS OF BONDS

Section 3.01.	Date of Bonds	43
Section 3.02.	Form and Denominations	43
Section 3.03.	Legends	43
Section 3.04.	Medium of Payment	43
Section 3.05.	Bond Details	43
Section 3.06.	Interchangeability, Transfer and Registry	44
Section 3.07.	Bonds Mutilated, Destroyed, Stolen or Lost	45
Section 3.08.	Cancellation and Destruction of Bonds	45
Section 3.09.	Requirements With Respect to Transfers	45
Section 3.10.	Bond Registrar	45
Section 3.11.	Payments Due on Saturdays, Sundays and Holidays	46

ARTICLE IV

APPLICATION OF BOND PROCEEDS AND OTHER AMOUNTS

Section 4.01.	Application of Proceeds of Initial Bonds	47
Section 4.02.	Deposit in the Advance Interest Deposit Fund	47

TABLE OF CONTENTS

(continued)

Page


ARTICLE V

CUSTODY AND INVESTMENT OF FUNDS

Section 5.01.	Creation of Funds and Accounts	48
Section 5.02.	Project Fund	48
Section 5.03.	Application of Advance Interest Deposit Fund	50
Section 5.04.	Payments into Renewal Fund; Application of Renewal Fund	51
Section 5.05.	Payments into Bond Fund	53
Section 5.06.	Application of Bond Fund Moneys	54
Section 5.07.	Payments into Earnings Fund; Application of Earnings Fund	56
Section 5.08.	Payments into Rebate Fund; Application of Rebate Fund	56
Section 5.09.	Purchase Fund	57
Section 5.10.	Transfer to Rebate Fund	58
Section 5.11.	Investment of Funds and Accounts	58
Section 5.12.	Application of Moneys in Certain Funds for Retirement of Bonds	59
Section 5.13.	Repayment to the Company from the Funds	60
Section 5.14.	Non-presentment of Bonds	60

ARTICLE VI

REDEMPTION OF BONDS

Section 6.01.	Privilege of Redemption and Redemption Price	61
Section 6.02.	Selection of Bonds to be Redeemed	61
Section 6.03.	Notice of Redemption	61
Section 6.04.	Payment of Redeemed Bonds	63
Section 6.05.	Cancellation of Redeemed Bonds	63
Section 6.06.	No Partial Redemption After Default	63

ARTICLE VII

PARTICULAR COVENANTS

Section 7.01.	Payment of Principal and Interest	64
Section 7.02.	Performance of Covenants; Authority	64
Section 7.03.	Books and Records; Certificate as to Defaults	64
Section 7.04.	Loan Agreement	65
Section 7.05.	Creation of Liens; Indebtedness	65
Section 7.06.	Ownership; Instruments of Further Assurance	65
Section 7.07.	Security Agreement; Recording and Filing	65
Section 7.08.	Issuer Tax Covenant	68

TABLE OF CONTENTS

(continued)

Page


ARTICLE VIII

EVENTS OF DEFAULT; REMEDIES OF BONDHOLDERS

Section 8.01.	Events of Default; Acceleration of Due Date	69
Section 8.02.	Enforcement of Remedies	70
Section 8.03.	Application of Revenues and Other Moneys After Default	71
Section 8.04.	Actions by Trustee	72
Section 8.05.	Majority Holders Control Proceedings	73
Section 8.06.	Individual Bondholder Action Restricted	73
Section 8.07.	Effect of Discontinuance of Proceedings	73
Section 8.08.	Remedies Not Exclusive	73
Section 8.09.	Delay or Omission	74
Section 8.10.	Notice of Default	74
Section 8.11.	Waivers of Default	74

ARTICLE IX

TRUSTEE, BOND REGISTRAR, PAYING AGENTS, TENDER AGENT AND REMARKETING AGENT

Section 9.01.	Appointment and Acceptance of Duties of Trustee	75
Section 9.02.	Indemnity of Trustee	75
Section 9.03.	Responsibilities of Trustee	75
Section 9.04.	Compensation of Trustee, Bond Registrar, Paying Agents, Tender Agent and Remarketing Agent	77
Section 9.05.	Evidence on Which Trustee May Act	77
Section 9.06.	Trustee, Paying Agents, Tender Agent and Remarketing Agent May Deal in Bonds	77
Section 9.07.	Resignation or Removal of Trustee	77
Section 9.08.	Successor Trustee	78
Section 9.09.	Paying Agents	80
Section 9.10.	Appointment of Co-Trustee	80
Section 9.11.	Tender Agent - Appointment, Acceptance and Successors.	81
Section 9.12.	Tender Agent - General Responsibilities	82
Section 9.13.	Remarketing Agent - Appointment, Acceptance and Successors	84
Section 9.14.	Remarketing Agent - General Responsibilities	85
Section 9.15.	Cooperation Among Certain of the Notice Parties.	87

iii

TABLE OF CONTENTS

(continued)

Page


ARTICLE X

DISCHARGE OF INDENTURE; DEFEASANCE

Section 10.01.	Defeasance	88
Section 10.02.	Defeasance Opinion and Verification	89
Section 10.03.	No Limitation of Rights of Holders	89

ARTICLE XI

AMENDMENTS OF INDENTURE

Section 11.01.	Limitation on Modifications	90
Section 11.02.	Supplemental Indentures Without Bondholders’ Consent	90
Section 11.03.	Supplemental Indentures With Bondholders’ Consent	91
Section 11.04.	Supplemental Indenture Part of this Indenture	92

ARTICLE XII

AMENDMENTS OF RELATED SECURITY DOCUMENTS

Section 12.01.	Rights of Company	94
Section 12.02.	Amendments of Related Security Documents Not Requiring Consent of Bondholders	94
Section 12.03.	Amendments of Related Security Documents Requiring Consent of Bondholders	94

ARTICLE XIII

MISCELLANEOUS

Section 13.01.	Evidence of Signature of Bondholders and Ownership of Bonds	96
Section 13.02.	Notices	96
Section 13.03.	Parties Interested Herein	98
Section 13.04.	Partial Invalidity	98
Section 13.05.	Effective Date; Counterparts	98
Section 13.06.	Laws Governing Indenture	98
Section 13.07.	No Pecuniary Liability of Agency or Members; No Debt of the State or the City	98
Section 13.08.	Priority of Indenture Over Liens	99

TABLE OF CONTENTS

(continued)

Page

EXHIBITS

Exhibit A — Description of Land

Exhibit B — Description of Facility Personalty

Exhibit C — Form of Initial Bond

Exhibit D — Form of Requisition from the Project Fund

MORTGAGE AND SECURITY AGREEMENT AND

ASSIGNMENT OF LEASES AND RENTS

(ACQUISITION LOAN)

From

ALBEE RETAIL DEVELOPMENT LLC,

a Delaware limited liability company having its principal office

at 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605,

THE BANK OF NEW YORK MELLON,

a New York banking corporation having a corporate trust office

at 101 Barclay Street, Floor 7W, New York, New York 10286,

as Trustee and Mortgagee,

Dated as of July 1, 2010

$20,000,000

New York City Capital Resource Corporation

Recovery Zone Facility Revenue Bonds

(Albee Retail Development LLC Project), Series 2010

Affecting that property described in the appendices to this

Mortgage and Security Agreement and Assignment of Leases and

Rents (Acquisition Loan), in the County of Kings, City of New

York, State of New York

____________________________________________________________________

Record and Return to:

Hawkins Delafield & Wood LLP

1 Chase Manhattan Plaza

New York, New York 10005

Attention: Arthur M. Cohen, Esq.

TABLE OF CONTENTS

Page

ARTICLE I

DEFINITIONS; CONSTRUCTION

Section 1.1.	Certain Definitions	6
Section 1.2.	Construction	11

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1.	Representations and Warranties of Debtor	13

ARTICLE III

GENERAL AGREEMENTS OF DEBTOR

Section 3.1.	Payment, Performance, Observance and Compliance	15
Section 3.2.	Acknowledgment of Amount Due	15
Section 3.3.	Security Agreement	15
Section 3.4.	Ownership; Instruments of Further Assurance	15
Section 3.5.	Creation of Liens; Indebtedness; Sale of Facility	16
Section 3.6.	Release of Property	16
Section 3.7.	Recording and Filing	16
Section 3.8.	After-Acquired Property	18
Section 3.9.	The Ground Lease	19
Section 3.10.	No Merger of Estates	25
Section 3.11.	Additional Taxes or Charges	25
Section 3.12.	Notice of Event of Default	25
Section 3.13.	Debtor’s Acquisition of Fee Estate	25
Section 3.14.	Leasehold Condominium	26

ARTICLE IV

ASSIGNMENT OF LEASES AND RENTS

Section 4.1.	Assignment of Leases and Rents	27
Section 4.2.	No Cancellation or Modification of Facility Leases	30
Section 4.3.	Required Facility Lease Provisions	31
Section 4.4.	Debtor Not to Waive Rents	31
Section 4.5.	Debtor to Furnish Rent Rolls	31
Section 4.6.	Mortgagee Right to Cure Default	31


ARTICLE V

PROVISIONS REQUIRED UNDER GROUND LEASE

Section 5.1.	Article 9 of the Ground Lease	32

ARTICLE VI

REMEDIES; EVENTS OF DEFAULT

Section 6.1.	Protective Action	33
Section 6.2.	Benefit of Section 254 of the Real Property Law	33
Section 6.3.	Sole Discretion of the Mortgagee	33
Section 6.4.	Recovery of Sums Required To Be Paid	33
Section 6.5.	Events of Default	34
Section 6.6.	Remedies Following an Event of Default	35
Section 6.7.	Appointment of a Receiver	37
Section 6.8.	Foreclosure	37
Section 6.9.	Non-Impairment	37
Section 6.10.	No Remedy Exclusive	38
Section 6.11.	Delay To Not Constitute Waiver	38
Section 6.12.	Effect of Discontinuance of Proceedings	38
Section 6.13.	Marshalling	39
Section 6.14.	Actions and Proceedings	39
Section 6.15.	Attorneys’ Fees and Other Costs	39
Section 6.16.	No Additional Waiver Implied by One Waiver	39
Section 6.17.	Application of Proceeds	39
Section 6.18.	Waiver of Moratorium	40
Section 6.19.	Waiver of Notice	40

ARTICLE VII

LIMITATIONS ON LIABILITY

Section 7.1.	No Liability of Debtor’s Members, Managers, Officers, Directors, Employees and Agents	41
Section 7.2.	Usury Laws	41
ARTICLE VIII
MISCELLANEOUS
Section 8.1.	Applicability of Section 13 of the Lien Law	42
Section 8.2.	No Merger	42
Section 8.3.	This Mortgage Constitutes A Commercial Transaction	42
Section 8.4.	Consents	43
Section 8.5.	Service of Process	43
Section 8.6.	Notices	43
Section 8.7.	Consent to Jurisdiction	44
Section 8.8.	Mortgage for Benefit of Debtor and Mortgagee	45

Section 8.9.	Authorization	45
Section 8.10.	Amendments and Modifications	45
Section 8.11.	Applicable Law	45
Section 8.12.	Date of Mortgage for Reference Purposes Only	45
Section 8.13.	Incorporation of Certain Indenture Provisions	45
Section 8.14.	Entire Agreement; Counterparts	45
Section 8.15.	Severability	45
Section 8.16.	Waiver of Jury Trial	46
Section 8.17.	Property Not Covered	46
Section 8.18.	Assignment of Mortgage Upon Refinancing of the Bonds	46

EXHIBITS

EXHIBIT A — Description of Land

iii

MORTGAGE AND SECURITY AGREEMENT AND

ASSIGNMENT OF LEASES AND RENTS (ACQUISITION LOAN)

This MORTGAGE AND SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS (ACQUISITION LOAN) made and entered into as of the date set forth on the cover page hereof (this “Mortgage”) from ALBEE RETAIL DEVELOPMENT LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Debtor”), as mortgagor, having its principal office at 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605, to THE BANK OF NEW YORK MELLON, a New York banki ng corporation together with any successor trustee (the “Trustee” or the “Mortgagee”) at the time serving as such under the Indenture referred to below, as mortgagee, having a corporate trust office at 101 Barclay Street, Floor 7W, New York, New York 10286 (capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture, in the Loan Agreement or in the Pledge and Security Agreement, each as referred to below):

W I T N E S S E T H :

WHEREAS, the Debtor has entered into negotiations with the New York City Capital Resource Corporation, a local development corporation created pursuant to Section 1411(a) of the Not-for-Profit Corporation Law of the State of New York, as amended (the “Issuer”), for the construction, renovation, equipping and furnishing of an approximately 50,000 square foot facility (the “Facility”) to be leased to retail commercial tenants, generally known by the street address of 1 DeKalb Avenue, Brooklyn, New York, and as further described in Exhibit A attached hereto — “DESCRIPT ION OF THE LAND”; and

WHEREAS, the site of the Facility, including the improvements to be constructed thereon, will be subject to the Ground Lease; and

WHEREAS, pursuant to the Loan Agreement, the Issuer has made a Loan of the proceeds of the Bonds, in the original principal amount of the Bonds, to the Debtor, and the Debtor has executed the Promissory Note in favor of the Issuer and the Mortgagee to evidence the Debtor’s obligation under the Loan Agreement to repay the Loan; and

WHEREAS, the Debtor intends to enter into various Facility Leases with Facility Tenants at the Facility; and

WHEREAS, pursuant to the Bond Resolution and the Indenture, the Issuer has authorized the issuance of its Bonds to provide funds for a portion of the costs of the Project, and to provide funds to pay a portion of the costs and expenses of the issuance of the Bonds; and

WHEREAS, concurrently with the execution hereof, (i) in order to further secure the Bonds, the Debtor and Acadia Strategic Opportunity Fund II LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Parent”, and, together with the Debtor, the “Guarantors”) will guarantee the payment of the principal of, Purchase Price, Sinking Fund Installments for, redemption premium, if any, and interest on the Bonds, and the payments, obligations, covenants and agreements of the Debtor under the Loan Agreement and under the Promissory Note, pursuant to the Bond Guaranty Agreement, (ii) the completion of the Project will be guaranteed by the Guarantors pursuant to the Project Completion Guaranty Agreement in favor of the Trustee, and (iii) the Debtor will grant a first lien in Facility Revenues and the remainder of the Pledged Collateral pursuant to the Pledge and Security Agreement in favor of the Trustee; and

WHEREAS, in order to induce the Issuer to issue the Bonds, and the initial owners to purchase the Bonds, the Debtor is entering into this Mortgage, the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan) and the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan);

NOW, THEREFORE, in consideration of the premises and of the purchase and acceptance of the Bonds by the initial owners thereof, and for other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to secure

(i) the payment of the Secured Principal Amount of the Bonds and the indebtedness represented thereby, the Purchase Price, if applicable, and the redemption premium, if any, and interest on the Bonds according to their tenor and effect and the performance and observance by the Issuer of all the covenants expressed or implied in the Bonds, and

(ii) the payment, performance and observance of all obligations of the Debtor and the Parent under the Security Documents including this Mortgage, and

GRANTING CLAUSES

The Ground Lease, including all rights, guarantees, amendments, supplements, modifications, renewals, substitutions and extensions relating to the Ground Lease and any right of continued possession of the Facility as might result by reason of a rejection of the Ground Lease thereunder, and all other right, title and interest of the Debtor in and the Facility together with the tenements, hereditaments, servitudes, appurtenances, estate, rights, privileges, liberties, appurtenances, licenses, royalties, mineral, oil and gas rights, water, water rights, reversions, remainders and immunities thereunto in which the Debtor shall have an interest, including all the right, title and interest of the Debtor in and to all streets, ways, alleys, roads, waters, water courses, water rights, waterways, passages, sewer rights and public pl aces adjoining the Facility and all easements and rights-of-way, public or private, and gores of land, now or hereafter used in connection therewith, together with all land lying in the bed of any street, road or avenue, open or proposed, in front of or adjoining the Facility to the center line thereof, now or hereafter used in connection with the Facility.

