Exhibit 10.1

 

The following is a form of Agreement of Sale executed by College Park
Investments, LLC, an indirect subsidiary of GMH Communities Trust (the “Buyer”),
and a number of entities affiliated with Capstone Properties (the “Seller”), in
connection with the acquisition of 13 properties. The parties executed separate
Agreements of Sale relating to each of the properties. Subsequent to the
execution of these agreements, the parties executed an amendment to terminate
agreements of sale relating to two of the properties in the portfolio, each
located in College Station, TX. A copy of that amendment has been filed by GMH
Communities Trust as an exhibit to its Quarterly Report on Form 10-Q for the
three months ended June 30, 2006.  Any material differences between the
following form agreement and the separate agreements of sale for each of the
individual properties within the portfolio are provided on Schedule I to this
form agreement.

 

 

AGREEMENT OF SALE

 

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[Affiliate of Capstone Properties]

 

 

And

 

 

College Park Investments, LLC, Buyer

 

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

1.

PROPERTY

1

 

1.1

Property

1

2.

PURCHASE PRICE

2

 

2.1

Purchase Price

2

 

2.2

Deposit

2

 

2.3

Balance

2

 

2.4

Deposit Non-Refundable

3

3.

CONDITIONS PRECEDENT

3

 

3.1

Conditions to Buyer’s Obligation to Purchase

3

 

3.2

Conditions to Seller’s Obligation to Sell

3

4.

DUE DILIGENCE

3

 

4.1

Buyer’s Investigation

3

 

4.2

Seller Deliverables

4

 

4.3

Termination

4

 

4.4

Survey

5

 

4.5

Clearing Title Objections

5

 

4.6

Termination of Contracts

6

5.

REPRESENTATIONS AND WARRANTIES OF SELLER

7

 

5.1

Representations and Warranties of Seller

7

 

5.2

Effective Date

12

6.

REPRESENTATIONS AND WARRANTIES OF BUYER

12

 

6.1

Representations and Warranties of Buyer

12

 

6.2

Effective Date

13

7.

INDEMNITIES

13

 

7.1

Seller’s Indemnities

13

 

7.2

Buyer’s Indemnities

13

8.

EXCLUDED LIABILITIES

14

 

8.1

Excluded Liabilities

14

9.

INTERIM OPERATION OF THE PROPERTY

14

 

9.1

Operations

14

 

9.2

Lease Enforcement

14

 

9.3

Modifications; Agreements

14

 

9.4

New Contracts

14

 

9.5

No Solicitation

14

 

9.6

Leasing Status Reports

15

10.

RISK OF LOSS

15

 

10.1

Risk of Loss and Insurance Proceeds

15

 

10.2

Notifications

15

11.

CLOSING

15

 

11.1

Escrow Instructions

15

 

11.2

Closing Date

16

 

11.3

Location

16

 

11.4

Closing Documents

16

 

11.5

Additional Seller Deliverables

17

 

11.6

Buyer Closing Deliveries

17

 

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Page

 

 

 

 

11.7

Closing by Title Insurance Company

17

 

11.8

Additional Title Insurance Documents

18

 

11.9

Possession

18

 

11.10

Transfer of Licenses and Permits

18

 

11.11

Tenant Notices

18

 

11.12

Termination/Assignment of Contracts

18

12.

PRORATIONS, CLOSING PAYMENTS

18

 

12.1

Closing Party

18

 

12.2

Sales Taxes

19

 

12.3

Installment Assessments

19

 

12.4

Tenant Deposits

19

 

12.5

Real Estate Taxes

19

 

12.6

Utilities and Contracts

19

 

12.7

Prorations

19

 

12.8

Proration Backup Information

20

 

12.9

Audit Rights

20

13.

DEFAULT

20

 

13.1

Buyer’s Default

20

 

13.2

Seller’s Default

21

14.

BROKERS

21

 

14.1

Brokers

21

15.

NOTICES

21

 

15.1

Notices

21

16.

MISCELLANEOUS

22

 

16.1

Entire Agreement

22

 

16.2

Amendments

23

 

16.3

Time

23

 

16.4

Attorneys’ Fees

23

 

16.5

Assignment

23

 

16.6

Counterparts

23

 

16.7

Governing Law

23

 

16.8

Waiver of Trial by Jury

23

 

16.9

No Third-Party Beneficiary

23

 

16.10

Severability

23

 

16.11

Drafts Not an Offer to Enter into a Legally Binding Contract

24

 

16.12

Consents

24

 

16.13

Survival

24

 

16.14

No Implied Easements

24

 

16.15

Joint Undertaking

24

17.

DEFINITIONS

24

 

17.1

Definitions

24

 

17.2

Terms Generally

26

 

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Affiliate

25

Agreement

1, 26

Assignment of Contracts

16

Assignment of Leases

16

Bill of Sale

16

Books and Records

2

Business Day

25

Buyer

1, 26

Buyer Title Objections

6

Buyer’s Conditions Precedent

3

Claim

25

Closing

16

Closing Documents

25

Closing Statement

17

Closings

16

Deed

16

Default Schedule

8

Deposit

2

Deposit Date

2

Due Diligence Period

4

Due Diligence Termination

5

Effective Date

1

employee benefit plan

7

Escrow Agreement

2

Existing Leases

9

Existing Litigation

8

General Assignment

16

Governmental Authority

25

Hazardous Substance

25

Improvements

1

Insurance Policies

10

Land

1

Lease

25

Lease Guaranties

9

Licenses and Permits

2

Monetary Liens

6

New Leases

25

Other Agreements

5

parties

26

Parties

26

Permitted Encumbrances

6

Person

26

Personal Property

1

Property

26

Reallocated Deposit

5

Remove of Record

6

Rent

9

Rent Rolls

9

Reports and Plans

2

Required Deletion Items

6

Seller

26

Seller Default

21

Seller Deliverables

4

Survey

5

Tenant Deposits

9

Tenants

9

Threshold Aggregate Purchase Price

5

Title Insurance Commitment

6

Title Insurance Commitments

6

Title Insurance Company

2

Title Insurance Policy

26

Title Objection Notice

6

Trade Mark

2

Trade Name

2

Warranties

1

 

 

 

 

EXHIBITS

 

A

DEED

B

BILL OF SALE

C

ASSIGNMENT OF CONTRACTS

C

ASSIGNMENT OF LEASES

E

REAFFIRMATION OF SELLER’S REPRESENTATIONS AND WARRANTIES

F

FIRPTA AFFIDAVIT

G

DESIGNATION AGREEMENT

H

NOTICE TO TENANTS

I

NOTICE TO CONTRACTORS

 

 

 

 

SCHEDULES

 

 

 

1.1.1

Description of Land

1.1.9

Trademarks

4.2

Seller Deliverables

 

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5.1.2

Existing Litigation

5.1.10

Employees

RIDER

 

 

 

I

Deposit and Escrow Agreement

 

iv

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AGREEMENT OF SALE

 

This Agreement of Sale (“Agreement”) is entered into as of June 12, 2006
(“Effective Date”), by and between                     (“Seller”), and College
Park Investments, LLC, a Delaware limited liability company (“Buyer”).  In
consideration of the mutual agreements herein set forth, and other valuable
consideration, the parties hereto, intending to be legally bound, agree as
follows.

 

1.    PROPERTY

 

1.1           Property.  For the Purchase Price and subject to the terms and
conditions hereof, Seller agrees to sell to Buyer, and Buyer agrees to purchase,
all Seller’s right, title and interest in and to all and singular the following
(hereinafter referred to as the “Property”):

 

1.1.1        Land.  The parcel or parcels of land described in Exhibit “A” to
the form of deed that is attached hereto as Exhibit “A” (collectively, the
“Land”), being all the land owned by Seller at the location identified in such
Exhibit “A”], together with all buildings, improvements, structures and fixtures
located thereon (collectively, “Improvements”), and together with the tenements,
hereditaments, appurtenances, rights of way, strips, gores, easements, licenses,
rights and privileges in any way pertaining or beneficial to the Land or the
Improvements (including without limitation any rights of the Seller as a
declarant), the land lying in the bed of any street, road, highway, avenue or
alley, opened or unopened, adjoining the Land, subject to the Permitted
Encumbrances (as hereinafter defined), and all damages, awards, claims and
causes of action now or hereafter payable or assertable with respect to any of
the foregoing by reason of any exercise of the power of eminent domain, any
change of grade of any street, road, highway, avenue or alley, or any damage,
destruction, loss or removal of any of the foregoing (the Land, Improvements and
all of the other property, right, title and interest referred to in this
Section being sometimes collectively referred to as the “Real Property”);

 

1.1.2        Personal Property.  All tangible and intangible personal property
located in, or attached to, or used in connection with the Real Property, and
all replacements thereof and additions thereto between the Effective Date and
the Closing Date, including without limitation all computers, software,
electronic and paper files and records, machinery, equipment, furniture,
furnishings, appliances and signs, excluding only personal property owned by any
Tenant (collectively, “Personal Property”);

 

1.1.3        Leases.  Seller’s interest, as landlord, owner or licensor (as
applicable) in all (a) Leases, (b) Tenant Deposits and (c) Lease Guaranties;

 

1.1.4        Contracts.  Those certain Contracts that Buyer elects to assume
pursuant to Section 4.6;

 

1.1.5        Warranties.  Warranties and guaranties made by or received from any
person with respect to any building, building component, structure, fixture,
machinery, equipment or material constituting part of the Property
(collectively, “Warranties”);

 

1.1.6        Reports and Plans.  (a) Preliminary, final and proposed building
plans and specifications (including “as-built” plans and drawings) and tenant
improvement plans and

 

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specifications for the Improvements, (b) surveys, grading plans, topographical
maps, architectural and structural drawings and engineering, soils, seismic,
environmental, geologic and architectural reports, studies and tests relating to
the Real Property and (c) lock combinations, keys, operating manuals and
technical data relating to the Real Property or Personal Property ((a), (b) and
(c) collectively, “Reports and Plans”);

 

1.1.7        Licenses and Permits.  (a) Licenses, permits, building inspection
approvals, certificates of occupancy, approvals, subdivision maps and
entitlements issued, approved or granted by Governmental Authorities in
connection with the Property, (b) development rights, covenants, conditions and
restrictions, reciprocal easement agreements and rights, area easement
agreements and rights and other common or planned development agreements and
rights benefiting the Property and (c) other licenses, consents and approvals
relating to the Real Property or Personal Property ((a), (b) and
(c) collectively, “Licenses and Permits”);

 

1.1.8        Trade Name.  The trade name “[Name of Property]” (“Trade Name”) and
the trade mark (“Trade Mark”) identified on Schedule 1.1.8 hereto; provided,
however, that Buyer’s use of the Trade Name and the Trade Mark shall be limited
solely and exclusively to the Real Property, and Buyer may not use the Trade
Name or the Trade Mark at any location whatsoever other than the Real Property;
and

 

1.1.9        Books and Records.  Books and records pertaining to the Contracts,
Leases, Warranties, Licenses and Permits, or the operation of the Real Property
(collectively, “Books and Records”).

 

2.    PURCHASE PRICE

 

2.1           Purchase Price.  The purchase price for the Property is
                  (“Purchase Price).  The parties shall allocate the Purchase
Price:

 

Land - $                 

Improvements - $                

Personal Property - $              

 

2.2           Deposit.  On or before the fifth (5th) Business Day following the
Effective Date (“Deposit Date”), Buyer shall deposit in escrow             
(“Deposit”) with Commonwealth Land Title Insurance Company (“Title Insurance
Company”), to be held in escrow and disbursed by the Title Insurance Company
pursuant to the provisions of that certain Deposit and Escrow Agreement (“Escrow
Agreement”) of even date herewith among the Sellers under and as defined in the
Other Agreements (below defined in Section 4.3), Buyer and the Title Insurance
Company, in the form attached hereto as Rider “I”.   As used herein, the term
“Deposit” shall be deemed to include all interest earned on such funds held in
escrow.

 

2.3           Balance.  Subject to the conditions of this Agreement, including
the prorations and adjustments herein provided for, the balance of the Purchase
Price (i.e., after application of the Deposit and any Reallocated Deposit
pursuant to Section 4.3(E) hereof) shall be payable at the Closing.

 

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2.4           Deposit Non-Refundable.  If (i) Buyer does not elect to terminate
this Agreement at the end of the Due Diligence Period as below provided or
(ii) Buyer provides written notice to Seller waiving its right to terminate this
Agreement, then, on the first Business Day following the end of the Due
Diligence Period, the Deposit shall continue to be held by the Title Insurance
Company, but shall not be refundable to Buyer, except in the case of a Seller
Default (below defined) hereunder or as otherwise provided for herein.

 

3.    CONDITIONS PRECEDENT

 

3.1           Conditions to Buyer’s Obligation to Purchase.  Without limitation
to other conditions or agreements stated herein, the performance by Buyer of all
agreements and obligations under this Agreement, including, without limitation
Buyer’s obligation to complete Closing, is conditioned upon the complete
satisfaction (or Buyer’s written waiver) on or prior to the Closing Date of all
of the following conditions (“Buyer’s Conditions Precedent”):

 

3.1.1        Seller’s Representations and Warranties.  The representations and
warranties of Seller herein contained shall be materially true and correct at
all times.  Seller shall have delivered to Buyer such documents and other
materials as Buyer reasonably may deem necessary to confirm fully the truth and
accuracy of such representations and warranties.

 

3.1.2        Seller’s Performance.  Seller shall have performed, observed and
complied with all agreements and obligations required by this Agreement to be
performed, observed and complied with on its part hereunder.  Seller shall have
delivered to Buyer such documents and other materials as Buyer reasonably may
deem necessary to confirm fully such performance, observance and compliance.

