Exhibit 10.43

 

AGREEMENT OF SALE AND PURCHASE

 

between and among

 

M-C HARSIMUS PARTNERS L.L.C.

 

and

 

COLUMBIA DEVELOPMENT COMPANY, L.L.C.,

 

together, as Seller

 

and

 

iSTAR HARBORSIDE LLC

 

as Purchaser

 

Dated:  August 12, 2003

 

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TABLE OF CONTENTS

 

ARTICLE I

DEFINITIONS

 

 

 

Section 1.1

Definitions

 

Section 1.2

References:  Exhibits and Schedules

 

 

 

ARTICLE II

AGREEMENT OF PURCHASE AND SALE

 

 

 

Section 2.1

Purchase and Sale

 

Section 2.2

Indivisible Economic Package

 

Section 2.3

Full Performance

 

 

 

ARTICLE III

CONSIDERATION

 

 

 

Section 3.1

Purchase Price

 

Section 3.2

Method of Payment of Purchase Price

 

 

 

ARTICLE IV

EARNEST MONEY DEPOSIT AND ESCROW INSTRUCTIONS

 

 

 

Section 4.1

The Earnest Money Deposit and Independent Contract Consideration

 

Section 4.2

Escrow Instructions

 

Section 4.3

Designation of Certifying Person

 

 

 

ARTICLE V

INSPECTION OF PROPERTY

 

 

 

Section 5.1

Completion of Due Diligence

 

Section 5.2

Document Review.

 

Section 5.3

Entry and Inspection Obligations; Termination of Agreement.

 

Section 5.4

Sale “As Is”

 

Section 5.5

iStar Financial Guaranty

 

 

 

ARTICLE VI

TITLE AND SURVEY MATTERS

 

 

 

Section 6.1

Survey

 

Section 6.2

Title Report.

 

Section 6.3

Title Defect.

 

 

 

ARTICLE VII

INTERIM OPERATING COVENANTS AND POST-CLOSING MATTERS

 

 

 

Section 7.1

Interim Operating Covenants.

 

Section 7.2

JMB Construction Contract and JMB Cooling Tower Contract

 

Section 7.3

Schwab Lease

 

Section 7.4

Excess Net Profits; Fines

 

Section 7.5

OCIP

 

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Section 7.6

EQR Release

 

 

 

ARTICLE VIII

REPRESENTATIONS AND WARRANTIES

 

 

 

Section 8.1

Harsimus Representations and Warranties

 

Section 8.2

Columbia Representations and Warranties

 

Section 8.3

Seller’s Representations and Warranties

 

Section 8.4

Purchaser’s Representations and Warranties

 

Section 8.5

Survival of Representations and Warranties

 

Section 8.6

Updates and Additional Representation/Warranty Matters.

 

 

 

ARTICLE IX

CONDITIONS PRECEDENT TO CLOSING

 

 

 

Section 9.1

Conditions Precedent to Obligation of Purchaser

 

Section 9.2

Conditions Precedent to Obligations of Seller

 

Section 9.3

Failure of Condition

 

 

 

ARTICLE X

CLOSING

 

 

 

Section 10.1

Closing

 

Section 10.2

Purchaser’s Closing Obligations

 

Section 10.3

Seller’s Closing Obligations

 

Section 10.4

Prorations.

 

Section 10.5

Costs of Title Company and Closing Costs

 

Section 10.6

Post-Closing Delivery of Tenant Notice Letters

 

Section 10.7

Like-Kind Exchange

 

 

 

ARTICLE XI

CONDEMNATION AND CASUALTY

 

 

 

Section 11.1

Casualty

 

Section 11.2

Condemnation of Property

 

 

 

ARTICLE XII

CONFIDENTIALITY

 

 

 

Section 12.1

Confidentiality

 

 

 

ARTICLE XIII

REMEDIES

 

 

 

Section 13.1

Default by Seller.

 

Section 13.2

Default by Purchaser

 

 

 

ARTICLE XIV

NOTICES

 

 

 

Section 14.1

Notices.

 

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ARTICLE XV

BROKERAGE

 

 

 

Section 15.1

Brokers

 

 

 

ARTICLE XVI

ESCROW AGENT

 

 

 

Section 16.1

Escrow.