Any right of continued possession and occupancy, by agreement or otherwise, in and to the Facility, including all right, title and interest in any such agreement.

III

Any and all rights under Section 365(h) of the Federal Bankruptcy Code, or any similar rights under any other law, including but not limited to any right to use or possession of the Facility.

All trade fixtures, equipment, machinery, apparatus, appliances, fittings, chattels and articles of personal property of every kind and nature, and all building equipment, materials and supplies of any nature whatsoever, now or hereafter attached to, or used or usable in connection with any present or future operation or occupancy of the Facility and in which the Debtor has or shall have an interest and all renewals and replacements thereof and additions and accessions thereto, including without limitation all partitions, elevators, lifts, steam and hot water boilers, heating and air conditioning equipment, lighting and power plants, engines, motors, compressors, ducts, coal, oil and gas burning apparatus, pipes, pumps, plumbing, radiators, sinks, bath tubs, water closets, refrigerators, gas and electrical fixtures, communications app aratus, stoves, ranges, shades, screens, awnings, vacuum cleaning system, and sprinkler system or other fire prevention or extinguishing apparatus and materials, all of which shall be deemed to be, remain and form a part of the Mortgaged Property and are covered by the Lien of this Mortgage; excluding, however, from the Lien of this Mortgage, the Company’s Property (as defined in Section 3.4(c) of the Loan Agreement), any property released from the Facility pursuant to Section 3.5 of the Loan Agreement, and any personal property owned by any Facility Tenant.

All right, title and interest of the Debtor in all Construction Contracts, payment bonds, performance bonds, surety bonds, Warranties, guarantees, maintenance, repair or replacement agreements and other contractual obligations of any contractor, subcontractor, surety, guarantor, manufacturer, dealer, laborer, supplier or materialman made with respect to the Facility or any part thereof.

All the right, in the name and on behalf of the Debtor, to appear in and defend any action or proceeding brought with respect to the Facility and to commence any action or proceeding to protect the interest of the Mortgagee in the Facility.

VII

Any and all air rights, development rights, zoning rights or other similar rights or interests which benefit or are appurtenant to the Facility and any proceeds arising therefrom.

VIII

All agreements (other than any Security Document) and/or contracts now or hereafter entered into by the Debtor for the Project Work or any part thereof, and all permits, licenses, bonds, plans and specifications relative to the Project.

All insurance proceeds, awards, payments and other compensation payments, including interest thereon, and the right to receive the same, which are heretofore or hereafter made with respect to the Facility as a result of or in lieu of any taking by eminent domain (including any transfer made in lieu of the exercise of said right), the alteration of the grade of any street, or any other damage or injury to or decrease in the value of the Facility or the occurrence of any Loss Event (as defined in, and subject to, Section 5.1 of the Loan Agreement), to the extent of all amounts which may be secured by this Mortgage at the date of receipt of any such award or payment by the Mortgagee, and of the reasonable attorneys’ fees, costs and disbursements incurred by the Mortgagee in connection with the collection of such award or payment, s ubject to the terms of the Indenture, the Loan Agreement and the Ground Lease, as to the application of all such amounts so received.

All right, title and interest of the Debtor in and to (a) any and all present and future leases of space in any Improvements; (b) the Facility Leases; (c) any and all present and future subleases of space in any Improvements; (d) all rents, issues and profits payable under any such leases and subleases including all Facility Revenues; and (e) any contracts for the sale of all or any portion of the Facility or any Improvements or portions thereof, on or to be erected upon the Facility (“sale contracts”). Nothing in this paragraph is intended to constitute the consent of the Mortgagee to any such leases, subleases or sale contracts, other than as expressly provided herein or in the Loan Agreement.

All right, title and interest of the Debtor in all proceeds of any unearned premiums on any property insurance policies concerning the Facility, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments or settlements made in lieu thereof, for damages to any portion of the Facility, subject, however, to the terms of the Indenture, the Loan Agreement and the Ground Lease.

XII

All right, title and interest of the Debtor in all Funds, Accounts and Subaccounts established under the Indenture.

XIII

All the right, in the name and on behalf of the Debtor, to appear in and defend any action or proceeding brought with respect to any of the Mortgaged Property and to commence any action or proceeding to protect the interest of the Mortgagee in the Mortgaged Property.

XIV

Any and all further estate, right, title, interest, property, claim and demand whatsoever of the Debtor in and to any of the above.

All proceeds of the conversion, voluntary or involuntary, of any of the foregoing into cash or liquidated claims.

XVI

Any and all other property of every kind and nature from time to time which was heretofore or hereafter is by delivery or by writing of any kind conveyed, mortgaged, pledged, assigned or transferred, as and for additional security hereunder, by the Debtor or by any other Person with or without the consent of the Debtor, to the Mortgagee which is hereby authorized to receive any and all such property at any time and at all times to hold and apply the same subject to the terms hereof.

TO HAVE AND TO HOLD all the same with all privileges and appurtenances hereby conveyed and assigned or agreed or intended so to be, to the Mortgagee and its successors and to them and their assigns forever;

THIS MORTGAGE secures the payment, performance and observance of the Obligations and shall continue in full force and effect until the Obligations shall be paid and satisfied in full or otherwise provided for in accordance with their respective terms.

Notwithstanding anything contained herein to the contrary, the maximum amount of Obligations secured by this Mortgage at execution or which under any contingency may become secured hereby at any time hereafter is the Secured Principal Amount plus interest thereon, plus all amounts expended by the Mortgagee after default by the Debtor which constitute payment of (i) taxes, charges or assessments which may be imposed by law upon the Mortgaged Property; (ii) premiums on insurance policies covering the Mortgaged Property; (iii) expenses incurred in protecting or upholding the lien of this Mortgage, including, but not limited to the expenses of any litigation to prosecute or defend the rights and lien created by this Mortgage; (iv) expenses incurred in protecting the collateral encumbered by this Mortgage; or (v) any am ount, cost or charge to which the Mortgagee becomes subrogated upon payment, whether under recognized principles of law or equity, or under express statutory authority.

DEBTOR represents, warrants, covenants and agrees with the Mortgagee as set forth below:

ARTICLE I

DEFINITIONS; CONSTRUCTION

Section 1.1. Certain Definitions. The following terms shall have the respective meanings in this Mortgage, except as the context otherwise requires:

An Affiliate of a Person shall mean a Person that directly or indirectly through one or more intermediaries Controls, or is under common Control with, or is Controlled by, such Person.

Authorized Representative shall mean:

(ii) in the case of the Debtor, a person named in Exhibit B — “Authorized Representative”, to the Loan Agreement, or any other officer or employee of the Debtor who is authorized to perform specific duties under the Loan Agreement or under any other Project Document and of whom another Authorized Representative of the Debtor has given written notice to the Issuer and the Mortgagee;

provided, however, that in each case for which a certification or other statement of fact or condition is required to be submitted by an Authorized Representative to any Person pursuant to the terms of the Loan Agreement or any other Project Document, such certificate or statement shall be executed only by an Authorized Representative in a position to know or to obtain knowledge of the facts or conditions that are the subject of such certificate or statement.

Bond Resolution shall mean the resolution of the Issuer adopted on February 9, 2010, as amended on April 13, 2010, authorizing the Project and the issuance of the Bonds.

Bonds shall mean the Issuer’s $20,000,000 Recovery Zone Facility Revenue Bonds (Albee Retail Development LLC Project), Series 2010, authorized, issued, executed, authenticated and delivered under the Indenture.

Building Loan Agreement shall mean the Building Loan Agreement, dated as of even date herewith, among the Issuer, the Debtor and the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Business Day shall have the meaning assigned to that term in the Indenture.

City shall mean The City of New York, New York.

Closing Date shall mean July 1, 2010, the date of the initial issuance and delivery of the Bonds.

Commencement Date shall have the meaning assigned to that term in the Loan Agreement.

Company’s Property shall have the meaning specified in Section 3.4(c) of the Loan Agreement.

Debtor shall mean Albee Retail Development LLC, a limited liability company organized and existing under the laws of the State of Delaware, and its successors and assigns; provided, however, that nothing contained in this definition shall be deemed to limit or modify the obligations of the Debtor under Section 7.8 or 7.9 of the Loan Agreement.

Facility shall mean, collectively, the Land and the Improvements.

Facility Address shall mean 1 DeKalb Avenue, Brooklyn, New York.

Facility Revenues shall mean all revenues, income, fees, receipts, charges, income and other money received in any period by or on behalf of the Debtor, derived from the leasing or operation of the Facility, including proceeds derived from insurance (including environmental insurance) and/or condemnation proceeds with respect to the Facility and Business Interruption Insurance and Extra Expense Insurance, in each case whether existing as of the Closing Date or hereafter coming into existence.

Facility Tenants shall mean all Persons as shall use, possess or occupy all or any portion of the Facility pursuant to a Facility Lease.

Ground Lease shall mean that certain Severance Lease (Site 1A), dated June 30, 2010, between the City, as landlord, and Albee Development, LLC, a Delaware limited liability company (“Albee Development”), as assigned on July 1, 2010 by Albee Development to, and assumed by, the Debtor, as tenant, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and herewith.

Guarantors shall mean, collectively, the Debtor and the Parent, and their respective successors and assigns.

Holders shall have the meaning assigned to that term in the Indenture.

Improvements shall mean:

(i) all buildings, structures, foundations, related facilities, fixtures and other improvements existing on the Commencement Date and erected or situated on the Land;

(iii) all replacements, improvements, additions, extensions, substitutions, restorations and repairs to any of the foregoing.

Independent Engineer shall mean a Person (not an employee of any of the Issuer, the Debtor, the Parent or any Affiliate of any thereof) registered and qualified to practice engineering or architecture under the laws of the State, selected by the Debtor, and approved in writing by the Trustee (which approval shall not be unreasonably withheld and shall be at the written direction of the Majority Holders).

Legal Requirements shall mean the Constitutions of the United States and the State of New York and all laws, statutes, codes, acts, ordinances, resolutions, orders, judgments, decrees, injunctions, rules, regulations, permits, licenses, authorizations, certificates of occupancy, directions and requirements (including zoning, land use, planning, environmental protection, air, water and land pollution, toxic wastes, hazardous wastes, solid wastes, wetlands, health, safety, equal opportunity, minimum wages, and employment practices) of all governments, departments, commissions, boards, courts, authorities, agencies, officials and officers, including those of the City, foreseen or unfore seen, ordinary or extraordinary, that are applicable now or may be applicable at any time hereafter to (i) the Debtor or any Facility Tenant, (ii) the Facility or any part thereof, or (iii) any use or condition of the Facility or any part thereof.

Loan Agreement shall mean the Loan Agreement, dated as of even date herewith, between the Issuer and the Debtor, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Majority Holders shall have the meaning assigned to that term in the Indenture.

Mortgage shall mean this Mortgage and Security Agreement and Assignment of Leases and Rents (Acquisition Loan) from the Debtor to the Mortgagee, and includes any and all amendments hereof and supplements hereto made in accordance herewith and with the Indenture.

Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan) shall mean the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan), dated as of even date herewith, from the Debtor to the Mortgagee, and includes any and all amendments thereof and supplements thereto hereafter made in accordance therewith and with the Indenture.

Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan) shall mean the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan), dated as of even date herewith, from the Debtor to the Mortgagee, and includes any and all amendments thereof and supplements thereto hereafter made in accordance therewith and with the Indenture.

Opinion of Counsel shall mean a written opinion of counsel for the Debtor, the Parent or any other Person (which counsel shall be reasonably acceptable to the Issuer and the Trustee) with respect to such matters as required under any Project Document or as the Issuer or the Trustee may otherwise reasonably require, and which shall be in form and substance reasonably acceptable to the Issuer and the Trustee.

Outstanding shall have the meaning assigned to that term in the Indenture.

Permitted Encumbrances shall have the meaning assigned to that term in the Indenture.

Person shall mean an individual or any Entity.

Pledge and Security Agreement shall mean the Pledge and Security Agreement, dated as of even date herewith, from the Debtor to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Project shall mean the construction, renovation, equipping and furnishing of an approximately 50,000 square foot facility to be leased to retail commercial tenants.

Promissory Note shall mean, with respect to the Bonds, that certain Promissory Note in substantially the form of Exhibit G to the Loan Agreement, and, with respect to any Series of Additional Bonds, that certain Promissory Note in substantially the form of any related Exhibit to an amendment to the Loan Agreement, and shall include in each case any and all amendments thereof and supplements thereto made in conformity with the Loan Agreement and the Indenture.

Purchase Price shall mean an amount equal to the principal amount of any Bond purchased on any Purchase Date, plus accrued interest to the Purchase Date (unless the Purchase Date is an Interest Payment Date, in which case the Purchase Price shall not include accrued interest, which shall be paid in the normal course).

Secured Principal Amount shall mean $1,685,597.43.

Security Documents shall mean, collectively, the Loan Agreement, the Promissory Note, the Pledge and Security Agreement, the Indenture, the Bond Guaranty Agreement, the Project Completion Guaranty Agreement, the Tax Regulatory Agreement, the Building Loan Agreement, this Mortgage, the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan) and the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan).

State shall mean the State of New York.

Supplemental Indenture shall mean any indenture supplemental to or amendatory of the Indenture, executed and delivered by the Issuer and the Trustee in accordance with Article XI of the Indenture.

Tax Regulatory Agreement shall mean the Tax Regulatory Agreement, dated the Closing Date, from the Issuer and the Debtor to the Trustee, and shall include any and all amendments thereof and supplements thereto hereafter made in conformity therewith and with the Indenture.

Trust Estate shall mean all property, interest, revenues, funds, contracts, rights and other security granted to the Trustee under the Security Documents.

Section 1.2. Construction. In this Mortgage, unless the context otherwise requires:

(a) The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar terms, as used in this Mortgage, refer to this Mortgage, and the term “hereafter” shall mean after, and the term “heretofore” shall mean before, the Closing Date.

(d) Any headings preceding the texts of the several Articles and Sections of this Mortgage, and any table of contents appended to copies hereof, shall be solely for convenience of reference and shall not constitute a part of this Mortgage, nor shall they affect its meaning, construction or effect.

(e) Unless the content indicates otherwise, references to designated “Exhibits,” “Articles,” “Sections,” “Subsections,” “clauses” and other subdivisions are to the designated Exhibits, Articles, Sections, Subsections, clauses and other subdivisions of or to this Mortgage.

(f) The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

(g) The word “will” shall be construed to have the same meaning and effect as the word “shall”.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1. Representations and Warranties of Debtor. The Debtor hereby represents and warrants that:

(a) The Debtor is a limited liability company duly organized under the laws of the State of Delaware, is validly existing and in good standing under the laws of the State of Delaware, is duly qualified to do business and in good standing under the laws of the State, is not in violation of any provision of its Organizational Documents, has the requisite power and authority to own its property and assets, to carry on its business as now being conducted by it and to execute, deliver and perform this Mortgage and each other Project Document to which it is or shall be a party.