 

3.2           Conditions to Seller’s Obligation to Sell.  Without limitation to
other conditions or agreements stated herein, the performance by Seller of all
agreements and obligations under this Agreement, including, without limitation
Seller’s obligation to complete Closing, is conditioned upon the complete
satisfaction (or Seller’s written waiver) on or prior to the Closing Date of all
of the following conditions (“Seller’s Conditions Precedent”):

 

3.2.1        Buyer’s Representations and Warranties.  The representations and
warranties of Buyer herein contained shall be materially true and correct at all
times.  Buyer shall have delivered to Seller such documents and other materials
as Seller reasonably may deem necessary to confirm fully the truth and accuracy
of such representations and warranties.

 

3.2.2        Buyer’s Performance.  Buyer shall have performed, observed and
complied with all agreements and obligations required by this Agreement to be
performed, observed and complied with on its part hereunder.  Buyer shall have
delivered to Seller such documents and other materials as Seller reasonably may
deem necessary to confirm fully such performance, observance and compliance.

 

4.    DUE DILIGENCE

 

4.1           Buyer’s Investigation.  (A)  Buyer, from time to time prior to
Closing and at Buyer’s sole cost and expense, shall have the right to inspect
and investigate each and every aspect of the Property, audit and copy the Books
and Records, perform surveys, dig test holes,

 

3

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make engineering studies, environmental studies and perform whatever other tests
and evaluations of the Property as Buyer may elect, all either independently or
through agents, representatives or contractors of Buyer’s choosing.  Such
investigation by Buyer may include, without limitation: (i)  matters relating to
governmental and other legal requirements with respect to the Property,
including without limitation taxes, assessments, zoning, use permit requirements
and building codes; (ii)  compliance with zoning, land use, building,
environmental and other statutes, rules, or regulations applicable to the
Property; (iii)  the physical condition of the Property, including, without
limitation, the interior, the exterior, the square footage of the Improvements
and of each tenant space therein, the structure, the roof, the paving, the
utilities, and all other physical and functional aspects of the Property; and
(iv) all matters relating to the income and operating or capital expenses of the
Property and all related financial matters.  Seller shall reasonably cooperate
with Buyer’s due diligence of the Property, and shall provide Buyer with all
documents, files and data reasonably requested by Buyer relating to the
Property.

 

(B)           In connection with any entry by Buyer or any of its agents,
employees or contractors onto the Property, Buyer shall give Seller reasonable
advance notice of such entry and shall conduct such entry and any inspections
during normal business hours.  Notwithstanding anything contained in this
Section 4.1 to the contrary, Buyer acknowledges and agrees that its entry and
inspection rights are subject to the privacy rights of all Tenants, and that any
such inspection or entry shall be performed so as to reasonably minimize
interference with Tenants.  Buyer shall maintain, or shall cause its contractors
to maintain, public liability and property damage insurance insuring Buyer
against any liability arising out of any entry or inspections of the Property
pursuant to the provisions hereof.  Such insurance shall be in the minimum
amount of $1,000,000 combined single limit for injury to or death of one or more
persons in an occurrence.  Buyer shall indemnify and hold Seller harmless from
and against any Claims and reasonable attorneys’ fees incurred by Seller arising
out of or relating to any entry on the Real Property by Buyer or any of its
agents, employees or contractors in the course of performing any inspections,
testings or inquiries.

 

4.2           Seller Deliverables.  On or before the fifth (5th) Business Day
following the Effective Date, Seller shall deliver to Buyer, all documents,
records and other information listed in Schedule 4.2 as well as the Default
Schedule called for by Section 5.1.4 hereof (collectively, “Seller
Deliverables”).

 

4.3           Termination.  (A) Subject to the next sentence, at any time prior
to the expiration of the later of: (a) the forty-fifth (45) day following the
Effective Date, (b) the fifth (5th) Business Day following Buyer’s receipt of
all Seller Deliverables, the Title Commitment (as hereinafter defined) and the
Survey (as hereinafter defined), or (c) the last Business Day on which Buyer may
terminate this Agreement under Section 4.5(D) because Seller has opted not to
Remove of Record the Buyer Title Objections (such period, the “Due Diligence
Period”), Buyer may, in its sole and absolute discretion, and for any or no
reason whatsoever, terminate this Agreement by written notice to Seller.  Any
termination of this Agreement by Buyer pursuant to this Section 4.3(A) is herein
referred to as a “Due Diligence Termination”.

 

(B)           Contemporaneously herewith, Buyer and certain Affiliates of Seller
have entered into twelve (12) other Agreements of Sale, as identified in
Schedule 4.3(B) hereto (“Other Agreements”).  Notwithstanding the foregoing
provisions of Section 4.3(A), Buyer shall

 

4

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not have the right to effectuate a Due Diligence Termination of this Agreement
unless (i) Buyer effectuates Due Diligence Termination of all Other Agreements
or (ii) Buyer effectuates Due Diligence Terminations of one or more Other
Agreements under Section 4.3(A) thereof, and the aggregate of the Purchase
Prices under and as defined in the Other Agreements that have not been so
terminated equals or exceeds the Threshold Aggregate Purchase Price.  “Threshold
Aggregate Purchase Price” means Two Hundred Twenty Two Million Three Hundred
Thousand Dollars ($222,300,000), minus the Purchase Price under and as defined
in each Other Agreement that has been terminated because of a Seller Default
thereunder or pursuant to Section 10.1 thereof.

 

(C)           If, during the Due Diligence Period, Buyer terminates this
Agreement and all Other Agreements in each instance as a Due Diligence
Termination, then Seller’s Portion of the Deposit (identified in the Escrow
Agreement) and all interest earned thereon shall be paid to Seller, and Buyer’s
Portion of the Deposit (identified in the Escrow Agreement) and all interest
earned thereon shall be paid to Buyer, within two (2) Business Days after the
Title Insurance Company receives written notice of such termination from either
party.

 

(D)          If Buyer terminates this Agreement because of a Seller Default
hereunder or pursuant to Section 10.1 hereof, then the entire Deposit shall be
paid to Buyer within two (2) Business Days after the Title Insurance Company
receives notice of such termination from either party.

 

(E)           If, during the Due Diligence Period, Buyer effectuates a Due
Diligence Termination of this Agreement, but does not effectuate Due Diligence
Terminations of all the Other Agreements, then the Deposit hereunder shall be
reallocated (“Reallocated Deposit”) to the Deposits under all Other Agreements
remaining in effect, in the same proportion as the Deposit under each remaining
Other Agreement bears to the aggregate amounts of all Deposits under all
remaining Other Agreements.

 

(F)           Notwithstanding any contrary provision of this Agreement or the
Escrow Agreement, in the event of a dispute between the parties as to whether
Seller’s Portion of the Deposit is payable to Seller hereunder, the Title
Company shall pay to Buyer Buyer’s Portion of the Deposit pursuant to the
foregoing.

 

4.4           Survey.  Buyer shall provide Seller with a copy of any survey of
the Real Property (“Survey”) obtained by Buyer in order for Seller to review any
Buyer Title Objections (as hereinafter defined).

 

4.5           Clearing Title Objections.  (A)  Buyer shall, within twenty (20)
Business Days following the Effective Date, cause the Title Insurance Company to
issue and shall deliver to Seller a commitment to issue a Title Insurance Policy
covering the Property (“Title Insurance Commitment”) in order for Seller to
review any Buyer Title Objections.

 

(B)           Buyer shall notify Seller (“Title Objection Notice”) what, if any,
matters disclosed by the Title Insurance Commitment or Survey are objectionable
to Buyer (collectively, “Buyer Title Objections”) within five (5) Business Days
following Buyer’s provision of the Title Insurance Commitment and Survey to
Seller.  If Buyer shall fail to give Seller a Title Objection

 

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Notice within such period, then Buyer shall be deemed to have approved all such
matters, and, at Closing, shall take title to the Property subject to all
encumbrances, exceptions and other matters disclosed by the Title Insurance
Commitment and Survey, other than mortgages, deeds of trust, judgments, security
interests, mechanics’ liens and other monetary liens (collectively, “Monetary
Liens”) which Seller shall be obligated to Remove of Record at or prior to the
Closing (“Remove of Record” means causing the Title Insurance Company to remove
a matter disclosed by the Title Insurance Commitment as an exception from
coverage under the Title Insurance Policy or, as applicable, causing the
surveyor to remove a matter from the Survey).

 

(C)           Within five (5) Business Days after Seller’s receipt of the Title
Objection Notice, Seller shall notify Buyer of those Buyer Title Objections
(other than Monetary Liens) that Seller shall not be obligated to Remove of
Record at or prior to Closing (the Buyer Title Objections that are duly
identified in Seller’s responsive notice as matters that Seller will not be
obligated to Remove of Record, together with title encumbrances that Buyer does
not identify as Buyer Title Objections, are herein collectively referred to as
“Permitted Encumbrances”; “Required Deletion Items” means all Monetary Liens and
all Buyer Title Objections that do not become Permitted Encumbrances).  Seller
shall not be obligated to Remove of Record any Permitted Encumbrances.  Seller
shall Remove of Record, at or prior to Closing, all Required Deletion Items,
and, prior to Closing, Exhibit “B” to the form of Deed attached hereto as
Exhibit “A” shall be modified by the parties to reflect the Permitted
Encumbrances.

 

(D)          If Seller does not give such a responsive notice within such five
(5) Business Day period, then (i) Seller shall be obligated to Remove of Record
all Buyer Title Objections and (ii) Buyer shall cause the Title Insurance
Company, within five (5) Business Days thereafter, to revise and reissue the
Title Insurance Commitment, calling for the removal of all Required Deletion
Items and obligating the Title Insurance Company to issue the Title Insurance
Policy under and subject only to the Permitted Encumbrances listed in the Title
Insurance Commitment.  If Seller timely gives such a responsive notice to the
effect that Seller will not Remove of Record certain Buyer Title Objections
then, within the five (5) Business Day period following Buyer’s receipt of such
notice from Seller, Buyer shall have the right to terminate this Agreement by
notifying Seller, whereupon the Deposit shall be refunded to Buyer promptly, and
neither party shall have any further rights, duties, liabilities, or obligations
under this Agreement, except as otherwise expressly set forth herein.  If Buyer
fails to so terminate this Agreement, then Buyer shall take title to the
Property at Closing subject to the Buyer Title Objections identified in Seller’s
responsive notice.

 

(E)           If at Closing there are any Required Deletion Items that have not
been Removed of Record, then, without limitation to any other right or remedy of
Buyer, Buyer may: (a) use any portion of the Purchase Price otherwise payable to
Seller to Remove of Record such Required Deletion Items or (b) by notice to
Seller, adjourn the Closing one or more times for an aggregate period not to
exceed thirty (30) days in order to give Seller more time to Remove of Record
such Required Deletion Items.

 

4.6           Termination of Contracts.  Buyer shall review the Contracts during
the Due Diligence Period and notify Seller in writing no later than ten
(10) Business Days following Buyer’s receipt of true, correct and complete
copies of the Contracts which Contracts Buyer wishes to assume and which
Contracts Buyer wishes for Seller to terminate.  Within five (5)

 

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Business Days following receipt of Buyer’s notice as aforesaid, Seller shall
notify Buyer in writing which, if any, Contracts designated by Buyer for
termination Seller refuses or is unable to terminate, whereupon Buyer shall have
the option to proceed to Closing and accept an assignment of such Contracts or
terminate this Agreement and receive a refund of the Deposit.  Seller, at its
expense, shall terminate, with respect to the Property, effective on the Closing
Date, all Contracts which Seller has agreed to terminate as aforesaid.  All
Contracts not agreed to be terminated by Seller as aforesaid shall be assigned
to Buyer at the Closing, if Buyer has not terminated this Agreement as
aforesaid, pursuant to the Assignments of Contracts, and Seller shall obtain any
and all consents necessary to effectuate such assignment.

 

5.    REPRESENTATIONS AND WARRANTIES OF SELLER

 

5.1           Representations and Warranties of Seller.  In order to induce
Buyer to enter into this Agreement and to complete Closing, Seller represents,
warrants and agrees with Buyer as follows:

 

5.1.1        Seller Subsistence; Power; Authority.  (a)  Seller is the entity
identified in the first paragraph of this Agreement, and is duly organized,
validly subsisting and in good standing under the laws of the State of Alabama,
and duly qualified and with full power and authority generally to do business in
the state where the Property is located, with all legal power and authority to
undertake, observe and perform all of Seller’s agreements and obligations
hereunder and under the Closing Documents.

 

(b)           Seller’s entry into this Agreement, and the observance and
performance of Seller’s agreements and obligations hereunder, have been duly
approved by all necessary action of the directors, shareholders, members and/or
partners (as applicable) in Seller. This Agreement constitutes and the Closing
Documents will, when executed and delivered, constitute the valid and binding
obligations of Seller, enforceable in accordance with their terms.

 

(c)           None of the Property is an asset, and none of the funds used by
Seller to acquire the Property were assets, of any “employee benefit plan”
within the meaning of the Employee Retirement Income Security Act of 1974, as
amended, or of any entity the underlying assets of which constitute “plan
assets” of one or more of such plans under applicable U.S. Department of Labor
regulations.

 

(d)           Seller is not a foreign person within the meaning of Section 1445
of the Internal Revenue Code of 1986, as amended.

 

(e)           All the persons who have any legal or equitable interest in the
Property, or whose joinder in any Closing Document would be necessary to convey
to Buyer title to all the Property, as required by this Agreement, are named
above as “Seller”.

