The Secretary of the Interior is authorized and empowered to grant leases, for periods of not exceeding twenty years, at annual rentals, and under terms and conditions to be determined by him, to any person, corporation, or company he may authorize to transact business in the Yosemite National Park, for separate tracts of land, not exceeding twenty acres each, at such places, not to exceed ten in number, to any person, corporation, or company in said park, as the comfort and convenience of visitors may require, for the construction and maintenance of substantial hotel buildings and buildings for the protection of motor cars, stages, stock and equipment, and so forth. Such leases may, at the option of the Secretary of the Interior, contain appropriate provisions for the appraisement, at the expiration of the lease, of the value of such hotel and other buildings (or portions thereof) as may be constructed by the lessees, respectively, and the payment of the same to the lessees in case a new lease be made to persons other than said lessees, such payments to be made by such new lessees, respectively.

Any person or corporation or company holding a lease or leases within said park for the purposes above described is authorized, with the approval of the Secretary of the Interior, to execute mortgages upon his or its rights and properties, including his or its contract or contracts with the Secretary of the Interior; such mortgages shall be executed in duplicate and delivered to the Secretary of the Interior for his approval, and upon his approval thereof he shall retain one of said duplicates and file the same for record in his office.

Any mortgage, lien, or encumbrance created under the provisions hereof shall be subject to the rights of the Government to compel the enforcement of the terms of the lease or contract of the mortgagor, and any purchaser under a foreclosure of such encumbrance shall take subject to all the conditions assumed by the original lessee or contractor.