(b) The execution, delivery and performance of this Mortgage and each other Project Document to which the Debtor is or shall be a party and the consummation of the transactions herein and therein contemplated will not (x) violate any provision of law, any order of any court or agency of government, or any of the Organizational Documents of the Debtor, or any indenture, agreement or other instrument to which the Debtor is a party or by which it or any of its property is bound or to which it or any of its property is subject, (y) be in conflict with or result in a breach of or constitute (with due notice and/or lapse of time) a default under any such indenture, agreement or other instrument, or (z) result in the imposition of any lien, charge or encumbrance of any nature whatsoever other than Permitted Encumbrances.

(c) There is no action or proceeding pending or, to the best of the Debtor’s knowledge, after diligent inquiry, threatened by or against the Debtor by or before any court or administrative agency that would adversely affect the ability of the Debtor to perform its obligations under this Mortgage or any other Project Document to which it is or shall be a party. Such knowledge is based upon the knowledge of Robert Masters, a Senior Vice President of the Parent, and a person employed by the Parent with actual knowledge of the Project and of the matters set forth in this paragraph.< /div>

(d) The Debtor has obtained all authorizations, consents and approvals of governmental bodies or agencies required to be obtained by the Debtor as of the Closing Date in connection with the execution and delivery of this Mortgage and each other Project Document to which the Debtor is a party or in connection with the performance of the obligations of the Debtor hereunder and under each of the Project Documents.

(e) This Mortgage and the other Project Documents to which the Debtor is a party (x) have been duly authorized by all necessary action on the part of the Debtor, (y) have been duly executed and delivered by the Debtor, and (z) constitute the legal, valid and binding obligations of the Debtor, enforceable against the Debtor in accordance with their respective terms, subject to limitations on enforceability resulting from bankruptcy, insolvency and principles of equity.

(f) The assumption by the Debtor of its obligations hereunder will result in a direct financial benefit to the Debtor.

(g) The Debtor has power to enter into and perform this Mortgage, to create, pledge and grant the mortgage, pledge, assignment and security interest in the Mortgaged Property as provided in this Mortgage, and to own its property and assets.

(h) The Debtor is vested with a good and marketable leasehold interest in the Facility pursuant to the Ground Lease, subject to no mortgage, lien, charge, pledge, assignment, security interest, conditional sale agreement or encumbrance of any kind whatsoever, other than Permitted Encumbrances.

(i) The Debtor is, as of the Closing Date, and after giving effect to all instruments evidencing or securing the Obligations will be, in a solvent condition.

(j) The execution and delivery of this Mortgage does not constitute a “fraudulent conveyance” within the meaning of Title 11 of the United States Code as so constituted or under any other applicable law.

(k) No bankruptcy or insolvency proceedings are pending or contemplated by or, to the best knowledge of the Debtor, against, the Debtor.

(l) The Debtor is duly authorized to mortgage and grant a security interest in the Mortgaged Property, and this Mortgage is a first lien upon the Mortgaged Property, subject only to Permitted Encumbrances.

(m) The Ground Lease is a valid and subsisting lease of the property therein described and purported to be demised and is in full force and effect in accordance with its terms, and has not been amended or modified in any respect.

(n) No default has occurred and is continuing under the Ground Lease and no event has occurred or is occurring which, with the passage of time or the giving of notice or both, would constitute an event of default under the Ground Lease.

(o) Neither the Ground Lease nor the Debtor’s interest in any of the Facility Leases or Facility Revenues is subject to any Liens or encumbrances other than in favor of the Mortgagee or as set forth in the mortgagee title insurance policy insuring the Lien of this Mortgage, a copy of which has been furnished to the Mortgagee.

(p) The Debtor is the owner of the leasehold estate created by the Ground Lease and has the right and authority under the Ground Lease to execute this Mortgage as provided herein.

(q) No Facility Leases are in effect as of the Closing Date.

ARTICLE III

GENERAL AGREEMENTS OF DEBTOR

Section 3.1. Payment, Performance, Observance and Compliance. The Debtor agrees to pay, perform, observe and comply with such of the Obligations to which it shall be subject (including this Mortgage) upon the terms and provisions required of the Debtor therein.

Section 3.2. Acknowledgment of Amount Due. The Debtor shall, upon request, furnish to the Mortgagee, in person within five (5) days, or, by mail within ten (10) days, a written statement duly acknowledged of the amount due under this Mortgage and whether any offsets or defenses exist against the Obligations.

Section 3.3. Security Agreement. This Mortgage is and shall be deemed to be a security agreement under the New York State Uniform Commercial Code with respect to the Mortgaged Property, and the Mortgagee shall have all the rights of a secured party thereunder with respect to that part of the Mortgaged Property that constitutes personal property subject thereto (sometimes referred to herein as the “Secured Property”). Upon request by the Mortgagee, the Debtor shall execute and deliver to the Mortgagee any security agreement, financing or continuation statement or other document the Mortgagee reasonably deems necessary to protect or perfect its lien on the Mortgaged Property. If the Debtor shall default under this Mortgage, the Mortgagee, in addition to any other rights and remedies that it may have, shall have and may exercise immediately and without demand any and all rights and remedies granted to a secured party upon default under the New York State Uniform Commercial Code, including the right to take possession of the Secured Property or any part thereof or indicia thereof, and to take such other measures as the Mortgagee may deem necessary for the care, protection and preservation of the Secured Property. Upon request or demand of the Mortgagee, the Debtor shall assemble the Secured Property and make it available to the Mortgagee at a convenient place acceptable to the M ortgagee. The Debtor shall pay to the Mortgagee on demand all expenses, including reasonable legal expenses and attorneys’ fees and expenses, incurred or paid by the Mortgagee in protecting its interest in the Secured Property and in enforcing its rights hereunder with respect to the Secured Property. Any notice of sale, other disposition, or other intended action by the Mortgagee with respect to the Secured Property sent to the Debtor in accordance with the provisions of this Mortgage at least seven (7) days prior to the date of any such sale, other disposition, or other intended action set forth or specified in the notice shall conclusively be deemed to be commercially reasonable within the meaning of the New York State Uniform Commercial Code unless objected to in writing by the Debtor within five (5) days after receipt by the Debtor of the notice. The proceeds of any sale or other disposition of the Secured Property, or any part thereof, shall be applied to the paym ent of the Obligations as provided in Section 6.17.

Section 3.4. Ownership; Instruments of Further Assurance. The Mortgagee on behalf of the Debtor shall defend the interest of the Debtor to the Mortgaged Property and every part thereof and the Debtor agrees to warrant and defend such interest against the claims and demands of all Persons whomsoever. The Debtor covenants that it will do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered, such supplements hereto and such further acts, instruments and transfers as the Mortgagee may reasonably require for the better assuring, transferring, conveying, pledging, assigning and confirming unto the Mortgagee all and singular the property herein described and subject to the lien and security interest of this Mortgage and those revenues pledged hereby and by the Indenture to the payment of the Obligations. Any and all property hereafter acquired (other than the Company’s Property) which is of the kind or nature herein provided to be and become subject to the lien and security interest hereof shall ipso facto, and without any further conveyance, assignment or act on the part of the Debtor or the Mortgagee, become and be subject to the lien and security interest of this Mortgage as fully and completely as though specifically described herein, but nothing in this sentence con tained shall be deemed to modify or change the obligations of the Debtor heretofore made by this Section 3.4.

Section 3.5. Creation of Liens; Indebtedness; Sale of Facility. The Debtor represents and covenants that this Mortgage is and will be a first mortgage Lien upon the Mortgaged Property. The Lien of the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan) is subject and subordinate to the Ground Lease and the Liens of this Mortgage and of the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loa n). The Debtor shall not (x) create or suffer to be created any Lien upon or pledge of the Mortgaged Property or any part thereof except the Lien created by this Mortgage and Permitted Encumbrances, and except as expressly permitted under the Indenture, (y) incur any Indebtedness or issue any evidences of Indebtedness, other than the Obligations, and except as expressly permitted under the Indenture, secured by a Lien on the Mortgaged Property, or (z) sell, convey, transfer, lease, mortgage or encumber the Mortgaged Property or any part thereof except as specifically permitted under the Loan Agreement, the Indenture, this Mortgage and Permitted Encumbrances, so long as any of the Obligations are Outstanding.

Section 3.6. Release of Property. Reference is made to the provisions of the Loan Agreement, including, without limitation, Sections 3.5 and 7.9 thereof, whereby the Debtor may withdraw from the Facility any fixtures or any right-of-way, easement, permit or license or unimproved portion thereof, all upon compliance with the terms and conditions of the Loan Agreement and the Ground Lease. At the request of the Debtor, the Mortgagee shall release from the lien and security interest of this Mortgage, the Mortgage and Security Agreement and Assignment of Leases and Rents (Building Loan) and the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan), and from under the Loan Agreement such portion of the property of the Facility so withdrawn upon compliance with the applicable provisions of the Loan Agreement and shall confirm any such release.

Section 3.7. Recording and Filing. a) The Debtor shall cause this Mortgage and all supplements hereto to be recorded (at the sole cost and expense of the Debtor) as a mortgage of an interest in real property in the appropriate offices of the Register of The City of New York or in such other offices as may be at the time provided by law as the proper place for the recordation thereof. In addition, the security interest of the Mortgagee, as created by this Mortgage, in the personal property and fixtures and the rights and other intangible interests herein described, shall be perfected by the filing of financing statements at the direction of the Debtor in the offices of the Secretary of State of the State in the City of Albany, New York, and in the offices of such Register of The City of New York, which financing statements shall be in accordance with the New York State Uniform Commercial Code - Secured Transactions. All mortgage recording taxes, if any, and filing and recording charges and fees shall be payable by the Debtor.

(b) The Debtor and the Mortgagee acknowledge that, as of the Closing Date,

(c) The parties hereto acknowledge and agree that, because the foregoing financing statements evidence collateral for the Bonds, and because the Bonds are municipal securities with a term that is at least twenty (20) years in duration, there is no need under the Uniform Commercial Code of the State of New York to re-file such financing statements in order to preserve the liens and security interests that they create for the period commencing with the Closing Date and terminating on the thirtieth anniversary of the Closing Date.

Subsequent to the foregoing recordation and filings, if in the Opinion of Counsel to the Debtor (described hereinbelow), to preserve (after the thirtieth (30th) anniversary of the Closing Date) the lien and security interest of this Mortgage, it is necessary to re-record and/or re-index documents, re-file financing statements and/or file continuation statements and/or take any other actions (individually or collectively, the “Continuation Action(s)”), then, the Debtor in a timely manner shall: (A) as applicable, (i) prepare and deliver to the Mortgagee all necessary instruments and filing papers, together with remittances equal to the cost of required filing fees and othe r charges, so that the Mortgagee may perform the Continuation Actions, or (ii) electronically perform the Continuation Actions and deliver to the Mortgagee written certification (upon which the Mortgagee may conclusively rely) that such performance has occurred, specifying the Continuation Actions performed, or (iii) perform some of the Continuation Actions in the manner described in clause “(i)” and the others in the manner described in clause “(ii)”; and (B) deliver or cause to be delivered to the Mortgagee the Opinion of Counsel to the Debtor as described below. The Mortgagee may conclusively rely upon (y) when applicable, the certification referred to in clause “(A)(ii),” and (z) in all instances, the Opinion of Counsel to the Debtor. In the event the Debtor chooses to have the Mortgagee perform all or some of the Continuation Actions, as provided in clause “(A)(i)” hereinabove, the Mortgagee shall reasonably promp tly perform such Continuation Actions at the Debtor’s sole expense. The Debtor shall perform the obligations described hereinabove in clauses “(A)” and “(B)” no later than ten (10) days prior to (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) each fifth (5th) anniversary thereafter, and/or (ii) the date (not covered by clause “(i)”) on which a Continuation Action is to be taken to preserve the lien and security interest of this Mortgage.

The Opinion of Counsel to the Debtor shall be addressed to the Debtor and the Mortgagee. Counsel shall deliver successive Opinions of Counsel in respect of (i)(y) the thirtieth (30th) anniversary of the Closing Date, and (z) every five-year period thereafter through the term of the Bonds, and/or (ii) the date of any required Continuation Action not covered by clause “(i),” in each case not later than fifteen (15) days prior to the date on which a Continuation Action is required to be taken. In the Opinion of Counsel to the Debtor, counsel shall opine as to: (i) what Continuation Actions are necessary; and (ii) the deadline dates for the required Continuation Actions; and (iii) the jurisdictions in wh ich the Continuation Actions must be effected. Counsel in such opinion shall additionally opine that, upon performance of the Continuation Actions by, as the case may be, (i) the Mortgagee with instruments and papers prepared by the Debtor, or (ii) the Debtor through electronic filing, or (iii) the Mortgagee as to some Continuation Actions, and the Debtor as to the others through electronic filings, all appropriate steps shall have been taken on the part of the Debtor and the Mortgagee then requisite to the maintenance of the perfection of the security interest of the Mortgagee in and to all property and interests which by the terms of this Mortgage are to be subjected to the lien and security interest of this Mortgage.

(d) Any filings with respect to the Uniform Commercial Code financing statements may be made electronically, and the Debtor (which shall be reasonably acceptable to the Mortgagee) shall have the right to designate a company to facilitate the filing of the Uniform Commercial Code financing statements.

(e) All costs (including reasonable attorneys’ fees and expenses) incurred in connection with the effecting of the requirements specified in this Section shall be paid by the Debtor.

(f) The Debtor agrees to perform all other acts (including the payment of all fees and expenses) necessary in order to enable the Mortgagee to comply with this Section, and with Section 7.07 of the Indenture, including but not limited to, providing prompt notice to the Mortgagee of any change in either of the name or address of the Debtor. The Debtor agrees that the Mortgagee, if permitted by applicable law, may provide for the re-recording of the Indenture or any other Security Document or the filing or re-filing of continuation statements without the cooperation of the Debtor as necessary at the Debtor’s sole cost and expense.

Section 3.8. After-Acquired Property. Except as provided in Section 3.4(c) of the Loan Agreement, all right, title and interest of the Debtor in and to all improvements, betterments, renewals, substitutes and replacements of, and all additions, accessions and appurtenances to, the Mortgaged Property (other than trade fixtures), or any part thereof, hereafter acquired, constructed, assembled or placed by or at the direction of the Debtor on or in the Facil ity (other than trade fixtures), and all conversions and proceeds of the security constituted thereby, immediately upon such acquisition, construction, assembly, placement or conversion, as the case may be, and in each such case without any further mortgage, conveyance or assignment or other act of the Debtor, shall become subject to the security and lien of this Mortgage as fully and completely, and with the same effect, as though now owned by the Debtor and specifically described in the Granting Clauses hereof; but at any and all times the Debtor, on demand, will execute, acknowledge, deliver to the Mortgagee and the Debtor will cause to be recorded or filed as provided in Section 3.8, any and all such further assurances and mortgages, conveyances or assignments thereof as the Mortgagee may reasonably require for the purposes of expressly and specifically subjecting the same to the security and lien of this Mortgage.