 

(f)            Seller’s execution and delivery of this Agreement and the Closing
Documents and Seller’s compliance with the provisions thereof will not conflict
with or constitute a breach of, or a default under, any of the provisions of any
applicable law, rule, regulation or order of any court, administrative agency,
bureau, board, commission, office, authority, department or other governmental
entity.

 

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(g)           Seller is not a party to or bound by any agreement or obligation
or subject to any restriction or to any applicable law, rule, regulation or
order of any court, administrative agency, bureau, board, commission, office,
authority, department or other governmental entity, which might result in a
material impairment of the rights or abilities of Seller to perform its
obligations hereunder or under the Closing Documents.

 

5.1.2        Litigation.  There are no judgments, orders, suits, actions,
garnishments, attachments or proceedings of any nature by or before any court,
commission, board or other governmental body pending, or to the knowledge of
Seller threatened, which involve or affect, or could involve or affect: (a) the
Property, or any part thereof, except for that certain ongoing litigation
described in Schedule 5.1.2 (“Existing Litigation”), (b) the validity or
enforceability of this Agreement or the Closing Documents, (c) any risk of any
judgment or liability being imposed upon Seller which could materially adversely
affect the financial condition of Seller or Seller’s ability to observe or
perform fully its agreements and obligations hereunder or under the Closing
Documents.

 

5.1.3        Bankruptcy Matters.  The consummation of the transactions
contemplated hereby will not render Seller insolvent or constitute a fraudulent
conveyance or fraudulent transfer under any applicable law.  Seller has not made
any general assignment for the benefit of  Seller’s creditors.  No proceeding
seeking (a) relief for Seller under any bankruptcy or insolvency law, (b) the
rearrangement or readjustment of Seller’s debt, (c) the appointment of a
receiver, custodian, liquidator or trustee to take possession of substantially
all of the assets of Seller, or (d) the liquidation of Seller, has been
commenced or is planned by Seller or has been threatened by any other Person.

 

5.1.4        No Default.  (A)  Except as will be disclosed in a schedule which
Seller shall deliver to Buyer as part of the Seller Deliverables (“Default
Schedule”), Seller has not received written notice, nor is Seller (to its
knowledge) aware, of any default under any License or Permit, Lease, Lease
Guaranty or Contract, or any other agreement or instrument relating to the
Property to which Seller is a party or by which Seller or Property is bound. 
Except as will be disclosed in the Default Schedule, to Seller’s knowledge,
there exists no condition or state of facts which, but for the giving of notice
or the expiration of time (or both), would constitute such a default.  The
observance and performance of Seller’s obligations hereunder and under the
Closing Documents will not conflict with or result in the breach of any License
or Permit, Lease, Lease Guaranty, Contract or other such agreement or other
instrument.

 

5.1.5        Environmental.  (A) In accordance with Section 4.2 hereof, Seller
will provide Buyer with true, complete and correct copies of all environmental
assessments, reports, permits and other written material relating to the
environmental condition of the Property and the presence of Hazardous
Substances, if any, to the extent in Seller’s possession or control.

 

(B)           In accordance with Section 4.2 hereof, Seller will provide Buyer
with true, complete and correct copies of all notices and information received
by Seller from any Person, if any, relating to the presence of Hazardous
Substances on the Property or in the vicinity of the Property.

 

(C)           To Seller’s knowledge, Seller has not received any complaint,
order,

 

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summons, citation, notice of violation, directive letter or other communication
from any Governmental Authority with regard to air emissions, water discharges,
noise emissions or Hazardous Substances, or any other environmental, health or
safety matters affecting the Real Property, or any portion thereof.  Seller has
complied with all federal, state or local environmental laws affecting the Real
Property, including notification requirements relating to the release of
Hazardous Substances.

 

(D)          Seller has not knowingly undertaken, permitted, authorized or
suffered the presence, or suspected presence, use, manufacture, handling,
generation, storage, treatment, discharge, release, burial or disposal on, under
or about the Real Property of any Hazardous Substances, except in compliance
with all federal, state or local environmental laws, or the transportation to or
from the Real Property, of any Hazardous Substances in violation of any federal,
state or local environmental laws.

 

(E)           Seller has not removed, or caused to be removed, any underground
storage tanks from the Real Property and, to the best of Seller’s knowledge,
there are no underground storage tanks located on the Real Property.

 

5.1.6        Leases.  (a)            The rent rolls (“Rent Rolls”) with respect
to the Property that Seller delivers to Buyer as part of the Seller Deliverables
shall accurately state, with respect to each existing written or oral lease,
license, concession or other agreement (collectively, “Existing Leases”) that
permits any person (collectively, “Tenants”) to use or occupy all or any part of
the Property, among other things, the name of the Tenant, the lease term
(including all renewal options), the leased premises (including all expansion or
surrender options), all rent, additional rent, fees and other sums payable by
the Tenant (collectively, “Rent”), any security deposit, tax or operating
expense escrow, and other accounts in which the Tenant has an interest,
including all accrued interest payable to the Tenant (collectively, “Tenant
Deposits”).  Any and all Rent prepaid by Tenants in advance of the current month
for which they are due shall be specified in the Rent Roll.  Seller represents
and warrants to Buyer that there are no tenant improvement allowances, or any
commission payable (including commissions payable upon renewals) in connection
with the Existing Leases.

 

(b)           Buyer will have access, at the Property, to true, complete and
correct copies of all Leases and all guaranties and sureties with respect to
such Existing Leases (“Lease Guaranties”), including all amendments and
modifications thereto.

 

(c)           Except as specified in the Rent Roll or on Schedule 5.1.4 attached
hereto and made a part hereof, (i) to Seller’s knowledge, each Lease and Lease
Guaranty is in full force and effect and is binding and enforceable against each
of the parties thereto, (ii) to Seller’s knowledge, no party is in default of
any of its agreements or obligations under, and has not made any claim against
another party, under a Lease or Lease Guaranty, (iii) Seller has not given or
received any written notice of default or claim under any Lease or Guaranty,
(iv) to Seller’s knowledge, each Tenant is in actual possession of its demised
premises in the normal course under its Lease, (v) all tenant improvements,
capital improvements, repairs, remodeling, furnishing and other work required by
each Lease has been fully completed and accepted by the relevant Tenant, and
(vi) there is no litigation, arbitration or similar proceeding pending or, to
Seller’s knowledge, threatened with respect to any Lease or Lease Guaranty.

 

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(d)           Except as set forth on the Rent Roll, no Tenant is entitled to any
concession, allowance, rebate or refund with respect to any rent payable or paid
under any Lease.  Except as set forth on Schedule 5.1.6 hereto, no Tenant has
prepaid, and if a Tenant hereafter tenders prepayment, Seller shall accept, any
Rent payable under its Lease for more than the month in advance.

 

(e)           None of the Leases or Lease Guaranties and none of the Rents
payable under the Leases is subject to any assignment, pledge or other
encumbrance, except with respect to the existing financing of Seller, which
Seller shall cause to be released at the Closing.

 

(f)            No brokerage or leasing commissions or other compensation is or
will be due or payable to any person, firm, corporation or other entity with
respect to or on account of any of the Leases or any extensions or renewals
thereof, except as specified in the Rent Roll.

 

5.1.7        Mechanics’ Liens.  No work has been or will be performed at, and no
materials have been or will be furnished to, the Property, or any part thereof,
which might give rise to any mechanics’, materialmen’s or other lien against the
Property, or any part thereof, except for certain repairs of sheetrock and the
installation of attic access panels, which work shall be completed and paid for
by Seller prior to Closing.  If any lien for such work is filed, Seller shall
discharge the same promptly and in any event prior to Closing.

 

5.1.8        Insurance.  As part of the Seller Deliverables, Seller shall
provide Buyer with a true, complete and correct copy of Seller’s certificate of
insurance demonstrating all coverages applicable to the Property (“Insurance
Policies”).  All premiums due under the Insurance Policies have been paid, and
the Insurance Policies are valid and enforceable.  No insurer of any Property
has imposed any requirement with respect to any Property which is unfulfilled,
or has called attention to the need for any work, repair or installation in
connection with such Property, or, to Seller’s knowledge, has threatened to
withdraw, cancel, reduce or adversely affect the insurance protection with
respect to such Property, or to increase materially the premiums thereof. 
Seller has not assigned, mortgaged or pledged the Insurance Policies or the
proceeds thereof, except with respect to the existing financing of Seller, which
Seller shall cause to be released at the Closing.

 

5.1.9        Contracts.  Except for the Contracts, there is no management,
service, equipment, supply, maintenance or other agreement of any kind or nature
with respect to or affecting any Property.  As part of the Seller Deliverables,
Seller shall deliver to Buyer true, correct and complete copies of all the
Contracts, including all supplements, amendments and modifications thereto. 
Seller has full authority, right and title to assign the Contracts to Buyer.
Seller has not previously sold, assigned, transferred, mortgaged or pledged the
Contracts, except with respect to the existing financing of Seller, which Seller
shall cause to be released at the Closing.  Each of the Contracts is fully
enforceable in accordance with its terms, is in full force and effect, and has
not been amended, modified or supplemented. Seller has not received written
notice, nor is Seller (to its knowledge) aware, of any default of any of its
obligations under any of the Contracts. Seller has not given any other party to
a Contract a notice of default which remains uncured, and no default has
occurred under any Contract, and, to Seller’s knowledge, no event has occurred
or condition exists which, with the passage of time or the giving of notice, or

 

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both, would constitute such a default.  The Assignment of Contracts shall assign
to Buyer at Closing all Seller’s right, title and interest in and to the
Contracts.

 

5.1.10      Employees.  Seller does not employ any persons at the Property other
than the persons listed on Schedule 5.1.10.  Buyer shall have no obligation to
hire any of the present employees of Seller engaged in connection with the
Property, but Buyer shall be free to do so if Buyer so elects.

 

5.1.11      Personal Property.  Except for the Personal Property that will be
transferred to Buyer pursuant to the Bill of Sale, there is no personal property
of any nature or description on or in the Property other than personal property
owned by Tenants.

 

5.1.12      Compliance with Laws.  No notice or communication of any kind has
been issued by any public authority relating to the Property, or any business or
activity conducted thereon, including, but not limited to, notice of violation
under zoning, building, health, or fire codes.  Seller shall be responsible for
all such notices and communications, and for the cost of all work, repairs,
construction and installations which may be required or called attention to by
any such notice or communication issued to Seller prior to Closing.  If any such
notice or communication is received by Seller after the date of this Agreement,
Seller shall promptly notify Buyer in writing, and Seller, if Buyer so requests,
shall give Buyer full opportunity, with the cooperation of Seller, to contest
such governmental action and to initiate or participate in such proceedings as
Buyer may deem necessary or desirable to protect Buyer’s interests.  In the
event Buyer takes any such actions, such actions taken by Buyer shall be at
Buyer’s sole cost and expense.

 

5.1.13      Financial Information.  All the operating statements and other
financial data which shall have been delivered by Seller to Buyer with respect
to the Property, are true and current and accurately reflect the revenue,
expenses and operations of the Property in all material respects.

 

5.1.14      Condemnation.  As of the Effective Date, Seller has not received any
written notice of any pending or threatened condemnation of all or any portion
of the Property.

 

5.1.15      Quality of Title.  (a)    Seller now has, and at Closing will have,
full legal and equitable fee simple absolute title to the Property, subject to
the Permitted Encumbrances, of the quality and insurability called for by this
Agreement.

 

(b)           There is no existing agreement, commitment, right of first
refusal, right of first offer, option or right with, in or to any person to
acquire the Property or any interest therein.

 

(c)           Seller has not received written notice, nor is Seller (to its
knowledge) aware, of any default or breach under any recorded easement,
covenant, agreement or restriction affecting the Property.

 

5.1.16      Accuracy of Information.  All Seller Deliverables prepared by Seller
or its employees including, without limitation, the Rent Roll and, to Seller’s
knowledge, all other information, materials, copies of documents and other
materials (including, without limitation, financial data, copies of Leases,
Contracts, Books and Records, Licenses and Permits, Insurance

 

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Policies, Warranties, municipal approvals, architect’s certificates, plans,
surveys, estoppel certificates and subordination agreements) prepared by third
parties heretofore or hereafter submitted by Seller, or anyone on Seller’s
behalf, to Buyer with respect to the Property or this Agreement shall be
accurate, complete, true and correct, and no fact or circumstance has occurred
or exists since the time of such submissions which in any way materially affects
same.  Such submissions are not misleading and do not omit facts or
circumstances having a material bearing on Seller’s ability to observe or
perform its agreements or obligations hereunder or under the Closing Documents. 
No representation, statement or warranty by Seller contained in this Agreement
or in any schedule or exhibit attached hereto or in any Seller Deliverables or
any Closing Document or other document to be executed in connection herewith
contains or will contain any untrue statement or omits or will omit a material
fact necessary to make the statement of fact therein recited not misleading.

 

5.2           Effective Date.  Each of the representations and warranties of
Seller contained in this Agreement:  (a) is made as of the Effective Date, and
(b) shall be deemed remade by Seller, and shall be true and correct in all
respects, as of the Closing Date.  If, after the execution of this Agreement,
any event occurs or condition exists which renders any of Seller’s
representations or warranties untrue or misleading, then Seller shall promptly
notify Buyer.

 

6.    REPRESENTATIONS AND WARRANTIES OF BUYER

 

6.1           Representations and Warranties of Buyer.  Buyer hereby makes the
following representations and warranties:

 

(a)           Buyer is a limited liability company duly organized and validly
existing and in good standing under the laws of the State of Delaware.  This
Agreement and all documents executed by Buyer that are to be delivered to Seller
at Closing (i) are, or at the time of Closing will be, duly authorized, executed
and delivered by Buyer, (ii) do not, and at the time of Closing will not,
violate any provision of any agreement or judicial order to which Buyer is a
party and (iii) constitute (or in the case of Closing Documents will constitute)
a valid and legally binding obligations of Buyer, enforceable in accordance with
their terms.

