EXHIBIT 10.19

 

MEMBERSHIP INTEREST CONTRIBUTION AGREEMENT

 

by and among

 

DOC-CCSC Crescent City Surgical Centre, LLC,

 

Crescent City Surgical Centre Facility, LLC,

 

Physicians Realty L.P.

 

and

 

the Members of Crescent City Surgical Centre Facility, LLC

 

September 30, 2013

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE 1

DEFINITIONS AND CONSTRUCTION

1

 

 

 

Section 1.1

Definitions

1

 

 

 

Section 1.2

Additional Defined Terms

6

 

 

 

Section 1.3

Construction

6

 

 

 

ARTICLE 2

THE TRANSACTION

7

 

 

 

Section 2.1

Contribution and Acquisition of Interests

7

 

 

 

Section 2.2

Agreed Value

7

 

 

 

Section 2.3

Closing

7

 

 

 

Section 2.4

Closing Transactions

7

 

 

 

Section 2.5

Closing Adjustments

10

 

 

 

Section 2.6

Title

10

 

 

 

Section 2.7

Right of First Offer / Right of First Refusal

12

 

 

 

Section 2.8

Risk of Loss

12

 

 

 

ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS

13

 

 

 

Section 3.1

Organization and Good Standing

13

 

 

 

Section 3.2

Authority and Enforceability

14

 

 

 

Section 3.3

No Conflict

14

 

 

 

Section 3.4

Capitalization and Ownership

14

 

 

 

Section 3.5

Financial Statements

15

 

 

 

Section 3.6

Books and Records

15

 

 

 

Section 3.7

No Undisclosed Liabilities

16

 

 

 

Section 3.8

Absence of Certain Changes and Events

16

 

 

 

Section 3.9

Assets

17

 

 

 

Section 3.10

Real Property

17

 

 

 

Section 3.11

Intellectual Property

19

 

 

 

Section 3.12

Contracts

20

 

 

 

Section 3.13

Tax Matters

20

 

 

 

Section 3.14

Employment Matters

21

 

 

 

Section 3.15

Environmental, Health and Safety Matters

21

 

 

 

Section 3.16

Compliance with Laws and Governmental Authorizations

21

 

 

 

Section 3.17

Legal Proceedings

21

 

 

 

Section 3.18

Insurance

21

 

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TABLE OF CONTENTS

(continued)

 

 

 

Page

 

 

 

Section 3.19

Related Party Transactions

22

 

 

 

Section 3.20

Brokers or Finders

22

 

 

 

Section 3.21

Disclosure

22

 

 

 

Section 3.22

Anti-Terrorism

22

 

 

 

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF THE ACQUIRER

23

 

 

 

Section 4.1

Organization and Good Standing

23

 

 

 

Section 4.2

Authority and Enforceability

23

 

 

 

Section 4.3

No Conflict

23

 

 

 

Section 4.4

Legal Proceedings

23

 

 

 

Section 4.5

Investment Intent

23

 

 

 

Section 4.6

Brokers or Finders

23

 

 

 

Section 4.7

Anti-Terrorism

24

 

 

 

Section 4.8

OPUs

24

 

 

 

ARTICLE 5

COVENANTS

24

 

 

 

Section 5.1

Access and Investigation

24

 

 

 

Section 5.2

Operation of the Business of the Company

24

 

 

 

Section 5.3

Consents and Filings

25

 

 

 

Section 5.4

Notification

25

 

 

 

Section 5.5

Confidentiality

26

 

 

 

Section 5.6

Public Announcements

26

 

 

 

Section 5.7

Distribution Waiver

26

 

 

 

Section 5.8

Further Assurances

26

 

 

 

ARTICLE 6

CONDITIONS PRECEDENT TO OBLIGATION TO CLOSE

27

 

 

 

Section 6.1

Conditions to the Obligation of the Acquirer

27

 

 

 

Section 6.2

Conditions to the Obligation of the Contributors

27

 

 

 

ARTICLE 7

TERMINATION

28

 

 

 

Section 7.1

Termination Events

28

 

 

 

Section 7.2

Effect of Termination

29

 

 

 

ARTICLE 8

CERTAIN TAX MATTERS

29

 

 

 

Section 8.1

Tax Returns

29

 

 

 

Section 8.2

Payment of Taxes

29

 

 

 

Section 8.3

Tax Apportionment

30

 

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TABLE OF CONTENTS

(continued)

 

 

 

Page

 

 

 

Section 8.4

Tax Elections

30

 

 

 

Section 8.5

Transactional Taxes

30

 

 

 

Section 8.6

Survival

30

 

 

 

ARTICLE 9

INDEMNIFICATION

30

 

 

 

Section 9.1

Indemnification by the Contributors

30

 

 

 

Section 9.2

Indemnification by the Acquirer and Acquirer’s Parents

31

 

 

 

Section 9.3

Survival

31

 

 

 

Section 9.4

No Right of Indemnification or Contribution

32

 

 

 

ARTICLE 10

GENERAL PROVISIONS

32

 

 

 

Section 10.1

Notices

32

 

 

 

Section 10.2

Amendment

33

 

 

 

Section 10.3

Waiver and Remedies

33

 

 

 

Section 10.4

Entire Agreement

33

 

 

 

Section 10.5

Assignment and Successors and No Third Party Rights

33

 

 

 

Section 10.6

Severability

34

 

 

 

Section 10.7

Exhibits and Schedules

34

 

 

 

Section 10.8

Interpretation

34

 

 

 

Section 10.9

Governing Law

34

 

 

 

Section 10.10

Specific Performance

34

 

 

 

Section 10.11

Jurisdiction and Service of Process

34

 

 

 

Section 10.12

Waiver of Jury Trial

35

 

 

 

Section 10.13

Expenses

35

 

 

 

Section 10.14

Counterparts

35

 

iii

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TABLE OF CONTENTS

(continued)

 

 

 

 

 

Page

Schedule A

-

Members of the Company and their Respective Membership Interests

 

Schedule B

-

Contributor Disclosure Schedule

 

Section 2.6

-

Permitted Exceptions

 

Section 3.4(b)

-

Capitalization and Ownership of Subsidiaries

 

Section 3.4(c)

-

Capitalization and Ownership of Affiliates

 

Section 3.5

-

Financial Statements

 

Section 3.7

-

Existing Indebtedness

 

Section 3.9

-

Assets

 

Section 3.10

-

Owned Real Property and Leased Real Property

 

Section 3.12

-

Contracts

 

Section 3.16(b)

 

Governmental Authorizations

 

Section 3.18

-

Insurance Policies

 

Section 3.19

-

Related Party Transactions

 

Section 6.1(c)

-

Governmental Authorizations and Consents

 

Schedule C

-

Acquirer Disclosure Schedule

 

Section 6.2(c)

-

Governmental Authorizations and Consents

 

Exhibit A

-

Member Release

 

Exhibit B

-

Members Bring-Down Certificate

 

Exhibit C

-

FIRPTA Certificate

 

Exhibit D

-

Officer Certificate

 

Exhibit E

-

Acquirer Bring-Down Certificate

 

 

iv

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MEMBERSHIP INTEREST CONTRIBUTION AGREEMENT

 

This Membership Interest Contribution Agreement (the “Agreement”) is made as of
September 30, 2013 (the “Effective Date”), by and among DOC-CCSC Crescent City
Surgical Centre, LLC, a Wisconsin limited liability company (the “Acquirer”),
Physicians Realty L.P., a Delaware limited partnership (“Acquirer’s Parent”),
Crescent City Surgical Centre Facility, LLC, a Louisiana limited liability
company (the “Company”) and the members of the Company identified on Schedule A
(the “Members”; together with the Company, the “Contributors”).

 

W I T N E S S E T H:

 

WHEREAS, the Members own 100% of the membership interests in the Company which
owns certain real property set forth herein; and

 

WHEREAS, the Company owns 40% of the membership interests in Jeff-Orleans
Medical Development Real Estate, LLC (“Landco”) which owns certain real property
set forth herein; and

 

WHEREAS, the Contributors desire to contribute to the Acquirer, and the Acquirer
desires to acquire from the Contributors, all of the membership interests in the
Company (collectively, the “Interests”) in accordance with the provisions of
this Agreement.

 

NOW, THEREFORE, intending to be legally bound and in consideration of the mutual
provisions set forth in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:

 

ARTICLE 1
DEFINITIONS AND CONSTRUCTION

 

Section 1.1            Definitions.  For the purposes of this Agreement and the
Ancillary Agreements:

 

“Affiliate” means, with respect to a specified Person, a Person that directly,
or indirectly through one or more intermediaries, controls, is controlled by or
is under common control with, the specified Person.  In addition to the
foregoing, if the specified Person is an individual, the term “Affiliate” also
includes (a) the individual’s spouse, (b) the members of the immediate family
(including parents, siblings and children) of the individual or of the
individual’s spouse and (c) any corporation, limited liability company, general
or limited partnership, trust, association or other business or investment
entity that directly or indirectly, through one or more intermediaries controls,
is controlled by or is under common control with any of the foregoing
individuals.  For purposes of this definition, the term “control” (including the
terms “controlling,” “controlled by” and “under common control with”) means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.

 

“Ancillary Agreements” means, collectively, the Member Release and any other
documents entered into between the parties to this Agreement in connection with
this Agreement.

 

“Business Day” means any day other than Saturday, Sunday or any day on which
banking institutions in New York, New York are closed either under applicable
Law or action of any Governmental Authority.

 

“Cash” means, with respect to the Company, all cash, cash equivalents and
marketable securities held by the Company, calculated in accordance with GAAP in
a manner consistent with the methods and

 

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practices used to prepare the Interim Balance Sheet.  For avoidance of doubt,
Cash will (a) be calculated net of issued but uncleared checks and drafts and
(b) include checks and drafts deposited for the account of the Company but not
yet posted.

 

“Existing Indebtedness” means the outstanding Indebtedness of the Company as of
immediately prior to the Closing as set forth in Section 3.7 of the Contributor
Disclosure Schedule.

 

“Code” means the Internal Revenue Code of 1986.

 

“Confidential Information” means any information, in whatever form or medium,
concerning the business or affairs of the Company.

 

“Consent” means any approval, consent, ratification, waiver or other
authorization.

 

“Contract” means any contract, agreement, lease, license, commitment, warranty,
guaranty, mortgage, note, bond, option, warrant, right or other instrument or
consensual obligation, whether written or oral.

 

“ Crescent City Surgical Centre Facility ” means that certain Leased Real
Property located at 3017 Galleria Drive, Metairie, LA 70001.

 

“Embargoed Person” means any person, entity or government subject to trade
restrictions under U.S. law, including but not limited to, the International
Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., The Trading with the
Enemy Act, 50 U.S.C. App. 1 et seq., and any executive orders or regulations
promulgated thereunder with the result that the transaction contemplated by this
Agreement is in violation of applicable law.

 

“Encumbrance” means any charge, claim, mortgage, servitude, easement, right of
way, community or other marital property interest, covenant, equitable interest,
license, lease or other possessory interest, lien, option, pledge,
hypothecation, security interest, preference, priority, right of first refusal,
condition, limitation or restriction of any kind or nature whatsoever (whether
absolute or contingent).

 

“Environmental Law” means any Law (a) relating to pollution (or the cleanup
thereof) or the protection of natural resources, endangered or threatened
species, human health or safety, or the environment (including ambient air,
soil, surface water or groundwater, or subsurface strata); or (b) concerning the
presence of, exposure to, or the management, manufacture, use, containment,
storage, recycling, reclamation, reuse, treatment, generation, discharge,
transportation, processing, production, disposal or remediation of any Hazardous
Materials.

 

“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“ERISA Affiliate” means any other Person that, together with the Company, would
be treated as a single employer under Section 414 of the Code.

 

“Executive Order” means 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.

 

“Facility Leases” means the Leases set forth in Section 3.10 of the Contributor
Disclosure Schedule.

 

2

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“GAAP” means generally accepted accounting principles for financial reporting in
the United States, as in effect as of the date of this Agreement.

 

“Governing Document” means any charter, articles, bylaws, certificate or similar
document adopted, filed or registered in connection with the creation,
formation, organization or governance of any entity.

 

“Governmental Authority” means any (a) nation, region, state, county, city,
town, village, district or other jurisdiction, (b) federal, state, local,
municipal, foreign or other government, (c) governmental or quasi-governmental
authority of any nature (including any governmental agency, branch, department
or other entity and any court or other tribunal), (d) multinational organization
or (e) body exercising, or entitled to exercise, any administrative, executive,
judicial, legislative, police, regulatory or taxing authority or power of any
nature.

 

“Governmental Authorization” means any Consent, license, franchise, permit,
exemption, clearance or registration issued, granted, given or otherwise made
available by or under the authority of any Governmental Authority or pursuant to
any Law.

 

“Hazardous Material” means any waste or other substance that is listed, defined,
designated or classified as, or otherwise determined to be, hazardous,
radioactive or toxic or a pollutant or a contaminant under any Environmental
Law, including any admixture or solution thereof, and including petroleum and
all derivatives thereof or synthetic substitutes therefor, asbestos or
asbestos-containing materials in any form or condition and polychlorinated
biphenyls.

 

“Healthcare Investigations” means any inquiries, investigations, probes, audits
or proceedings concerning the business affairs, practices, licensing or
reimbursement entitlements of any Contributor (including, without limitation,
inquiries, investigations, probes, audit or procedures concerning potential or
actual violations of Healthcare Laws).

 

“Healthcare Laws” means all provisions, rules and regulations pursuant to or
promulgated under the False Claims Act (31 U.S.C. Section 3729 et seq.), the
Anti-Kickback Act of 1986 (41 U.S.C. Section 51 et seq.), the Federal Health
Care Programs Anti-Kickback statute (42 U.S.C. Section 1320-7a(b)), the Ethics
in Patient Referrals Act of 1989, as amended (Stark Law) (42 U.S.C. 1395nn), the
Civil Monetary Penalties Law (42 U.S.C. Section 1320-7a), or the Truth in
Negotiations (10 U.S.C. Section 2304 et seq.), Health Care Fraud (18 U.S.C.
1347), Wire Fraud (18 U.S.C. 1343), Theft or Embezzlement (18 U.S.C. 669), False
Statements (18 U.S.C. 1001), False Statements (18 U.S.C. 1035), Patent
Inducements Statute, and equivalent state statutes and regulations, and any and
all rules and regulations promulgated by any Governmental Authority, including
the Centers of Medicare and Medicaid Services (CMS), with respect to any of the
foregoing.