Section 3.9. The Ground Lease. i) The Debtor will promptly pay or cause to be paid all rents, additional rents and other charges as and when the same become due, and diligently perform and observe all terms, covenants and conditions required to be paid, performed and observed by the Debtor as lessee under the Ground Lease, within the period provided in the Ground Lease (provided, however, that the aforesaid covenant of the Debtor shall be deemed to requir e that all such rents, additional rents and other charges be paid, and all such terms, covenants and conditions be performed and observed, no later than five (5) Business Days in the case of a performance covenant (and no later than three (3) Business Days in the case of a payment obligation) prior to the date that the failure to make such payment or perform and observe such terms, covenants and conditions, would constitute a default under the Ground Lease), and will do all things necessary to preserve and keep unimpaired its rights under the Ground Lease. The Debtor will furnish the Mortgagee, upon demand, proof of payment of all items which are required to be paid by the Debtor pursuant to the Ground Lease and proof of payment of which is required to be given to the lessor under the Ground Lease. To the extent that the Ground Lease shall grant to the Debtor, as lessee thereunder, the privilege to postpone or defer the payment of any sum required to be paid thereunder, the failure of t he Debtor to pay the same shall not constitute a default hereunder if and so long as the Debtor shall faithfully comply with all of the conditions and other requirements of the Ground Lease with respect to the exercise of such privilege. The Debtor shall not waive any of its rights under the Ground Lease, or refrain from exercising any right or remedy accorded to it under the Ground Lease on account of any default by the lessor thereunder, or release the lessor from any liability or condone or excuse any improper actions of the lessor thereunder without first obtaining the written consent of the Mortgagee.

(b) No release or forbearance of any of the Debtor’s obligations under the Ground Lease, pursuant to the Ground Lease or otherwise, shall release the Debtor from any of its obligations under this Mortgage, including its obligation with respect to the payment of rent as provided for in the Ground Lease and the performance of all of the terms, provisions, covenants, conditions and agreements contained in the Ground Lease to be kept, performed and complied with by the tenant therein.

(c) The Debtor shall not make any election or give any consent or approval (other than the exercise of a renewal right or extension right or other right conferring a benefit on the Debtor, provided that any such action has no adverse effect or consequence to the Issuer, the Mortgagee or the Bondholders or the security for the Bonds) for which a right to do so is conferred upon the Debtor as tenant under the Ground Lease without the prior written consent of the Mortgagee if such election, consent or approval would impair the rights of the Mortgagee or the security for the Obligations. In case of any Event of Default under this Mortgage, all such rights, together with the right of termination, cancellation, modification, change, supplement, alteration or amendment of the Ground Lease, all of which have been assigned for collateral purposes to the Mortgagee, shall vest in and be exercisable solely by the Mortgagee.

(d) Not more than three hundred sixty (360) and less than two hundred seventy (270) days before the right of the Debtor to exercise any option or right to renew or extend the term of the Ground Lease shall expire, the Debtor shall give the Mortgagee written notice specifying the date, term and manner for which such option or renewal is to be exercised. Within ten (10) days of written demand by the Mortgagee, the Debtor shall exercise any such option or renewal which is necessary to extend the term of the Ground Lease beyond the term of this Mortgage or to comply with any Legal Requirement affecting the Debtor, the Issuer or the Mortgagee, or which is necessary, in the reasonable judgment of the Mortgagee, to preserve the value of the Mortgaged Property intended to be afforded by this Mortgage. The Debtor shall promptly provide evidence of such exercise of such option or right to the reasonable satisfaction of the Mortgagee. In the event that the Debtor fails to so exercise any such option or right or upon the occurrence of an Event of Default, the Debtor hereby agrees and grants to the Mortgagee all right and authority to exercise such option in the name of the Debtor or in its own name. Nothing contained herein shall affect or limit any rights of the Mortgagee under the Ground Lease.

(e) In the event the Debtor shall violate any of the covenants specified in Section 3.9(a) above, then the Mortgagee shall have the right (but shall not be obligated) to take any action as the Mortgagee may deem reasonably necessary or desirable to prevent or cure any default of the Debtor under the Ground Lease or any default of the lessor thereunder, it being agreed that upon receipt by the Mortgagee from the lessor under the Ground Lease of any notice of default, the Mortgagee shall be entitled to rely thereon and take any of the aforesaid action even though the Debtor denies or questions the existenc e of any such default, and shall have the immediate right to enter all or any portion of the Facility at such times and in such manner as the Mortgagee deems reasonably appropriate in order to prevent or to cure any such default, or any condition which with notice and/or lapse of time would constitute an Event of Default under the Ground Lease.

(f) In the event the Debtor shall violate any of the covenants specified in Section 3.9(a) hereof, then, for the purpose of preventing or curing any default by the Debtor under the Ground Lease, the Mortgagee may (but shall be under no obligation to) do any act or execute any document in the name of the Debtor or as its attorney-in-fact, as well as in the name of the Mortgagee, without waiving or releasing the Debtor from any of its obligations hereunder. The Debtor hereby irrevocably appoints the Mortgagee its true and lawful attorney-in-fact in its name or otherwise to do any and all acts an d to execute any and all documents which in the opinion of the Mortgagee may be reasonably necessary or desirable to prevent or cure any default under the Ground Lease or to preserve any rights of the Debtor in, to or under the Ground Lease, or any Facility Lease, or to preserve any rights of the Debtor whatsoever in respect of any part of the Facility, subject, however, to the provisions of the Ground Lease and Section 5.1.

(g) The Debtor shall, from time to time, use commercially reasonable good faith efforts to obtain from the landlord under the Ground Lease such certificates of estoppel with respect to compliance by the Debtor with the terms of the Ground Lease as may be reasonably requested from time to time by the Mortgagee (but not more often than once in any calendar year except upon reasonable cause). The curing by the Mortgagee of any default by the Debtor under the Ground Lease shall not remove or waive, as between the Debtor and the Mortgagee, any default which may have occurred hereunder by virtue of the d efault by the Debtor under the Ground Lease, and all sums expended by the Mortgagee (upon ten (10) days prior written notice by the Mortgagee to the Debtor of its intention to expend such sums, except if in the reasonable judgment of the Mortgagee an emergency condition exists) in order to cure any such default and costs and expenses incurred by the Mortgagee in connection with the curing of such default shall be paid by the Debtor to the Mortgagee upon demand with interest therein at the annual rate of eighteen percent (18%) per annum from the date of advancement until paid, and any such indebtedness shall be deemed to be secured by this Mortgage.

(h) The Debtor shall not, without the prior consent of the Mortgagee, surrender the leasehold estate created by the Ground Lease or terminate or cancel the Ground Lease, and the Debtor hereby assigns to the Mortgagee, as further security for the payment of the Obligations and for the performance and observance of the terms, covenants and conditions of this Mortgage, all of the rights, privileges and prerogatives of the Debtor, as tenant under the Ground Lease, to surrender the leasehold estate created by the Ground Lease or to terminate or cancel the Ground Lease, and any such surrender of the leasehold estat e created by the Ground Lease or termination or cancellation of the Ground Lease without the prior consent of the Mortgagee shall be void and of no force and effect.

(i) The Debtor shall notify the Mortgagee promptly of (i) the occurrence of any default by the lessor under the Ground Lease or the occurrence of any event which, with the passage of time or giving of notice, or both, would constitute a default by the lessor under the Ground Lease, (ii) the receipt by the Debtor of any notice (written or oral) from the lessor under the Ground Lease noting or claiming the occurrence of any default by the Debtor under the Ground Lease or the occurrence of any event which, with the passage of time or giving of notice, or both, would constitute a default by the Debtor under the G round Lease, and deliver to the Mortgagee a true copy of such notice, or (iii) any request made by either party to the Ground Lease for arbitration proceedings pursuant to the Ground Lease and of the institution or commencement of arbitration proceedings thereunder. The Debtor shall permit the Mortgagee to participate in any arbitration proceedings in association with the Debtor, and if at the time any such arbitration proceedings shall be initiated, an Event of Default shall exist and be continuing, the Mortgagee is hereby granted the right to designate and appoint any arbitrators to be appointed by the Debtor under the Ground Lease. If any action or proceeding shall be instituted to evict the Debtor or to recover possession of the Facility or any portion thereof or for any other purpose affecting the Ground Lease or this Mortgage, the Debtor shall, immediately upon service thereof on or to the Debtor, deliver to the Mortgagee a true and complete copy of each petition, summons, complai nt, notice of motion, order to show cause and of all other provisions, pleadings, and papers, however designated, served in any such action or proceeding.

(j) The Debtor shall not unreasonably withhold its consent to any proposed modifications of the Ground Lease which the lessor thereunder agrees to make at the request of the Mortgagee necessary for the improving, maintaining or preserving the Mortgagee’s security in the Ground Lease.

(k) The Debtor shall not sell or assign the Ground Lease or any of its rights thereunder or the leasehold estate created thereby or sublease all or any portion of the Facility except in accordance with the Loan Agreement.

(l) The Debtor will promptly perform and observe all the terms, covenants and conditions required to be performed and observed by the Debtor as sublessor under the Facility Leases, within the periods provided in the Facility Leases prior to the date that the failure to make such payment or perform and observe such terms, covenants and conditions, would constitute a default under the respective Facility Leases), and will do all things necessary to preserve and keep unimpaired its rights under the Facility Leases. The Debtor shall not waive any of its rights under the Facility Leases, or refrain from exercising any right or remedy accorded to it as sublessor thereunder on account of an event of default under any Facility Lease, or release any Facility Tenant from liability or condone or excuse any improper act of any Facility Tenant under any Facility Lease, in any case if such action or failure to take action were not effected (in the Debtor’s reasonable judgment) in good faith in a commercially reasonable manner. The Debtor shall not voluntarily terminate a Facility Lease or accept a surrender of any Facility Lease or suffer or permit any termination or surrender of any Facility Lease, in each case prior to the scheduled expiration thereof, except (x) with the prior written consent of the Mortgagee which consent must be given if the Mortgagee is so directed by the Majority Holders (if not so directed, such consent not to be unreasonably withheld or delayed), (y) if the termination or surrender of such Facility Lease will not have a material adverse effect upon Facility Revenues, or (z ) if the Debtor’s actions with respect to such Facility Tenant and Facility Lease are taken (in the Debtor’s reasonable judgment) in a good faith commercially reasonable manner.

(m) The Debtor will not (i) modify, amend or supplement any Facility Lease if such modification, amendment or supplement would have a material adverse effect on Facility Revenues (except if such material adverse effect on Facility Revenues is only of a short-term consequence and is not reasonably likely to have a long-term material adverse effect on Facility Revenues), or (ii) require any Facility Tenant to subordinate any Facility Lease to the Lien of any mortgage on the Facility other than Permitted Encumbrances. The Debtor shall deliver to the Mortgagee, promptly following the execution thereof, a copy of each executed amendment, modification or supplement to a Facility Lease, accompanied by a certificate of an Authorized Representative of the Debtor to the effect that such amendment, modification or supplement was entered into in good faith by the Debtor and was commercially reasonable.

(n) Each Facility Lease entered into by the Debtor must provide that the Facility Lease is subordinate to the Lien of this Mortgage and any extensions, replacements or modifications hereof.

(o) The Mortgagee is hereby granted the right to participate in any dispute with the lessor under the Ground Lease, and the Debtor shall not settle with the lessor under the Ground Lease any insurance or condemnation claim or adjustment in an amount in excess of $500,000 without the consent of the Mortgagee.

(p) If there shall be filed by or against the Debtor a petition under the United States Bankruptcy Code, Title 11 of the United States Code (the “Bankruptcy Code”), then the Lien of this Mortgage shall attach to all of the Debtor’s rights and remedies at any time arising under or pursuant to the Bankruptcy Code, including, but not limited to, §365 thereof. Upon the filing of any petition by or against the Debtor under the Bankruptcy Code, the Debtor shall immediately provide copies of all pleadings and notices related thereto to the Mortgagee. The Debtor unconditio nally assigns to the Mortgagee all of the Debtor’s rights to remain in possession of the Mortgaged Property following the filing of any bankruptcy petition by or against the Debtor, and acknowledges that the Mortgagee may file any pleading in furtherance thereof. This assignment constitutes a present, irrevocable, and unconditional assignment of the foregoing claims, rights, and remedies of the Debtor, and shall continue in effect until all of the Obligations shall have been satisfied and discharged in full. Furthermore, the Debtor hereby irrevocably constitutes and appoints the Mortgagee as the Debtor’s attorney in fact for the purpose of filing any pleading in the court in which the initial petition was filed or any court to which the action thereon may be removed, transferred, or assigned (the “Bankruptcy Court”) that the Mortgagee determines in its sole discretion to protect the Mortgagee’s interests in and to the Mortgaged Property, including but not l imited to a motion to extend any applicable time period for the filing of any motion related to the assumption of the Ground Lease.

(q) The Debtor shall not, without the prior written consent of the Mortgagee, file any motion or other pleading to reject or otherwise elect to treat the Ground Lease as terminated under §365 of the Bankruptcy Code. Any such motion, pleading, or election made without such prior written consent shall be void ab initio, and this Mortgage may be pled in bar thereof. If the Debtor does file such a motion to reject the Ground Lease under §365 of the Bankruptcy Code, the Debtor hereby acknowledges and agrees that, unless the Mortgagee consents in writing to such rejection, the Debtor may not reject the Ground Lease unless the Debtor proves, by a preponderance of the evidence, that the Debtor was “insolvent,” within the meaning of §101 of the Bankruptcy Code, on the petition filing date. If the Debtor, as tenant under the Ground Lease and as debtor under the Bankruptcy Code, shall desire to reject the Ground Lease pursuant to §365 of the Bankruptcy Code, the Debtor shall give the Mortgagee not less than thirty (30) days’ prior written notice of the date on which the Debtor intends to file a motion in or otherwise apply to the Bankruptcy Court for authority to reject the Ground Lease. In such event, the Mortgagee shall have the right, but not the obligation, to serve upon the Debtor within such thirty (30) day period a notice stating that the Mortgagee demands that the Debtor assume the Ground Lease and assign the Ground Lease to the Mortgagee or the Mortgagee’s designee pursuant to §365 of the Bankruptcy Code. If the Mortgagee shall serve upon the Debtor the notice described in the preceding sentence, the Debtor shall not seek to reject the Ground Lease and shall comply with the demand provided for in the preceding sentence.

(r) If the Debtor shall desire to assume the Ground Lease, then the Debtor shall give the Mortgagee not less than ten (10) days’ prior written notice of the date on which the Debtor intends to file a motion in, or otherwise apply to, the Bankruptcy Court for authority to assume the Ground Lease. The Debtor shall inform the Mortgagee as a part of such notice whether or not the Debtor intends to assign the Ground Lease following assumption thereof. The Mortgagee shall have the right, but not the obligation, to serve upon the Debtor within such ten (10) day period a notice stating tha t the Mortgagee demands that the Debtor assume the Ground Lease and assign the Ground Lease to the Mortgagee or the Mortgagee’s designee pursuant to §365 of the Bankruptcy Code, and such election by the Mortgagee shall be binding upon the Debtor. Should the Debtor file a motion to assume the Ground Lease, the Mortgagee shall have the sole right to determine what terms and conditions will provide the Mortgagee with “adequate assurance of future performance,” within the meaning of §365 of the Bankruptcy Code.