 

(b)           Buyer has full and complete power and authority to enter into this
Agreement and to perform its obligations hereunder.

 

(c)           Buyer’s execution and delivery of this Agreement and the Closing
Documents and Buyer’s compliance with the provisions thereof will not conflict
with or constitute a breach of, or a default under, any of the provisions of any
applicable law, rule, regulation or order of any court, administrative agency,
bureau, board, commission, office, authority, department or other governmental
entity.

 

(d)           Buyer is not a party to or bound by any agreement or obligation or
subject to any restriction or to any applicable law, rule, regulation or order
of any court, administrative agency, bureau, board, commission, office,
authority, department or other governmental entity, which might result in a
material impairment of the rights or abilities of Buyer to perform its
obligations hereunder or under the Closing Documents.

 

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(e)           To the best of Buyer’s knowledge, there are no judgments, orders,
suits, actions, garnishments, attachments or proceedings of any nature by or
before any court, commission, board or other governmental body pending, or to
the knowledge of Buyer threatened, which involve or affect, or could involve or
affect: (i) the validity or enforceability of this Agreement or the Closing
Documents, (ii) any risk of any judgment or liability being imposed upon Buyer
which could materially adversely affect the financial condition of Buyer or
Buyer’s ability to observe or perform fully its agreements and obligations
hereunder or under the Closing Documents.

 

(f)            The consummation of the transactions contemplated hereby will not
render Buyer insolvent.  No proceeding seeking (i) relief for Buyer under any
bankruptcy or insolvency law, (ii) the rearrangement or readjustment of Buyer’s
debt, (iii) the appointment of a receiver, custodian, liquidator or trustee to
take possession of substantially all of the assets of Buyer, or (iv) the
liquidation of Buyer, has been commenced or is planned by Buyer or has been
threatened by any other Person.

 

(g)           To Buyer’s knowledge, no representation, statement or warranty by
Buyer contained in this Agreement or in any schedule or exhibit attached hereto
or in any Closing Document or other document to be executed in connection
herewith contains or will contain any untrue statement or omits or will omit a
material fact necessary to make the statement of fact therein recited not
misleading.

 

6.2           Effective Date.  Each of the representations and warranties of
Buyer contained in this Agreement (a) is made on the Effective Date and
(b) shall be deemed remade by Buyer and shall be true in all material respects
as of the Closing Date.  If, after the execution of this Agreement, any event
occurs or condition exists which renders any of Buyer’s representations or
warranties untrue or misleading, then Buyer shall promptly notify Seller.

 

7.    INDEMNITIES

 

7.1           Seller’s Indemnities.  Provided Closing takes place, Seller shall
indemnify, protect and hold harmless Buyer against all Claims arising in
connection with any (a) breach or inaccuracy of any representation or warranty
of Seller contained herein, provided that with respect to a breach or inaccuracy
of any representation or warranty, Buyer shall have given Seller notice of such
breach or inaccuracy within one (1) year following the Closing Date, except that
Seller’s Representations and Warranties under Sections 5.1.1, 5.1.2 and 5.1.3
shall not be limited by such notice or one-year period, (b) failure by Seller to
observe or perform when due any agreement or obligation contained herein or in
any Closing Document, and (c) Existing Litigation.

 

7.2           Buyer’s Indemnities.  Provided Closing takes place, Buyer shall
indemnify, protect and hold harmless Seller against all Claims suffered or
incurred by Seller, in connection with any (a) breach or inaccuracy of any
representation or warranty of Buyer contained herein, and (b) failure by Buyer
to observe or perform when due any agreement or obligation contained herein.

 

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8.    EXCLUDED LIABILITIES

 

8.1           Excluded Liabilities.  Buyer shall neither assume nor pay for nor
be liable for any of Seller’s agreements, liabilities, debts, responsibilities
or obligations with respect to the Property or otherwise, whether direct, fixed
or contingent, and whether existing or arising at any time prior or subsequent
to the Closing Date, except and only to the extent otherwise provided herein
with respect to Leases and Contracts expressly assumed by Buyer at Closing.

 

9.    INTERIM OPERATION OF THE PROPERTY

 

9.1           Operations.  Except as otherwise approved by Buyer in writing,
from the Effective Date until the Closing Date, Seller shall (a) operate,
maintain, repair and lease the Property in the ordinary course and consistent
with sound business practices and (b) not sell, dispose of or encumber the
Property, or enter into an agreement to so do, except replacements of Personal
Property in the ordinary course of business.  Without limiting the foregoing,
Seller shall, in the ordinary course: (i) enforce the Leases in all material
respects, (ii) perform in all material respects all of landlord’s obligations
under the Leases (other than Leases that have been or are in the process of
being terminated due to the Tenant’s default thereunder), and (iii) pay all
costs and expenses of the Property, including, without limitation, debt service
and Real Estate Taxes.

 

9.2           Lease Enforcement.  Without limitation to the provisions of
Section 9.1, prior to Closing, Seller shall enforce the rights and remedies of
the landlord under each existing Lease and New Lease following a default by the
Tenant thereunder by legal proceedings or otherwise, provided Seller shall not
apply all or any portion of any security deposits then held by Seller toward any
loss or damage incurred by Seller by reason of any default by any Tenant, unless
(i) written notice of such default and of the application of such security
deposit shall have been provided to the relevant Tenant, and such notice shall
comply with the applicable terms of such Tenant’s Lease and with all applicable
laws, and (ii) the applicable Tenant is more than sixty (60) days in default
under its Lease.

 

9.3           Modifications; Agreements.  Seller shall not terminate, or modify
or amend any material term of, any Lease, Lease Guaranty, Contract, License or
Permit or Warranty without, in each instance, Buyer’s prior written consent,
which consent (i) shall not unreasonably be withheld if such consent is
requested prior to the expiration of the Due Diligence Period or (ii) may be
withheld in Buyer’s sole discretion if such consent is requested following the
expiration of the Due Diligence Period.

 

9.4           New Contracts.  Seller shall not enter into any new lease (other
than residential leases on market terms), contract, agreement or understanding
with respect to the Property unless: (a) by its express terms, it is terminable
by Seller by no more than thirty (30) days notice, without premium or penalty,
and (b) a copy is provided to Buyer prior to its effectiveness.

 

9.5           No Solicitation.  Seller shall not solicit offers for the
Property, or submit or accept or discuss proposals or solicitations for the sale
or other disposition of, or investment in, the Property.

 

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9.6           Leasing Status Reports.  Upon request by Buyer, Seller shall
promptly deliver to Buyer, with respect to the Property, updated certified rent
rolls (including rent concession information) and pre-leasing reports and such
other information as may reasonably be requested by Buyer.

 

10.    RISK OF LOSS

 

10.1         Risk of Loss and Insurance Proceeds.  (A) Seller shall bear the
risk of loss with respect to the Property in the manner provided herein.  If, on
or after the Effective date, (a) the Property is contaminated or damaged or
destroyed by fire or other casualty, and Buyer’s estimated cost of repair
exceeds one percent (1%) of the Purchase Price, or (b) the Property is
condemned, then Buyer shall have the right to terminate this Agreement upon
notice to Seller.  If Buyer elects to terminate this Agreement, the Deposit
shall be refunded to Buyer promptly.  If Buyer does not elect to terminate this
Agreement, at the Closing, there shall be credited against the Purchase Price an
amount equal to the gross amount of any insurance proceeds collected by Seller
as a result of such damage or destruction, plus the gross amount of any
insurance policy deductible, or as applicable, the gross amount of the
condemnation award collected by Seller.  To the extent any such proceeds or
awards have not been collected as of the Closing, then such proceeds or awards
shall be unconditionally and absolutely assigned to Buyer at Closing, in form
reasonably satisfactory to Buyer.  Notwithstanding anything herein to the
contrary, no proceeds from a casualty or condemnation shall be payable to Buyer
hereunder unless the Deposit has become non-refundable in accordance with the
provisions of Section 2.4 hereof and Buyer has agreed to proceed to Closing.

 

(B)           Seller shall not settle, compromise or otherwise stipulate any
award or recovery in connection with any such damage, destruction or
condemnation without the prior written approval of Buyer, which approval shall
not be unreasonably withheld if Buyer has the right to terminate this Agreement
in accordance with Section 10.1 (A) above, and Buyer shall have the right to
participate in any such settlement and other proceedings.

 

10.2         Notifications.  Between the Effective Date and the Closing, Seller
shall promptly notify Buyer of any Material Damage (as hereinafter defined) to
the Property, any condemnation, environmental, zoning or other land-use
regulation proceedings relating to the Property of which Seller becomes aware,
any notices of violations of any legal requirements relating to the Property
received by Seller, and any litigation of which Seller receives written notice
that relates to the Property or Seller’s ability to perform its agreements and
obligations hereunder.  As used herein, “Material Damage” shall mean damage
which, in Seller’s commercially reasonable judgment, will cost in excess of Five
Thousand Dollars ($5,000) to repair or replace.

 

11.    CLOSING

 

11.1         Escrow Instructions.  Upon execution of this Agreement, the parties
hereto shall deposit an executed counterpart of this Agreement with the Title
Insurance Company, and this Agreement, as well as the Deposit Escrow Agreement,
shall serve as the instructions to the Title Insurance Company as escrow holder
for consummation of the purchase and sale contemplated hereby (the “Closing”). 
Seller and Buyer agree to execute such reasonable additional escrow instructions
as may be appropriate to enable the Title Insurance Company to comply with the

 

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terms of this Agreement, provided, however, that in the event of any conflict
between or among the provisions of this Agreement, the Deposit Escrow Agreement
and/or any supplementary escrow instructions, the terms of this Agreement shall
control.

 

11.2         Closing Date.  Closing shall be held at 10:00 A.M. prevailing local
time on the date (the “Closing Date”) which shall be no more than thirty (30)
days following the expiration of the Due Diligence Period (as extended, if
applicable) on such date as is mutually agreed upon by the parties.

 

11.3         Location.  The parties shall use their best efforts to conduct the
Closing through the Title Insurance Company pursuant to the escrow instructions
provided herein.  If a Closing shall require in-person attendance by the
parties, then such in-person Closing shall be held commencing at 10:00 a.m.
prevailing local time on the Closing Date at a location mutually acceptable to
the parties,

 

11.4         Closing Documents.  At least one (1) Business Day prior to the
Closing Date, Seller shall execute and deposit into escrow with the Title
Insurance Company the following:

 

(a)           a special warranty deed (“Deed”) substantially in the form
attached hereto as Exhibit “A”, sufficient to vest in Buyer title to the Real
Property in accordance with this Agreement.  The Deed shall describe the Land in
accordance with the Survey and, if necessary, the legal description of the Land
that appears in Exhibit “A” to the form of Deed attached hereto as “Exhibit “A”
shall be revised by the parties prior to Closing to reflect the legal
description in the Survey;

 

(b)           a Bill of Sale (“Bill of Sale”), substantially in the form
attached hereto as Exhibit “B”;

 

(c)           an Assignment and Assumption of Contracts (“Assignment of
Contracts”), substantially in the form attached hereto as Exhibit “C”;

 

(d)           an Assignment and Assumption of Leases (“Assignment of Leases”), 
substantially in the form attached hereto as Exhibit “D”;

 

(e)           a General Assignment (“General Assignment”), substantially in the
form attached hereto as Exhibit “E”;

 

(f)            a FIRPTA Affidavit, substantially in the form attached hereto as
Exhibit “F”;

 

(g)           a duly executed counterpart of an agreement designating the Title
Insurance Company as the “Reporting Person” for the transaction contemplated
hereby pursuant to Section 6045(e) of the Internal Revenue Code and the
regulations promulgated thereunder, substantially in the form attached hereto as
Exhibit “G”;

 

(h)           all documents required by the Title Insurance Company which are
reasonably necessary in order for the Title Insurance Company to issue the Title
Insurance Policy

 

16

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to Buyer in accordance with this Agreement, including without limitation the
seller’s affidavit prepared by the Title Insurance Company;

 

(i)            a termination of management agreement between Seller and the
manager or managers of the Property in form reasonably satisfactory to Buyer;
and

 

(j)            (j)            a duly executed counterpart of such certificates,
disclosures and reports as are required by applicable state and local law in
connection with the conveyance of the Property.

 

11.5         Additional Seller Deliverables.  (A) At Closing, Seller shall
deliver to Buyer the complete, original counterparts, to the extent originals of
such documents are in the possession or available to Seller, of the Leases,
Lease Guaranties, Contracts, Licenses and Permits, Books and Records and
Warranties, all certified as true and correct by Seller.

 

(B)           At Closing Seller shall deliver to Buyer originals of all tenant
correspondence files for the Property, and originals of all other files and
items in Seller’s possession relating to the use, ownership, operation,
maintenance, leasing, repair, alteration, management or development of the
Property.

 

11.6         Buyer Closing Deliveries.  At least one (1) Business Day prior to
the Closing Date, Buyer shall execute and deposit into escrow with the Title
Insurance Company the following:

 

(i)            a duly executed counterpart of the Assignment of Leases;

 

(ii)           a duly executed counterpart of the Assignment of Contracts; and

 

(iii)          a duly executed counterpart of the Designation Agreement.