 

 

 

ARTICLE XVII

MISCELLANEOUS

 

 

 

Section 17.1

Waivers

 

Section 17.2

TIME OF THE ESSENCE

 

Section 17.3

Recovery of Certain Fees

 

Section 17.4

Construction

 

Section 17.5

Counterparts

 

Section 17.6

Severability

 

Section 17.7

Entire Agreement

 

Section 17.8

Governing Law

 

Section 17.9

No Recording

 

Section 17.10

Further Actions

 

Section 17.11

No Partnership

 

Section 17.12

Limitations on Benefits

 

Section 17.13

Assignment: Binding Effect

 

Section 17.14

Remedies Cumulative

 

Section 17.15

Further Assurances

 

Section 17.16

Cooperation.

 

Section 17.17

Exculpation

 

Section 17.18

Drafts Not an Offer to Enter into a Legally Binding Contract

 

 

 

ARTICLE XVIII

SCHWAB MATTERS

 

 

 

Section 18.1

Schwab’s Lease.

 

Section 18.2

Work Allowance and Additional Work Allowance.

 

 

 

ARTICLE XIX

INDEMNITY

 

 

 

Section 19.1

Indemnification by Seller

 

Section 19.2

Indemnification by Purchaser

 

Section 19.3

Survival of Indemnity

 

 

 

ARTICLE XX

8/9 TRANSFEREE DEBT MAINTENANCE COVENANT

 

 

 

Section 20.1

Maintenance Covenant

 

Section 20.2

Guaranty of Maintenance

 

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TABLE OF CONTENTS

(Continued)

INDEX OF DEFINED TERMS

 

 

Page

8/9 Bifurcated Waterfront Permit

22

8/9 Transferee

4

8/9 Transferee Guaranty

44

Access Agreement

15

AFE

1

Affiliate

2

Agreement

1

Allocation Letter

11

Amended Financial Agreement

3

Amended Leases

24

Amendment to Ground Lease

24

Amendment to Sublease

24

Approvals

3

Approvals shall have been obtained

3

Authorities

3

Broker

54

Building

3

Business Day

3

Certificate as to Foreign Status

3, 44

Certifying Person

3, 11

City

3

Closing

3

Closing Date

3

Closing Statement

3, 46

Closing Surviving Obligations

4

Code

4, 11

Columbia

1

Columbia Documents

30

Columbia Interest

2

Confidentiality Agreement

4

Construction Agreements

4

Contractor

6

Contracts

32

Contribution Agreement

4

Contribution Amount

48

Control

3

CRA

4, 26

CREA

4, 26

Dedication

4, 25

Delinquent

47

Delinquent Rental

4

Development Permit

22

Documents

4, 13

 

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TABLE OF CONTENTS

(Continued)

 

 

Page

Earnest Money Deposit

4, 11

Effective Date

4

Entry Notice

12

Environmental Laws

4

Environmental Reports

32

Environmental Statutes

5

Escrow Agent

5

Escrowed Funds

56

Excluded Real Property

5

Existing Deed Notice

25

Existing Survey

5

Final Closing Statement

47

Financial Agreement

6

Financial Statements

6

GAAP

6

Governmental Regulations

6

Ground Lease

1

Harsimus

1

Harsimus Documents

28

Harsimus Interest

2

Hazardous Substances

6

Improvements

6

Initial Term Schwab Commissions

47

IRS

6

iStar

15

JCRA Approval

6

JMB Construction Contract

6

JMB Cooling Tower Contract

6

Leasing Commission Agreements

7

Legal Restraints

38

Licensee Parties

7, 12

Licenses and Permits

7

LLC Assignment and Assumption

43

Losses

7, 62

Material Taking

50

Memorial

25

MOA

25

Monetary Objections

7, 20

NJDEP

7

Operating Expenses

7

Ordinance

7

Outside Closing Date

7, 41

PECA

7

Permit Condition

22

 

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TABLE OF CONTENTS

(Continued)

 

 

Page

Permitted Exceptions

7, 19

Permitted Outside Parties

7, 13

Permitted Transfers

7

Personal Property

7

PILOT Service Charge

48

Plaza IX

5

Plaza VIII

5

Plaza X Bifurcated Waterfront Permit

22

Post-Transfer AFE

22

Property

8

Property Management Agreement

42

Property Owner

1

Proration Items

8, 46

Proration Time

46

Purchase Price

8, 10

Purchaser

1

Purchaser Documents

36

Purchaser has actual knowledge

8

Purchaser’s Affiliates

8

Purchaser’s Costs

11

Purchaser’s Information

8, 15

Purchaser’s Proposed Estoppel Certificate

39

Purchaser’s Share of the Contribution Amount

48

PXLA

1

PXR

1

PXURA

1

Real Property

1

Redevelopment Agreement

8

References Exhibits and Schedules

9

Renewal Term Schwab Commissions

47

Rent Shortfall Credit

48

Rental

8, 47

Representation Basket

36

Representation Cap

36

Retained Entity

2

Retained Interest

2

ROEA

26

Schedule of Insurance by Property Owner

31

Scheduled Closing Date

8

Schwab

2

Schwab Lease

2

Schwab Parties

12

Schwab Subleases

32

Schwab’s Expansion Options

9

 