(s) If there shall be filed by or against the landlord or any fee owner of the Mortgaged Property a petition under the Bankruptcy Code, the Debtor shall, after obtaining knowledge thereof, promptly notify the Mortgagee thereof in writing. The Debtor shall promptly deliver to the Mortgagee, following receipt, complete and correct copies of any and all notices, motions, summonses, pleadings, claim forms, applications, and other documents received by the Debtor in connection with any such petition and any proceedings relating thereto. In the event of such a bankruptcy filing, the Mortgagee shall have the option, exercisable upon notice from the Mortgagee to the Debtor, to conduct and control any such litigation with counsel chosen by the Mortgagee. If an Event of Default shall exist and be continuing, or if the Mortgagee shall reasonably determine that such actions are necessary to preserve the security of this Mortgage, the Mortgagee may proceed in its own name or in the name of the Debtor in connection with any such litigation, and the Debtor agrees to execute any and all powers, authorizations, consents, or other documents required by the Mortgagee in connection therewith. The Debtor shall not commence any action, suit, proceeding, or case, or file any application or make any motion, seeking to terminate the Ground Lease in any such case under the Bankruptcy Code without the prior written consent of the Mortgagee. The Debtor hereby unconditionally assigns, transfers, and sets over to the Mortgagee all of the Debtor’s claims and rights to the payment of damages or any claim arising from any rejection of the Ground Lease by the landlord or any other fee owner of the Mortgaged Property, or the payment of any amount or claim associated with the Ground Lease in any proceeding under the Bankruptcy Code. If an Event of Default shall exist and be continuing, or if the Mortgagee shall reasonably determine that such actions are necessary to preserve the security of this Mortgage, the Mortgagee shall have the right to proceed in its own name and/or in the name of the Debtor in respect of any claim, suit, action, or proceeding relating to the assumption or rejection of the Ground Lease by the landlord, including, without limitation, the right to file and prosecute, to the exclusion and in the name of the Debtor, any proofs of claim, complaints, motions, applications, notices, and other documents, or to defend against any objection thereto, in any case in respect to the landlord or any fee owner of the Mortgaged Property. This assignment constitu tes a present, irrevocable, and unconditional assignment of the foregoing claims, rights, and remedies, and shall continue in effect until all of the Obligations shall have been satisfied and discharged in full. Any amounts received by the Mortgagee as damages arising out of the rejection of the Ground Lease as aforesaid shall be applied first to all costs and expenses of the Mortgagee (including, without limitation, attorneys’ and paralegals’ fees and expenses) incurred in connection with the exercise of any of its rights or remedies under this Section. The Debtor shall promptly make, execute, acknowledge, and deliver, in form and substance satisfactory to the Mortgagee, a UCC Financing Statement (Form UCC 1), and all such additional instruments, agreements and other documents, as may at any time hereafter be required by the Mortgagee to effectuate and carry out the assignment made pursuant to this Section.

(t) If the Debtor shall seek to offset against the rent reserved in the Ground Lease the amount of any damages caused by the nonperformance by the landlord or any fee owner of the Mortgaged Property of any of its obligations under the Ground Lease after the rejection by the landlord or any fee owner of the Mortgaged Property under the Bankruptcy Code, the Debtor shall, prior to effecting such offset, notify the Mortgagee of its intent to do so, setting forth the amounts proposed to be so offset and the basis therefor. The Mortgagee shall have the right to object to all or any part of such offset th at, in the reasonable judgment of the Mortgagee, would constitute a breach of the Ground Lease, and in the event of such objection, the Debtor shall not effect any offset of the amounts so objected to by the Mortgagee. Neither the failure of the Mortgagee to object as aforesaid nor any objection relating to such offset shall constitute an approval of any such offset by the Mortgagee. The Debtor shall pay and protect the Mortgagee, and indemnify and save the Mortgagee harmless from and against, any and all claims, demands, actions, suits, proceedings, damages, losses, costs, and expenses of every nature whatsoever (including without limitation, attorneys’ and paralegals’ fees and expenses) arising from or relating to any off set by the Debtor against the rent reserved in the Ground Lease.

(u) This Mortgage and the rights of the Mortgagee hereunder shall in all respects be subject and subordinate to the terms, covenants, conditions and provisions set forth in the Ground Lease.

Section 3.10. No Merger of Estates. So long as any portion of the Obligations shall remain unpaid, unless the Mortgagee shall otherwise consent, the interest of the lessor under the Ground Lease in the Facility and the leasehold estate of the Debtor created in the Facility pursuant to the provisions of the Ground Lease shall not merge but shall always be kept separate and distinct, notwithstanding the union of such estates in the Debtor, or in any other Person by purchase , operation of law or otherwise. If the Mortgagee shall acquire the interest of the lessor under the Ground Lease in the Facility and the leasehold estate created in the Facility pursuant to the provisions of the Ground Lease, by foreclosure of this Mortgage or otherwise, such estates shall not merge as a result of such acquisition and shall remain separate and distinct for all purposes after such acquisition unless and until the Mortgagee shall elect to merge such estates. Nothing herein contained shall be construed as authorizing the sale by the Debtor of its leasehold estates under the Ground Lease without the prior written consent of the Mortgagee.

Section 3.11. Additional Taxes or Charges. If any law or ordinance is enacted or adopted which imposes a tax, either directly or indirectly, on this Mortgage, the Debtor will pay such tax, with interest and penalties thereon, if any. If at any time the United States of America, any state thereof or any governmental subdivision of any such state, shall require revenue or other stamps to be affixed to this Mortgage or any of the other Security Documents, the Debt or agrees to pay for the same, with interest and penalties thereon, if any. Nothing contained in this Section 3.11 shall obligate the Debtor to indemnify for any income tax liability arising by reason of this Mortgage.

Section 3.12. Notice of Event of Default. The Debtor shall immediately notify the Mortgagee in writing of any Event of Default or any event which with notice and/or lapse of time would constitute an Event of Default under any Security Document. Any notice required to be given pursuant to this Section shall be signed by the Debtor and set forth a description of the default and the steps, if any, being taken to cure said default. If no steps have been taken to cure a default, the notice should plainly state this fact.

Section 3.13. Debtor’s Acquisition of Fee Estate. Subject to the provisions of Section 3.10, in the event that the Debtor, so long as any portion of the Obligations remains unpaid, shall be the owner and holder of the fee title to any leasehold portion of the Mortgaged Property, the lien of this Mortgage shall be spread to cover the Debtor’s fee title to such Mortgaged Property and said fee title shall be deemed to be included in the Mortgaged Property wi thout any further action. The Debtor agrees, at its sole cost and expense, including without limitation reasonable attorneys’ fees of the Mortgagee, to (i) execute any and all documents or instruments necessary to subject its fee title to the Mortgaged Property to the lien of this Mortgage; and (ii) provide a title insurance endorsement which shall insure that the lien of this Mortgage is a first lien on the Debtor’s fee title to the Mortgaged Property.

Section 3.14. Leasehold Condominium. In the event the Debtor shall subject the premises leased under the Ground Lease to a condominium regime of ownership pursuant to the provisions of Article 9-B of the New York Real Property Law, the Ground Lease and the Loan Agreement, the lien of this Mortgage shall automatically extend to the condominium declaration and by-laws effecting such condominium regime, and to each condominium unit created thereunder.

ARTICLE IV

ASSIGNMENT OF LEASES AND RENTS

Section 4.1. Assignment of Leases and Rents. ii) The Debtor hereby assigns to the Mortgagee all of the right, title and interest of Debtor in any and all Facility Leases (including all related rights, guarantees, amendments, supplements, modifications, renewals and extensions relating thereto) together with (i) all Facility Revenues, including all rents, income, profits, issues, avail, insurance proceeds, condemnation awards, funds deposited by any F acility Tenant to pay costs of construction, restoration or repair, and any other awards and settlements arising from such Facility Leases, and all other payments by the Facility Tenants to or owing to Debtor under any such Facility Leases (all such amounts payable by a Facility Tenant under a Facility Lease, being, collectively, the “Facility Lease Payments”), (ii) the rights to sue for, collect and receive such Facility Lease Payments, (iii) all amendments, supplements, modifications, renewals and extensions thereof now existing or hereafter made, (iv) the right to amend, supplement, modify, waive, extend, renew or cancel such Facility Leases, (v) any and all guarantees of any Facility Tenant’s obligations under any such Facility Lease, (vi) the rights of the Debtor to collect, receive, hold and apply all bonds and security in all of said such Facility Leases provided to be furnished to the Debtor thereunder, (vii ) the rights of the Debtor to enforce any and all of the agreements, terms, covenants and conditions in all of such Facility Leases and to give notices, consents, releases and waivers thereunder, (viii) the right to make all waivers and agreements, (ix) the right to give all notices, consents, releases and other instruments, (x) the right to give all notices of default and to take all action upon the happening of a default under any Facility Lease, including the commencement, conduct and consummation of proceedings as shall be permitted under any provision of any Facility Lease, or by law or in equity, (xi) the right to receive all notices sent to the Debtor, as lessor under any Facility Lease, and (xii) the right to do any and all other things whatsoever which the Debtor or any lessor is or may be entitled to do under any Facility Lease, and to apply the rents, issues and profits, after payment of all necessary charges and expenses, on account of the Obligations.

(b) This assignment and grant shall continue in effect until the Obligations are paid. The Mortgagee hereby waives the right to enter upon and to take possession of the Facility for the purpose of collecting said rents, issues and profits, and the Debtor shall be entitled to collect and receive said rents, issues and profits and to apply same in payment of the amounts becoming due on the Obligations, operating expenses related to the Facility and other expenses (capital or otherwise) consistent with the purposes of the Debtor until the occurrence of an Event of Default hereunder. Upon th e occurrence of an Event of Default hereunder, the Debtor will pay monthly in advance to the Mortgagee, or to any receiver appointed to collect said rents, issues and profits, the fair and reasonable rental value for the use and occupation of the Facility or of such part thereof as may be in the possession of the Debtor, and upon default in any such payment will vacate and surrender the possession of the Facility to the Mortgagee or to such receiver, and in default thereof may be evicted by summary proceedings.

(c) As long as no default or Event of Default shall exist under the Indenture or under any other Security Document including this assignment, Mortgagee shall permit Debtor

(i) to sue for Facility Lease Payments, and

(ii) to take any action stated in clauses (iii) through (xii) of the paragraph above,

provided, however, that Debtor shall only act in good faith and in a commercially reasonable manner.

(d) The Debtor will not, without the written consent of the Mortgagee, receive or collect rent from any tenant of the Facility or any part thereof for a period of more than one month in advance.

(e) Upon the occurrence and during the continuance of an Event of Default, if the Debtor shall not have commenced to cure any default of the Debtor under any of the Facility Leases, nor shall have continued its efforts to effect such cure with good faith and due diligence, the Mortgagee shall have the right, but shall not have the obligation, at the Debtor’s expense, to cure any default by the Debtor under any of the Facility Leases upon at least ten (10) days’ prior written notice to the Debtor, provided, however, that lesser notice shall be required in the event of any emergency situation which, in the Mortgagee’s judgment, may have a material adverse effect on the receipt of the Facility Lease Payments.

(f) The Mortgagee shall not in any way be responsible for any failure to do any or all of the things for which the rights, interests, power and/or authority are herein granted; and the Mortgagee shall not be responsible for or liable under any of the agreements undertaken or obligations imposed upon the lessor under any Facility Lease or other agreements with respect to the Facility, except for its gross negligence or willful misconduct.

(g) The Mortgagee’s failure to do any of the things or exercise any of the rights, interests, powers and/or authorities granted hereunder shall not be construed as a waiver of any of the rights, interests, powers or authorities assigned and granted to the Mortgagee under this Mortgage.

(h) The parties agree that this Mortgage is an actual assignment effective immediately, and that without demand each Facility Tenant or other person liable under or in respect of any Facility Lease shall, and is hereby authorized and directed to, pay to or upon the Mortgagee’s order, and without any inquiry of any nature, and upon the declaration by the Mortgagee of an Event of Default hereunder, all Facility Lease Payments then or thereafter accruing under said Facility Leases or any other instrument or agreement, oral or written, granting rights to, and creating an obligation to pay, Facility Lease Pa yments in connection with the Facility.

(i) All Facility Tenants or occupants of any part of the Facility are hereby authorized to recognize the claims and demands of the Mortgagee upon assertion of an Event of Default, without investigation as to the reason for any action taken by the Mortgagee or the validity or the amount or Obligations owing to the Mortgagee or the application to be made by the Mortgagee, of any amounts to be paid to the Mortgagee. The Mortgagee’s sole signature shall be sufficient for the exercise of any right under this Mortgage, and the Mortgagee’s sole receipt given for any sums received shall be a fu ll discharge and release therefor to any such Facility Tenant or occupant of the Facility. Checks for all or any part of the rental collected under this Mortgage shall be made to the exclusive order of the Mortgagee, and, upon written request by the Debtor, the Mortgagee shall fully account to the Debtor as to all such payments received hereunder.

(j) To the extent that the Mortgagee shall exercise the judgment of a reasonable man under like circumstances, the Mortgagee shall not be obligated to perform or discharge any obligation, duty or liability under any Facility Lease, nor shall this Mortgage operate to place upon the Mortgagee any responsibility for the control, operation, management, or repair of the Facility or the carrying out of any of the terms and conditions of any Facility Lease, nor shall this Mortgage operate to make the Mortgagee liable for any waste committed on the Facility by a Facility Tenant under any Facility Lease or any other P erson, or for any dangerous or defective condition of the Facility, or for any negligence in the management, upkeep, repair or control of the Facility, resulting in loss, injury or death to any tenant, licensee, employee, invitee or stranger or any property thereof.

(k) The Debtor shall, and does hereby agree to, indemnify and hold the Mortgagee harmless of and from any and all liability, loss or damage which it may or might incur under any of the Facility Leases or under or by reason of this Mortgage and of and from any and all claims and demands whatsoever which may be asserted against it by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants or agreements contained in any of the Facility Leases, except to the extent of the gross negligence or willful misconduct of the Mortgagee. Should the Mortga gee incur any such liability, loss or damage under any of the Facility Leases or under or by reason of this Mortgage, or in the defense of any such claims or demands, the amount thereof, including costs, expenses and reasonable attorneys’ fees and expenses, shall be secured hereby, and the Debtor shall reimburse the Mortgagee therefor immediately upon demand.

(l) The Mortgagee shall not be liable (except to the extent of its gross negligence or willful misconduct) for any loss sustained by the Debtor resulting from the Mortgagee’s failure to let the Facility or any portion thereof after the occurrence of an Event of Default or from any other act or omission of the Mortgagee either in collecting the Facility Lease Payments or, if the Mortgagee shall have taken possession of all or any portion of the Facility, in managing all or any portion of the Facility after any such Event of Default (except that the Mortgagee must exercise the judgment of a reasonable man under like circumstances). The Mortgagee shall not be obligated to perform or discharge, nor does the Mortgagee hereby undertake to perform or discharge, any obligation, duty or liability of the Debtor under any Facility Lease or under or by reason of this Mortgage, and the Debtor shall, and does hereby agree to, indemnify the Mortgagee for, and to hold the Mortgagee harmless from, any and all liability, loss or damage which may or might be incurred under any Facility Lease or under or by reason of this Mortgage and from any and all claims and demands whatsoever which may be asserted against the Mortgagee by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants or agreements contained in any Facility Lease (collectively, the “Claims”), except to the extent such Claims are a direct result of the Mortgagee’s gross negligence or willful misconduct. Should t he Mortgagee incur any such liability under any Facility Lease or under or by reason of this Mortgage or in defense of any such claims or demands, the Debtor shall reimburse the Mortgagee therefor, including, without limitation, its costs, expenses and reasonable attorneys’ fees and expenses, within five (5) Business Days after demand, and upon the failure of the Debtor to do so, the Mortgagee may, at its option, exercise its remedies under the Indenture or under any other Security Document. It is further understood that this Mortgage shall not operate to place responsibility for the control, care, management or repair of all or any portion of the Facility upon the Mortgagee, nor for the carrying out of any of the terms and conditions of any Facility Lease, nor shall it operate to make the Mortgagee responsible or liable for any waste committed on the Facility by any Facility Tenant or any other Person, or for any dangerous or defective condition affecting any portion of the Facility, or for any negligence in the management, upkeep, repair or control of the Facility resulting in loss or injury or death to any tenant, licensee, invitee, employee, stranger or any other Person.