 

“Indebtedness” means, with respect to any Person, (a) all indebtedness of such
Person, whether or not contingent, for borrowed money, (b) all obligations of
such Person evidenced by notes, bonds, debentures or other similar instruments
or debt securities and warrants or other rights to acquire any such instruments
or securities and (c) all Indebtedness of others referred to in clauses (a) and
(b) hereof that is directly or indirectly guaranteed in any manner by such
Person or that such Person has agreed (contingently or otherwise) to purchase or
otherwise acquire or in respect of which it has otherwise assured a creditor
against loss.

 

“Intellectual Property” means all of the following anywhere in the world and all
legal rights, title or interest in, under or in respect of the following arising
under Law: (a) all patents and applications for patents and all related
reissues, reexaminations, divisions, renewals, extensions, provisionals,
continuations and continuations in part; (b) all copyrights, copyright
registrations and copyright

 

3

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applications, copyrightable works and all other corresponding rights; (c) all
mask works, mask work registrations and mask work applications and all other
corresponding rights; (d) all trade dress and trade names, logos, Internet
addresses and domain names, trademarks and service marks and related
registrations and applications, including any intent to use applications,
supplemental registrations and any renewals or extensions, all other indicia of
commercial source or origin and all goodwill associated with any of the
foregoing; (e) all inventions (whether patentable or unpatentable and whether or
not reduced to practice), know how, technology, technical data, trade secrets,
confidential business information, manufacturing and production processes and
techniques, research and development information, financial, marketing and
business data, pricing and cost information, business and marketing plans,
advertising and promotional materials, customer, distributor, reseller and
supplier lists and information, correspondence, records, and other
documentation, and other proprietary information of every kind; (f) all computer
software (including source and object code), firmware, development tools,
algorithms, files, records, technical drawings and related documentation, data
and manuals; (g) all databases and data collections; (h) all other proprietary
rights; and (i) all copies and tangible embodiments of any of the foregoing (in
whatever form or medium).

 

“IRS” means the Internal Revenue Service and, to the extent relevant, the
Department of Treasury.

 

“Judgment” means any order, injunction, judgment, decree, ruling, assessment or
arbitration award of any Governmental Authority or arbitrator.

 

“Knowledge” means, with respect to the Contributors, the actual knowledge,
without any duty to investigate, of Kirk Long, Dr. Najeeb Thomas, Dr. Thomas
Lavin, Dr. Chad Miller and Jeffrey Morris.

 

“Law” means any federal, state, local, municipal, foreign, international,
multinational, or other constitution, law, statute, treaty, rule, regulation,
ordinance, code, binding case law or principle of common law.

 

“Liability” includes liabilities, debts or other obligations of any nature,
whether known or unknown, absolute, accrued, contingent, liquidated,
unliquidated or otherwise, due or to become due or otherwise.

 

“Loss” means any loss, Proceeding, Judgment, damage, fine, penalty, expense
(including reasonable attorneys’ or other professional fees and expenses and
court costs), injury, diminution of value, Liability, Tax, Encumbrance or other
cost, expense or adverse effect whatsoever, whether or not involving the claim
of another Person.

 

“Material Adverse Effect” means any event, change, circumstance, effect or other
matter that has, or could reasonably be expected to have, either individually or
in the aggregate with all other events, changes, circumstances, effects or other
matters, with or without notice, lapse of time or both, a material adverse
effect on (a) the business, assets, Liabilities, properties, condition
(financial or otherwise), operating results, operations or prospects of the
Company or (b) the ability of the Company or any Contributor to perform its
obligations under this Agreement or to consummate timely the transactions
contemplated by this Agreement.

 

“Occupational Safety and Health Law” means any Law designed to provide safe and
healthful working conditions and to reduce occupational safety and health
hazards.

 

“Patriot Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001
(Public Law 107-56).

 

4

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“Permitted Encumbrances” means statutory liens for current real or personal
property Taxes not yet due and payable, and such other encumbrances as may be
approved or deemed approved by Acquirer pursuant to the terms of Section 2.9
hereof.

 

“Person” means an individual or an entity, including a corporation, limited
liability company, partnership, trust, unincorporated organization, association
or other business or investment entity, or any Governmental Authority.

 

“Proceeding” means any action, arbitration, audit, examination, investigation,
hearing, litigation or suit (whether civil, criminal, administrative, judicial
or investigative, whether formal or informal, and whether public or private)
commenced, brought, conducted or heard by or before, or otherwise involving, any
Governmental Authority or arbitrator.

 

“Prohibited Person” means

 

(i)                                     a Person that is listed in the annex to,
or is otherwise subject to the provisions of, the Executive Order;

 

(ii)                                  a Person owned or controlled by, or acting
for or on behalf of, any Person that is listed in the annex to, or is otherwise
subject to the provisions of, the Executive Order;

 

(iii)                               a Person with whom Acquirer or any
Contributor is prohibited from dealing or otherwise engaging in any transaction
by any terrorism or money laundering laws, including the Executive Order and the
Patriot Act;

 

(iv)                              a Person who commits, threatens or conspires
to commit or supports “terrorism” as defined in the Executive Order;

 

(v)                                 a Person 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/tl lsdn.pdf or at any replacement website or
other replacement official publication of such list; and

 

(vi)                              a Person who is Affiliated with a Person
listed above.

 

“Subsidiary” means, with respect to a specified Person, any corporation or other
entity of which (a) a majority of the voting power of the equity securities or
other interests is owned, directly or indirectly, by such Person (without regard
to the occurrence of any contingencies affecting voting power) or (b) the power
to elect a board majority (or persons performing similar functions) or otherwise
control the entity is held directly or indirectly by such Person.  When used in
this Agreement without reference to a particular Person, “Subsidiary” means a
Subsidiary of the Company.

 

“Tax” means (a) any federal, state, local, foreign or other tax, charge, fee,
duty (including customs duty), levy or assessment, including any income, gross
receipts, net proceeds, alternative or add-on minimum, corporation, ad valorem,
turnover, real property, personal property (tangible or intangible), sales, use,
franchise, excise, value added, stamp, leasing, lease, user, transfer, fuel,
excess profits, profits, occupational, premium, interest equalization, windfall
profits, severance, license, registration, payroll, environmental (including
taxes under Section 59A of the Code), capital stock, capital duty, disability,
estimated, gains, wealth, welfare, employee’s income withholding, other
withholding, unemployment or social security or other tax of whatever kind
(including any fee, assessment or other charges in the nature of or in lieu of
any tax) that is imposed by any Governmental Authority, (b) any interest, fines,
penalties or additions resulting from, attributable to, or incurred in
connection with any items described in this

 

5

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paragraph or any related contest or dispute and (c) any items described in this
paragraph that are attributable to another Person but that the Company is liable
to pay by Law, by Contract or otherwise, whether or not disputed.

 

“Tax Return” means any report, return, filing, declaration, claim for refund, or
information return or statement related to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.

 

“Title Company” means First American Title Insurance Company.

 

“West Napoleon Avenue Property” means that certain Owned Real Property set forth
in Section 3.10 of the Contributor Disclosure Schedule.

 

Section 1.2                                    Additional Defined Terms.  For
purposes of this Agreement and the Ancillary Agreements, the following terms
have the meanings specified in the indicated Section of this Agreement:

 

Defined Term

 

Section

Agreement

 

Preamble

Agreed Value

 

2.2

Adjustment Date

 

2.6

Acquirer

 

Preamble

Acquirer Disclosure Schedule

 

Article 4

Acquirer Indemnified Parties

 

9.1

Claim Notice

 

9.3(a)

Closing

 

2.3

Closing Adjustments

 

2.6

Closing Date

 

2.3

Company

 

Preamble

Confidentiality Agreement

 

5.5(a)

Contributors

 

Preamble

Contributor Disclosure Schedule

 

Article 3

Member Release

 

2.4(a)

Indemnified Party

 

9.3(a)

Indemnifying Party

 

9.3(a)

Interests

 

Preamble

Leases

 

3.10(b)

Noncontrolling Party

 

9.4(c)

Owned Real Property

 

3.10

Permitted Exceptions

 

Section 2.6 of the Contributor Disclosure Schedule

Securities Act

 

3.4(e)

Special Claim

 

9.4(b)

Third Party Claim

 

9.4(a)

Wire Transfer

 

2.2(c)

 

Section 1.3                                    Construction.  Any reference in
this Agreement to an “Article,” “Section,” “Exhibit” or “Schedule” refers to the
corresponding Article, Section, Exhibit or Schedule of or to this Agreement,
unless the context indicates otherwise.  The table of contents and the headings
of Articles and Sections are provided for convenience only and are not intended
to affect the construction or interpretation of this Agreement.  All words used
in this Agreement are to be construed to be of such gender or number as the
circumstances require.  The words “including,” “includes,” or “include” are to
be

 

6

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read as listing non-exclusive examples of the matters referred to, whether or
not words such as “without limitation” or “but not limited to” are used in each
instance.  Where this Agreement states that a party “shall”, “will” or “must”
perform in some manner or otherwise act or omit to act, it means that the party
is legally obligated to do so in accordance with this Agreement.  Any reference
to a statute is deemed also to refer to any amendments or successor legislation
as in effect at the relevant time.  Any reference to a Contract or other
document as of a given date means the Contract or other document as amended,
supplemented and modified from time to time through such date.

 

ARTICLE 2
THE TRANSACTION

 

Section 2.1                                    Contribution and Acquisition of
Interests.  In accordance with the provisions of this Agreement, at the Closing,
the Contributors will contribute and transfer to the Acquirer as a capital
contribution, and the Acquirer will acquire from the Contributors, all of the
Interests.

 

Section 2.2                                    Agreed Value.

 

(a)                                 The aggregate agreed value (within the
meaning of the First Amended and Restated Agreement of Limited Partnership of
Acquirer’s Parent, dated July 24, 2013) for the Interests (the “Agreed Value”)
will be an amount equal to (i) Thirty-Seven Million, Five Hundred Thousand
United States Dollars ($37,500,000) minus (ii) the Existing Indebtedness that is
paid off at Closing by Acquirer, plus or minus (iii) the amount of Closing
Adjustments (if any).

 

(b)                                 The Agreed Value shall be delivered to the
Contributors (a) in the form of common units of limited partnership interest
(“OPUs”) in Acquirer’s parent or (b) at each Contributing Member’s election, in
cash, payable by Acquirer to said electing Members at the time of Closing by 
wire transfer of immediately available funds (“Wire Transfer”).

 

(i)                                     The number of OPUs will be determined by
taking the aggregate dollar value in net proceeds payable to such Member in the
form of OPUs, and dividing by the average closing price for Physicians Realty
Trust (“REIT”) shares on the New York Stock Exchange for the three (3) trading
days prior to the Closing.  For illustration purposes, if the dollar value
payable to a Member is $100,000, and the three (3) day average closing price is
$11.50, then the Member would receive 8,695 OPUs in lieu of cash.

 

(c)                                  The personal property referred to herein is
included for convenience and no portion of the Purchase Price is attributable
thereto.

 

Section 2.3                                    Closing.  The closing of the
transactions contemplated by this Agreement (the “Closing”) will take place at
the offices of Ajubita, Leftwich & Salzer, LLC located at 1100 Poydras Street,
1500 Energy Centre, New Orleans, LA 70163-1500, on or before the date that is
fifteen (15) days after the Effective Date, or at such other time and place as
the Acquirer and the Contributors may agree to in writing.  The date on which
the Closing actually occurs is referred to in this Agreement as the “Closing
Date.”

 

Section 2.4                                    Closing Transactions.

 

(a)                                 At the Closing, the Contributors (unless a
different Person is identified below) will deliver to the Acquirer:

 

(i)                                     certificates representing the Interests,
duly endorsed in blank or accompanied by powers duly executed in blank, with all
appropriate transfer tax stamps affixed;

 

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(ii)                                  a release in the form of Exhibit A
executed by each Member (the “Member Release”);

 

(iii)                               a certificate in the form of Exhibit B,
dated as of the Closing Date, executed by each Member confirming the
satisfaction of the conditions specified in Sections 6.1(a) through (g);

 

(iv)                              a certification in the form of Exhibit C
executed by each Contributor stating, under penalty of perjury, such Contributor
‘s U.S. taxpayer identification number and address and that such Contributor is
not a “foreign person” as defined in Section 1445 of the Code;

 

(v)                                 resignations effective as of the Closing
Date from all managers and officers of the Company;

 

(vi)                              a certificate in the form of Exhibit D of the
secretary or assistant secretary of the Company dated as of the Closing Date and
attaching with respect to the Company (A) the Company’s articles of organization
and all amendments thereto, certified by the Secretary of State of the
jurisdiction of the Company’s formation not more than five Business Days prior
to the Closing Date; (B) the Company’s operating agreement and all amendments
thereto; (C) a certificate of good standing of the Company certified by the
Secretary of State of the jurisdiction of the Company’s organization and each
other jurisdiction where the Company is authorized to do business, each issued
not more than five Business Days prior to the Closing Date; (D) all resolutions
of the managers and members of the Company relating to this Agreement and the
transactions contemplated by this Agreement; and (E) incumbency and signatures
of the officers of the Company executing this Agreement or any other agreement
contemplated by this Agreement;

 

(vii)                           a receipt for the Agreed Value, in a form
reasonably satisfactory to the Acquirer;

 

(viii)                        Company shall deliver any and all affidavits,
instruments or forms (y) which are customarily executed, acknowledged and
delivered by parties to similar transactions in order to effectuate the
transactions contemplated hereby and (z) which the Title Company shall
reasonably require to omit from its title insurance policy all exceptions for
mechanic’s liens, general exceptions for rights of tenants, judgments,
bankruptcies or other returns against the Contributors, Company and persons or
entities whose names are the same as, or are similar to, the Contributors’ and
the Company’s names;

 

(ix)                              copies of any required transfer tax returns or
waiver forms, if any, duly executed and acknowledged by Contributors together
with the transfer taxes due thereunder, if any;