 

11.7         Closing by Title Insurance Company.  At least one (1) Business Day
prior to the Closing Date, Seller and Buyer shall approve a closing statement in
the Title Insurance Company’s customary form (the “Closing Statement”) and shall
detail: (i) the disposition of the Deposit and the Purchase Price, (ii) the
proration amounts allocable to each of the parties pursuant to Article 12,
(iii) the closing costs allocable to each of the parties pursuant to Article 12,
(iv) all fees, costs and expenses payable to any third party, including the
Title Insurance Company, and (vi) all necessary wiring instructions.  On the
Closing Date, Buyer shall effect a wire transfer of immediately available
federal funds to the Title Insurance Company’s escrow account in the amount set
forth in the Closing Statement and Seller and Buyer shall deposit with the Title
Insurance Company the documents required by this Agreement and such other
instruments as are reasonably required by the Title Insurance Company or
otherwise required to close the escrow and consummate the purchase and sale of
the Property in accordance with the terms hereof.  Upon receipt of the documents
and funds in accordance with the terms of this Agreement and the Closing
Statement, and at such time as the Title Insurance Company has issued the Title
Insurance Policy called for by the Title Insurance Commitment, without exception
for Required Deletion Items, and subject only to the Permitted Encumbrances, the
Title Insurance Company shall: (i) record the Deed and deliver copies to both
Seller and Buyer, (ii) disburse funds to persons entitled thereto, as expressly
stated in the Closing Statement, (iii) 

 

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deliver: (A) to Seller: (1) two originals of all documents deposited with the
Title Insurance Company (other than the Deed and the FIRPTA Affidavit), (2) one
conformed copy of each document recorded pursuant to the terms hereof, and (3) a
counterpart of the Title Insurance Commitment marked to conform to the issuance
to Buyer of the Title Insurance Policy; and (B) to Buyer: (1) two originals of
all documents deposited into escrow (other than the Deed and the FIRPTA
Affidavit), (2) the original FIRPTA Affidavit, (3) one conformed copy of each
document recorded pursuant to the terms hereof, and (4) the Title Insurance
Policy.

 

11.8         Additional Title Insurance Documents.  Buyer and Seller shall each
execute and deposit in escrow with the Title Insurance Company such other
instruments as are reasonably required by the Title Insurance Company or
otherwise required to close the escrow and consummate the purchase and sale of
the Property in accordance with the terms hereof.

 

11.9         Possession.  At Closing, Seller shall deliver to Buyer actual
possession of the Property, vacant and free of all leases and rights of
possession, use or occupancy, excepting only the Leases.

 

11.10       Transfer of Licenses and Permits.   Seller shall cooperate with
Buyer in Buyer’s efforts to obtain from all public authorities (a) the transfer
or the reissuance, as applicable, to Buyer of all Licenses and Permits, and
(b) such site plan, land use plan, land development plan approvals and other
approvals, building, construction and other permits, certificates, agreements,
authorizations, zoning variances and special exceptions as may be required or
desired by Buyer in connection with its intended use and/or development of the
Property.  Seller shall execute promptly all documents necessary or reasonably
required by Buyer with respect thereto.

 

11.11       Tenant Notices.  At Closing, Seller shall execute and deliver to
Buyer, for delivery by Buyer to each Tenant, a notice to each Tenant of the
assignment of the Tenant’s lease to Buyer, in conformity with each Lease and
with applicable law.  Such notices shall be substantially in the form of
Exhibit “H”.

 

11.12       Termination/Assignment of Contracts.  All Contracts not designated
by Buyer for termination, as above provided, shall be assigned to Buyer pursuant
to the Assignment of Contracts, and at Closing, Seller shall notify each
counterpart to each Assigned Contract of such assignment, which notices shall be
substantially in the form of  “Exhibit I.”  At Closing, Seller shall provide
Buyer with copies of all such termination and assignment notices.

 

12.           PRORATIONS, CLOSING PAYMENTS

 

12.1         Closing Party.  At Closing, the Parties shall pay the following
closing expenses:

 

Expense

 

Paying Party

 

 

 

Title Insurance Commitment and Owner’s Title Insurance Policy

 

Buyer

 

 

 

Survey

 

Buyer

 

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Title Insurance Company Closing and Escrow Fees

 

Seller

 

 

 

Transfer Taxes on Deed

 

Seller

 

 

 

Recording Cost for Deed and Monetary Lien Releases

 

Buyer

 

12.2         Sales Taxes.  At Closing, any and all sales taxes, duties, levies
or imposts payable by reason of the sale of the Property shall be paid by Seller
to the extent such taxes are then due and payable.

 

12.3         Installment Assessments.  If, at the time of Closing, the Property
is affected by any assessment which is or may become payable in annual
installments, then for the purpose of this Agreement, all the unpaid
installments of any such assessment, including without limitation those which
are to become due and payable after Closing, shall be deemed liens on the
Property and shall be paid and discharged by Seller at or prior to Closing.

 

12.4         Tenant Deposits.  At the Closing, Seller shall pay to Buyer all
Tenant Deposits for the Property.

 

12.5         Real Estate Taxes.  At Closing, all real estate taxes general
assessments and municipal water and sewer rents assessed against the Property
for the tax year in which Closing occurs shall be apportioned between Seller and
Buyer as of the Closing Date.   Such apportionment shall be based on the
respective tax years for which such taxes are assessed, and on the most recent
assessment of the Property and the then applicable tax rates.  Any “roll back”
taxes payable in relation to any period tax abatement or relief or preferential
assessment with respect to the Property prior to the Closing Date shall be paid
in full by Seller, whenever billed by the relevant taxing authority.

 

12.6         Utilities and Contracts.  Payments under the Contracts assumed by
Buyer and charges for the supply of telephone, heat, steam, electric power, gas,
lighting and any other utility service consumed at the Property for the month,
or other relevant billing period, in which Closing takes place, shall be
prorated between the parties as of the Closing Date.  Where possible, Seller
shall obtain cutoff readings for all utilities as of the Closing Date.  To the
extent they are not available, the cost of such utilities shall be apportioned
between the parties on the basis of the latest actual (not estimated) bill for
such service and adjusted by the parties as necessary post-Closing.  Buyer shall
receive a credit for any of the foregoing items to the extent the same are
accrued but unpaid as of the Closing Date (whether or not due, owing or
delinquent as of the Closing Date), and Seller shall receive a credit to the
extent any of the foregoing items shall have been paid prior to the Closing Date
to the extent the payment thereof specifically relates to any period of time
after the Closing Date.

 

12.7         Prorations.  (A)  Current Rents, fees and any additional charges
and expenses payable under the Leases, all as and when actually collected
(whether such collection occurs prior to, on or after the Closing Date), water,
sewer and utility charges and amounts payable under any Contract that is
assigned to Buyer at Closing, and real estate taxes payable for, or

 

19

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levied or assessed with respect to, the calendar year in which the Closing Date
occurs, shall all be prorated as of 12:01 a.m. prevailing time on the Closing
Date, on the basis of a 365-day year, with Buyer deemed the owner of the
Property on the Closing Date.

 

(B)           Any delinquent rents or expense reimbursements under any current
Lease collected by Seller or Buyer after the Closing shall be the property of
Buyer.

 

(C)           If any of the aforesaid prorations cannot be calculated accurately
on the relevant Closing Date, either party owing the other party a sum of money
based on proration(s) calculated after a Closing Date shall promptly pay said
sum to the other party, together with interest thereon at the rate of ten
percent (10%) per annum from the date the invoice is delivered to the date of
payment, if payment is not made within thirty (30) days after delivery of a bill
therefor.

 

12.8         Proration Backup Information.  Seller shall calculate the
adjustments and prorations called for by this Article and shall deliver such
calculations and all relevant back-up information to Buyer no less than five
(5) Business Days prior to the Closing Date.  If all such information is not so
delivered, then Buyer shall have the right, without limitation to Buyer’s other
rights and remedies hereunder, to postpone the Closing until the fifth (5th)
Business Day after Buyer’s receipt from Seller of all such information.

 

12.9         Audit Rights.  (A) Buyer or an independent auditor designated by
Buyer shall have the right to inspect and audit Seller’s books and records
related to the Property for calendar years 2004 through 2006.  Such rights shall
be available to Buyer prior to Closing and for a period of two (2) years
following Closing.  Such inspection and audit may be conducted by Buyer at any
time during normal business hours upon prior written notice from Buyer to Seller
and shall not result in an unreasonable disruption of the business of Seller. 
If requested by Seller, the party performing such audit shall enter into a
commercially reasonable confidentiality agreement regarding the disclosure of
information obtained during such audit, the terms of which agreement shall
permit disclosure of such information if required by law or in connection with
legal process.

 

(B)           Buyer shall reimburse Seller for all reasonable costs incurred by
Seller in participating in any such audit and in any audit or investigation of
this transaction by the United States Securities and Exchange Commission.

 

13.    DEFAULT

 

13.1         Buyer’s Default.  (A) If Seller complies with all of its
obligations under this Agreement, and any time after the Deposit has become
non-refundable in accordance with Section 2.4 hereof, Buyer defaults in its
obligation to complete Closing hereunder, then Seller shall have the right at
Closing to terminate this Agreement and to be paid the Deposit as liquidated
damages for such breach.  The parties have agreed that Seller’s actual damages,
in the event of a failure to consummate this sale due to Buyer’s default, would
be extremely difficult or impossible to determine.  After negotiation, the
parties have agreed that, considering all the circumstances existing on the date
of this Agreement, the amount of the Deposit is a reasonable estimate of the
damages that Seller would incur in such event. Upon such termination, Seller and
Buyer shall be released from all further liability and obligations hereunder, it
being understood

 

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that Seller’s right to terminate this Agreement and to be paid the Deposit shall
be the sole remedy available to Seller in the event of any default by Buyer
hereunder, Seller hereby waiving all other rights and remedies.

 

(B)           If this Agreement is terminated by Seller pursuant to the
foregoing provisions of Section 13.1, then any Reallocated Deposit under a
terminated Other Agreement that shall have been applied to the Deposit hereunder
pursuant to Section 2.4(E) of such Other Agreement (i) shall be refunded to
Buyer if the aggregate Purchase Prices under and as defined in all Other
Agreements under which Closing (as defined thereunder) shall have occurred,
equals or exceeds the Threshold Aggregate Purchase Price, or (ii) shall be paid
to Seller if the aggregate Purchase Price under and as defined in all Other
Agreements under which Closing (as defined thereunder) shall have occurred is
less than the Threshold Aggregate Purchase Price.

 

13.2         Seller’s Default.  If Buyer complies with all of its obligations
under this Agreement, and if on the date of this Agreement or at the time of
Closing title to the Property is not as required by this Agreement, or if, at
any time, Seller fails to complete Closing or otherwise defaults in the
observance or performance of any of its other material agreements or obligations
hereunder, or if any of Seller’s representations and warranties hereunder is
untrue or incorrect (each, a “Seller Default”), then, in any such case, Buyer
shall have the right, in addition to all its other rights and remedies at law or
in equity or as set forth herein, including without limitation the right of
specific performance of this Agreement (in which event Buyer shall have the
right to collect all attorneys fees and costs and all other costs and expenses
incurred in connection with any such specific performance action), to terminate
its obligations hereunder.  If Buyer so elects to terminate its obligations
hereunder, then the Deposit shall be refunded promptly to Buyer, and Seller,
upon demand of Buyer, shall reimburse Buyer for all costs and expenses incurred
by Buyer in connection with this transaction including, without limitation,
costs and expenses incurred for legal counsel, surveys, engineering tests,
environmental studies, feasibility studies, due diligence, permit applications
and title searches provided that Buyer delivers to Seller all reasonable
supporting documentation evidencing such costs and expenses.  If the remedy of
specific performance is not available, Buyer shall have the right to seek
damages (including, without limitation, all attorneys fees and costs and all
other costs and expenses incurred in connection with any cause of action)
against Seller.  Notwithstanding anything herein to the contrary, Seller’s
obligation to reimburse Buyer for, and Buyer’s right to recover, damages against
Seller hereunder shall be limited to the amount of $287,020.50

 

14.    BROKERS

 

14.1         Brokers.  Seller and Buyer hereby represent and warrant to the
other that they have not engaged the services of any agent, broker or similar
party in connection with this transaction.  Seller and Buyer each hereby agree
to indemnify one another for any claim for brokerage commissions or the like
asserted by any person or entity claiming to have been engaged by the party
against whom indemnity is sought.

 

15.    NOTICES

 

15.1         Notices.  Any notices required or permitted to be given hereunder
shall be given in writing and shall be delivered (a) in person, (b) by certified
mail, postage prepaid, return

 

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receipt requested, (c) by a commercial overnight courier that guarantees next
day delivery and provides to the sender a delivery receipt or (d) by legible
facsimile (followed by hard copy delivered in accordance with preceding
subsections (a)-(c)). Any notice shall be effective only upon receipt (or
refusal by the intended recipient to accept delivery).  Such notices shall be
addressed as follows:

 

Seller:

 

 

 

 

 

c/o Capstone Properties

 

 

431 Office Park Drive

 

 

Birmingham, AL 35223

 

 

Attention: Rob Howland

 

 

Fax: 205-414-6455

 

 

 

With a required copy to:

 

 

 

 

 

Hand Arendall, L.L.C.

 

 

107 St. Francis Street

 

 

3000 AmSouth Bank Building

 

 

Mobile, AL 36602

 

 

Attention: Christopher M. Gill

 

 

Fax: 251-544-1615

 

 

 

Buyer:

 

College Park Investments, LLC

 

 

c/o GMH Communities Trust

 

 

10 Campus Boulevard

 

 

Newtown Square, PA 19073

 

 

Attention: Joseph M. Macchione

 

 

Fax: 610-359-0572

 

 

 

With a required copy to:

 

 

 

 

 

Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103-2921
Attention:  Richard J. Sabat, Esquire
Telephone: (215) 963-5357
Fax: (877) 432-9652

 

or to such other address as either party may from time to time specify in
writing to the other party.