(m) The Debtor agrees that it will, at the written request therefor by the Mortgagee, deliver to the Mortgagee an executed counterpart of each (or a certified photocopy thereof) and every Facility Lease then affecting all or any part of the Facility.

(n) Upon the occurrence of an Event of Default hereunder, upon or at any time after default in the payment of any of the Obligations, and after the delivery of any notice and/or the expiration of any period of grace, if any, with respect to any such default provided for in the Security Documents, the Mortgagee may, at the Mortgagee’s option, without notice, either in the Mortgagee’s person or by agent and with or without bringing any action or proceeding, or by any receiver to be appointed by a court, enter upon, take possession of, and manage and operate the Facility and each and every part there of, and in connection therewith, the Mortgagee may make, cancel, enforce and modify Facility Leases; fix or modify rents; repair, maintain and improve the Facility; employ contractors, subcontractors and workmen in and about the Facility; obtain and evict tenants; in its own name, sue for or otherwise collect or reserve any and all Facility Lease Payments, including those past due and unpaid; employ leasing agents, managing agents, attorneys and accountants in connection with the enforcement of the Mortgagee’s rights hereunder and pay the reasonable fees and expenses thereof; and otherwise do and perform any and all acts which the Mortgagee may deem necessary and appropriate in and about the Facility for the protection thereof and of the Mortgagee’s rights hereunder or under the other Security Documents, and any and all amounts reasonably expended by the Mortgagee in connection with the foregoing shall constitute so much additional indebtedness secured hereby. The Mortgagee shall apply any moneys collected by the Mortgagee, as aforesaid, less costs and expenses incurred, as aforesaid, upon any Obligations secured hereby in accordance with the provisions of Section 8.03 of the Indenture. The entering upon and taking possession of the Facility, the collection of Facility Lease Payments, the exercise of any rights hereinabove specified, and the application of collections, as aforesaid, shall not cure, waiver, modify or otherwise affect any default hereunder or under the other Security Documents.

Section 4.2. No Cancellation or Modification of Facility Leases. Except as expressly permitted in the Loan Agreement, the Debtor shall not, without the prior written consent of the Mortgagee, make, or suffer to be made, any leases, or cancel or modify any leases or accept prepayments of installments of rent for a period of more than one month in advance or further assign the whole or any part of the rents without the prior written consent of the Mortgagee. 60; No lease or contract covering all or any part of the Mortgaged Property shall be valid or effective without the prior written approval of the Mortgagee. The Mortgagee shall have all of the rights against lessees of the Mortgaged Property as set forth in Section 291-f of the Real Property Law of New York. In respect of any lease, the Debtor will (i) fulfill or perform each and every provision thereof on its part to be fulfilled or performed; (ii) promptly send copies of all notices of default which either shall send or receive thereunder to the Mortgagee; and (iii) enforce, short of termination thereof, the performance or observance of the provisions thereof. Nothing contained in this Mortgage shall be deemed to impose on the Mortgagee any of the obligations of the lessor under the leases.

Section 4.3. Required Facility Lease Provisions. All Facility Leases must provide that (i) the Facility Tenant shall pay to the Mortgagee upon an Event of Default hereunder all sums due under the Facility Lease upon notice to the Facility Tenant from the Mortgagee, (ii) any Facility Tenant shall, at the Mortgagee’s option, furnish the Mortgagee with an estoppel and attornment letter as to its Facility Lease in form and substance reasonably acce ptable to the Mortgagee, and (iii) the Facility Lease is expressly subordinated to the Ground Lease, this Mortgage (including any extensions, replacements or modifications hereof) and the other Security Documents.

Section 4.4. Debtor Not to Waive Rents. The Debtor will not waive, release, reduce, discount or otherwise discharge or assign to any Person other than the Mortgagee the Facility Lease Payments, rents, issues and profits of the Facility. In addition, the Debtor will observe and comply with all of its respective obligations as lessor under each Facility Lease, will promptly notify the Mortgagee if it receives any default notice thereunder and forward a copy of the default notice to the Mortgagee, and enforce any default thereunder by the Facility Tenant.

Section 4.5. Debtor to Furnish Rent Rolls. The Debtor will furnish to the Mortgagee, within fifteen (15) Business Days after mailing to the Debtor of a written request therefor, a detailed statement in writing, duly sworn, and covering the period of time specified in such request, showing all income derived from the operation of the Facility and all disbursements made in connection therewith, and containing a list of the names of all tenants of the Facility sp ecified in such request, showing all income derived from the operation of the Facility and occupants other than those claiming possession through such tenants, the portion or portions of the Facility occupied by such tenant and occupant, the rents and other charges payable under the terms of their leases or other agreements, and the periods covered by such leases or other agreements.

Section 4.6. Mortgagee Right to Cure Default. If Debtor shall not have commenced to cure any default of the Debtor under any of the Facility Leases, nor shall have continued its efforts to effect such cure with good faith and due diligence, the Mortgagee shall have the right, but shall not have the obligation, at the Debtor’s expense, to cure any default by the Debtor under any of the Facility Leases upon at least ten (10) days prior written notice to th e Debtor, provided, however, that lesser notice shall be required in the event of any emergency situation which in the Mortgagee’s judgment may have any adverse effect on the receipt of the Facility Lease Payments.

ARTICLE V

PROVISIONS REQUIRED UNDER GROUND LEASE

Section 5.1. Article 9 of the Ground Lease. In accordance with Article 9 of the Ground Lease, iii) this Mortgage is executed upon the condition that no purchaser at any foreclosure sale shall acquire any right, title or interest in or to the Ground Lease, unless the said purchaser, or the person, firm or corporation to whom or to which such purchaser’s right has been assigned, shall, in the instrument transferring to such purchaser or to such assign ee the interest of Tenant (as defined in the Ground Lease) under the Ground Lease, assumes and agrees to perform all of the terms, covenants and conditions of the Ground Lease thereafter to be observed or performed on the part of Tenant, and moreover, that no further or additional mortgage or assignment of the Ground Lease shall be made except in accordance with the provisions contained in Article 9 of the Ground Lease, and that a duplicate original of said instrument containing such assumption agreement, duly executed and acknowledged by such purchaser or such assignee and in recordable form, is delivered to Landlord (as defined in the Ground Lease) under the Ground Lease immediately after the consummation of such sale, or, in any event, prior to taking possession of the premises demised thereby; and (b) the Mortgagee waives all right and option to retain and apply the proceeds of any insurance payable by reason of any special endorsement covering the cost of Demolition (as defined in the Ground Lease) toward payment of the sum secured by this Mortgage to the extent such proceeds are required for the demolition of the mortgaged premises in accordance with the provisions of the Ground Lease.

ARTICLE VI

REMEDIES; EVENTS OF DEFAULT

Section 6.1. Protective Action. The Mortgagee (at the direction of the Majority Holders) may take such action as the Mortgagee deems reasonably appropriate upon ten (10) days prior written notice to the Debtor (except that no such prior notice shall be required if in the reasonable judgment of the Mortgagee an emergency condition shall exist that threatens to do severe damage to or destruction of the Facility) to protect the Mortgaged Property or the status or priority of the lien of this Mortgage thereon including, but not limited to, entry upon the Facility to protect it from deterioration or damage, or to cause the Mortgaged Property to be put in compliance with any governmental, insurance rating or contract requirements; dispossession of the Debtor if necessary to remedy an emergency condition; payments of amounts due on liens having priority over this Mortgage if such lien constitutes a default pursuant to this Mortgage; curing any default by the Debtor under any of the Security Documents including this Mortgage; payment of any tax or charge for purposes of assuring the priority or enforceability of this Mortgage if failure to pay such tax by the Debtor is a default pursuant to this Mortgage; obtaining insurance on the Mortgaged Property; or commencement or defense of any legal action or proceeding to assert or protect the validity or priority of the lien of this Mortgage. The Debtor agrees to reimburse the Mortgagee for all expenses in taking any such action, on demand, with interest at a rate being the lesser of (i) eighteen percent (18%) per annum or (ii) the highest rate permitted under the applicable usury law, and the amount thereof shall be secured by this Mortgage and shall, to the extent permitted by law, be in addition to the maximum amount of the Obligations heretofore stated.

Section 6.2. Benefit of Section 254 of the Real Property Law. Nothing herein contained shall be construed as depriving the Mortgagee of any right or advantage available under Section 254 of the Real Property Law of the State of New York, but all covenants herein differing therefrom shall be construed as conferring additional and not substitute rights and advantages.

Section 6.3. Sole Discretion of the Mortgagee. Wherever pursuant to this Mortgage, the Mortgagee exercises any right given to it to approve or disapprove, or any arrangement or term is to be satisfactory to the Mortgagee, the decision of the Mortgagee to approve or disapprove or to decide that arrangements or terms are satisfactory or not satisfactory shall be in the sole discretion of the Mortgagee and shall be final and conclusive. Notwithstanding the foregoing, if, pursuant to the terms of the Indenture or this Mortgage, a stated percentage of Holders of the Outstanding Bonds has the right to direct the Mortgagee in the exercise of any such right, such direction shall be final and conclusive, provided that such direction shall not be arbitrary or capricious.

Section 6.4. Recovery of Sums Required To Be Paid. The Mortgagee shall have the right (at the written direction of the Majority Holders) from time to time to take action to recover any sum or sums which constitutes a part of the Obligations as the same becomes due, without regard to whether or not the balance of the Obligations shall be due, and without prejudice to the right of the Mortgagee thereafter to bring an action of foreclosure, or any other act ion, for a default or defaults by the Debtor existing at the time such earlier action was commenced.

Section 6.5. Events of Default. Any one or more of the following events shall constitute an “Event of Default” hereunder:

(a) Failure of the Debtor to pay any amount that has become due and payable hereunder, and continuance of such failure for a period of two (2) Business Days after written notice has been given to the Debtor specifying the nature of such default by the Mortgagee;

(b) Failure of the Debtor to observe and perform any covenant, condition or agreement hereunder on its part to be performed (except as set forth in Section 5.6(a) above) and (1) continuance of such failure for more than thirty (30) days after written notice of such failure has been given to the Debtor specifying the nature of such failure by the Mortgagee, or (2) if by reason of the nature of such failure the same can be remedied, but not within the said thirty (30) days, the Debtor fails to commence and thereafter proceed with reasonable diligence after receipt of said notice to cure such fail ure or fails to continue with reasonable diligence its efforts to cure such failure;

(c) The Debtor or the Parent shall (i) apply for or consent to the appointment of or the taking of possession by a receiver, liquidator, custodian or trustee of itself or of all or a substantial part of its property, (ii) admit in writing its inability, or be generally unable, to pay its debts as such debts generally become due, (iii) make a general assignment for the benefit of its creditors, (iv) commence a voluntary case under the Federal Bankruptcy Code (as now or hereafter in effect), (v) file a petition seeking to take advantage of any other law relating to bankruptcy, insolvenc y, reorganization, winding-up, or composition or adjustment of debts, (vi) fail to controvert in a timely or appropriate manner, or acquiesce in writing to, any petition filed against itself in an involuntary case under the Federal Bankruptcy Code (as now or hereafter in effect), (vii) take any action for the purpose of effecting any of the foregoing, or (viii) be adjudicated a bankrupt or insolvent by any court;

(d) A proceeding or case shall be commenced, without the application or consent of the Debtor or the Parent in any court of competent jurisdiction, seeking (i) liquidation, reorganization, dissolution, winding-up or composition or adjustment of debts, (ii) the appointment of a trustee, receiver, liquidator, custodian or the like of the Debtor or the Parent or of all or any substantial part of their respective assets, or (iii) similar relief under any law relating to bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts, and such proceeding or case shall contin ue undismissed, or an order, judgment or decree approving or ordering any of the foregoing shall be entered and continue unstayed and in effect, for a period of ninety (90) days; or any order for relief against the Debtor or the Parent shall be entered in an involuntary case under the Federal Bankruptcy Code (as now or hereafter in effect); the terms “dissolution” or “liquidation” of the Debtor or the Parent as used above shall not be construed to prohibit any action otherwise permitted under the Security Documents;

(e) Any representation or warranty made by the Debtor (i) in the application and related materials submitted to the Issuer for approval of the Project or the transactions contemplated by this Mortgage, (ii) herein, (iii) in any other Project Document, or (iv) in any report, certificate, financial statement or other instrument furnished pursuant hereto or any of the foregoing, shall, in any case, prove to be false, misleading or incorrect in any material respect as of the date made;

(f) The Debtor shall be in default under any other mortgage covering any part of the Mortgaged Property and proceedings shall have been commenced to foreclose such mortgage, whether it be superior or inferior to the lien of this Mortgage; or

(g) An “Event of Default” under any Security Document shall occur and be continuing.

Section 6.6. Remedies Following an Event of Default. Upon the occurrence of an Event of Default hereunder, the Mortgagee may, in addition to any other rights or remedies available to it hereunder or elsewhere, take such action, without notice or demand, as it deems advisable, as directed by the Majority Holders, to protect and enforce its rights against the Debtor and in and to the Mortgaged Property, including, but not limited to, the following actions, each of which may be pursued concurrently or otherwise, at such time and in such order as the Mortgagee, as directed by the Majority Holders, may determine, in its sole discretion, subject, however, to the Ground Lease, without impairing or otherwise affecting the other rights and remedies of the Mortgagee:

(a) enter into or upon the Mortgaged Property, either personally or by its agents, nominees or attorneys, and dispossess the Debtor and its agents and servants therefrom, and thereupon the Mortgagee, as directed by the Majority Holders, may:

(1)

use, operate, manage, control, insure, maintain, repair, restore and otherwise deal with all and every part of the Mortgaged Property and conduct business thereat and therewith;

(2)

complete any construction, renovation, rebuilding or repairing of the Mortgaged Property in such manner and form as the Mortgagee deems advisable;

(3)

make alterations, additions, renewals, replacements and improvements to or on the Mortgaged Property;

(4)

exercise all rights and powers of the Debtor with respect to the Mortgaged Property, in the name of the Debtor, including, without limitation, the right to make, cancel, enforce or modify leases, obtain and evict tenants, and demand, sue for, collect and receive all earnings, revenues, rents, issues, profits and other income of the Mortgaged Property and every part thereof; and

(5)

apply the receipts from the Mortgaged Property to the payment of the Obligations in accordance with Section 8.03 of the Indenture;

(b) with or without entry, to the extent permitted and pursuant to the procedures provided by applicable law, institute proceedings for the partial foreclosure of this Mortgage for the portion of the Obligations then due and payable, subject to the continuing security and lien of this Mortgage for the balance of the Obligations not then due;

(c) institute proceedings to foreclose the lien of this Mortgage against all or, from time to time, against any part of the Mortgaged Property and to have the same sold under the judgment or decree of a court of competent jurisdiction to the highest bidder, at public or private sale, subject to statutory and other legal requirements, if any, including all right, title and interest, claim and demand therein and thereto and all right of redemption thereof;

(d) sell, assign or transfer the Mortgaged Property or any part thereof and all estate, claim, demand, right, title and interest of the Debtor therein and right of redemption thereof, pursuant to power of sale or otherwise, at such time and place, upon such terms and after such notice thereof as may be required or permitted by law (provided that ten (10) days notice of sale of the Mortgaged Property shall be deemed reasonable notice) for such price and form of consideration as the Mortgagee may determine or as may be required by law;

(e) institute an action, suit or proceeding in equity for the specific performance of any covenant, condition or agreement contained herein;

(f) apply for the appointment of or appoint a trustee, receiver, liquidator or conservator of the Mortgaged Property, without regard for the adequacy of the security for the Obligations and without regard for the solvency of any Person liable for the payment of the Obligations whether or not in connection with an action to foreclose this Mortgage;

(g) take possession of the Mortgaged Property (which shall, to the extent practicable, be assembled and made available to the Mortgagee by the Debtor at such place in New York City or elsewhere as may be required by the Mortgagee) and otherwise exercise any and all of the rights of secured parties under the New York State Uniform Commercial Code-Secured Transactions;

(h) without prejudice to its right to bring an action for foreclosure of this Mortgage, sell the Mortgaged Property, or any part thereof, and all estate, right, title and interest, claim and demand therein, and right of redemption thereof, to the extent permitted and pursuant to the procedures provided by applicable law, including, without limitation, Article 14 of the Real Property Actions and Proceedings Law of the State of New York and any amendments or substitute statutes in regard thereto, at one or more sales as a single parcel or in parcels, and at such time and place and upon such terms and after such notice thereof as may be required or permitted by law; or

(i) pursue such other remedies as the Mortgagee may have under applicable law.