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TABLE OF CONTENTS

(Continued)

 

 

Page

Seller

1

Seller Entity

1

Seller Related Parties

62

Seller’s Affiliates

9

Seller’s LLC Interest

2

Significant Portion

9

Sublease

1

Superfund Act

5

Survey

19

Tenant Notice Letters

42

Termination Surviving Obligations

9

Threshold Estoppel Certificate

38

Title Company

9

Title Defect

21

Title Policy

9

Title Report

9, 19

To Columbia’s Knowledge

9

To Harsimus’ Knowledge

9

To Seller’s Knowledge

9

Transfer Tax Forms

42

Treasury Regulations

9

Updated Deed Notice

9, 25

Walkway Easement

27

Waterfront Walkway

27

Work Allowance Credit

63

 

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THIS AGREEMENT OF SALE AND PURCHASE (“Agreement”) is made this 12th day of
August, 2003 between and among M-C HARSIMUS PARTNERS L.L.C., a limited liability
company organized under the laws of the State of New Jersey having an address
c/o Mack-Cali Realty Corporation, 11 Commerce Drive, Cranford, New Jersey 07016
(“Harsimus”) and COLUMBIA DEVELOPMENT COMPANY, L.L.C., a limited liability
company organized under the laws of the State of New Jersey having an address at
30 Montgomery Street, 15th Floor, Jersey City, New Jersey 07302 (“Columbia,” and
together with Harsimus, “Seller;” Columbia and Harsimus are also sometimes
referred to individually as a “Seller Entity”) and iSTAR HARBORSIDE LLC, a
limited liability company organized under the laws of the State of Delaware
having an address at c/o iStar Financial, Inc., 1114 Avenue of the Americas, New
York, New York  10036 (“Purchaser”)

 

R E C I T A L S:

 

WHEREAS, as of the date hereof, Columbia and Harsimus are the sole members of,
and together own one hundred percent (100%) of the beneficial ownership interest
in, American Financial Exchange L.L.C., a limited liability company organized
under the laws of the State of New Jersey (“AFE”);

 

WHEREAS, AFE is (i) the owner of that certain parcel or parcels of real property
described on the legal description attached hereto and made a part hereof as
Schedule A, together with all of AFE’s right, title and interest, if any, in and
to the appurtenances pertaining thereto, including but not limited to AFE’s
right, title and interest in and to the adjacent streets, alleys and
right-of-ways, and any easement rights, air rights, subsurface development
rights and water rights (but not including the Excluded Real Property (as
hereinafter defined)) (collectively, the “Real Property”), and (ii) the landlord
under that certain Ground Lease dated as of October 6, 2000 (the “Ground
Lease”), pursuant to which the Real Property is leased to Plaza X Urban Renewal
Associates L.L.C., a limited liability company organized under the laws of the
State of New Jersey (“PXURA”);

 

WHEREAS, AFE is the sole member of, and owns one hundred percent (100%) of the
interest in, Plaza X Realty L.L.C., a limited liability company organized under
the laws of the State of New Jersey (“PXR”), and PXR is the sole member of, and
owns one hundred percent (100%) of the interest in, PXURA;

 

WHEREAS, PXURA constructed, and is the owner of, the Building (as hereinafter
defined) constructed upon the Real Property and, as sublandlord, has further
sublet the Real Property and the Building to Plaza X Leasing Associates L.L.C.,
a limited liability company organized under the laws of the State of New Jersey
(“PXLA,” and together with PXURA, PXR and AFE, collectively or individually as
the context may require, “Property Owner”), as subtenant, pursuant to that
certain Lease dated as of October 6, 2000 (the “Sublease”);

 

WHEREAS, PXR is the sole member of, and owns one hundred percent (100%) of the
interest in, PXLA;

 

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WHEREAS, via its sole membership in, and one hundred percent (100%) ownership
of, PXR, AFE indirectly owns all of both PXLA and PXURA;

 