 

16.    MISCELLANEOUS

 

16.1         Entire Agreement.  This Agreement sets forth all of the agreements,
representations, warranties and conditions of the parties hereto with respect to
the subject matter hereof, and supersedes all prior or contemporaneous letters
of intent, agreements, representations, warranties and conditions. This
Agreement, together with the Exhibits,

 

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Schedules and Rider hereto contain all representations, warranties and covenants
made by Buyer and Seller and constitutes the entire understanding between the
parties hereto with respect to the subject matter hereof. Any correspondence,
memoranda or agreements between the parties are not binding on or enforceable
against any party, and are superseded and replaced in total by this Agreement
together with the Exhibits, Schedules and Rider attached hereto.

 

16.2         Amendments.  This Agreement may be amended or modified only by a
written instrument signed by Buyer and Seller.

 

16.3         Time.  Time is of the essence in the performance of each of the
parties’ respective agreements and obligations contained herein.

 

16.4         Attorneys’ Fees.  If either party hereto fails to perform any of
its obligations under this Agreement or if any dispute arises between the
parties hereto concerning the meaning or interpretation of any provision of this
Agreement, then the defaulting party or the party not prevailing in such
dispute, as the case may be, shall pay any and all costs and expenses incurred
by the other party on account of such default and/or in enforcing or
establishing its rights hereunder, including, without limitation, court costs
(including costs of any trial or appeal therefrom) and reasonable attorneys’
fees and disbursements.

 

16.5         Assignment.  Buyer may assign to any Affiliate of Buyer all of
Buyer’s rights and obligations under this Agreement without Seller’s approval;
provided, however, that Buyer shall not be released or discharged from all
obligations and liabilities hereunder.  Buyer shall not assign Buyer’s rights
and obligations under this Agreement to any person or entity that is not an
Affiliate of Buyer without Seller’s prior written consent, which consent may be
withheld in Seller’s sole discretion.

 

16.6         Counterparts.  This Agreement may be executed in separate
counterparts, all of which taken together shall constitute one and the same
instrument.

 

16.7         Governing Law.  This Agreement and all issues arising hereunder
shall be governed by the laws of the state in which the Property is located,
except that the Escrow Agreement and all issues arising thereunder shall be
governed by the laws of the Commonwealth of Pennsylvania.

 

16.8         Waiver of Trial by Jury.  EACH PARTY HEREBY WAIVES, IRREVOCABLY AND
UNCONDITIONALLY, TRIAL BY JURY IN ANY ACTION BROUGHT ON, UNDER OR BY VIRTUE OF
OR RELATING IN ANY WAY TO THIS AGREEMENT OR ANY OF THE DOCUMENTS EXECUTED IN
CONNECTION HEREWITH, THE PROPERTY, OR ANY CLAIMS, DEFENSES, RIGHTS OF SET-OFF OR
OTHER ACTIONS PERTAINING HERETO OR TO ANY OF THE FOREGOING.

 

16.9         No Third-Party Beneficiary.  The provisions of this Agreement are
not intended to benefit any Person who is not a party to this Agreement.

 

16.10       Severability.  If any provision of this Agreement, or the
application thereof to any person, place or circumstance, shall be held by a
court of competent jurisdiction to be invalid,

 

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unenforceable or void, the remainder of this Agreement and such provisions as
applied to other persons, places and circumstances shall remain in full force
and effect.

 

16.11       Drafts Not an Offer to Enter into a Legally Binding Contract.  The
parties hereto agree that the submission of a draft of this Agreement by one
party to another is not intended by either party to be an offer to enter into a
legally binding contract with respect to the purchase and sale of the Property. 
The parties shall be legally bound with respect to the purchase and sale of the
Property pursuant to the terms of this Agreement only if and when the parties
have been able to negotiate all of the terms and provisions of this Agreement in
a manner acceptable to each of the parties in their respective sole discretion,
including, without limitation, all of the Exhibits and Schedules and the Rider
hereto, and Seller and Buyer have fully executed and delivered to each other a
counterpart of this Agreement, including, without limitation, all Exhibits and
Schedules and the Rider hereto.

 

16.12       Consents.  Any consent, determination, election or approval required
to be obtained, or permitted to be given, by or of any party hereunder, shall be
granted, withheld or made (as the case may be) by such party in the exercise of
such party’s sole and absolute discretion, except as otherwise set forth herein.

 

16.13       Survival.  Notwithstanding any presumption to the contrary, all
agreements, covenants and conditions contained in this Agreement which, by their
nature, impliedly or expressly involve observance or performance in any respect
after the Closing, or which cannot be ascertained to have been fully observed or
performed until after Closing, and all representations and warranties of Seller
contained in this Agreement, shall survive Closing and shall not merge with any
Closing Document or with the conveyance of the Property.

 

16.14       No Implied Easements.  Nothing shown on any subdivision plan now or
hereafter recorded, on any plan referred to in this Agreement or in the Deed, or
on any other plan, shall create or constitute an additional covenant,
representation or agreement of Buyer or create a lien, easement, right of way or
encumbrance with respect to the Property.

 

16.15       Joint Undertaking.  In addition to the obligations expressly
required to be performed hereunder by Seller and Buyer, each party agrees to
cooperate with the other and to perform such other acts and to execute,
acknowledge and deliver, before and after the Closing, such other instruments,
documents and materials as a party may reasonably request and as shall be
necessary in order to effect the consummation of the transactions contemplated
hereby and to vest title to the Property in Buyer or its assignees or nominees;
provided that no such other instrument, document or material shall either extend
or enlarge the obligations of the non-requesting party beyond the express
undertakings of this Agreement or shall require or could require the
non-requesting party to make any payment or expend any funds which are not
expressly provided for herein.

 

17.    DEFINITIONS

 

17.1         Definitions.  As used in this Agreement, the following terms shall
have the meanings set forth below, which meanings shall be applicable equally to
the singular and plural of the terms defined:

 

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“Affiliate” shall mean with respect to any Person (i) any other Person that
directly or indirectly through one or more intermediaries controls or is
controlled by or is under common control with such Person, (ii) any other Person
owning or controlling ten percent (10%) or more of the outstanding voting
securities of or other ownership interests in such Person, (iii) any officer,
director or partner of such Person, or (iv) if such Person is an officer,
director or partner, any other company for which such Person acts in any such
capacity.

 

“Business Day” shall mean any day other than a Saturday, a Sunday, or a federal
holiday recognized by the Federal Reserve Bank of New York.

 

“Claim” or “Claims” shall mean any and all suits, actions, proceedings,
investigations, demands, claims, liabilities, fines, penalties, liens,
judgments, losses, injuries and damages.

 

“Closing Documents” shall mean all the documents to be executed and delivered by
the parties at each Closing.

 

“Governmental Authority” shall mean any federal, state, county or municipal
government, or political subdivision thereof, any governmental agency,
authority, board, bureau, commission, department, instrumentality, or public
body, or any court or administrative tribunal.

 

“Hazardous Substance” shall mean materials, wastes or substances that are
(A) included within the definition of any one or more of the terms “hazardous
substances,” “hazardous materials,” “toxic substances,” “toxic pollutants” and
“hazardous waste” in the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. Section 9601, et seq.), the
Resource Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901, et
seq.), the Clean Water Act (33 U.S.C. Section 1251, et seq.), the Safe Drinking
Water Act (14 U.S.C. Section 1401, et seq.), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801, et seq.), and the Toxic Substance
Control Act (15 U.S.C. Section 2601, et seq.) and the regulations promulgated
pursuant to such laws, (B) regulated or classified as hazardous or toxic, under
federal, state or local environmental laws or regulations, (C) petroleum,
(D) asbestos or asbestos-containing materials, (E) polychlorinated biphenyls,
(F) flammable explosives or (G) radioactive materials.

 

“Lease” or “Leases” shall mean all or any of the Existing Leases and New Leases,
collectively.

 

“New Leases” shall mean those leases, license agreements and occupancy
agreements with respect to the Property which are entered into after the
Effective Date in accordance with the terms of this Agreement, as the same may
be amended or modified from time to time in accordance with the terms of this
Agreement.

 

“Parties” shall mean Seller and Buyer and their respective successors and
assigns.

 

“Person” shall mean any individual, partnership, corporation, limited liability
company, trust or other legal entity and any governmental authority, agency or
body.

 

“Title Insurance Policy” shall mean a standard 1992 ALTA owner’s policy of title

 

25

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insurance with respect to the Property, in the form customary in the county in
which the Property is located, showing title to the Property to be vested in
Buyer, subject only to the Permitted Encumbrances, with affirmative insurance as
to contiguity of lots and the absence of any gaps and gores (if the Property
includes more than one lot), with additional coverage to the effect that no
financing statements or other personal property liens or encumbrances shall have
been filed or recorded against those portions of the Property that constitute
personal property under applicable law, and with a coverage amount equal to the
Purchase Price.

 

17.2         Terms Generally.  For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires, the words
“herein,” “hereof” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular Article, Section or other
subdivision, the words “including” and “include” and other words of similar
import shall be deemed to be followed by the phrase “without limitation,”
“Property” includes each portion of the Property and each estate and interest
therein, “Agreement” includes these presents as supplemented or amended from
time to time by written agreement(s) entered into by Seller and Buyer, “Seller”
includes each Seller’s successors and assigns,  “Buyer” includes Buyer’s
successors and assigns and “parties” means Buyer and Seller.  Whenever the
context may require, any pronoun used herein shall include the corresponding
masculine, feminine or neuter forms, and the singular form of pronouns or nouns
shall include the plural and vice versa.  The captions of the sections of this
Agreement are for convenience only and have no meaning with respect to this
Agreement or the rights or obligations of the parties hereto.

 

[Execution Pages Follow]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement the date and year
first above written.

 

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

By:

 

 

 

 

Name: Joseph M. Macchione

 

 

 

Title: Vice President

 

 

27

--------------------------------------------------------------------------------

 

Exhibit A

 

[Special Warranty Deed for each property to be attached]

 

--------------------------------------------------------------------------------

 

EXHIBIT “A”

 

Land

 

--------------------------------------------------------------------------------

 

EXHIBIT “B”

 

Permitted Encumbrances

 

--------------------------------------------------------------------------------

 

Exhibit B

 

BILL OF SALE

 

On               , 2006,                            (“Seller”), in consideration
of Ten Dollars ($10.00) and other valuable consideration received from College
Park Investments, LLC, a Delaware limited liability company (“Buyer”), receipt
of which is hereby acknowledged, hereby grants, bargains, sells and delivers to
Buyer, its successors and assigns, all Seller’s right, title and interest in and
to Warranties, Reports and Plans, Books and Records, Licenses and Permits, Trade
Name, Trademarks and the Personal Property (as those terms are defined in a
certain Agreement of Sale between Seller and Buyer, dated June 12, 2006),
including without limitation the personal property described in Exhibit “A”
attached hereto and made a part hereof (collectively, “Property”), to have and
to hold the Property unto the Buyer, its successors and assigns, forever. 
Notwithstanding the foregoing, Buyer, by its acceptance of this instrument,
acknowledges and agrees that any use of the Trade Name shall be made strictly in
accordance with the terms and conditions of the Agreement of Sale.

 

Seller, for itself, its successors and assigns, hereby represents, warrants and
covenants to Buyer, its successors and assigns, that Seller is the lawful owner
of all the Property, that the Property is free from all pledges, security
interests, mortgages, liens and encumbrances, and that Seller, its successors
and assigns, shall forever warrant and defend good and clear title to the
Property against all claims and demands of all persons whatsoever.

 

In witness whereof, Seller has executed and delivered this Bill of Sale as of
the date first above written.

 

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

 

Title: Senior Vice President

 

 

--------------------------------------------------------------------------------

 

EXHIBIT “A”

 

2

--------------------------------------------------------------------------------

 

Exhibit C

 

ASSIGNMENT OF CONTRACTS

 

This Assignment of Contracts (“Assignment”) is entered into as of           ,
2006 by                            , with offices at 431 Office Park Drive,
Birmingham, Alabama 35223 (“Seller”), and College Park Investments, LLC, a
Delaware limited liability company, with offices at 10 Campus Boulevard, Newtown
Square, Pennsylvania 19073 (“Buyer”).  For valuable consideration, the parties
hereto, each intending to be legally bound and to bind their respective
successors and assigns, hereby covenant and agree as follows.

 

1.  Seller hereby assigns, transfers and sets over unto Buyer, and Buyer hereby
accepts and assumes, all Seller’s rights, title and interest in and to those
certain contracts, copies of which are attached hereto as Exhibit “A” and made a
part hereof (“Contracts”), which Contracts pertain to certain real property
located at                            , which Seller has contemporaneously
herewith conveyed unto Buyer.

 

2.  Seller represents and warrants to Buyer that: (a) the Contracts have not
been assigned previously and are not subject to any lien or encumbrance, (b) all
sums required to be paid as of the date hereof under the Contracts have been
paid or will be paid by Seller, and (c) to Seller’s knowledge, the copies of the
Contracts which are attached hereto are true correct and complete and constitute
the entire agreement between Seller and the respective contractors under the
Contracts.

 

3.  Buyer hereby assumes and agrees to perform all agreements and obligations of
Seller with respect to the Contracts arising on and after the date hereof. 
Seller shall be responsible for the observance and performance of all its
agreements and obligations under the Contracts arising prior to the date hereof.

 

4.  Seller shall defend, protect, indemnify and save harmless Buyer from and
against any and all liabilities, suits, actions, losses, damages, costs and
expenses, including without limitation counsel fees, suffered or incurred by
Buyer resulting from or relating to any failure by Seller to observe or perform
any of its agreements or obligations under the Contracts prior to the date
hereof.