 

(x)                                 Company shall deliver notification letters
to service providers/utilities, if required;

 

(xi)                              Company shall deliver fully-executed
amendments to the Facility Leases;

 

(xii)                           Operating Partnership Unit issuance (if
elected);

 

(xiii)                        Termination and release documentation for the
mortgage debt relating to the Crescent City Surgical Centre Facility;

 

(xiv)                       Guaranty of Lease by individual Members pertaining
to tenant’s obligations under the Facility Leases;

 

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(xv)                          any required bulk sales or similar release with
respect to the transactions contemplated herein;

 

(xvi)                       Title company shall deliver to the Acquirer, at
Acquirer’s cost, the Title Policy in the form previously accepted by Acquirer,
with endorsements as required by Acquirer;

 

(xvii)                    Evidence of conveyance of the West Napoleon Avenue
Property by the Company to Crescent City Surgical Centre Operating Company,
L.L.C. ;

 

(xviii)                 Evidence of conveyance of 40% of the membership
interests in Landco held by the Company to Crescent City Surgical Centre
Operating Company, L.L.C.;

 

(xix)                       Estoppel certificates pertaining to the Crescent
City Surgical Centre Facility, including but not limited to the Ground Lessor
Estoppel and the Estoppel Certificate;

 

(xx)                          If elected by a Contributor with a negative
capital account who is receiving OPUs, a Limited Guaranty Agreement for each
such Contributor in favor of Regions Bank, as administrative agent under that
certain Credit Agreement dated as of August 29, 2013 and other Credit Documents
as more particularly described therein;

 

(xxi)                       Nondisturbance and Recognition Agreement from
Whitney Bank in recordable form;

 

(xxii)                    Memorandum of Lease for that certain Net Lease of
Commercial Property dated July 30, 2010 (as amended) in recordable form;

 

(xxiii)                 Termination of that certain Net Lease of Commercial
Property dated October 23, 2009 in recordable form;

 

(xxiv)                Memorandum of Sub-Lease for that certain Net Sub-Lease of
Commercial Property dated July 30, 2010 (as amended) in recordable form;

 

(xxv)                   Resolutions and any other documentation required to
adopt the new Operating Agreement for the Company; and

 

(xxvi)                such other documents, instruments and agreements as the
Acquirer reasonably requests for the purpose of consummating the transactions
contemplated by this Agreement;

 

(b)                                 At the Closing, the Acquirer will deliver to
the Contributors:

 

(i)                                     the Agreed Value payable in proportion
to the Contributors’ respective holdings of the Interests as set forth on
Schedule A, by wire transfer of immediately available funds to the accounts
specified on Schedule A and/or by delivery of the OPUs in accordance with
Section 2.2;

 

(ii)                                  a certificate in the form of Exhibit E,
dated as of the Closing Date, executed by the Acquirer confirming the
satisfaction of the conditions specified in Sections 6.2(a) and (b);

 

(iii)                               copies of any required transfer tax forms or
waiver forms, if any, duly executed and acknowledged by Acquirer; and

 

(iv)                              such other documents, instruments and
agreements as the Contributors reasonably request for the purpose of
consummating the transactions contemplated by this Agreement.

 

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Section 2.5                                    Closing Adjustments.

 

(a)                                 In the event that any of the following shall
accrue to the Company but are not subject to adjustment in the Facility Leases,
they shall be apportioned (“Closing Adjustments”) and adjusted between
Contributors and Acquirer as of midnight of the day preceding the Closing Date
(“Adjustment Date”) on a pro rata basis (unless explicitly stated otherwise):

 

(i)                                     real estate and other taxes, assessments
and charges, and other municipal and state charges, license and permit fees, if
any, assessed or charged against the Real Property, on the basis of the fiscal
period for which assessed or charged;

 

(ii)                                  water and sewer rents and charges assessed
or charged against the Real Property, on the basis of the fiscal period for
which assessed or charged;

 

(iii)                               water, electric, gas, steam and other
utility charges for services furnished to the Real Property except that no
apportionment shall be made for any of such items as are furnished and charged
by the utility company furnishing such service directly to tenants;

 

(iv)                              fuel, if any, and all taxes thereon, on the
basis of a written reading taken as late as possible prior to the Adjustment
Date, at the price then charged by Contributors’ supplier, including any taxes;

 

(v)                                 deposits with utility companies and fees and
charges for transferable governmental permits and licenses;

 

(vi)                              personal property taxes, if any, on the basis
of the fiscal year for which assessed;

 

(vii)                           rents paid by tenants under the Leases;

 

(viii)                        the swap breakup fee with respect to the Existing
Indebtedness shall be divided equally between the Contributors and the Acquirer
so that the Contributors are responsible for one-half (1/2) and the Acquirer is
responsible for the remaining one-half (1/2) of such fee; and

 

(ix)                              such additional adjustments as are normally
made in connection with the sale of comparable properties in the Metairie,
Louisiana area.

 

Section 2.6                                    Title.

 

(a)                                 The Company shall have good, valid and
marketable fee simple title to the Owned Real Property, subject only to
Permitted Exceptions.

 

(b)                                 Acquirer may, at Acquirer’s sole cost and
expense, order (i) a commitment (the “Title Commitment”) for an ALTA Owner’s
Policy of Title Insurance for the Real Property from the Title Company (“Title
Policy”) and (ii) a current survey or an update of any existing survey of the
Property certified to  Contributor, Acquirer and the Title Company (the
“Survey”).

 

(c)                                  If any title defects or encumbrances appear
in the Title Commitment or the Survey, other than the Permitted Exceptions
(“Title Objections”), Acquirer may reject title by giving notice of such
rejection to Contributors (“Acquirer’s Rejection Notice”) after receipt of the
Title Commitment (or a bringdown or update thereof) and Survey, which notice
shall specify the alleged Title Objections.  If Acquirer shall so reject title,
Contributors shall have the right, upon notice to Acquirer given not more than
fifteen (15) days after receipt of Acquirer’s Rejection Notice, to adjourn the
Closing for a period or

 

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periods not exceeding thirty (30) days in the aggregate, during which time
Contributors shall endeavor to cure such Title Objections.

 

(d)                                 If Contributors shall elect not to cure or
if Contributors shall elect to attempt to cure such alleged Title Objections and
if, for any reason whatsoever, any or all of the same are not cured within such
period not exceeding thirty (30) days, and Contributor shall give notice to
Acquirer of such uncured Title Objections, Acquirer shall, within twenty (20)
days after receiving such notice of Contributor, give notice to Contributor
electing either to cancel and terminate this Agreement or to waive such alleged
Title Objections without compensation or offset or abatement to or of the
Purchase Price, and Acquirer shall thereupon take and accept title to the
Property “as is”.  Acquirer’s failure to timely give such notice shall be deemed
an election by Acquirer to cancel and terminate this Agreement.

 

(e)                                  If Acquirer shall cancel and terminate this
Agreement pursuant to the terms of this Section 2.9, Contributors shall return
the Deposit, together with any interest accrued thereon, to Acquirer and this
Agreement shall in all respects be and become null and void and of no force or
effect whatsoever, and no party hereto shall have any rights, claims,
obligations or liabilities hereunder except for those which expressly survive
the termination of this Agreement.

 

(f)                                   In the event that Acquirer shall elect to
waive such alleged Title Objections as aforesaid, then the Closing shall take
place on the later of (i) the Closing Date or (ii) the third (3rd) business day
following the expiration of the twenty (20) day period referred to in
Section 2.8(d) above.

 

(g)                                  Notwithstanding anything in this
Section 2.8 to the contrary, Contributor shall, at its sole cost and expense,
remove of record and otherwise cure Title Objections which (i) can be removed of
record by the payment of a liquidated amount, and/or (ii) arise out of the
willful act of Contributor.

 

(h)                                 If (i) no Title Objections shall appear in
the Title Commitment or Survey, (ii) any existing Title Objections shall be
cured as aforesaid within the time hereinabove provided or (iii) Acquirer shall
elect to waive any alleged Title Objections as aforesaid within the time
hereinabove provided, then this Agreement shall remain in full force and effect.

 

(i)                                     Any unpaid taxes, assessments, water
charges and sewer rents and any other liens and encumbrances which Contributors
are obligated to pay and discharge hereunder, together with the cost of
recording or filing any instruments necessary to discharge such liens and
encumbrances of record, may be paid out of the proceeds of any monies payable to
Contributors at the Closing if Contributors deliver to Acquirer on the Closing
Date official bills for such taxes, assessments, water charges, sewer rents, and
instruments in recordable form sufficient to discharge such other liens and
encumbrances of record.

 

(j)                                    If any instruments or affidavits are
required by the Title Company in order to obviate a defect in or objection or
exception to title including any standard exceptions, Company agrees to execute,
acknowledge and deliver any such instruments and affidavits which shall be in
such form and shall contain such terms and conditions as may be required by the
Title Company to satisfy said company sufficiently for it to omit any defect in
or objection or exception to title without any additional charge to Acquirer.

 

(k)                                 If a search of title discloses judgments,
bankruptcies, or other returns against other persons having names the same as or
similar to those of Contributors, Contributors will on request deliver to
Acquirer an affidavit showing that such judgments, bankruptcies, or other
returns are not against Contributors.

 

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Section 2.7                                    Right of First Offer / Right of
First Refusal.

 

(a)                                 In the event that any of the three
individual Members with the largest number of Interests or any of their
respective Affiliates (each, a “Developer Party”) intends to develop an
outpatient or medical office facility adjacent to the Real Property or within
the Crescent City Surgical Centre Facility (“Adjacent Development”), Acquirer
shall have the right of first offer (“ROFO”) to provide the acquisition and/or
development financing for the Adjacent Development.  If the relevant Developer
Party and Acquirer fail to agree to the terms for such acquisition and/or
development financing within sixty (60) days from the start of the Developer
Party’s negotiation with Acquirer, then such Developer Party may obtain a bona
fide third-party offer for the acquisition and/or development financing of the
Adjacent Development.  Upon obtaining such an offer, the Developer Party shall
notify Acquirer of the same and Acquirer shall then have the right of first
refusal (“ROFR”) to match such bona fide third-party offer.

 

(b)                                 In the event that a Developer Party intends
to sell an Adjacent Development, Acquirer shall have the ROFO to purchase the
Adjacent Development.  If the relevant Developer Party and Acquirer fail to
agree to the terms for such purchase within sixty (60) days from the start of
the Developer Party’s negotiation with Acquirer, then such Developer Party may
obtain a bona fide third-party offer for the purchase of the Adjacent
Development.  Upon obtaining such an offer, the Developer Party shall notify
Acquirer of the same and Acquirer shall then have the ROFR to match such bona
fide third-party offer.

 

(c)                                  This Section 2.7 shall survive the Closing.

 

Section 2.8                                    Risk of Loss.

 

(a)                                 If, on or before the Closing Date, any
portion of any Real Property shall be damaged or destroyed by fire or other
cause, Contributors shall notify Acquirer thereof.  Within forty-five (45) days
after the occurrence of such damage or destruction, Contributors shall notify
Acquirer of the estimated cost of restoration of such Real Property as
determined by a written estimate of an independent construction contracting firm
retained by Contributors (“Restoration Estimate”).  If the estimated cost of
restoration shall be Fifty Thousand United States Dollars (US$50,000.00) or
less, then notwithstanding any provision in this Agreement to the contrary,
Acquirer shall accept the Property “as is” together with (i) any insurance
proceeds paid to Contributors  and (ii) an assignment of insurance proceeds not
yet paid to Contributors. If the estimated cost of restoration shall exceed
Fifty Thousand United States Dollars (US$50,000.00), then Acquirer shall have
the option to terminate this Agreement by giving written notice to Contributors
within thirty (30) days after the Acquirer’s receipt of the Restoration Notice. 
Upon a termination of this Agreement by Acquirer pursuant to this
Section 2.10(a), Contributors shall cause the Deposit, together with any
interest accrued thereon, to be returned to Acquirer, and thereupon this
Agreement shall terminate and be of no further force and effect except for
obligations which expressly survive the termination of this Agreement.  In the
event Acquirer does not exercise its right to terminate this Agreement as
provided in this Section 2.10(a), Acquirer shall accept the Real Property “as
is” together with (i) any insurance proceeds paid to Contributors and (ii) an
assignment of insurance proceeds not yet paid to Contributors.  If the damage or
destruction to the Real Property shall occur within thirty (30) days of the
Closing Date, then the Closing Date shall be postponed to a date which shall be
thirty (30) days after the occurrence of such damage or destruction to permit
adequate time for determination of the cost of restoration. Upon the occurrence
of any such damage or destruction to the Real Property and prior to the date of
Closing, Contributors shall, provided the same is practicable under the
circumstances in light of the date of the Closing, apply any insurance proceeds
they may receive to (x) take protective measures at the Real Property if
required by law or by reasonable considerations of safety, and (y) commence
restoration of a leased premises (if required under any Lease) subject to and in
accordance with the terms of such Lease.

 

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(b)                                 If, on or before the Closing Date, all or
any material portion (as defined in Section 2.10(d) below) of any Real Property
is subject to a taking by public authority, Acquirer shall have the right,
exercisable by giving written notice to Contributors within thirty (30) days
after receiving written notice of such taking (but in any event prior to the
Closing), either (i) to terminate this Agreement, in which case this Agreement
shall be of no further force and effect except for obligations which expressly
survive the termination of this Agreement, or (ii) to accept the Real Property
in its then condition, without any abatement or reduction in the Purchase Price,
and receive an assignment of all of Contributors’ rights to any condemnation
award payable by reason of such taking.  A failure by Acquirer to notify
Contributor in writing within such thirty (30) day period shall be deemed an
election to terminate this Agreement under clause (i) above. As used in this
Section 2.10, “taking” shall mean any transfer of the Real Property or any
portion thereof to a Governmental Entity or other party with appropriate
authority, by exercise of the power of eminent domain.

 

(c)                                  If, on or before the Closing Date, any
non-material portion of any Real Property is subject to a taking, Acquirer shall
accept the Real Property in its then condition without any abatement or
reduction in the Purchase Price and proceed with the Closing, in which case
Acquirer shall be entitled to an assignment of all of Contributors’ rights to
any award in connection with such taking.