WHEREAS, PXLA, as sub-sublandlord, has entered into that certain Amended and
Restated Lease dated as of December 29, 2000, as supplemented and amended, and
as is more particularly described on Schedule 8.3(c)(i)-1 annexed hereto
(collectively, the “Schwab Lease”), with Charles Schwab & Co., Inc. (“Schwab”),
as sub-subtenant, for the entire rentable area of the Building, all as is more
particularly set forth in the Schwab Lease;

 

WHEREAS, contemporaneously with the Closing (as hereinafter defined), but
sequentially prior to all other actions taken at the Closing, (i) Columbia,
pursuant to an assignment and assumption agreement will assign, transfer and
convey a 4% membership interest in and to AFE pursuant to an assignment and
assumption agreement in substantially the form attached hereto as
Exhibit 10.3(a) (the “Retained Interest”) to an entity entirely owned and
controlled by certain owners of an indirect interest in Columbia (the “Retained
Entity” ), and (ii) the Retained Entity will assign, transfer and convey the
Retained Interest to Purchaser pursuant to an assignment and assumption
agreement in substantially the form attached hereto as Exhibit 10.3(a)
(collectively, the “Retained Interest Assignments”);

 

WHEREAS, at Closing, (i) Harsimus will assign, transfer and convey to Purchaser
its entire membership interest in AFE (the “Harsimus Interest”) and (ii)
Columbia will assign, transfer and convey to Purchaser its entire membership
interest in AFE (after the assignment, transfer and conveyance of the Retained
Interest, the “Columbia Interest,” and together with the Harsimus Interest,
sometimes referred to as “Seller’s LLC Interest”), all upon and subject to the
terms and conditions set forth in this Agreement; and

 

WHEREAS, Seller desires to sell, and Purchaser desires to purchase, Seller’s LLC
Interest, all upon and subject to the terms and conditions set forth in this
Agreement.

 

NOW THEREFORE, in consideration of the mutual promises, covenants, and
agreements set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser
agree as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.1             Definitions.  For purposes of this Agreement, the
following capitalized terms have the meanings set forth in this Section 1.1:

 

“Affiliate” means, with respect to any entity, any other individual or entity
which, directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such entity first mentioned, and
the heirs, administrators, executors, personal or legal representatives and
successors and assigns of any or all of the foregoing.  With respect to any
individual, such individual’s parents, spouse, direct lineal or adoptive
descendants, descendants by marriage, and/or one more trusts created for the
benefit of such individual or any

 

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such family members.  “Control” (including the correlative meaning of the terms
“controlled by” and “under the common control with”) means the possession,
direct or indirect, of the power to direct or cause the direction of an entity,
whether through the ownership of voting securities, by contract or otherwise.

 

“Amended Financial Agreement” means that certain amendment to the Financial
Agreement (as hereinafter defined), entered into in accordance with the
Ordinance (as hereinafter defined), between PXURA and the City (as hereinafter
defined), which form of amendment is annexed hereto as Exhibit 1.1(a); provided,
however, that such form may be modified to include any non-material changes
requested by the City and such other matters as may be approved by both
Purchaser and Seller, which approval shall not be unreasonably withheld,
conditioned or delayed.

 

“Approvals” means the collective reference to the Ordinance (as hereinafter
defined), the Amended Financial Agreement and the approval by the New Jersey
Department of Community Affairs to the amended Certificate of PXURA, as annexed
to the Amended Financial Agreement.

 

“Approvals shall have been obtained” means the occurrence of the following: the
Ordinance is obtained, the Amended Financial Agreement becomes effective, the
approval by the New Jersey Department of Community Affairs to the amended
Certificate of PXURA, as annexed to the Amended Financial Agreement, is obtained
and the submission for filing with the Treasurer of the State of New Jersey of
such amended Certificate of PXURA.

 

“Authorities” means the various federal, state and local governmental and
quasi-governmental bodies or agencies having jurisdiction over the Real Property
and Improvements (as hereinafter defined), or any portion thereof.

 

“Building” shall have the meaning ascribed to such term in the Schwab Lease.

 

“Business Day” means any day other than a Saturday, Sunday or a day on which
national banking associations are authorized or required to close.

 

“Certificate as to Foreign Status” has the meaning ascribed to such term in
Section 10.3(d).

 

“Certifying Person” has the meaning ascribed to such term in Section 4.3(a).

 

“City” means the City of Jersey City.

 

“Closing” means the consummation of the purchase and sale of the Seller’s LLC
Interest contemplated by this Agreement, as provided for in Article X.

 

“Closing Date” means the date on which the Closing of the transaction
contemplated hereby actually occurs.