 

5.  Buyer shall defend, protect, indemnify and save harmless Seller from and
against any and all liabilities, suits, actions, losses, damages, costs and
expenses, including without limitation counsel fees, suffered or incurred by
Seller resulting from or relating to any failure by Buyer to observe or perform
any of its agreements or obligations under the Contracts on or after the date
hereof.

 

6.  This Assignment may be executed in any number of counterparts, each of which
shall be deemed to be an original and all of which shall constitute one and the
same agreement.

 

[Execution pages follow.]

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, Seller and Buyer have executed this Assignment as of the
date first above written.

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

2

--------------------------------------------------------------------------------

 

EXHIBIT “A”

 

3

--------------------------------------------------------------------------------

 

Exhibit D

 

ASSIGNMENT AND ASSUMPTION OF LEASES

 

This Assignment and Assumption of Leases (“Assignment”) is entered into as of
               , 2006, by                                 , with offices at 431
Office Park Drive, Birmingham, Alabama 35223 (“Seller”), and College Park
Investments, LLC, a Delaware limited liability company, with offices at 10
Campus Boulevard, Newtown Square, Pennsylvania 19073 (“Buyer”).  For valuable
consideration, the parties hereto, each intending to be legally bound and to
bind their respective successors and assigns, hereby covenant and agree as
follows.

 

1.  Seller hereby assigns, transfers and sets over unto Buyer, and Buyer hereby
accepts, all Seller’s rights, title and interest in and to those certain leases,
a schedule of which is attached hereto as Exhibit “A” and made a part hereof
(“Leases”), which Leases pertain to various portions of that certain real
property located at                               , which Seller has
contemporaneously herewith conveyed unto Buyer. This Assignment includes (i) all
sureties and guaranties of the leases, (ii) the right to collect from all
tenants under the Leases (collectively, “Tenants”) all rents and other payments
whether heretofore or hereafter payable, (iii) the right to enforce all
obligations of the Tenants under the Leases and all sureties and guaranties, and
(iv) all security deposits paid by the tenants under the Leases.

 

2.  Seller represents and warrants to Buyer that Seller is the landlord under
the Leases, and the Leases, except with respect to Seller’s former financing
facilities, the liens of which are being released contemporaneous herewith, have
not been assigned previously and are not subject to any lien or encumbrance.

 

3.  Buyer hereby assumes and agrees to perform all agreements and obligations of
the landlord with respect to the Leases arising on and after the date hereof. 
Seller, and not Buyer, shall be responsible for the observance and performance
of all agreements and obligations of the landlord with respect to the Leases
arising prior to the date hereof.  Buyer, and not Seller, shall be responsible
for the observance and performance of all agreements and obligations of the
landlord with respect to the Leases arising on or after the date hereof.

 

4.  Seller shall defend, protect, indemnify and save harmless Buyer from and
against any and all liabilities, suits, actions, losses, damages, costs and
expenses, including without limitation counsel fees, suffered or incurred by
Buyer resulting from or relating to any failure by Seller to observe or perform
any of its agreements or obligations hereunder or under the Leases prior to the
date hereof.

 

5.  Buyer shall defend, protect, indemnify and save harmless Seller from and
against any and all liabilities, suits, actions, losses, damages, costs and
expenses, including, without limitation counsel fees, suffered or incurred by
Seller resulting from or relating to any failure by Buyer to observe or perform
any of its agreements or obligations hereunder or under the Leases on or after
the date hereof.

 

6.  This Assignment may be executed in any number of counterparts, each of which
shall be

 

--------------------------------------------------------------------------------

 

deemed to be an original and all of which shall constitute one and the same
agreement.

 

2

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, Seller and Buyer have executed this Assignment as of the
date first above written.

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

 

Title: Senior Vice President

 

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

3

--------------------------------------------------------------------------------

 

EXHIBIT “A”

 

4

--------------------------------------------------------------------------------

 

Exhibit E

 

GENERAL ASSIGNMENT

 

Effective                  , 2006,                    (“Seller”), in
consideration of Ten Dollars ($10.00), and other valuable consideration, the
receipt of which is hereby acknowledged, intending to be legally bound and to
bind its successors and assigns, hereby sells, assigns, transfers and sets over
to College Park Investments, LLC, a Delaware limited liability company
(“Buyer”), its successors and assigns, all of Seller’s right, title and interest
of, in and to
                                                                                                                            .

 

Seller, for itself, its successors and assigns, hereby covenants and warrants to
Buyer, its successors and assigns, that Seller is the lawful owner of all the
                                                     , that the
                                                  is free from all pledges,
security interests and encumbrances, and that Seller, shall forever warrant and
defend the good and clear title to the
                                                against all claims and demands
of all persons whatsoever.

 

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

 

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

--------------------------------------------------------------------------------

 

Exhibit F

 

Internal Revenue Code

Section 1445(b)(2)

Nonforeign Affidavit

(FIRPTA)

 

              , 2006

 

For purposes of Section 1445(b)(2) of the Internal Revenue Code, as amended, the
undersigned, as Senior Vice President of Capstone Development Corp., an Alabama
corporation, which is a general partner of                                 
(“Transferor”), hereby certifies, under penalty of perjury, to College Park
Investments, LLC, a Delaware limited liability company, that (i) Transferor’s
United States taxpayer identification number is 63-1057148, (ii) Transferor’s
address is 431 Office Park Drive, Birmingham, Alabama 35223, and
(iii) Transferor is not a “foreign person”, within the meaning of said
Section 1445(b)(2), as amended.  Transferor understands that this Affidavit may
be disclosed to the Internal Revenue Service, and that any false statement made
herein could be punished by fine, imprisonment or both.

 

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

 

Title: Senior Vice President

 

 

 

Sworn to and subscribed

before me this         day

of                ,       .

 

 

 

 

Notary Public

My Commission Expires:

 

--------------------------------------------------------------------------------

 

Exhibit G

 

DESIGNATION AGREEMENT

 

THIS DESIGNATION AGREEMENT (the “Agreement”) is entered into as of
                     , 2006, by and between                              
(“Seller”), College Park Investments, LLC, a Delaware limited liability company
(“Buyer”) and Commonwealth Land Title Insurance Company (“Title Insurance
Company”).

 

1.  RECITALS

 

a.   Pursuant to that certain Agreement of Sale, dated June 12, 2006
(“Agreement”), Seller has agreed to sell to Buyer, and Buyer has agreed to buy
from Seller (“Transaction”), that certain property located at
                                       (“Property”).

 

b.   Section 6045(e) of the United States Internal Revenue Code and the
regulations promulgated thereunder (collectively, the “Reporting Requirements”)
require an information return to be made to the United States Internal Revenue
Service, and a statement to be furnished to Seller, in connection with the
Transaction.

 

c.   Pursuant to Section 2.2(b)(i) of the Agreement, an escrow has been opened
with Title Insurance Company [Escrow No.                            ] through
which the Transaction will be or is being accomplished.  Title Insurance Company
is either (i) person responsible for closing the Transaction (as described in
the Reporting Requirements) or (ii) the disbursing title or escrow company that
is most significant in terms of gross proceeds disbursed in connection with the
Transaction (as described in the Reporting Requirements).

 

d.   Seller, Buyer and Title Insurance Company desire to designate Title
Insurance Company as the “Reporting Person” (as defined in the Reporting
Requirements) with respect to the Transaction.

 

2.     AGREEMENT

 

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Seller, Buyer and Title Insurance Company agree
as follows:

 

a.   Title Insurance Company is hereby designated as the Reporting Person for
the Transaction.  Title Insurance Company shall perform all duties that are
required by the Reporting Requirements to be performed by the Reporting Person
for the Transaction.

 

b.   Seller and Buyer shall furnish to Title Insurance Company, in a timely
manner, any information requested by Title Insurance Company, and necessary, for
Title Insurance Company, to perform its duties as Reporting Person for the
transaction.

 

c.   Seller hereby certifies to Title Insurance Company, under penalties of
perjury, that Seller’s correct taxpayer identification number is
                      .

 

--------------------------------------------------------------------------------

 

d.    The correct names and addresses of the parties hereto are as set forth
above.

 

e.   Each of the parties hereto shall retain this Agreement for a period of four
(4) years following the calendar year during which the date of closing of the
Transaction occurs.

 

f.   This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original and all of which shall constitute one and the
same agreement.

 

g.   This Agreement shall be governed by and construed in accordance with the
laws of the state in which the Property is located.

 

IN WITNESS WHEREOF, the parties have entered into this Agreement as of the date
and year first above written.

 

 

 

[Affiliate of Capstone Properties]

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

Commonwealth Land Title Insurance
Company

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

2

--------------------------------------------------------------------------------

 

Exhibit H

 

[Affiliate of Capstone Properties]

431 Office Park Drive

Birmingham, Alabama 35223

 

                   , 2006

 

Re:                               Lease, dated                  , between
                                       and                     (“Lease”)

 

Dear Sirs/Madams:

 

We have sold the property, of which your leased premises are a part, and have
assigned your Lease to College Park Investments, LLC.

 

From and after the date of this notice, all rent payments should be made to the
order of                                       and transmitted to:

 

 

 

[Affiliate of Capstone Properties]

 

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

--------------------------------------------------------------------------------

 

Exhibit I

 

[Affiliate of Capstone Properties]

431 Office Park Drive

Birmingham, Alabama 35223

 

            , 2006

 

Re:                                         , dated                  , between
                    and                      (“Contract”)

 

Dear Sirs/Madams:

 

We have sold the property, to which your Contract applies, and have assigned
your Contract to                                                .

 

 

[Affiliate of Capstone Properties]

 

 

 

By:

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

College Park Investments, LLC, a Delaware
limited liability company

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

Title:

 

--------------------------------------------------------------------------------

 

Schedule 1.1.8

 

Trademark

 

[g194421kg03i001.jpg]

 

--------------------------------------------------------------------------------

 

Schedule 4.2

 

Seller Deliverables

 

1.                                       Bankruptcy/Default/Workout History – A
detailed narrative of any bankruptcy filings, foreclosure proceedings or
significant loan modifications involving Seller.  If no such events have
occurred, please provide a statement to that effect.

 

2.                                       Financial Information – Current,
audited (if available) financial statements for Seller.

 

3.                                       Property Level Information – Originals
or legible copies of the following property level information:

 

a.                                       A title report for each parcel
comprising the Property issued by a national title insurance company, together
with complete legible copies of all documents reference therein.

b.                                      ALTA as-built surveys and legal
descriptions of each parcel comprising the Property in insurable form.

c.                                       Real estate tax bills for each parcel
comprising the Property for the three most recently ended tax years and, the
extent available, for the current tax year.  Also, the most recent tax
assessment for each parcel comprising the Property, any current or threatened
betterment assessments, and complete files on any pending tax appeal
proceedings.

d.                                      A detailed listing of all capital
expenditures on the Property made during the last three years.

e.                                       All existing and proposed leases, lease
proposals and standard lease forms.

f.                                         All service contracts, management
agreements, leasing agreements, reciprocal easement and/or operating agreements,
common area maintenance agreements, option agreements, land purchase agreements
and other agreements relating to the Property, including all amendments thereto.

g.                                      Any environmental, asbestos, lead paint,
engineering and other physical reports of the Property in Seller’s possession or
obtainable by Seller.

h.                                      Any appraisals of the Property completed
within the past three years.

i.                                          Operating statements for the
Property for the two most recently ended calendar years, and operating
statements for the Property through the most recently ended calendar month of
the current calendar year.  Audited financial statements for the Property (if
available) for the three most recently ended calendar years.

j.                                          Rent-rolls for the Property for the
past three months, identifying any rental concessions currently in effect.

k.                                       A schedule of all licenses, permits
(including grading, building and other permits for any work currently in
progress), certificates of occupancy, etc. for the Property currently in effect
together with copies thereof and of all amendments thereto.

 

--------------------------------------------------------------------------------

 

l.                                          Zoning compliance letters of
governmental authorities and/or similar evidence that the Property is in
compliance with zoning, subdivision and other land use requirements.

m.                                    Utility bills for the Property for the
past twenty-four months, which will be made available on site.

n.                                      An inventory of all personal property at
the Property.

o.                                      Complete files and details on any
pending or threatened litigation at or affecting the Property.

p.                                      The current year’s operating, leasing
and capital budget for the Property and a proposed operating, leasing and
capital budget for the first 12 months after closing.

q.                                      As-built plans and specifications for
the Property together with a full set of soil reports.

r.                                         An incident report for the Property
for the past twenty-four months.

s.                                       A list of names of all architects and
engineers and all major subcontractors, materialmen and suppliers used in
construction and development of the Property, to the best of Seller’s
capability.

 

t.                                         Loss runs for any and all insurance
claims for the history of the Property.

 

2

--------------------------------------------------------------------------------

 

Schedule 4.3(B)

 

Other Agreements

 

Property

 

Seller

 

Purchase Price

 

Deposit

 

 

 

 

 

 

 

Capstone Commons Apartments
2501 Abbott Road
East Lansing, MI 48823-1415

 

University Commons-East Lansing, Ltd.

 

$

22,700,000.00

 

$

459,514.17

 

 

 

 

 

 

 

University Commons Athens
1000 Lakeside Drive
Athens, GA 30605

 

Capstone Commons-Athens, Ltd

 

$

17,950,000.00

 

$

363,360.32

 

 

 

 

 

 

 

University Commons Baton Rouge
4600 Burbank Drive
Baton Rouge, LA 70820

 

University Commons-Baton Rouge, Ltd.