 

(d)                                 For the purpose of Section 2.10(b) above, a
taking of a portion of any Real Property shall be deemed to involve a material
portion of such Real Property if (i) more than twenty percent (20%) of the
Improvements on such Real Property is subject to the taking or (ii) the taking
reduces the number of parking spaces at the Real Property such that the Real
Property is no longer in compliance with applicable parking zoning regulations.

 

(e)                                  Contributors agree to give Acquirer written
notice of any taking of any Real Property immediately after Contributors receive
written notice thereof.

 

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS

 

The Members, pro rata and in accordance with each Member’s Interest in the
Company, and the Company, represent and warrant to their Knowledge (except that
Sections 3.4, 3.9, 3.10 and 3.11 shall not be subject to the foregoing Knowledge
qualifier) to the Acquirer that as of the date of this Agreement and as of the
Closing Date the statements set forth in this Article 3 are true and correct,
except as set forth on the disclosure schedule delivered by the Contributors to
the Acquirer concurrently with the execution and delivery of this Agreement and
dated as of the date of this Agreement (the “Contributor Disclosure Schedule”):

 

Section 3.1                                    Organization and Good Standing. 
The Company is a limited liability company duly organized, validly existing and
in good standing under the Laws of the jurisdiction of its organization and has
all requisite corporate power and authority to own, lease and operate its
properties and assets and to conduct its business as presently conducted.  The
Company is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the properties it owns, operates or
leases or the nature of its activities makes such qualification necessary. 
Copies of the Company’s Governing Documents, as currently in effect, have been
delivered to the Acquirer and are accurate and complete as of the date hereof. 
The Company is not in violation of its Governing Documents.

 

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Section 3.2                                    Authority and Enforceability.

 

(a)                                 The Company has all requisite corporate
power and authority to execute, deliver and perform its obligations under this
Agreement and each Ancillary Agreement to which it is a party.  The execution,
delivery and performance of this Agreement and each Ancillary Agreement and the
consummation of the transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of the Company.  The Company has
duly and validly executed and delivered this Agreement and, on or prior to the
Closing, the Company will have duly and validly executed and delivered each
Ancillary Agreement to which it is a party.  This Agreement constitutes, and
upon execution and delivery each Ancillary Agreement to which the Company is a
party will constitute, the valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms.

 

(b)                                 Each Contributor has all requisite power,
authority and capacity to execute, deliver and perform its respective
obligations under this Agreement and each Ancillary Agreement to which it is a
party.  The execution, delivery and performance of this Agreement and each
Ancillary Agreement and the consummation of the transactions contemplated hereby
and thereby have been duly authorized by all necessary action on the part of the
Contributors.  Each Contributor has duly and validly executed and delivered this
Agreement and, on or prior to the Closing, each Contributor will have duly and
validly executed and delivered each Ancillary Agreement to which it is a party. 
This Agreement constitutes, and upon execution and delivery each Ancillary
Agreement to which a Contributor is a party will constitute, the valid and
binding obligation of the Contributor that is party thereto, enforceable against
such Contributor in accordance with its terms.

 

Section 3.3                                    No Conflict.  Neither the
execution, delivery and performance of this Agreement or any Ancillary Agreement
by the Company or any Contributor, nor the consummation of the transactions
contemplated hereby or thereby, will (a) conflict with or violate the Governing
Documents of the Company or any Contributor, or any resolution adopted by the
board of managers or members of the Company or any Contributor, (b) result in
(with or without notice or lapse of time or both) a breach or default under or
create in any Person the right to terminate, cancel, accelerate or modify, or
require any notice, consent or waiver under, any Contract to which the Company
or any Contributor is a party or by which the Company, any Contributor or any of
their respective properties or assets is otherwise bound or affected, (c) result
in the imposition of any Encumbrances on any of the Interests or any of the
properties or assets of the Company, (d) violate any Law, Judgment or
Governmental Authorization applicable to the Company or any Contributor or any
of their respective businesses, properties or assets, or (e) require the Company
or any Contributor to obtain any Consent or Governmental Authorization or make
any filing or registration with any Governmental Authority or other Person.

 

Section 3.4                                    Capitalization and Ownership.

 

(a)                                 The current capital reserve of the Company
is $0.  The Contributors are the sole owners (of record and beneficially) of all
of the Interests, free and clear of all Encumbrances, in the respective amounts
set forth in Schedule A.  Upon the consummation of the Closing, the Acquirer
will become the beneficial owner of the Interests, free and clear of all
Encumbrances.

 

(b)                                 Section 3.4(b) of the Contributor Disclosure
Schedule sets forth for each Subsidiary (i) its name and jurisdiction of
incorporation or organization, (ii) its authorized capital stock and (iii) the
number of issued and outstanding shares of capital stock, the record and
beneficial owners thereof and the number of shares held in treasury.  All of the
outstanding equity securities and other securities of each Subsidiary are owned
of record and beneficially by the Company, free and clear of all Encumbrances,
in the respective amounts set forth in Section 3.4(b) of the Contributor
Disclosure Schedule.

 

(c)                                  Section 3.4(c) of the Contributor
Disclosure Schedule sets forth for each Affiliate of the Company (i) its name
and jurisdiction of incorporation or organization and (ii) the membership
interests

 

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and beneficial owners thereof.  The respective amounts of equity of each
Affiliate that are owned by the Company, free and clear of all Encumbrances, are
set forth in Section 3.4(c) of the Contributor Disclosure Schedule.

 

(d)                                 The Company does not own, control or have
any rights to acquire, directly or indirectly, any capital stock or other equity
interests or debt instruments of any Person, except for the Subsidiaries set
forth in Section 3.4(b) of the Contributor Disclosure Schedule and the
Affiliates set forth in Section 3.4(c) of the Contributor Disclosure Schedule.

 

(e)                                  Except as set forth in this Section 3.4,
(i) there are no equity securities of any class of the Company, or any security
exchangeable into or exercisable for such equity securities, authorized, issued,
reserved for issuance or outstanding and (ii) there are no options, warrants,
equity securities, calls, rights or other Contracts to which the Company is a
party or by which the Company is bound obligating the Company to issue,
exchange, transfer, deliver or sell, or cause to be issued, exchanged,
transferred, delivered or sold, additional shares of capital stock or other
equity interests of the Company or any security or rights convertible into or
exchangeable or exercisable for any such shares or other equity interests, or
obligating the Company to grant, extend, accelerate the vesting of, change the
price of, otherwise modify or amend or enter into any such option, warrant,
equity security, call, right, or Contract.  There are no outstanding or
authorized stock appreciation, phantom stock, profit participation or similar
rights with respect to the Company.   There are no Contracts to which the
Company or any Contributor or any Affiliate of the Company or any Contributor is
a party or by which the Company or any Contributor or any Affiliate of the
Company or any Contributor is bound with respect to the voting (including voting
trusts or proxies), registration under the Securities Act of 1933 (the
“Securities Act”) or any foreign securities Law, or the sale or transfer
(including Contracts imposing transfer restrictions) of any shares of capital
stock or other equity interests of the Company.  No holder of Indebtedness of
the Company has any right to convert or exchange such Indebtedness for any
equity securities or other securities of the Company.  No holder of Indebtedness
of the Company has any rights to vote for the election of directors of the
Company or to vote on any other matter.

 

(f)                                   All of the Interests, the interests of
each Subsidiary and the interests of each Affiliate are duly authorized, validly
issued, fully paid, nonassessable, not subject to or issued in violation of any
purchase option, right of first refusal, preemptive right, subscription right or
any similar right and have been issued in compliance with all applicable Laws.

 

(g)                                  There are no obligations, contingent or
otherwise, of the Company to repurchase, redeem or otherwise acquire any
membership interests of the Company. The Company is not subject to any
obligation or requirement to provide funds to or make any investment (in the
form of a loan, capital contribution or otherwise) in any Subsidiary or any
other Person.

 

Section 3.5                                    Financial Statements.  Attached
as Section 3.5 of the Contributor Disclosure Schedule are correct and complete
copies of the audited consolidated and consolidating balance sheet of the
Company as of June 30, 2013 (the “Balance Sheet”) and the related audited
consolidated and consolidating statements of income and cash flows for the
fiscal year then ended, including any notes thereto, together with the report
thereon of independent certified public accountants (all such financial
statements, the “Financial Statements”).  The Financial Statements fairly
present the financial condition, results of operations and cash flows of the
Company as of the times and for the periods indicated therein, in accordance
with GAAP, consistently applied (subject, in the case of the interim financial
statements, to normal recurring year-end adjustments, the effect of which will
not be material, and the absence of notes).  The Financial Statements are
consistent with the books and records of the Company.

 

Section 3.6                                    Books and Records.  The books of
account, minute books, membership record books and other records of the Company,
all of which have been made available to the Acquirer, are

 

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accurate and complete and have been maintained in accordance with sound business
practices and an adequate system of internal controls.  The minute books of the
Company contain accurate and complete records of all meetings held of, and
action taken by, the Company’s members and managers, and no such meeting has
been held for which minutes have not been prepared and are not contained in such
minute books.  At the time of the Closing, all of such books and records will be
in the possession of the Company.

 

Section 3.7                                    No Undisclosed Liabilities.  The
Company has no Liabilities except the Existing Indebtedness identified in
Section 3.7 of the Contributor Disclosure Schedule.

 

Section 3.8                                    Absence of Certain Changes and
Events.  The Company has conducted its business only in the ordinary course of
business and there has not been any Material Adverse Effect.  Without limiting
the generality of the foregoing, there has not been with respect to the Company
any:

 

(a)                                 amendment to its Governing Documents;

 

(b)                                 issuance, sale, grant or other disposition
of or Encumbrance on any of its membership interests or other securities or any
options, warrants or other rights to acquire, any such securities;

 

(c)                                  split, combination or reclassification of
any of its membership interests;

 

(d)                                 declaration, setting aside or payment of any
other distribution (whether in cash, securities or other property) in respect of
its membership interests;

 

(e)                                  incurrence, assumption or guarantee of any
Indebtedness;

 

(f)                                   sale, lease, license, pledge or other
disposition of, or Encumbrance on, any of its properties or assets;

 

(g)                                  consummation of (i) any merger,
consolidation or other business combination, or (ii) the purchase of all or a
substantial portion of the assets or any stock of any business or Person;

 

(h)                                 damage to, or destruction or loss of, any of
its properties or assets, whether or not covered by insurance;

 

(i)                                     entry into, modification, acceleration,
cancellation or termination of any Contract except in the ordinary course of
business;

 

(j)                                    entry into any hedging Contract or other
financial agreement or arrangement designed to protect the Company against
fluctuations in commodities prices or exchange rates;

 

(k)                                 cancellation, compromise, release or waiver
of any claims or rights (or series of related claims or rights) with a value
exceeding Fifty Thousand United States Dollars (US$50,000) or otherwise outside
the ordinary course of business;

 

(l)                                     settlement or compromise in connection
with any Proceeding involving the Company;

 

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(m)                             capital expenditure or other expenditure with
respect to property, plant or equipment in excess of One Hundred Thousand United
States Dollars (US$100,000) in the aggregate;

 

(n)                                 change in accounting principles, methods or
practices (including any methods of accounting for Tax purposes) or investment
practices by the Company or any Subsidiary of the Company, including any changes
as were necessary to conform with GAAP;

 

(o)                                 making or rescission of any Tax election,
settlement or compromise of any Tax Liability, amendment of any Tax Return,
waiver of any statute of limitations with respect to Taxes or extension of time
with respect to any Tax assessment or deficiency by the Company or any
Subsidiary of the Company;

 

(p)                                 change in payment or processing practices or
policies regarding intercompany transactions;

 

(q)                                 revaluation of any of its assets;

 

(r)                                    increase, reduction, draw-down or
reversal of its reserves (other than in accordance with GAAP); or

 

(s)                                   authorization or agreement, in writing or
otherwise, to do any of the foregoing.

 

Section 3.9                                    Assets.  The Company has good and
valid title to, or in the case of leased assets, valid leasehold interests in,
all of its assets, free and clear of any Encumbrances other than Permitted
Encumbrances.  The Company owns or leases all tangible assets used in its
business as conducted.  Notwithstanding the reference to this Section 3.9 in the
first paragraph of Article 3, to the Contributors’ Knowledge, each such tangible
asset has been maintained in accordance with normal industry practice, is in
good operating condition and repair (ordinary wear and tear excepted) and is
suitable and sufficient for the purposes for which it is being used. 
Section 3.9 of the Contributor Disclosure Schedule contains an accurate and
complete list of all tangible personal property having a value in excess of Five
Thousand United States Dollars (US$5,000) owned by the Company or used in the
operation of its business.

 

Section 3.10                             Real Property.

 

(a)                                 Section 3.10 of the Contributor Disclosure
Schedule sets forth a true and correct list and legal description, street
address and tax parcel identification number of each parcel of  real property in
which the Company has an ownership interest (the “Owned Real Property”).  Except
for the Owned Real Property and the Leased Real Property (as defined below), the
Contributors do not have any other interest in any real property other than the
West Napoleon Property which will be conveyed out by the Company prior to
Closing in accordance with Section 2.4(a)(xvii) of this Agreement.  The
Contributors have delivered to the Acquirer accurate and complete copies of
(i) all deeds and other instruments (as recorded) by which the Company acquired
its interest in the Owned Real Property and (ii) all certificates of occupancy,
title reports, surveys, title policies, Encumbrances, appraisals, and similar
documents, and all amendments thereof, with respect to the Owned Real Property. 
There are no outstanding options, rights of first offer or rights of first
refusal to purchase any Owned Real Property or any portion thereof or interest
therein.