 

“Closing Statement” has the meaning ascribed to such term in Section 10.4(a).

 

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“Closing Surviving Obligations” means the rights, liabilities, obligations,
covenants, and agreements set forth in Sections 4.3, 5.3, 5.4, 7.2, 7.3, 7.4,
7.5, 7.6, 8.1, 8.2, 8.3, 8.4, 8.5, 8.6, 10.4, 10.5, 10.6, 10.7, 11.1, 12.1,
15.1, 16.1, Article XIV, Article XVII, Section 18.2, Article XIX and Article XX,
and any other provisions (including, without limitation, guaranties and
indemnities) which pursuant to their terms survive the Closing hereunder.

 

“Code” has the meaning ascribed to such term in Section 4.3.

 

“Confidentiality Agreement” means that certain Confidentiality Agreement, dated
October 2, 2002, between AFE and iStar Financial Inc.

 

“Construction Agreements” means (i) the JMB Construction Contract and the JMB
Cooling Tower Contract (as such terms are hereinafter defined), (ii) all other
contracts and agreements entered into by PXURA or any other Property Owner in
connection with the construction of the Building, including, without limitation,
all written agreements, if any, with the architects (including architects’
drawings), contractors, subcontractors and product manufacturers that provided
services and/or materials in connection with the construction of the Building,
and (iii) any and all warranties or guarantees issued under or pursuant to the
JMB Construction Contract and the JMB Cooling Tower Contract (such warranties or
guarantees, collectively, the “Warranties”).

 

“Contribution Agreement” means that certain Contribution Agreement dated
November 15, 2000 between AFE and the City.

 

“CRA” has the meaning ascribed to such term in Section 7.1(k).

 

“CREA” has the meaning ascribed to such term in Section 7.1(j).

 

“Dedication” has the meaning ascribed to such term in Section 7.1(f)(ii).

 

“Delinquent Rental” has the meaning ascribed to such term in Section 10.4(b).

 

“Documents” has the meaning ascribed to such term in Section 5.2(a).

 

“Earnest Money Deposit” has the meaning ascribed to such term in Section 4.1.

 

“Effective Date” means the date of this Agreement.

 

“8/9 Transferee” means Plaza VIII & IX Associates L.L.C., a New Jersey limited
liability company, the successor-in-interest to AFE to the fee title to the
Excluded Real Property (as hereinafter defined).

 

“Environmental Laws” means each and every federal, state, county and municipal
statute, ordinance, rule, regulation, code, order, requirement, directive,
binding written interpretation and binding written policy pertaining to
Hazardous Substances (as hereinafter defined) issued by any Authorities and in
effect as of the date of this Agreement which affects the Real Property or the
Improvements (as hereinafter defined), or any portion thereof, the use,

 

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ownership, occupancy or operation of the Real Property or the Improvements, or
any portion thereof, and as same have been amended, modified or supplemented
from time to time prior to the Effective Date, including but not limited to the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42
U.S.C. § 9601 et seq.) (the “Superfund Act”), the Hazardous Substances
Transportation Act (49 U.S.C. § 1802 et seq.), the Resource Conservation and
Recovery Act (42 U.S.C. § 6901 et seq.), as amended by the Hazardous and Solid
Wastes Amendments of 1984, the Water Pollution Control Act (33 U.S.C. § 1251 et
seq.), the Safe Drinking Water Act (42 U.S.C. § 300f et seq.), the Clean Water
Act (33 U.S.C. § 1321 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.),
the Solid Waste Disposal Act (42 U.S.C. § 6901 et seq.), the Toxic Substances
Control Act (15 U.S.C. § 2601 et seq.), the Emergency Planning and Community
Right-to-Know Act of 1986 (42 U.S.C. § 11001 et seq.), the Radon and Indoor Air
Quality Research Act (42 U.S.C. § 7401 note, et seq.), the National
Environmental Policy Act (42 U.S.C. § 4321 et seq.), the Superfund Amendment
Reauthorization Act of 1986 (42 U.S.C. § 9601 et seq.), the Occupational Safety
and Health Act (29 U.S.C. § 651 et seq.); the New Jersey Environmental Rights
Act, N.J.S.A. 2A:35A-1 et seq.; the New Jersey Spill Compensation and Control
Act, N.J.S.A. 58:10-23.11 et seq.; the New Jersey Air Pollution Control Act,
N.J.S.A. 26:2C-1 et seq.; the New Jersey Water Pollution Control Act, N.J.S.A.
58:10A-1 et seq.; the Hazardous Substances Discharge: Reports and Notices Act,
N.J.S.A. 13:1K-15 et seq.; the Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et
seq.; the New Jersey Underground Storage of Hazardous Substances Act, N.J.S.A.
58:10A-21 et seq. (collectively, the “Environmental Statutes”), and any and all
rules and regulations which have become effective prior to the date of this
Agreement under any and all of the Environmental Statutes.