Further, the Debtor, if there shall occur an Event of Default, shall pay monthly in advance to the Mortgagee, or to any receiver appointed at the request of the Mortgagee to collect the rents, revenues, issues, income and profits of the Mortgaged Property, the fair and reasonable rental value for the use and occupancy of the Mortgaged Property or of such part thereof as may be in the possession of the Debtor. Upon default in the payment thereof, the Debtor shall vacate and surrender possession of the Mortgaged Property to the Mortgagee or such receiver, and upon a failure so to do may be evicted by summary proceedings.

If an Event of Default shall happen and be subsisting, in case there shall be pending proceedings for the bankruptcy or for the reorganization of the Debtor under the federal bankruptcy laws or any other applicable law, or in case a receiver or trustee shall have been appointed for the property of the Debtor or in the case of any other similar judicial proceedings relative to the Debtor, or to the credits or property of the Debtor, the Mortgagee shall be entitled and empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims for the whole amount owing and unpaid pursuant to this Mortgage, irrespective of whether the principal of the Obligations or any amount hereunder shall then be due and payable as therein or herein expressed or by declaration or otherwise, and irrespective of whether the Mortgagee shall have made any demand pursuant to the provisions of this Section 6.6 or of Section 8.01 of the Indenture, and, in case of any judicial proceedings, to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Mortgagee allowed in such judicial proceedings relative to the Debtor, its creditors, or its property, and to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute the same after the deduction of their charges and expenses; and any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized to make such payments to the Mortgagee, and to pay to the Mortgagee any amount due it for compensation and expenses, including reasonable counsel fees and expenses incurred by it up to the date of such distribution.

Section 6.7. Appointment of a Receiver. Upon the occurrence of an Event of Default, the Mortgagee shall be entitled to the appointment of a receiver. The right to have a receiver appointed shall be a matter of strict right and without regard to the value or adequacy of the security and such receiver may enter upon and take possession of the Mortgaged Property, collect the rents, issues and profits therefrom and apply the same as the court may direct, such rece iver to have all of the rights and powers as a receiver may have under the laws of the State of New York. The expenses, including, without limitation, receiver’s fees, counsel fees and expenses, costs and agent’s commissions and compensation incurred pursuant to the powers herein granted shall be added to the principal portion of the Obligations and secured hereby.

Section 6.8. Foreclosure. In a case of a foreclosure sale or pursuant to any order in any judicial proceeding or otherwise, the Mortgaged Property may be sold as an entirety in one parcel (or as one integrated unit) or separate parcels (or one or more of the interests comprising the Mortgaged Property separately from the others) in such manner or order as the Mortgagee in its sole and absolute discretion may elect. If the Mortgagee so elects it may sell the remainder of the property except for the land, buildings and improvements, at one or more separate sales in the manner provided by the Uniform Commercial Code of the State of New York. One or more exercises of the powers herein granted shall neither extinguish nor exhaust such powers, until the entire property is sold or the Obligations secured hereby are paid in full or otherwise provided for in accordance with their terms.

Section 6.9. Non-Impairment. No provision of this Mortgage: (a) is or shall be deemed to be a release or impairment of any of the Obligations including this Mortgage, (b) shall preclude the Mortgagee, upon the occurrence of an Event of Default hereunder, from foreclosing this Mortgage or from enforcing its rights hereunder or under any other instrument governing or securing the Obligations, (c) shall preclude or bar the Mortgagee upon foreclosur e from obtaining a deficiency judgment against the Debtor, against any subsequent owner of the Mortgaged Property who assumes the Obligations on a non-recourse basis, or against any other Person liable for the payment and performance of the Obligations, (d) shall require the Mortgagee to accept a part of the Mortgaged Property (as distinguished from its entirety) as payment of the debt secured hereby, or (e) shall compel the Mortgagee to accept or allow any apportionment of the debt secured hereby to or among any separate parts of the Mortgaged Property.

Section 6.10. No Remedy Exclusive. No remedy conferred upon or reserved to the Mortgagee hereunder is or shall be deemed to be exclusive of any other available remedy or remedies. Each such remedy shall be distinct, separate and cumulative, shall not be deemed to be inconsistent with or in exclusion of any other available remedy, may be exercised in the discretion of the Mortgagee at any time, in any manner, and in any order, and shall be in addition to and separate and d istinct from every other remedy given the Mortgagee under this Mortgage or any other Security Document or now or hereafter existing in favor of the Mortgagee at law or in equity or by statute. Without limiting the generality of the foregoing, the Mortgagee shall have the right to exercise any available remedy to recover any amount due and payable hereunder without regard to whether any other amount is due and payable, and without prejudice to the Mortgagee to exercise any available remedy for other Events of Default existing at the time the earlier action was commenced.

Section 6.11. Delay To Not Constitute Waiver. Any delay, omission or failure by the Mortgagee to insist upon the strict performance by the Debtor of any of the covenants, conditions and agreements herein set forth to be exercised by it or to exercise any right or remedy available to it upon the occurrence of an Event of Default hereunder shall not impair any such right or remedy or be considered or taken as a waiver or relinquishment for the future of the right to insist upon and to enforce, by injunction or other appropriate legal or equitable remedy, strict compliance by the Debtor with all of the covenants, conditions and agreements herein to be exercised by it, or of the right to exercise any such rights or remedies if such default by the Debtor be continued or repeated. Any failure of the Mortgagee to exercise the option to accelerate the maturity of Obligations secured hereby, or any forbearance by the Mortgagee before or after any exercise of any such option, or any forbearance to exercise any other remedy of the Mortgagee, or any withdrawal or abandonment of the Mortgagee of any of its rights in any one circumstance shall not be construed as a waiver of any option, power, remedy or right of the Mortgagee hereunder. The rights and remedies of the Mortgagee expressed and contained in this Mortgage are cumulative and none of them shall be deemed to be exclusive of any other or of any right or remedy the Mortgagee may now or hereafter have in law or in equity. The election of any one or more remedies shall not be deemed to be an election of remedies under any statute, rule, regulation or case law. The covenants of this Mortgage shall run with the Mortgaged Property and other properties and the estates hereby mortgaged and bind the Debtor and its assigns, legal representatives and successors and shall inure to the benefit of the Mortgagee, its successors and assigns.

Section 6.12. Effect of Discontinuance of Proceedings. In case any proceedings taken by the Mortgagee on account of any Event of Default hereunder shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Mortgagee, then and in every such case, the Debtor, the Mortgagee and the Holders of the Bonds shall be restored, respectively, to their former positions and rights hereunder, and all rights, remedies, powers and duties of the Mortgage e shall continue as in effect prior to the commencement of such proceedings.

Section 6.13. Marshalling. The Debtor waives and releases any right to have the Mortgaged Property marshalled.

Section 6.14. Actions and Proceedings. The Mortgagee shall have the right to appear in and defend any action or proceeding brought with respect to the Mortgaged Property and to bring any action or proceeding which the Mortgagee, in its discretion, determines to be brought to protect its interest in the Mortgaged Property. The Mortgagee shall further have the right, from time to time, to sue for any sums required to be paid under the terms of this Mortgage or an y other mortgage to which this Mortgage is expressly subordinate, as the same become due, without regard to whether or not the principal sums secured or any other sums secured by this Mortgage shall be due and without prejudice to the right of the Mortgagee thereafter to bring an action of foreclosure or any other action for a default or defaults by the Debtor existing at the time such earlier action was commenced.

Section 6.15. Attorneys’ Fees and Other Costs. The Debtor agrees to bear all costs, fees and expenses including court costs and reasonable expenses (including reasonable attorneys’ fees and disbursements) for legal services of or incidental to the enforcement of any provisions hereof (whether incurred during the continuance of an Event of Default or by the Mortgagee or any Holders of the Bonds), or enforcement, compromise or settlement of any of the collateral pledged hereunder, and for the curing thereof, or defending or asserting the rights and claims of the Mortgagee in respect thereof, by litigation or otherwise, and will pay to the Mortgagee any such expenses incurred, and such expenses shall be deemed part of the Obligations secured by this Mortgage and shall be collectible in like manner as the Obligations secured by this Mortgage, and until so paid shall bear interest at a rate being the lesser of (i) eighteen percent (18%) per annum or (ii) the highest rate permitted under the applicable usury law. All rights and remedies of the Mortgagee shall be cumulative and may be exercised singly or concurrently.

Section 6.16. No Additional Waiver Implied by One Waiver. In the event any covenant or agreement contained in this Mortgage should be breached by the Debtor and thereafter waived by the Mortgagee, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. No waiver shall be binding unless it is in writing and signed by the Mortgagee. No course of dealing between the Debtor and/or any o ther Person or any delay or omission on the part of the Mortgagee in exercising any rights hereunder shall operate as a waiver.

Section 6.17. Application of Proceeds. All proceeds derived through the exercise of any remedies or the commencement of any proceedings under this Mortgage shall be applied in accordance with Section 8.03 of the Indenture.

Section 6.18. Waiver of Moratorium. The Debtor will not at any time insist upon, or plead, or in any manner whatever claim or take any benefit or advantage of any stay or extension or moratorium law, or the exemption from execution from sale of any or all of the property, now or any time hereafter enacted or enforced, nor claim, take or insist upon the benefit of any law now or hereafter enacted or enforced providing for the valuation or appraisal of the Mortgaged Property or any pa rt thereof prior to any sale or sales thereof which may be made pursuant to any provisions herein or pursuant to the decree, judgment or order of any court of competent jurisdiction; nor, after any sale or sales, claim or exercise any right under any statute heretofore or hereafter enacted or enforced to redeem the property so sold or any part thereof. The Debtor, to the extent permitted by law, hereby expressly waives the benefit or advantage of any such law or laws and covenants not to delay or impede the execution of any power herein granted or delegated to the Mortgagee.

Section 6.19. Waiver of Notice. The Debtor shall not be entitled to any notices of any nature whatsoever from the Mortgagee except with respect to matters for which this Mortgage specifically and expressly provides for the giving of notice by the Mortgagee to the Debtor, and the Debtor hereby expressly waives the right to receive any notice from the Mortgagee with respect to any matter for which this Mortgage does not specifically and expressly provide for the giving of s uch notice.

ARTICLE VII

LIMITATIONS ON LIABILITY

Section 7.1. No Liability of Debtor’s Members, Managers, Officers, Directors, Employees and Agents. It is agreed that, other than the Parent, the members, managers, directors, officers, employees and agents of the Debtor shall have no personal liability hereunder. All covenants, stipulations, promises, agreements and obligations of the Debtor contained herein shall be deemed to be covenants, stipulations, promises, agreements and obligations o f the Debtor and, other than the Parent, not of any member, manager, director, officer, employee or agent of the Debtor in his individual capacity, and no recourse shall be had hereunder for the payment of the principal of any debt or interest thereon or any of the Obligations or for any claim based thereon or hereunder against any member, manager, director, officer, employee or agent of the Debtor, other than the Parent, or any natural person executing this Mortgage.

Section 7.2. Usury Laws. This Mortgage and all other Security Documents are subject to the express condition that at no time shall the Debtor be obligated or required to pay interest on the principal balance due under the Obligations at a rate which could subject the holder of the Obligations to either civil or criminal liability as a result of being in excess of the maximum interest rate which the Debtor, is permitted by law to contract or agree to pay. If by the terms of this Mortgage or any of the other Security Documents, the Debtor is at any time required or obligated to pay interest on the principal balance due under the Obligations at a rate in excess of such maximum rate, the rate of interest under the Obligations shall be deemed to be immediately reduced to such maximum rate and the interest payable shall be computed at such maximum rate.

ARTICLE VIII

MISCELLANEOUS

Section 8.1. Applicability of Section 13 of the Lien Law. This Mortgage is given in order to secure funds to pay for the Project and by reason thereof, it is intended that this Mortgage shall be superior to any laborers’, mechanics’ or materialmen’s liens which may be placed upon the Mortgaged Property subsequent to the recordation hereof. The Debtor shall, therefore, in compliance with Section 13 of the New York Lien La w, receive the advances secured hereby and shall hold the right to receive such advances as a trust fund to be applied first for the purpose of paying the cost of the Improvements and shall apply the same first to the payment of the cost of the Improvements before using any part of the total of the same for any other purpose.

Section 8.2. No Merger. It is the intention of this Mortgage that if the Mortgagee shall at any time hereafter acquire title to all or any portion of the Mortgaged Property, or any interest therein or lien thereon under any other mortgage or instrument, then, and until the Obligations have been paid in full or otherwise discharged or satisfied in accordance with their terms, the interest of the Mortgagee hereunder and the security interest created by thi s Mortgage shall not merge or become merged in or with the estate and interest of the Mortgagee as the holder and owner of title to all or any portion of the Mortgaged Property, or in or with the interest of the Mortgagee under or the lien of such other mortgage or instrument, and that, until such payment, discharge or satisfaction, the estate of the Mortgagee in the Mortgaged Property and the security interest created by this Mortgage and the interest of the Mortgagee hereunder shall continue in full force and effect to the same extent as if the Mortgagee had not acquired title to all or any portion of the Mortgaged Property or any other interest therein or lien thereon. If, however, the Mortgagee shall consent to such merger or if such merger shall nevertheless occur without its consent, then this Mortgage shall attach to, and cover and be a conveyance of the fee title or any other estate, title or interest in the Mortgaged Property acquired by the Debtor, and the same shall be considered as gra nted, released, assigned, transferred, pledged, conveyed and set over to the Mortgagee and this Mortgage spread to cover such estate with the same force and effect as though specifically herein granted, released, assigned, transferred, pledged, conveyed, set over and spread, provided, however, the Debtor shall pay any and all transfer, recording or other taxes in connection therewith.