 

(b)                                 Section 3.10 of the Contributor Disclosure
Schedule sets forth an accurate and complete description (by street address, the
date and term of the lease, sublease or other occupancy right, the name

 

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of the parties thereto, each amendment thereto and the aggregate annual rent
payable thereunder) of all land, buildings, structures, fixtures, improvements
and other interests in real property that is leased or otherwise occupied by the
Company or in which the Company has any interest (the “Leased Real Property”;
together with the Owned Real Property, the “Real Property”).  The Contributors
have delivered to the Acquirer accurate and complete copies of  all leases,
subleases, licenses, or other occupancy agreements and all amendments thereto
(collectively, the “Leases”).  With respect to each such Lease,

 

(i)                                     The rental set forth in the Lease is the
actual rental being paid, and there are no separate agreements or understandings
with respect to the same;

 

(ii)                                  The Lease is valid, binding and
enforceable and in full force and effect against the tenant thereunder and has
not been modified or supplemented;

 

(iii)                               The transactions contemplated by this
Agreement do not require the consent of any party under the Lease, will not
result in a breach of or default under the Lease, and will not otherwise cause
the Lease to cease to be valid, binding, enforceable and in full force and
effect on identical terms following the Closing;

 

(iv)                              There are no disputes with respect to the
Lease;

 

(v)                                 Neither the Company nor to Contributor’s
Knowledge, any other party to the Lease is in breach of or default under the
Lease, and no event has occurred or circumstance exists that, with the delivery
of notice, the passage or time, or both, would constitute such a breach or
default, or permit the termination, modification, or acceleration of rent under
the Lease;

 

(vi)                              No security deposit or portion thereof
deposited with respect to the Lease has been applied in respect of a breach of
or default under the Lease that has not been redeposited in full;

 

(vii)                           Contributors do not owe, or will not owe in the
future any brokerage commissions or finder’s fees with respect to the Lease;

 

(viii)                        The Company or the tenant has not collaterally
assigned nor granted any other lien or Encumbrance with regard to the Lease or
any interest therein that would have a Material Adverse Effect on the use of the
Real Property;

 

(ix)                              The tenant has paid all rent and other charges
due under the Lease up to and including September 30, 2013 and no rent or other
charge or expense has been paid more than 30 days in advance of its due date;

 

(x)                                 The tenant (A) has no claim against the
Company and no offset or defense to enforcement of the terms of the Lease and
(B) has not advanced any funds for or on behalf of the Company for which the
tenant has the right to deduct from or offset against future payments;

 

(xi)                              All improvements required to be completed by
the Company or tenant have been completed and there are no sums due to the
tenant from the Company.  The Company has not agreed to grant the tenant any
free rent or rent rebate;

 

(xii)                           The tenant has not assigned the Lease and has
not sublet the leased premises or any part thereof; and

 

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(xiii)                        The tenant has no right to terminate the Lease
prior to the expiration of the term of the Lease and the tenant has no
contraction rights or options in the Lease.

 

(c)                                  The Company has (i) good, valid and
marketable fee simple title to the Owned Real Property and (ii) valid leasehold
interests in the Leased Real Property, including without limitation, all fixed
assets and structures thereon free and clear of any Encumbrances, except for
Permitted Exceptions and those exceptions as described in Section 2.6 of the
Contributor Disclosure Schedule.

 

(d)                                 The Company is in peaceful and undisturbed
possession of the Real Property, and there are no contractual or legal
restrictions that preclude or restrict the ability of the Company to use such
Real Property for the purposes for which it is currently being used.

 

(e)                                  Except as set forth in Section 3.10 of the
Contributor Disclosure Schedule, the Company has not leased, subleased, licensed
or otherwise granted to any Person the right to use or occupy any portion of the
Real Property, and the Company has received no notice, and no Contributor has
Knowledge, of any claim of any Person to the contrary.  There are no contracts
outstanding for the sale, exchange, Encumbrance, lease, sublease or transfer in
any way of any of the Real Property, or any portion thereof.

 

(f)                                   The parcels constituting the Real Property
are assessed separately from all other adjacent property not constituting the
Real Property for purposes of real estate Taxes assessed to, or paid by, the
Company.  There are no Taxes, assessments, fees, charges or similar costs or
expenses imposed by any Governmental Authority, association or other Person
having jurisdiction over the Real Property with respect to any Real Property or
portion thereof that are delinquent and there is no pending or, to the
Contributors’ Knowledge, threatened increase or special assessment or
reassessment of any such Taxes, costs or expenses.

 

(g)                                  The current use and occupancy of the Real
Property and the operation of the Contributors’ business as currently conducted
thereon does not violate any easement, covenant, condition, restriction or
similar provision in any instrument of record or, to Contributors’ Knowledge,
other unrecorded agreements affecting such Real Property (the “Encumbrance
Documents”).  The Company has not received any notice of violation of any
Encumbrance Documents, and to the Contributors’ Knowledge there is no basis for
the issuance of any such notice or the taking of any action for such violation.

 

(h)                                 The Real Property comprises all of the real
property necessary for the Contributors’ business as presently conducted and as
currently planned to be conducted by the Contributors and neither Contributors
nor their Affiliates are party to any agreement or option to purchase any real
property or interest therein.

 

(i)                                     There are no condemnation,
appropriation, or other proceedings in eminent domain, pending or to the
Knowledge of Contributors, threatened against any of such Real Property or any
plants, buildings or other structures located thereon.  There is no injunction,
decree order, writ or judgment outstanding, or any claim, litigation,
administrative action or similar proceeding. pending or, to the Contributors’
Knowledge, threatened, relating to the ownership, lease, use, or occupancy of
the Real Property or any portion thereof, or the operation of the Contributors’ 
business as currently conducted thereon.

 

Section 3.11                             Intellectual Property.  The Company
does not own or otherwise possess any Intellectual Property and the Company has
not received notice of any pending or threatened Proceeding or any claim in
which any Person alleges that the Company or its business has violated any
Person’s Intellectual Property rights.

 

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Section 3.12                             Contracts.

 

(a)                                 Section 3.12 of the Contributor Disclosure
Schedule sets forth an accurate and complete list of each Contract to which the
Company is a party or by which the Company or any of their respective properties
or assets is bound or affected.

 

(b)                                 The Contributors have delivered to the
Acquirer an accurate and complete copy of each Contract required to be listed in
Section 3.12 of the Contributor Disclosure Schedule.  Each such Contract is
legal, valid, binding, enforceable and in full force and effect.  Neither the
Company nor, to the Contributors’ Knowledge, any other party to any such
Contract is in breach or default under, or has provided or received any notice
of any intention to terminate, any such Contract.

 

Section 3.13                             Tax Matters.

 

(a)                                 The Company and all Subsidiaries of the
Company have timely filed all Tax Returns that they were required to file in
accordance with applicable Laws, and each such Tax Return is accurate and
complete in all material respects.  The Company and all Subsidiaries of the
Company have timely paid all Taxes due with respect to the taxable periods
covered by such Tax Returns and all other Taxes (whether or not shown on any Tax
Return).  No claim has ever been made by a Governmental Authority in a
jurisdiction where the Company or a Subsidiary of the Company does not file a
Tax Return that such entity is or may be subject to taxation by that
jurisdiction.  None of the Company or the Subsidiaries of the Company has
requested an extension of time within which to file any Tax Return which has not
since been filed.  The Contributors have delivered to the Acquirer accurate and
complete copies of all Tax Returns of the Company and all Subsidiaries of the
Company (and each of their predecessors) for the years ended 2010, 2011 and
2012.

 

(b)                                 There are no material liens on any of the
assets of the Company or any Subsidiary of the Company that arose in connection
with any failure to pay any Tax.

 

(c)                                  All Taxes that the Company and the
Subsidiaries of the Company are required by Law to withhold or collect
(including sales and use Taxes and amounts required to be withheld or collected
in connection with any amount paid or owing to any employee, independent
contractor, creditor or other Person) have been duly withheld or collected and,
to the extent required by applicable Law, have been paid over to the proper
Governmental Authority.

 

(d)                                 No Tax audits or other Proceedings involving
the Company or a Subsidiary of the Company are pending or being conducted, nor
has the Company or any Subsidiary of the Company received any notice from any
Governmental Authority that any such audit or other Proceeding is pending,
threatened or contemplated.  There is no claim or assessment pending, or
threatened against the Company or a Subsidiary of the Company for any alleged
deficiency in Taxes.  None of the Company or the Subsidiaries of the Company has
waived any statute of limitations with respect to Taxes or agreed to an
extension of time with respect to any Tax assessment or deficiency.

 

(e)                                  None of the Company or the Subsidiaries of
the Company is a party to, or bound by, any Tax allocation or sharing agreement,
Tax indemnity obligation or similar Contract or practice with respect to Taxes.

 

(f)                                   None of the Company or the Subsidiaries of
the Company has made an election to be excluded from the provisions of
subchapter K of the Code or to be taxable as a corporation.

 

(g)                                  None of the Company or the Subsidiaries of
the Company has entered into any “reportable transaction” within the meaning of
Section 6011 of the Code.

 

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Section 3.14                             Employment Matters.  The Company does
not have employees and there are no  independent contractors currently
performing services for the Company. There is no Proceeding pending or, to the
Contributors’ Knowledge, threatened against or affecting the Company relating to
the alleged violation by the Company (or its members / managers or officers) of
any Law pertaining to labor relations or employment matters.  There has been no
complaint, claim or charge filed or, to the Contributors’ Knowledge, threatened,
against the Company with or by any Governmental Authority responsible for
prevention of unlawful employment practices.

 

Section 3.15                             Environmental, Health and Safety
Matters.  The Company and each of its respective predecessors and Affiliates is,
and at all times has been, in compliance in all material respects with all
Environmental Laws and Occupational Safety and Health Laws.  The Company has not
received any notice, report or other information regarding any actual or alleged
violation of any Environmental Laws or Occupational Safety and Health Laws,
including any investigatory, remedial or corrective obligations relating to the
Company or any Real Property or other property or facility currently or
previously owned, leased, operated or controlled by the Company.  No Hazardous
Materials, contamination, landfill, surface impoundment, disposal area,
underground storage tank, groundwater monitoring well, drinking water well or
production water well is present or, to the Contributors’ Knowledge, has ever
been present at any Real Property or other property or facility currently or
previously owned, leased, operated or controlled by the Company.  Neither the
Company nor its predecessors or Affiliates has treated, stored, disposed of,
transported, handled, generated, or released any Hazardous Materials.  The
Company has not received any notice of a Healthcare Investigation or any
threatened or pending legal, judicial or regulatory proceedings pertaining to a
Healthcare Investigation.

 

Section 3.16                             Compliance with Laws and Governmental
Authorizations.

 

(a)                                 The Company is in compliance and has
complied with all Laws or Governmental Authorizations applicable to it or to the
conduct of its business or the ownership or use of any of its properties or
assets.

 

(b)                                 All Governmental Authorizations necessary
for the Company to conduct its business have been obtained by the Company and
are valid and in full force and effect.  Section 3.16(b) of the Contributor
Disclosure Schedule lists all of the Governmental Authorizations issued to the
Company.  No event has occurred that, with or without notice or lapse of time or
both, would reasonably be expected to result in the revocation, suspension,
lapse or limitation of any Governmental Authorization listed in
Section 3.16(b) of the Contributor Disclosure Schedule.

 

(c)                                  Neither the Real Property, nor any
Contributor is in violation of any Healthcare Laws or the subject of a
Healthcare Investigation.

 

Section 3.17                             Legal Proceedings.  There are no
Proceedings pending or, to the Contributors’ Knowledge, threatened (a) by or
against the Company or that otherwise relate to or could reasonably be expected
to affect the Company’s business, properties or assets, or (b) against any
Contributor or the Company that challenges, or that may have the effect of
preventing, delaying, making illegal or otherwise interfering with, any of the
transactions contemplated by this Agreement.

 

Section 3.18                             Insurance.  Section 3.18 of the
Contributor Disclosure Schedule sets forth an accurate and complete list of all
insurance policies maintained by the Company.  All such insurance policies are
in full force and effect and all premiums due and payable under such policies
have been paid and the Company is otherwise in compliance with the terms
thereof.  The Contributors have no Knowledge of any threatened termination of,
or material premium increase with respect to, any such policy.

 

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Section 3.19                             Related Party Transactions.  Except as
set forth on Section 3.19 of the Contributor Disclosure Schedule, no
Contributor, member, manager, officer, employee or Affiliate of the Company (or
Affiliate of any such Contributor, member, manager, officer, employee or
Affiliate), is a party to any agreement, Contract, commitment or transaction
with the Company.

 

Section 3.20                             Brokers or Finders.  Neither any
Contributor or the Company, nor any Person acting on behalf of any Contributor
or Company has incurred any Liability to pay any fees or commissions to any
broker, finder or agent or any other similar payment in connection with any of
the transactions contemplated by this Agreement.  Contributors hereby indemnify
and hold Acquirer harmless from and against any loss incurred by Acquirer
arising out of a claim by any broker, agent or finder that they acted on behalf
of any Contributor in connection with the execution of this Agreement or the
transactions contemplated by this Agreement.  Notwithstanding anything in this
Agreement to the contrary, the representations and indemnifications of
Contributors under this Section 3.20 shall survive  the Closing and/or the
termination of this Agreement.

 

Section 3.21                             Disclosure.  No representation or
warranty of the Contributors in this Agreement, and no statement made by any
Contributor in the Contributor Disclosure Schedule, the Ancillary Agreements, or
any certificate, instrument or other document delivered by or on behalf of any
Contributor pursuant to this Agreement or any Ancillary Agreement, contains or
will contain any untrue statement or omits or will omit to state a material fact
necessary to make the statements contained herein or therein, in light of the
circumstances in which they were made, not misleading.  The Contributors have no
Knowledge of any fact or circumstance that has specific application to any
Contributor or the Company or its business (other than general economic or
industry conditions that do not affect the Company or its business uniquely) and
that could have a Material Adverse Effect that has not been set forth in this
Agreement or the Contributor Disclosure Schedule.

 

Section 3.22                             Anti-Terrorism.

 

(a)                                 No Contributor nor the Company nor any other
Person owning a direct or indirect, legal or beneficial interest in Contributors
or the Company is in violation of the Executive Order and/or the Patriot Act.

 

(b)                                 No Contributor nor any of Contributors’
Affiliates, any of their respective brokers or other agents, if any, acting or
benefiting, directly or indirectly, in any capacity in connection with the
transaction contemplated by this Agreement, is a Prohibited Person.

 

(c)                                  Contributors covenant and agree to deliver
to Acquirer any certification or other evidence requested from time to time by
Acquirer in its reasonable discretion, confirming compliance with this
Section 3.22.