 

$

18,950,000.00

 

$

383,603.24

 

 

 

 

 

 

 

University Commons Bloomington
1150 Clarizz Boulevard
Bloomington, IN 47401

 

University Commons-Bloomington, IN., Ltd.

 

$

28,450,000.00

 

$

575,910.93

 

 

 

 

 

 

 

University Commons College Station –
Phase I
950 Colgate Drive
College Station, TX 77840

 

University Commons-College Station, Ltd.

 

$

17,700,000.00

 

$

358,299.60

 

 

 

 

 

 

 

University Commons College Station –
Phase II
950 Colgate Drive
College Station, TX 77840

 

University Commons-College Station Phase II, Ltd.

 

$

6,350,000.00

 

$

128,542.51

 

 

 

 

 

 

 

University Commons Columbia
800 Alexander Road
Cayce, SC 29033

 

University Commons-Columbia, S.C., L.P.

 

$

19,450,000.00

 

$

393,724.70

 

 

 

 

 

 

 

University Commons Eugene
90 Commons Drive
Eugene, OR 97401

 

University Commons-Eugene, OR., Ltd.

 

$

22,450,000.00

 

$

454,453.44

 

 

 

 

 

 

 

University Commons Lexington
845 Red Mile Road
Lexington, KY 40504

 

University Commons-Lexington, KY., Ltd.

 

$

21,450,000.00

 

$

434,210.53

 

 

 

 

 

 

 

University Commons Oxford
5262 Brown Road
Oxford, OH 45056

 

University Commons-Ohio, Ltd.

 

$

20,500,000.00

 

$

414,979.76

 

 

 

 

 

 

 

University Commons Starkville
1000 Campus View Drive
Starkville, MS 39759

 

University Commons-Starkville, Ltd.

 

$

10,399,900.00

 

$

210,524.29

 

 

 

 

 

 

 

University Commons Tuscaloosa
301 Helen Keller Blvd.
Tuscaloosa, AL 35404

 

University Commons-Tuscaloosa, Ltd.

 

$

19,700,100.00

 

$

398,787.44

 

--------------------------------------------------------------------------------

 

Property

 

Seller

 

Purchase Price

 

Deposit

 

 

 

 

 

 

 

University Commons Urbana
1321 Lincoln Ave.
Urbana, IL 61801

 

University Commons-Urbana, IL., Ltd.

 

$

20,950,000.00

 

$

424,089.05

 

 

 

 

$

247,000,000.00

 

$

5,000,000.00

 

2

--------------------------------------------------------------------------------

 

Schedule 5.1.2

Existing Litigation

 

NONE

 

--------------------------------------------------------------------------------

 

Schedule 5.1.10

Employees

 

--------------------------------------------------------------------------------

 

RIDER I

 

--------------------------------------------------------------------------------

 

DEPOSIT AND ESCROW AGREEMENT

 

Commonwealth Land Title Insurance Company (“Escrowee”) hereby agrees to hold in
escrow pursuant to this Deposit and Escrow Agreement, the aggregate amount of
Five Million Dollars ($5,000,000) (“Aggregate Deposit”) to be deposited by
College Park Investments, LLC (“Buyer”) pursuant to thirteen (13) Agreements of
Sale, dated June 12, 2006, (collectively, the “Agreements”, and each an
“Agreement”), between Buyer and University Commons-East Lansing, Ltd., Capstone
Commons-Athens, Ltd., University Commons-Baton Rouge, Ltd., University
Commons-Bloomington, IN., Ltd., University Commons-College Station, Ltd.,
University Commons-College Station Phase II, Ltd., University Commons-Columbia,
S.C., L.P., University Commons-Eugene, OR., Ltd., University Commons-Lexington,
KY., Ltd., University Commons-Ohio, Ltd., University Commons-Starkville, Ltd.,
University Commons-Tuscaloosa, Ltd., University Commons-Urbana, IL., Ltd.
(collectively, “Sellers”, and each a “Seller”), respectively, the provisions of
which (including, without limitation, the defined terms) are hereby incorporated
herein by reference.  Escrowee shall, immediately upon receipt of the Aggregate
Deposit, deposit same in an interest bearing, money market type escrow account
with a federally insured bank or savings and loan association in Pennsylvania. 
The Aggregate Deposit has been allocated by Buyer and Sellers to each of the
Agreements as shown in Exhibit “A” hereto, each such allocated amount
constituting the Deposit under, and as defined in, each Agreement.  Escrowee
shall pay each Deposit to each Seller, on account of the Purchase Price under
each Agreement, at Closing under each Agreement, or if Closing does not take
place under any Agreement, distribute the Deposit in accordance with the terms
of such Agreement.  In the event Buyer terminates all Agreements during the Due
Diligence Period as Due Diligence Terminations, then Escrowee shall pay each
Seller the amount of “Seller’s Share of Deposit” in the amount shown on
Exhibit “A” hereto, and all interest accrued thereon, and shall pay Buyer
“Buyer’s Share of Deposit” in the amount shown on “Exhibit “A” hereto.

 

Seller and Buyer agree that Escrowee is an escrow holder only and is merely
responsible for the safekeeping of the Aggregate Deposit and interest.  Escrowee
is not authorized, and shall not be required, to determine questions of fact or
law.  If Escrowee shall receive notice of a dispute as to the disposition of any
Deposit, then Escrowee shall not distribute such Deposit or interest except in
accordance with written instructions signed by both Buyer and Seller.  Pending
resolution of any such dispute, Escrowee may at its own election, and Escrowee
shall at the direction of any Seller or Buyer, pay the relevant Deposit and
interest into court.  If Escrowee pays any Deposit and interest into court, it
shall be discharged from all further obligations hereunder with respect to that
Deposit.

 

This Escrow Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.  This Escrow Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
shall constitute one and the same

 

--------------------------------------------------------------------------------

 

agreement.

 

Each Seller represents that its Federal Tax Payer Identification Number is as
stated in Exhibit “B” hereto.  Buyer represents that its Federal Employer
Identification Number is                     .

 

Escrowee agrees to hold the Closing Documents in escrow, to conduct Closing and
to distribute such documents as provided in the Agreement.

 

IN WITNESS WHEREOF, Buyer, Sellers and Escrowee, for valuable consideration,
each intending to be legally bound and to bind its respective heirs,
administrators, executors, personal representatives, successors and assigns,
have caused this Deposit and Escrow Agreement to be executed and delivered as of
June 12, 2006.

 

 

 

BUYER:

 

 

 

College Park Investments, LLC, a Delaware limited
liability company

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

ESCROWEE:

 

 

 

 

 

Commonwealth Land Title Insurance Company

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

SELLER:

 

 

 

 

 

Capstone Commons-Athens, Ltd., an Alabama limited
partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

--------------------------------------------------------------------------------

 

 

University Commons-Baton Rouge, Ltd., an Alabama
limited partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

University Commons-Bloomington, IN., Ltd., an
Alabama limited partnership

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

University Commons-College Station, Ltd., an
Alabama limited partnership

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

University Commons-College Station Phase II, Ltd., an
Alabama limited partnership

 

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

--------------------------------------------------------------------------------

 

 

University Commons, Columbia, S.C., L.P., an
Alabama limited partnership

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

University Commons-East Lansing, Ltd., an Alabama
limited partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

 

 

University Commons-Eugene, OR., Ltd., an Alabama
limited partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

University Commons-Lexington, KY., Ltd., an
Alabama limited partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

--------------------------------------------------------------------------------

 

 

University Commons-Ohio, Ltd., an Alabama limited
partnership

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

University Commons-Starkville, Ltd., an Alabama
limited partnership

 

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

 

 

University Commons-Tuscaloosa, Ltd., an Alabama
limited partnership

 

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

 

 

 

 

 

 

 

 

 

 

University Commons-Urbana, IL., Ltd., an Alabama
limited partnership

 

 

 

By:

Capstone Development Corp., an Alabama
corporation, its sole general partner

 

 

 

 

 

 

By:

 

 

 

 

 

Name: Rob Howland

 

 

 

Title: Senior Vice President

 

--------------------------------------------------------------------------------

 

Exhibit “A”

 

Property

 

Seller

 

Deposit

 

Seller’s Portion of 
Deposit

 

Buyer’s Portion of 
Deposit

 

 

 

 

 

 

 

 

 

 

 

Capstone Commons Apartments
2501 Abbott Road
East Lansing, MI 48823-1415

 

University Commons-East Lansing, Ltd.

 

$

459,514.17

 

$

22,975.71

 

$

436,538.46

 

 

 

 

 

 

 

 

 

 

 

University Commons Athens
1000 Lakeside Drive
Athens, GA 30605

 

Capstone Commons-Athens, Ltd

 

$

363,360.32

 

$

18,168.01

 

$

345,192.31

 

 

 

 

 

 

 

 

 

 

 

University Commons Baton Rouge
4600 Burbank Drive
Baton Rouge, LA 70820

 

University Commons-Baton Rouge, Ltd.

 

$

383,603.24

 

$

19,180.16

 

$

364,423.08

 

 

 

 

 

 

 

 

 

 

 

University Commons Bloomington
1150 Clarizz Boulevard
Bloomington, IN 47401

 

University Commons-Bloomington, IN., Ltd.

 

$

575,910.93

 

$

28,795.55

 

$

547,115.38

 

 

 

 

 

 

 

 

 

 

 

University Commons College Station –
Phase I
950 Colgate Drive
College Station, TX 77840

 

University Commons-College Station, Ltd.

 

$

358,299.60

 

$

17,914.98

 

$

340,384.62

 

 

 

 

 

 

 

 

 

 

 

University Commons College Station –
Phase II
950 Colgate Drive
College Station, TX 77840

 

University Commons-College Station Phase II, Ltd.

 

$

128,542.51

 

$

6,427.12

 

$

122,115.39

 

 

 

 

 

 

 

 

 

 

 

University Commons Columbia
800 Alexander Road
Cayce, SC 29033

 

University Commons-Columbia, S.C., L.P.

 

$

393,724.70

 

$

19,686.23

 

$

374,038.47

 

 

 

 

 

 

 

 

 

 

 

University Commons Eugene
90 Commons Drive
Eugene, OR 97401

 

University Commons-Eugene, OR., Ltd.

 

$

454,453.44

 

$

22,722.67

 

$

431,730.77

 

 

 

 

 

 

 

 

 

 

 

University Commons Lexington
845 Red Mile Road
Lexington, KY 40504

 

University Commons-Lexington, KY., Ltd.

 

$

434,210.53

 

$

21,710.53

 

$

412,500.00

 

 

 

 

 

 

 

 

 

 

 

University Commons Oxford
5262 Brown Road
Oxford, OH 45056

 

University Commons-Ohio, Ltd.

 

$

414,979.76

 

$

20,748.99

 

$

394,230.77

 

 

 

 

 

 

 

 

 

 

 

University Commons Starkville
1000 Campus View Drive
Starkville, MS 39759

 

University Commons-Starkville, Ltd.

 

$

210,524.29

 

$

10,526.22

 

$

199,998.07

 

 

 

 

 

 

 

 

 

 

 

University Commons Tuscaloosa
301 Helen Keller Blvd.
Tuscaloosa, AL 35404

 

University Commons-Tuscaloosa, Ltd.

 

$

398,787.44

 

$

19,939.38

 

$

378,848.06

 

 

 

 

 

 

 

 

 

 

 

University Commons Urbana
1321 Lincoln Ave.
Urbana, IL 61801

 

University Commons-Urbana, IL., Ltd.

 

$

424,089.05

 

$

21,204.45

 

$

402,884.60

 

 

 

 

 

$

5,000,000.00

 

$

250,000.00

 

4,750,000.00

 

 

--------------------------------------------------------------------------------

 

Exhibit “B”

 

Partnership Tax Payer ID Numbers:

 

--------------------------------------------------------------------------------

 

SCHEDULE I

 

The individual purchase prices and deposits with respect to each of the
properties is provided in Schedule 4.3(b) to this form Agreement of Sale.

 

The responsibilities regarding the payment of closing expenses for each of the
properties vary with respect to the individual Agreement of Sale for each such
property, based upon the customs of the state in which the property is located.

 

The form of deed and closing documents attached as exhibits to this form
Agreement of Sale vary with respect to the state in which each of the properties
is located.

 

Seller’s right to receive damages, as set forth in Section 12 of this form
Agreement of Sale, differ with respect to each separate Agreement of Sale in
proportion to the purchase price for each individual property.

 

Each individual Agreement of Sale contains certain immaterial modifications from
those set forth in this form Agreement of Sale, which modifications are based on
varying state law regarding warranties and mechanics liens.

 

The Agreement of Sale relating to the property located in Starkville,
Mississippi provides for a drainage easement and an access easement granting the
seller an access right to the property the seller is retaining and the right to
drain into one of the water-retention basins located on the property to be
conveyed to the buyer.  The seller also has agreed to share in the cost of
maintaining the access routes and the retention basin. This Agreement of Sale
also contains a representation from the seller that the property the seller is
retaining has been legally subdivided form the property the seller is conveying
to the buyer.

 

The Agreement of Sale relating to the property located in Tuscaloosa, Alabama
provides for a drainage easement and an access easement granting the seller an
access right to the property the seller is retaining and the right to drain into
one of the water-retention basins located on the property to be conveyed to the
buyer.  In addition, this agreement contains a provision granting an easement to
the seller to utilize a parking area located on the property to be conveyed to
the buyer.  The seller has agrees to share in the cost of maintaining the access
routes, parking area and retention basin.  This Agreement of Sale also contains
a representation from the seller that the property the seller is retaining has
been legally subdivided from the property the seller is conveying to the buyer.

 

--------------------------------------------------------------------------------