Section 8.3. This Mortgage Constitutes A Commercial Transaction. THE DEBTOR ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS MORTGAGE IS A PART IS A COMMERCIAL TRANSACTION, AND HEREBY VOLUNTARILY AND KNOWINGLY WAIVES, TO THE EXTENT PERMITTED BY LAW, ITS RIGHTS TO NOTICE AND HEARING AS ALLOWED UNDER ANY STATE OR FEDERAL LAW OR OTHER RIGHT WITH RESPECT TO ANY PREJUDGMENT REMEDY OR OTHER RIGHT WHICH THE MORTGAGEE MAY DESIRE TO USE. FURTHER, THE DEBTOR H EREBY WAIVES, TO THE EXTENT PERMITTED BY LAW, THE BENEFITS OF ALL PRESENT AND FUTURE VALUATION, APPRAISEMENT, HOMESTEAD, EXEMPTION, STAY, REDEMPTION AND MORATORIUM LAWS.

Section 8.4. Consents. Wherever in this Mortgage the prior consent of the Mortgagee is required, the consent of the Mortgagee given as to one such transaction shall not be deemed to be a waiver of the right to require such consent to future or successive transactions. Any such consents shall be in writing.

Section 8.5. Service of Process. The Debtor represents that it is subject to service of process in the State and covenants that it will remain so subject until all obligations, covenants and agreements of the Debtor under this Mortgage shall be satisfied and met. If for any reason the Debtor should cease to be so subject to service of process in the State, the Debtor hereby irrevocably consents to the service of all process, pleadings, notices or ot her papers in any judicial proceeding or action by designating and appointing General Counsel, at Acadia Realty Trust, 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605, as its agent upon whom may be served all process, pleadings, notices or other papers which may be served upon the Debtor as a result of any of its obligations under this Mortgage. If such appointed agent shall cease to act or otherwise cease to be subject to service of process in the State, the Debtor hereby irrevocably designates and appoints the Secretary of State of the State of New York as its agent upon whom may be served all process, pleadings, notices or other papers which may be served upon the Debtor as a result of any of its obligations under this Mortgage; provided, however, that the service of such process, pleadings, notices or other papers shall not constitute a condition to the Debtor’s obligations hereunder.

For such time as any of the obligations, covenants and agreements of the Debtor under this Mortgage remain unsatisfied, the Debtor’s agent(s) designated in this Section 8.5 shall accept and acknowledge on the Debtor’s behalf each service of process in any such suit, action or proceeding brought in any such court. The Debtor agrees and consents that each such service of process upon such agents and written notice of such service to the Debtor in the manner set forth in Section 8.6 shall be taken and held to be valid personal service upon the Debtor whether or not the Debtor shall then be doing, or at any time shall have done, business within the State and that each such service of process shall be of the same fo rce and validity as if service were made upon the Debtor according to the laws governing the validity and requirements of such service in the State, and waive all claim of error by reason of any such service.

Such agents shall not have any power or authority to enter into any appearance or to file any pleadings in connection with any suit, action or other legal proceedings against the Debtor or to conduct the defense of any such suit, action or any other legal proceeding except as expressly authorized by the Debtor.

Section 8.6. Notices. All notices, requests, consents, demands and other communications to any party hereunder or any other Person specified herein shall be in writing (including bank wire, telecopy or similar writing) and shall be given to such party or other Person, addressed to it, at its address or telecopy number set forth below or such other address or telecopy number as such party or other Person may hereafter specify for the purpose by notice to the other p arties or such other Persons. Each such notice, request, consent or demand or other communication shall be if sent (i) by registered or certified United States mail, return receipt requested and postage prepaid, (ii) by a nationally recognized overnight delivery service for overnight delivery, charges prepaid or (iii) by hand delivery, addressed, as follows:

Party	Address
Debtor	Albee Retail Development LLC c/o Acadia Realty Trust 1311 Mamaroneck Avenue, Suite 260 White Plains, New York 10605 Attention: General Counsel

with a copy to:	Washington Square Partners 675 Third Avenue, 25th Floor New York, New York 10017 Attention: Paul Travis and

	Akerman Senterfitt LLP 335 Madison Avenue Suite 2600 New York, New York 10017 Attention: Steven P. Polivy, Esq.

Mortgagee	The Bank of New York Mellon 101 Barclay Street, Floor 7W New York, New York 10286 Attn: Corporate Trust Administration

Any party hereunder may, by like notice, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Any notice, certificate or other communication hereunder shall, except as may expressly be provided herein, be deemed to have been delivered or given (i) three (3) Business Days following posting if transmitted by mail, (ii) one (1) Business Day following sending if transmitted for overnight delivery by a nationally recognized overnight delivery service, or (iii) upon delivery if given by hand delivery, with refusal by an Authorized Representative of the intended recipient party to accept delivery of a notice given as prescribed above to constitute delivery hereunder.

Section 8.7. Consent to Jurisdiction. The Debtor irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of this Mortgage or any other Security Document, the Facility, the Project, the Debtor’s leasehold, use or occupancy of the Facility and/or any claim for injury or damages may be brought in the courts of record of the State in New York County or the United States District Court for the Southern District o f New York; (ii) consents to the jurisdiction of each such court in any such suit, action or proceeding; (iii) waives any objection which it may have to the venue of any such suit, action or proceeding in such courts; and (iv) waives and relinquishes any rights it might otherwise have (w) to move to dismiss on grounds of forum non conveniens, (x) to remove to any federal court other than the United States District Court for the Southern District of New York, and (y) to move for a change of venue to a New York State Court outside New York County.

If the Debtor commences any action against the Mortgagee in a court located other than the courts of record of the State in New York County or the United States District Court for the Southern District of New York, the Debtor shall, upon request from the Mortgagee, either consent to a transfer of the action or proceeding to a court of record of the State in New York County or the United States District Court for the Southern District of New York, or, if the court where the action or proceeding is initially brought will not or cannot transfer the action, the Debtor shall consent to dismiss such action without prejudice and may thereafter reinstitute the action in a court of record of the State in New York County or the United States Distri ct Court for the Southern District of New York.

Section 8.8. Mortgage for Benefit of Debtor and Mortgagee. The covenants and agreements contained in this Mortgage (including all indemnities set forth herein) shall run with the land and bind the Debtor, and its heirs, executors, administrators, legal representatives, successors and assigns and each Person constituting the Debtor, and all subsequent owners, encumbrances and tenants of the Mortgaged Property, or any part thereof, and shall inure to the benefit of the Mortgagee, its respective successors and assigns, and all subsequent beneficial owners of this Mortgage, and survive the foreclosure of this Mortgage.

Section 8.9. Authorization. The execution of this Mortgage has been duly authorized by the appropriate Governing Body of the Debtor.

Section 8.10. Amendments and Modifications. This Mortgage shall be amended, modified or supplemented only by a written agreement executed by the Debtor and the Mortgagee and, in any event, only in accordance with the Indenture.

Section 8.11. Applicable Law. This Mortgage shall be governed by and construed in accordance with the laws of the State of New York, without regard or giving effect to the principles of conflicts of laws thereof.

Section 8.12. Date of Mortgage for Reference Purposes Only. The date of this Mortgage shall be for reference purposes only and shall not be construed to imply that this Mortgage was executed on the date first above written. This Mortgage was executed and delivered on the Closing Date.

Section 8.13. Incorporation of Certain Indenture Provisions. All provisions of Article IX of the Indenture shall be construed as extending to and including all of the rights, duties and obligations imposed upon the Trustee under this Mortgage as fully and for all purposes as if said Article IX were contained in this Mortgage.

Section 8.14. Entire Agreement; Counterparts. This Mortgage constitutes the entire agreement, and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof (other than any Project Documents) and may be executed simultaneously in several counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

Section 8.15. Severability. If any one or more of the provisions of this Mortgage shall be ruled illegal or invalid by any court of competent jurisdiction, the illegality or invalidity of such provision(s) shall not affect any of the remaining provisions of this Mortgage, but this Mortgage shall be construed and enforced as if such illegal or invalid provision had not been contained herein.

Section 8.16. Waiver of Jury Trial. The Debtor hereby expressly waives, to the extent permitted by law, the right to assert a counterclaim in any action or proceeding brought against it by the Mortgagee, and waives, to the extent permitted by law, all rights to a trial by jury on any cause of action or proceeding brought by any party hereto against the other or in any counterclaim asserted by the Mortgagee against the Debtor, or in any matters whatsoever arising out of or in any way connected with this Mortgage or the Obligations, the Debtor’s obligations hereunder, the Facility, the Mortgaged Property, the Project, the Debtor’s leasehold, use or occupancy of the Facility and/or any claim for injury or damages.

Section 8.17. Property Not Covered. This Mortgage does not cover property principally improved or to be improved by one or more structures containing in the aggregate not more than six individual residential dwelling units, each having its own separate cooking facilities.

Section 8.18. Assignment of Mortgage Upon Refinancing of the Bonds. Upon written request of the Debtor in connection with a refinancing in whole of the Bonds, the Mortgagee shall assign this Mortgage, without recourse, warranty or representation whatsoever, to the refinancing lender upon (i) termination of the Loan Agreement pursuant to Article IX thereof, (ii) discharge of the Indenture, (iii) payment of all costs and expenses (including, without limi tation, reasonable in-house and outside attorney's fees) incurred in connection with the assignment of this Mortgage, and (iv) the delivery by the Debtor to the Mortgagee of an affidavit pursuant to Section 275 of the New York Real Property Law and such other documents and instruments as the Mortgagee may reasonably request.

IN WITNESS WHEREOF, the Debtor has duly executed this Mortgage as of the date first above written.

	ALBEE RETAIL DEVELOPMENT LLC

	By:	/s/ Robert Masters
		Robert Masters
		Senior Vice President

STATE OF NEW YORK	)
	:	ss.:
COUNTY OF NEW YORK	)

On the 30 day of June, in the year two thousand ten, before me, the undersigned, personally appeared Robert Masters, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person or entity upon behalf of which the individual acted, executed the instrument.



		/s/ Kara A. Lobdell
		Notary Public


		Kara A. Lobdell
		Notary Public, State of New York
		No. 02 LO6031220
		Qualified in New York County
		Commission Expires Sept. 27, 2013

EXHIBIT A

DESCRIPTION OF THE LAND

(Block 149, Lot 103)

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

BEGINNING at the corner formed by the intersection of the northerly side of Dekalb Avenue with the easterly side of Gold Street;

RUNNING THENCE easterly, along the easterly side of Gold Street, 114 feet to a point;

RUNNING THENCE easterly, at right angles to the easterly side of Gold Street, 129.12 feet to the northwesterly side of Fleet Street;

RUNNING THENCE southwesterly, along the northwesterly side of Fleet Street, 132.02 feet to the corner formed by the intersection of the northwesterly side of Fleet Street, with the northerly side of Dekalb Avenue;

RUNNING THENCE westerly, along the northerly side of Dekalb Avenue, 63.76 feet to the point or place of BEGINNING.

MORTGAGE AND SECURITY AGREEMENT AND

ASSIGNMENT OF LEASES AND RENTS

(BUILDING LOAN)

From

ALBEE RETAIL DEVELOPMENT LLC,

a Delaware limited liability company having its principal office

at 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605,

THE BANK OF NEW YORK MELLON,

a New York banking corporation having a corporate trust office

at 101 Barclay Street, Floor 7W, New York, New York 10286,

as Trustee and Mortgagee,

Dated as of July 1, 2010

$20,000,000

New York City Capital Resource Corporation

Recovery Zone Facility Revenue Bonds

(Albee Retail Development LLC Project), Series 2010

Affecting that property described in the appendices to this

Mortgage and Security Agreement and Assignment of Leases and

Rents (Building Loan), in the County of Kings, City of New York,

State of New York

____________________________________________________________________

Record and Return to:

Hawkins Delafield & Wood LLP

1 Chase Manhattan Plaza

New York, New York 10005

Attention: Arthur M. Cohen, Esq.

MORTGAGE AND SECURITY AGREEMENT AND

ASSIGNMENT OF LEASES AND RENTS (BUILDING LOAN)

This MORTGAGE AND SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS (BUILDING LOAN) made and entered into as of the date set forth on the cover page hereof (this “Mortgage”) from ALBEE RETAIL DEVELOPMENT LLC, a limited liability company organized and existing under the laws of the State of Delaware (the “Debtor”), as mortgagor, having its principal office at 1311 Mamaroneck Avenue, Suite 260, White Plains, New York 10605, to THE BANK OF NEW YORK MELLON, a New York banking corporation together with any successor trustee (the “Trustee” or the “Mortgagee”) at the time serving as such under the Indenture referred to below, as mortgagee, having a corporate trust office at 101 Barclay Street, Floor 7W, New York, New York 10286 (capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture, in the Loan Agreement or in the Pledge and Security Agreement, each as referred to below):

W I T N E S S E T H :

WHEREAS, the site of the Facility, including the improvements to be constructed thereon, will be subject to the Ground Lease; and

WHEREAS, the Debtor intends to enter into various Facility Leases with Facility Tenants at the Facility; and

WHEREAS, in order to induce the Issuer to issue the Bonds, and the initial owners to purchase the Bonds, the Debtor is entering into this Mortgage, the Mortgage and Security Agreement and Assignment of Leases and Rents (Acquisition Loan) and the Mortgage and Security Agreement and Assignment of Leases and Rents (Indirect Loan);

(ii) the payment, performance and observance of all obligations of the Debtor and the Parent under the Security Documents including this Mortgage, and

whether now arising or hereafter arising, direct or indirect, absolute or contingent, joint or several, due or to become due, liquidated or unliquidated, secured or unsecured, original, renewed or extended, whether arising directly or acquired from others (all such indebtedness and obligations described in clauses (i) and (ii) above being collectively referred to herein as the “Obligations”), provided, however, that the maximum principal amount secured hereby shall not exceed the Secured Principal Amount, the Debtor does hereby grant, bargain, sell, convey, transfer, mortgage, grant a security interest in, pledge and assign to the Trustee, as Mortgagee, and its assigns forever, the following (the “Mortgaged Propert y”), subject to the Mortgage and Security Agreement and Assignment of Leases and Rents (Acquisition Loan), dated as of the date hereof, from the Debtor to the Mortgagee:

GRANTING CLAUSES

Any right of continued possession and occupancy, by agreement or otherwise, in and to the Facility, including all right, title and interest in any such agreement.

III

Any and all rights under Section 365(h) of the Federal Bankruptcy Code, or any similar rights under any other law, including but not limited to any right to use or possession of the Facility.

VII

Any and all air rights, development rights, zoning rights or other similar rights or interests which benefit or are appurtenant to the Facility and any proceeds arising therefrom.

VIII

XII

All right, title and interest of the Debtor in all Funds, Accounts and Subaccounts established under the Indenture.

XIII

XIV

Any and all further estate, right, title, interest, property, claim and demand whatsoever of the Debtor in and to any of the above.

All proceeds of the conversion, voluntary or involuntary, of any of the foregoing into cash or liquidated claims.

XVI

Any and all other property of every kind and nature from time to time which was heretofore or hereafter is by delivery or by writing of any kind conveyed, mortgaged, pledged, assigned or transferred, as and for additional security hereunder, by the Debtor or by any other Person with or without the consent of the Debtor, to the Mortgagee which is hereby authorized to receive any and all such property at any time and at all times to hold and apply the same subject to the terms hereof.

THIS IS A BUILDING LOAN MORTGAGE, the proceeds of which are advanced and to be advanced pursuant to the terms of a Building Loan Agreement dated as of even date herewith by and among the Debtor, the Issuer and the Mortgagee.