 

(d)                                 (i) None of the funds or other assets of
Contributors constitute property of, or are beneficially owned, directly or
indirectly, by any Embargoed Person; (ii) no Embargoed Person has any interest
of any nature whatsoever in Contributors (whether directly or indirectly); and
(iii) none of the funds or other assets of Contributors have been derived from
any unlawful activity with the result that the transaction contemplated by this
Agreement is in violation of law.

 

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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE ACQUIRER AND ACQUIRER’S PARENT

 

The Acquirer and Acquirer’s Parent represent and warrant to the Contributors
that to their actual knowledge without any duty to investigate, as of the date
of this Agreement and as of the Closing Date, the statements set forth in this
Article 4 are true and correct, except as set forth on the disclosure schedule
delivered by the Acquirer to the Contributors concurrently with the execution
and delivery of this Agreement and dated as of the date of this Agreement (the
“Acquirer Disclosure Schedule”):

 

Section 4.1                                    Organization and Good Standing. 
The Acquirer is (i) a limited liability company duly organized, validly existing
and in good standing under the Laws of its jurisdiction of formation and (ii) a
wholly owned Subsidiary of Acquirer’s Parent.  For U.S. federal income tax
purposes, Acquirer is treated as a disregarded entity, which is not treated as
separate from Acquirer’s Parent.

 

Section 4.2                                    Authority and Enforceability. 
The Acquirer has all requisite corporate power and authority to execute and
deliver this Agreement and each Ancillary Agreement to which it is a party and
to perform its obligations under this Agreement and each such Ancillary
Agreement.  The execution, delivery and performance of this Agreement and each
Ancillary Agreement to which the Acquirer is a party and the consummation of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary action on the part of the Acquirer.  The Acquirer has duly and validly
executed and delivered this Agreement and, on or prior to the Closing, the
Acquirer will have duly and validly executed and delivered each Ancillary
Agreement to which it is a party.  This Agreement constitutes, and upon
execution and delivery each Ancillary Agreement to which the Acquirer is a party
will constitute, the valid and binding obligation of the Acquirer, as
applicable, enforceable against the Acquirer in accordance with its terms.

 

Section 4.3                                    No Conflict.  Neither the
execution, delivery and performance by the Acquirer of this Agreement or any
Ancillary Agreement to which the Acquirer is a party, nor the consummation of
the transactions contemplated hereby or thereby, will (a) conflict with or
violate the Governing Documents of the Acquirer, or any resolution adopted by
the managers or members of the Acquirer, (b) result in (with or without notice
or lapse of time or both) a breach or default under or create in any Person the
right to terminate, cancel, accelerate or modify, or require any notice, consent
or waiver under, any Contract to which the Acquirer is a party or by which the
Acquirer or any of its properties or assets is otherwise bound or affected,
(c) violate any Law, Judgment or Governmental Authorization applicable to the
Acquirer or any of its properties or assets, or (d) require the Acquirer to
obtain any Consent or Governmental Authorization or make any filing with any
Governmental Authority or other Person.

 

Section 4.4                                    Legal Proceedings.  There is no
Proceeding pending or, to the Acquirer’s knowledge, threatened, against the
Acquirer that challenges, or that may have the effect of preventing, delaying,
making illegal or otherwise interfering with, any of the transactions
contemplated by this Agreement.

 

Section 4.5                                    Investment Intent.  The Acquirer
is acquiring the Interests for its own account and not with a view to their
distribution within the meaning of Section 2(11) of the Securities Act.

 

Section 4.6                                    Brokers or Finders.  Neither the
Acquirer nor any Person acting on its behalf has incurred any Liability to pay
any fees or commissions to any broker, finder or agent or any other similar
payment in connection with any of the transactions contemplated by this
Agreement.  Acquirer hereby indemnifies and holds Contributors harmless from and
against any loss incurred by Contributors arising out of a claim by any broker,
agent or finder that they acted on behalf of Acquirer in connection with the
execution of this Agreement or the transactions contemplated by this Agreement. 
Notwithstanding

 

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anything in this Agreement to the contrary, the representations and
indemnifications of Acquirer under this Section 4.6 shall survive the Closing
and/or the termination of this Agreement.

 

Section 4.7                                    Anti-Terrorism.

 

(a)                                 Neither Acquirer nor any other Person owning
a direct or indirect, legal or beneficial interest in Acquirer is in violation
of the Executive Order.

 

(b)                                 Neither Acquirer nor any of its Affiliates,
any of their respective brokers or other agents, if any, acting or benefiting,
directly or indirectly, in any capacity in connection with the transaction
contemplated by this Agreement, is a Prohibited Person.

 

(c)                                  Acquirer covenants and agrees to deliver to
a Contributor any certification or other evidence requested from time to time by
a Contributor in its reasonable discretion, confirming compliance with this
Section 4.7.

 

(d)                                 (i) None of the funds or other assets of
Acquirer constitute property of, or are beneficially owned, directly or
indirectly, by any Embargoed Person; (ii) no Embargoed Person has any interest
of any nature whatsoever in Acquirer (whether directly or indirectly); and
(iii) none of the funds of Acquirer have been derived from any unlawful activity
with the result that the transaction contemplated by this Agreement is in
violation of law.

 

Section 4.8                                    OPUs.  Acquirer’s Parent will
take commercially reasonable actions in accordance with Section 8.04 of the
First Amended Partnership Agreement of Acquirer’s Parent to cause there to be
sufficient registered, publicly traded shares of the REIT that will be available
for distribution to the Contributors within ninety (90) days from the date any
Contributor is permitted to request and does request to exchange its OPUs for
marketable traded securities, such date of request not to be prior to July 24,
2014.

 

ARTICLE 5
COVENANTS

 

Section 5.1                                    Access and Investigation.  Until
the Closing and upon reasonable advance notice from the Acquirer, the Company
and the Contributors will, and will cause the Company to, allow the Acquirer and
its directors, officers, employees, agents, prospective financing sources,
consultants and other advisors and representatives full access during normal
business hours to, and furnish them with all documents, records, work papers and
information with respect to, all of the properties, assets, personnel, books,
Contracts, Governmental Authorizations, reports and records relating to the
Company as the Acquirer may reasonably request.

 

Section 5.2                                    Operation of the Business of the
Company.

 

(a)                                 Affirmative Covenants.  Until the Closing,
except as expressly consented to by the Acquirer in writing, the Company will,
and the Company and the Contributors will cause the Company to:

 

(i)                                     conduct its business only in the
ordinary course of business and use its commercially reasonable efforts to
preserve and protect its business organization and relationships with tenants
and others having dealings with it;

 

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(ii)                                  pay its accounts payable and other
obligations when they become due and payable in the ordinary course of business;

 

(iii)                               perform all of its obligations under all
Contracts to which it is a party or by which it or any of its properties or
assets is bound or affected, and comply with all Laws, Judgments and
Governmental Authorizations applicable to it or its business, properties or
assets;

 

(iv)                              maintain the Real Property and all of its
other properties and assets in a state of repair and condition that complies
with all applicable Laws and is consistent with the requirements and normal
conduct of its business;

 

(v)                                 continue in full force and effect the
insurance policies set forth in Section 3.18 of the Contributor Disclosure
Schedule;

 

(vi)                              maintain its books and records consistent with
its past custom and practice; and

 

(vii)                           confer with the Acquirer concerning operational
matters of a material nature and otherwise report periodically to the Acquirer
concerning the status of its business, operations and finances.

 

(b)                                 Negative Covenants.  Until the Closing,
except as expressly permitted by this Agreement or as otherwise expressly
consented to by the Acquirer in writing, the Company will not take any action,
or fail to take any action, as a result of which (i) any of the changes, events
or conditions described in Section 3.8 would occur or would reasonably be
expected to occur; (ii) any of the Leases or Contracts would be modified; or
(iii) any alterations or capital improvements would be made to any Real Property
(except in response to a casualty in accordance with Section 2.11 hereof).

 

Section 5.3                                    Consents and Filings.  The
Company and the Contributors will, and will cause the Company to, use its
commercially reasonable efforts (i) to take promptly, or cause to be taken
(including actions after the Closing), all actions, and to do promptly, or cause
to be done, all things necessary, proper or advisable to consummate and make
effective the transactions contemplated by this Agreement and (ii) as promptly
as practicable after the date of this Agreement, to obtain all Governmental
Authorizations from, give all notices to, and make all filings with, all
Governmental Authorities, and to obtain all other Consents from, and give all
other notices to, all other Persons, that are necessary or advisable in
connection with the authorization, execution and delivery of this Agreement and
the consummation of the transactions contemplated by this Agreement, including
those listed in Section 3.3 and Section 6.1(c) of the Contributor Disclosure
Schedule.

 

Section 5.4                                    Notification.  Until the Closing,
the Company and the Contributors will give prompt notice to the Acquirer of
(a) any fact, circumstance, event or action, the existence, occurrence or taking
of which would reasonably be expected to cause any representation or warranty of
the Contributors in this Agreement to be untrue or inaccurate, (b) any failure
to comply with or satisfy any covenant or agreement of the Contributors or the
Company under this Agreement, and (c) the failure of any condition precedent to
the Acquirer’s obligations under this Agreement.   If Contributors notify
Acquirer of any change in any representation and warranty or inability to comply
with any of Contributors’ covenants under this Agreement, prior to the Closing,
then Contributors’ representation and warranty and covenants will be changed in
accordance with said notification, at which point Acquirer will have the right
to either accept the change in representation and warranty and covenants without
reduction in the Agreed Value or the right to terminate this Agreement and the
Deposit shall be returned to Acquirer and this Agreement will have no further
force or affect.

 

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Section 5.5                                    Confidentiality.

 

(a)                                 From and after the Closing, each Contributor
will, and will cause each of its Affiliates and its and their respective
officers, members, managers, employees, agents, consultants and other advisors
and representatives (its “Restricted Persons”) to, maintain the confidentiality
of, and not use for their own benefit or the benefit of any other Person, the
Confidential Information.

 

(b)                                 Except as contemplated by Section 5.6,
neither the Acquirer nor any Contributor will, and the Acquirer and each
Contributor will cause each of their respective Restricted Persons not to,
disclose to any Person any information with respect to the legal, financial or
other terms or conditions of this Agreement, any of the Ancillary Agreements or
any of the transactions contemplated hereby or thereby.  The foregoing does not
restrict the right of any party to disclose such information (i) to its
respective Restricted Persons to the extent reasonably required to facilitate
the negotiation, execution, delivery or performance of this Agreement and the
Ancillary Agreements, (ii) to any Governmental Authority or arbitrator to the
extent reasonably required in connection with any Proceeding relating to the
enforcement of this Agreement or any Ancillary Agreement and (iii) as permitted
in accordance with Section 5.5(d).  Each party will advise its respective
Restricted Persons with respect to the confidentiality obligations under this
Section 5.5(c) and will be responsible for any breach or violation of such
obligations by its Restricted Persons.

 

(c)                                  If a party or any of its respective
Restricted Persons become legally compelled to make any disclosure that is
prohibited or otherwise restricted by this Agreement, then such party will
(i) promptly notify the other party in writing, (ii) consult with and assist the
other party in obtaining an injunction or other appropriate remedy to prevent
such disclosure and (iii) use its commercially reasonable efforts to obtain a
protective order or other reliable assurance that confidential treatment will be
accorded to any information so disclosed.  Subject to the previous sentence, the
disclosing party or such Restricted Persons may make only such disclosure that,
in the written opinion of its counsel, it is legally compelled or otherwise
required to make.

 

(d)                                 To the extent that any Contributor has not
done so prior to the Closing, each Contributor will, immediately following the
Closing, surrender to the Company all data, documents, records, databases,
specifications, customer lists, financial reports and all other tangible
embodiments of Confidential Information, it being expressly understood that all
these writings, tangible embodiments and other things are the exclusive property
of the Company.

 

Section 5.6                                    Public Announcements.  Any public
announcement or similar publicity with respect to this Agreement or the
transactions contemplated by this Agreement will be issued at such time and in
such manner as the Acquirer determines after consultation with the
Contributors.  The Acquirer and the Contributors will consult with each other
concerning the means by which others having dealings with the Company will be
informed of the transactions contemplated by this Agreement, and the Acquirer
has the right to be present for any such communication.  Notwithstanding the
foregoing, the Acquirer has the right to make any announcement required by Law
or the rules of a stock exchange in its sole discretion without having to
consult with the Contributors.

 

Section 5.7                                    Distribution Waiver. Each
Contributor receiving OPUs under this Agreement will, if requested by Acquirer’s
Parent following the Closing Date and prior to November 4, 2013, enter into a
letter agreement irrevocably waiving any and all rights to allocations of income
and loss and distributions for the period from the Closing Date through the end
of 2013.

 

Section 5.8                                    Further Assurances.  Subject to
the other express provisions of this Agreement, upon the request of any party to
this Agreement, the other parties will (a) furnish to the requesting party any
additional information, (b) execute and deliver, at their own expense, any other
documents and (c) take any other actions as the requesting party may reasonably
require to more effectively carry out the intent of this Agreement and the
transactions contemplated by this Agreement.

 

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ARTICLE 6
CONDITIONS PRECEDENT TO OBLIGATION TO CLOSE

 

Section 6.1                                    Conditions to the Obligation of
the Acquirer.  The obligation of the Acquirer to consummate the transactions
contemplated by this Agreement is subject to the satisfaction, on or before the
Closing Date, of each of the following conditions:

 

(a)                                 Accuracy of Representations and Warranties. 
The  representations and warranties of the Contributors in this Agreement must
have been true and correct in all respects as of the date of this Agreement and
must be true and correct in all respects as of the Closing Date, except for the
representations and warranties set forth in Section 3.2 (Authority and
Enforceability), Section 3.4 (Capitalization) and Section 3.5 (Financial
Statements), and each of the Contributors’ representations and warranties that
is qualified as to materiality or contains terms such as “Material Adverse
Effect,” each of which must have been true and correct in all respects as of the
date of this Agreement and must be true and correct in all respects as of the
Closing Date, and except to the extent any representation or warranty of the
Contributors speaks as of the date of this Agreement or any other specific date,
in which case such representation or warranty must have been true and correct in
all respects as of such date. However, nothing herein shall prevent Contributors
from updating or changing any representation and warranty or covenant provided
such update or change is disclosed to Acquirer prior to the Closing and is
subject to Acquirer’s right to terminate the Agreement as set forth in
Section 5.4.;

 

(b)                                 Performance of Covenants.  All of the
covenants and obligations that the Company or the Contributors are required to
perform or comply with under this Agreement on or before the Closing Date must
have been duly performed and complied with in all respects;

 

(c)                                  Consents.  Each of the Governmental
Authorizations and Consents listed in Section 6.1(c) of the Contributor
Disclosure Schedule must have been obtained and must be in full force and
effect;

 

(d)                                 Termination of Agreements.  The following
Contracts must have been terminated:  (i) any membership interests purchase
agreements under which any obligations or potential liability still exist;
(ii) agreements containing non-compete and/or other restrictive covenants; and
(iii) any Tax sharing, indemnity or allocation agreement between the Company and
any other Person;

 

(e)                                  No Action.  There must not be in effect any
Law or Judgment, and there must not have been commenced or threatened any
Proceeding, that would prohibit or make illegal the consummation of any of the
transactions contemplated by this Agreement;

 

(f)                                   No Material Adverse Effect.  Since the
date of this Agreement, there must not have been any Material Adverse Effect;
and

 

(g)                                  Transaction Documents.  The Contributors
must have delivered or caused to be delivered each document that
Section 2.4(a) requires them to deliver.

 

Section 6.2                                    Conditions to the Obligation of
the Contributors.  The obligation of the Contributors to consummate the
transactions contemplated by this Agreement is subject to the satisfaction, on
or before the Closing Date, of each of the following conditions:

 

(a)                                 Accuracy of Representations and Warranties. 
The representations and warranties of the Acquirer in this Agreement must have
been true and correct in all respects as of the date of this Agreement and must
be true and correct in all material respects as of the Closing Date (with
materiality being measured individually and on an aggregate basis with respect
to all breaches of representations and

 

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warranties), except for the Acquirer’s representations and warranties that are
qualified as to materiality, each of which must have been true and correct in
all respects as of the date of this Agreement and must be true and correct in
all respects as of the Closing Date, and except to the extent any representation
or warranty of the Acquirer speaks as of the date of this Agreement or any other
specific date, in which case such representation or warranty must have been true
and correct in all respects as of such date;

 

(b)                                 Performance of Covenants.  All of the
covenants and obligations that the Acquirer is required to perform or comply
with under this Agreement on or before the Closing Date must have been duly
performed and complied with in all material respects (with materiality being
measured individually and on an aggregate basis with respect to all breaches of
covenants and obligations);

 

(c)                                  Consents.  Each of the Governmental
Authorizations and Consents listed in Section 6.2(c) of the Acquirer Disclosure
Schedule must have been obtained and must be in full force and effect;

 

(d)                                 No Action.  There must not be in effect any
Law or Judgment that would prohibit or make illegal the consummation of any of
the transactions contemplated by this Agreement; and

 

(e)                                  Transaction Documents.  The Acquirer must
have delivered or caused to be delivered to the Contributors each document that
Section 2.4(b) requires it to deliver.

 

ARTICLE 7
TERMINATION

 

Section 7.1                                    Termination Events.  This
Agreement may, by written notice given before or at the Closing, be terminated:

 

(a)                                 by mutual consent of the Acquirer and the
Contributors;

 

(b)                                 by the Acquirer (so long as the Acquirer is
not then in material breach of any of its representations, warranties, covenants
or agreements contained in this Agreement) if there has been a breach of any of
the Contributors’ or the Company’s representations, warranties, covenants or
agreements contained in this Agreement (as may have been updated pursuant to
Section 5.4), which would result in the failure of a condition set forth in
Section 6.1(a) or Section 6.1(b), and which breach has not been cured or cannot
be cured within 30 days after the notice of the breach from the Acquirer by the
Contributors (so long as neither the Company nor any of the Contributors is then
in material breach of any of its representations, warranties, covenants or
agreements contained in this Agreement) if there has been a breach of any of the
Acquirer’s representations, warranties, covenants or agreements contained in
this Agreement, which would result in the failure of a condition set forth in
Section 6.2(a) or Section 6.2(b), and which breach has not been cured or cannot
be cured within 30 days after the notice of breach from the Contributors;

 

(c)                                  the Contributors or Acquirer if there has
been a Material Adverse Effect to any party hereto and/or the REIT;

 

(d)                                 by either the Acquirer or the Contributors
if any Governmental Authority has issued a nonappealable final Judgment or taken
any other nonappealable final action, in each case having the effect of
permanently restraining, enjoining or otherwise prohibiting the transactions
contemplated by this Agreement; or

 

(e)                                  by either the Acquirer or the Contributors 
if the Closing has not occurred on or before October 4, 2013 (other than through
the failure of the terminating party to comply fully with its obligations under
this Agreement).

 

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Section 7.2                                    Effect of Termination.  Each
party’s rights of termination under Section 7.1 are in addition to any other
rights it may have under this Agreement or otherwise, and the exercise of such
rights of termination is not an election of remedies.  If this Agreement is
terminated pursuant to Section 7.1, this Agreement and all rights and
obligations of the parties under this Agreement automatically end without
Liability against any party or its Affiliates, except that (a) Sections 3.24
(Brokers or Finders), 5.5 (Confidentiality), 5.6 (Public Announcement),
Article 10 (General Provisions) (except for Section 10.10 (Specific
Performance)) and this Section 7.2 will remain in full force and survive any
termination of this Agreement. and (b) if this Agreement is terminated by a
party because of the breach of this Agreement by another party or because one or
more of the conditions to the terminating party’s obligations under this
Agreement is not satisfied as a result of the other party’s failure to comply
with its obligations under this Agreement, the terminating party’s right to
pursue all legal remedies will survive such termination unimpaired.

 

ARTICLE 8
CERTAIN TAX MATTERS

 

Section 8.1                                    Tax Returns.

 

(a)                                 The Members shall cause to be prepared and
filed on a timely basis any Tax Returns with respect to the Company and the
Subsidiaries of the Company for taxable periods ending on or before the Closing
Date that are not filed by the Closing Date.  Such Tax Returns will be prepared
in a manner consistent with and utilizing the accounting methods utilized in the
preparation of the prior Tax Returns of the Company and the Subsidiaries of the
Company.  The Members will submit a draft of any such Tax Return to the Acquirer
for its review at least 15 days prior to filing and will consider in good faith
any comments that the Acquirer may have with respect to such draft Tax Return or
any objections to the manner in which one or more items are reflected on such
draft Tax Return.  If the Acquirer notifies the Members of any objection, the
parties and their tax advisors shall attempt to resolve any differences in good
faith; provided, however, that if any dispute regarding the manner in which an
item is reflected in such draft Tax Return is not resolved prior to the due date
of the Tax Return, the Members shall be authorized to file such Tax Return in
such format as they reasonably believe is appropriate; provided, further,
however, that if any such disputed item is reasonably likely to result in any
adverse Tax consequences to the Acquirer or Acquirer’s Parent in any taxable
period ending after the Closing Date, then such disputed item shall be reflected
on the final Tax Return in the manner that the Acquirer reasonably believes is
appropriate.

 

(b)                                 The Acquirer will prepare and file (or cause
to be prepared and filed) all Tax Returns with respect to the Company and the
Subsidiaries of the Company for all taxable periods ending after the Closing
Date.

 

Section 8.2                                    Payment of Taxes.

 

(a)                                 To the extent that Taxes of the Company or
of the Subsidiaries of the Company for all taxable periods and portions of
periods through the Closing Date (including all such Taxes payable with respect
to Tax Returns filed under this Article 8 and any Taxes assessed after the
Closing with respect to taxable periods or portions of periods through the
Closing Date) are apportioned as a Closing Adjustment to the period ending on
the Closing Date under Section 2.6, the Acquirer will pay or cause to be paid
such Taxes.  To the extent such Taxes for all taxable periods and portions of
periods through the Closing Date are not so apportioned as a Closing Adjustment
to the period ending on the Closing Date under Section 2.6, the Members will pay
all such Taxes.  Taxes that are payable with respect to a taxable period that
begins before the Closing Date and ends after the Closing Date will be allocated
to the portion of the period that ends on the Closing Date in accordance with
Section 8.3.

 

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(b)                                 In the case of Tax Returns filed by the
Acquirer under this Article 8 and as to which the Acquirer expects payment from
the Members, the Acquirer may elect to deliver the pertinent Tax Return to the
Members and inform the Members of any amounts due from them at least ten days
prior to the due date of the pertinent Tax Return and the Members will pay such
amounts to the Acquirer in immediately available funds at least two Business
Days prior to the due date of the Tax Return.

 

Section 8.3                                    Tax Apportionment.  The books of
the Company will be closed on the Closing Date.  In the case of any taxable
period that begins before the Closing Date and ends after the Closing Date, the
amount of any Taxes with respect to such period will be apportioned between the
portion of such period ending on the Closing Date and the portion of such period
that begins on the day immediately following the Closing Date.  The portion of
any such Tax that is allocable to the portion of the period ending on the
Closing Date will be:

 

(a)                                 in the case of Taxes that are either
(i) based upon or related to income or receipts or (ii) imposed in connection
with any sale or other transfer or assignment of property (real or personal,
tangible or intangible) (other than any transaction Taxes contemplated by
Section 8.5), deemed equal to the amount which would be payable if the taxable
period ended as of the close of business on the Closing Date; and

 

(b)                                 in the case of Taxes imposed on a periodic
basis with respect to the assets of the Company, or otherwise measured by the
level of any item, deemed to be the amount of such Taxes for the entire period
(or, in the case of such Taxes determined on an arrears basis, the amount of
such Taxes for the immediately preceding period), multiplied by a fraction the
numerator of which is the number of calendar days in the portion of the period
ending on the Closing Date and the denominator of which is the number of
calendar days in the entire period.

 

Section 8.4                                    Tax Elections.  The Contributors
will not, and will not cause or permit the Company or the Subsidiaries of the
Company to, without the prior written consent of the Acquirer (which consent
will not be unreasonably withheld or delayed), make or revoke, or cause or
permit to be made or revoked, any Tax election pertaining to the Company or the
Subsidiaries of the Company.

 

Section 8.5                                    Transactional Taxes. 
Notwithstanding any other provision of this Agreement, all transfer,
documentary, recording, notarial, sales, use, registration, stamp and other
similar Taxes or fees imposed by any taxing authority in connection with the
transactions contemplated by this Agreement will be borne by the Contributors. 
The Contributors will, at their own expense, file all necessary Tax Returns and
other documentation with respect to all such Taxes and, if required by
applicable Law, the Acquirer will, and will cause its Affiliates to, join in the
execution of any such Tax Returns or other documentation.

 

Section 8.6                                    Survival.  Notwithstanding any
other provisions of this Agreement, the Acquirer and the Contributors agree that
the covenants in this Article 8 will survive until 180 days following the
expiration of the longest statute of limitations applicable to the underlying
matters covered by such provisions (giving effect to any waiver or extension
thereof).

 

ARTICLE 9
INDEMNIFICATION

 

Section 9.1                                    Indemnification by the
Contributors.  Subject to the limitations expressly set forth in Section 9.3,
the Contributors pro rata and in accordance with each Member’s Interest in the
Company, will indemnify and hold harmless the Acquirer and its Affiliates
(including, following the Closing, the Company) and their respective directors,
officers, members, managers, equity owners, employees, agents, consultants and
other advisors and representatives (collectively, the “Acquirer

 

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Indemnified Parties”) from and against, and will pay and reimburse them for, any
and all Losses incurred or suffered by the Acquirer Indemnified Parties directly
or indirectly arising out of, relating to or resulting from any of the
following:

 

(a)                                 any inaccuracy in or breach of any
representation or warranty of any Contributor contained in this Agreement, any
Ancillary Agreement or in any certificate or instrument delivered by or on
behalf of any Contributor pursuant to this Agreement or any Ancillary Agreement;

 

(b)                                 any nonperformance or other breach of any
covenant or agreement of any Contributor or the Company contained in this
Agreement, any Ancillary Agreement or in any certificate or instrument delivered
by or on behalf of any Contributor pursuant to this Agreement or any Ancillary
Agreement; and

 

(c)                                  (i) any Taxes of the Company with respect
to taxable periods ending on or before the Closing Date, and (ii) with respect
to taxable periods beginning before the Closing Date and ending after the
Closing Date, any Taxes of the Company which are allocable, pursuant to
Section 8.3, to the portion of such period ending on the Closing Date.

 

For purposes of this Section 9.1, any inaccuracy in, or breach of any
representation or warranty, or nonperformance or other breach of any covenant or
agreement by any Contributor or the Company, and the amount of any Losses
associated therewith, will be determined without regard for any materiality,
“Material Adverse Effect” or similar qualification.

 

Section 9.2                                    Indemnification by the Acquirer
and Acquirer’s Parent.  Subject to the limitations expressly set forth in
Section 9.3, the Acquirer and Acquirer’s Parent will indemnify and hold harmless
the Members from and against, and will pay and reimburse them for, any and all
Losses incurred or suffered by the Members directly or indirectly arising out
of, relating to or resulting from any of the following:

 

(a)                                 any inaccuracy in or breach of any
representation or warranty or other statement of the Acquirer and Acquirer’s
Parent contained in this Agreement, any Ancillary Agreement or in any
certificate or instrument delivered by the Acquirer or Acquirer’s Parent
pursuant to this Agreement or any Ancillary Agreement; and

 

(b)                                 any nonperformance or other breach of any
covenant or agreement of the Acquirer and Acquirer’s Parent contained in this
Agreement, any Ancillary Agreement or in any certificate or instrument delivered
by the Acquirer or Acquirer’s Parent pursuant to this Agreement or any Ancillary
Agreement.

 

For purposes of this Section 9.2, any inaccuracy in, or breach of any
representation or warranty, or nonperformance or other breach of any covenant or
agreement by the Acquirer and Acquirer’s Parent, and the amount of any Losses
associated therewith, will be determined without regard for any materiality,
material adverse effect or similar qualification.

 

Section 9.3                                    Survival.  All representations
and warranties contained in this Agreement, any Ancillary Agreement or in any
certificate or instrument delivered pursuant to this Agreement will survive the
Closing, for a period of 6 months from the Closing Date; provided, however, that
(i) the representations and warranties set forth in Sections 3.13 (Tax Matters)
and 3.15 (Environmental, Health and Safety Matters) will survive until 180 days
following the expiration of the statute of limitations applicable to the
underlying matters covered by such provisions (giving effect to any waiver or
extension thereof), and (ii) the representations and warranties set forth in
Sections 3.2 (Authority and Enforceability), 3.3 (No Conflict), 3.4
(Capitalization and Ownership) 3.19 (Brokers or Finders), and 4.8 (OPUs) will
survive indefinitely.  Notwithstanding the foregoing, any claims for
indemnification asserted

 

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in good faith with reasonable specificity (to the extent known at such time) and
in writing by notice from before the expiration of the applicable survival
period will not thereafter be barred by the expiration of the relevant
representation or warranty and such claims will survive until finally resolved.

 

Section 9.4                                    No Right of Indemnification or
Contribution.  No Contributor has any right of indemnification or contribution
against the Company with respect to any breach by the Contributors or the
Company of any of their representations, warranties, statements, covenants or
agreements contained in this Agreement, any Ancillary Agreement or in any
certificate, instrument or other document delivered by or on behalf of any
Contributor or the Company pursuant to this Agreement or any Ancillary
Agreement, whether by virtue of any contractual or statutory right of indemnity
or otherwise, and all claims to the contrary are hereby waived and released.

 

ARTICLE 10
GENERAL PROVISIONS

 

Section 10.1                             Notices.  All notices and other
communications under this Agreement must be in writing and are deemed duly
delivered when (a) delivered if delivered personally or by nationally recognized
overnight courier service (costs prepaid), (b) sent by facsimile with
confirmation of transmission by the transmitting equipment (or, the first
Business Day following such transmission if the date of transmission is not a
Business Day) or (c) received or rejected by the addressee, if sent by United
States of America certified or registered mail, return receipt requested; in
each case to the following addresses or facsimile numbers and marked to the
attention of the individual (by name or title) designated below (or to such
other address, facsimile number or individual as a party may designate by notice
to the other parties):

 

If to the Members:

 

3017 Galleria Drive

Metairie, Louisiana 70001

 

with a copy (which will not constitute notice) to:

 

Ajubita, Leftwich & Salzer, LLC

1100 Poydras Street, Suite 1500

New Orleans, Louisiana 70163

Attn: A. Albert Ajubita

 

If to the Company:

 

3017 Galleria Drive

Metairie, Louisiana 70001

Attn: Kirk Long

 

with a copy (which will not constitute notice) to:

 

Ajubita, Leftwich & Salzer, LLC

1100 Poydras Street, Suite 1500

New Orleans, Louisiana 70163

Attn: A. Albert Ajubita

 

If to the Acquirer:

 

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DOC-CCSC-Crescent City Surgical Centre, L.L.C.

c/o Physicians Realty Trust

250 East Wisconsin Avenue, Suite 1900

Milwaukee, Wisconsin 53202

Attn: John T. Thomas

 

with a copy (which will not constitute notice) to:

 

Baker & McKenzie LLP

300 East Randolph Drive, Suite 5000

Chicago, Illinois 60601

Attn: Matthew C. Alshouse

 

and with a copy (which will not constitute notice) to:

 

Davis & Kuelthau, s.c.

111 East Kilbourn Avenue, Suite 1400

Milwaukee, WI 53202

Attn: Bradley D. Page

 

Section 10.2                             Amendment.  This Agreement may not be
amended, supplemented or otherwise modified except in a written document signed
by each party to be bound by the amendment and that identifies itself as an
amendment to this Agreement.

 

Section 10.3                             Waiver and Remedies.  The parties may
(a) extend the time for performance of any of the obligations or other acts of
any other party to this Agreement, (b) waive any inaccuracies in the
representations and warranties of any other party to this Agreement contained in
this Agreement or in any certificate, instrument or document delivered pursuant
to this Agreement or (c) waive compliance with any of the covenants, agreements
or conditions for the benefit of such party contained in this Agreement.  Any
such extension or waiver by any party to this Agreement will be valid only if
set forth in a written document signed on behalf of the party or parties against
whom the waiver or extension is to be effective.  No extension or waiver will
apply to any time for performance, inaccuracy in any representation or warranty,
or noncompliance with any covenant, agreement or condition, as the case may be,
other than that which is specified in the written extension or waiver.  No
failure or delay by any party in exercising any right or remedy under this
Agreement or any of the documents delivered pursuant to this Agreement, and no
course of dealing between the parties, operates as a waiver of such right or
remedy, and no single or partial exercise of any such right or remedy precludes
any other or further exercise of such right or remedy or the exercise of any
other right or remedy.  Any enumeration of a party’s rights and remedies in this
Agreement is not intended to be exclusive, and a party’s rights and remedies are
intended to be cumulative to the extent permitted by law and include any rights
and remedies authorized in law or in equity.

 

Section 10.4                             Entire Agreement.  This Agreement
(including the Schedules and Exhibits hereto and the documents and instruments
referred to in this Agreement that are to be delivered at the Closing)
constitutes the entire agreement among the parties and supersedes any prior
understandings, agreements or representations by or among the parties, or any of
them, written or oral, with respect to the subject matter of this Agreement.

 

Section 10.5                             Assignment and Successors and No Third
Party Rights.  No party may assign any of its rights or delegate any of its
obligations under this Agreement without the prior written consent of

 

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the other parties to this Agreement, except that the Acquirer may, without the
consent of the Company or the Contributors, (a) assign any of its rights and
delegate any of its obligations under this Agreement to any entity that is an
Affiliate of the Acquirer or to any subsequent acquirer of the Interests, the
Acquirer or of all or substantially all of the business or assets of the Company
or the Acquirer and (b) assign any of its rights under this Agreement as
collateral security for any lender providing financing to the Acquirer.  Subject
to the preceding sentence, this Agreement will apply to, be binding in all
respects upon, and inure to the benefit of each Contributors’ heirs, executors,
administrators and permitted assigns and the Acquirer’s successors and permitted
assigns.

 

Section 10.6                             Severability.  If any provision of this
Agreement is held invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions of this Agreement are not affected or
impaired in any way and the parties agree to negotiate in good faith to replace
such invalid, illegal and unenforceable provision with a valid, legal and
enforceable provision that achieves, to the greatest lawful extent under this
Agreement, the economic, business and other purposes of such invalid, illegal or
unenforceable provision.

 

Section 10.7                             Exhibits and Schedules.  The Exhibits
and Schedules to this Agreement (including the Contributor Disclosure Schedule
and the Acquirer Disclosure Schedule) are incorporated herein by reference and
made a part of this Agreement.  The Contributor Disclosure Schedule and the
Acquirer Disclosure Schedule are arranged in sections and paragraphs
corresponding to the numbered and lettered sections and paragraphs of Article 3,
Article 4 and Article 6, as applicable.  The disclosure in any section or
paragraph of the Contributor Disclosure Schedule or the Acquirer Disclosure
Schedule qualifies other sections and paragraphs in this Agreement only to the
extent it is clear by appropriate cross-references that a given disclosure is
applicable to such other sections and paragraphs.  The listing or inclusion of a
copy of a document or other item is not adequate to disclose an exception to any
representation or warranty in this Agreement unless the representation or
warranty relates to the existence of the document or item itself.

 

Section 10.8                             Interpretation.  In the negotiation of
this Agreement, each party has received advice from its own attorney.  The
language used in this Agreement is the language chosen by the parties to express
their mutual intent, and no provision of this Agreement will be interpreted for
or against any party because that party or its attorney drafted the provision.

 

Section 10.9                             Governing Law.  The internal laws of
the State of New York (without giving effect to any choice or conflict of law
provision or rule (whether of the State of Louisiana or any other jurisdiction)
that would cause the application of laws of any other jurisdiction) govern all
matters arising out of or relating to this Agreement and its Exhibits and
Schedules and all of the transactions it contemplates, including its validity,
interpretation, construction, performance and enforcement and any disputes or
controversies arising therefrom or related thereto.

 

Section 10.10                      Specific Performance.  The parties agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached.  The parties accordingly agree that, in addition to any
other remedy to which they are entitled at law or in equity, the parties are
entitled to injunctive relief to prevent breaches of this Agreement and
otherwise to enforce specifically the provisions of this Agreement.  Each party
expressly waives any requirement that any other party obtain any bond or provide
any indemnity in connection with any action seeking injunctive relief or
specific enforcement of the provisions of this Agreement.

 

Section 10.11                      Jurisdiction and Service of Process.  Any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated by this Agreement must be brought in the courts of the
State of New York, County of New York, or, if it has or can acquire
jurisdiction, in the

 

34

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United States District Court for the Southern District of New York.  Each of the
parties knowingly, voluntarily and irrevocably submits to the exclusive
jurisdiction of each such court in any such action or proceeding and waives any
objection it may now or hereafter have to venue or to convenience of forum.  Any
party to this Agreement may make service on another party by sending or
delivering a copy of the process to the party to be served at the address and in
the manner provided for the giving of notices in Section 10.1.  Nothing in this
Section 10.11, however, affects the right of any party to serve legal process in
any other manner permitted by law.

 

Section 10.12                      Waiver of Jury Trial. EACH OF THE PARTIES
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE ACTIONS
OF ANY PARTY TO THIS AGREEMENT IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT OF THIS AGREEMENT.

 

Section 10.13                      Expenses.  Except as otherwise provided in
this Agreement, whether or not the transactions contemplated by this Agreement
are consummated, the Contributors, on the one hand, and the Acquirer, on the
other hand, will pay all of their own expenses (including, but not limited to,
all compensation and expenses of counsel, financial advisors, consultants,
actuaries and independent accountants) incurred in connection with the
preparation and negotiation of this Agreement and the consummation of the
transactions contemplated by this Agreement.

 

Section 10.14                      Counterparts.  The parties may execute this
Agreement in multiple counterparts, each of which constitutes an original as
against the party that signed it, and all of which together constitute one
agreement.  This Agreement is effective upon delivery of one executed
counterpart from each party to the other parties.  The signatures of all parties
need not appear on the same counterpart.  The delivery of signed counterparts by
facsimile or email transmission that includes a copy of the sending party’s
signature(s) is as effective as signing and delivering the counterpart in
person.

 

[Signature page follows.]

 

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The parties have executed and delivered this Agreement as of the date indicated
in the first sentence of this Agreement.

 

 

Acquirer:

 

 

 

DOC-CCSC Crescent City Surgical Centre, LLC

 

 

 

By: Physicians Realty L.P, its manager

 

 

 

 

By:

Physicians Realty Trust, its general partner

 

 

 

 

 

 

By:

 /s/ John. T. Thomas

 

 

Name: John T. Thomas

 

 

Title: President & CEO

 

 

 

Company:

 

 

 

Crescent City Surgical Centre Facility, LLC

 

 

 

 

 

 

By:

 /s/ Kirk W. Long

 

 

Name: Kirk W. Long

 

 

Title: CEO

 

 

 

 

 

Acquirer’s Parent:

 

 

 

Physicians Realty L.P.

 

 

 

By: Physicians Realty Trust, its general partner

 

 

 

 

 

 

By:

/s/ John T. Thomas

 

 

Name: John T. Thomas

 

 

Title: President & CEO

 

36

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Members of the Company:

 

 

 

Lavin Healthcare, L.L.C.

 

 

 

 

 

 

By:

/s/ Thomas E. Lavin

 

 

Name: Thomas E. Lavin

 

 

Title: Manager

 

 

 

 

 

NANEELIE, L.L.C.

 

 

 

 

 

 

By:

/s/ Najeeb M. Thomas

 

 

Name: Najeeb M. Thomas

 

 

Title: Manager

 

 

 

 

 

CWM Consulting, L.L.C.

 

 

 

 

 

 

By:

/s/ Chad W. Millet

 

 

Name: Chad W. Millet

 

 

Title: Manager

 

 

 

 

 

/s/ Michael J. Thomas, M.D.

 

Michael J. Thomas, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Clark G. Warden, M.D.

 

Clark G. Warden, M.D., in his/her individual capacity

 

 

 

 

 

/s/ James G. Redmann, M.D.

 

James G. Redmann, M.D., in his/her individual capacity

 

37

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/s/ Matthew S. French, M.D.

 

Matthew S. French, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Rachel L. Moore, M.D.

 

Rachel L. Moore, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Rand M. Voorhies, M.D.

 

Rand M. Voorhies, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Richard L. Corales, M.D.

 

Richard L. Corales, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Lucien Miranne, M.D.

 

Lucien Miranne, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Richard L. Meyer, Jr., M.D

 

Richard L. Meyer, Jr., M.D., in his/her individual capacity

 

 

 

 

 

/s/ Lance S. Estrada, M.D.

 

Lance S. Estrada, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Kevin M. Watson, M.D.

 

Kevin M. Watson, M.D., in his/her individual capacity

 

38

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/s/ Andres G. Todd, M.D.

 

Andrew G. Todd, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Roger H. Ogden, M.D.

 

Roger H. Ogden, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Ralph W. Junius, M.D.

 

Ralph W. Junius, M.D., in his/her individual capacity

 

 

 

 

 

/s/ N. Knight Worley, M.D.

 

N. Knight Worley, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Russell Patrick Cecola, M.D.

 

Russell Patrick Cecola, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Sean G. Mayfield, M.D.

 

Sean G. Mayfield, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Michael F Adinolfi, M.D.

 

Michael F. Adinolfi, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Elliot B. Black, M.D.

 

Elliott B. Black, M.D., in his/her individual capacity

 

39

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/s/ Eileen S. Black, M.D.

 

Eileen S. Black, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Richard C Vanderbrook, M.D.

 

Richard C. Vanderbrook, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Simon Finger, M.D.

 

Simon Finger, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Michael J. McNulty, M.D.

 

Michael J. McNulty, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Everett G. Robert, M.D.

 

Everett G. Robert, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Douglas N. Lurie, M.D.

 

Douglas N. Lurie, M.D., in his/her individual capacity

 

 

 

 

 

/s/ Claude Williams, M.D.

 

Claude Williams, M.D., in his/her individual capacity

 

40

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