 

“Escrow Agent” means First American Title Insurance Company, with an office at
633 Third Avenue, New York, New York 10017.

 

“Excluded Real Property” means (i) those certain parcels of land adjacent to the
Real Property and designated as Block 15, Lot 50 commonly referred to as Plaza
VIII (“Plaza VIII”) and  Plaza IX (“Plaza IX”) and that certain publicly
accessible open space adjacent thereto and designated as Block 15, Lot 49 at the
Harborside Financial Center, Jersey City, New Jersey, (ii) the portion of Block
15, Lot 18 described on Schedule A-1 attached hereto and (iii) all unutilized
air and subsurface development rights, if any, set forth in the Licenses and
Permits (as hereinafter defined) the Financial Agreement (as hereinafter
defined), and the Redevelopment Agreement (as hereinafter defined); provided,
however, if the Waterfront Development Permit is bifurcated prior to Closing in
the manner set forth in Section 7.1(b)(ii) of this Agreement, then the term
“Excluded Real Property” shall also include the 8/9 Bifurcated Waterfront
Permit, and all of the rights and privileges granted therein.  In no event shall
“Excluded Real Property” include the development rights set forth in the
Waterfront Development Permit which pertained to the development of the
Building, which development rights are to be set forth in the Plaza X Bifurcated
Waterfront Permit.

 

“Existing Survey” means that certain survey of the Real Property November 23,
2002, updated as of June 24, 2003, prepared by John Zanetakos Associates, Inc.

 

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“Financial Agreement“ means that certain Financial Agreement, together with all
exhibits and schedules annexed thereto, made as of November 15, 2000 between
Plaza X Urban Renewal Associates, LLC and the City, as amended by the Addendum
to Financial Agreement made as of November 15, 2000.

 

“Financial Statements” means the consolidated financial statements of AFE and
its subsidiaries as of and for the year ended December 31, 2002 and as of and
for the six month period ended June 30, 2003, each prepared in accordance with
GAAP (as hereinafter defined).

 

“GAAP” means United States generally accepted accounting principles,
consistently applied.

 

“Governmental Regulations” means all statutes, ordinances, rules and regulations
of the Authorities applicable to Seller or the use or operation of the Real
Property or the Improvements or any portion thereof.

 

“Hazardous Substances” means (a) asbestos, radon gas and urea formaldehyde foam
insulation, (b) any solid, liquid, gaseous or thermal contaminant, including
smoke vapor, soot, fumes, acids, alkalis, chemicals, petroleum products or
byproducts, PCB’s, phosphates, lead or other heavy metals and chlorine, (c) any
solid or liquid waste (including, without limitation, hazardous waste),
hazardous air pollutant, hazardous substance, hazardous chemical substance and
mixture, toxic substance, pollutant, pollution, regulated substance and
contaminant, as such terms are defined in any of the Environmental Laws, and
(d) any other chemical, material or substance, the use or presence of which, or
exposure to the use or presence of which, is prohibited, limited or regulated by
any Environmental Laws.

 

“Improvements” means all buildings (including, without limitation, the
Building), structures, fixtures, parking areas and other improvements, together
with the tenements, hereditaments and appurtenances thereto belonging, located
on the Real Property.

 

“IRS” means the Internal Revenue Service.

 

“JCRA Approval” means the issuance of a Certificate of Substantial Completion
from Jersey City Redevelopment Agency, a New Jersey public body corporate, which
confirms that all obligations of the Redevelopment (as defined in the
Redevelopment Agreement (as hereinafter defined)) under the Redevelopment
Agreement have been substantially completed with respect to the Real Property,
and that the Jersey City Redevelopment Agency’s right of reverter with respect
to the Real Property has been terminated.

 

“JMB Construction Contract” means that certain construction agreement between
PXURA and Jeffrey M. Brown, Inc. (“Contractor”), with respect to the
construction of the Building, dated July 15, 2000.

 

“JMB Cooling Tower Contract” means that certain construction agreement between
PXURA and Contractor with respect to construction of the fourth cooling tower at
the Building dated December 11, 2002.

 

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 “Leasing Commission Agreements” means the leasing commission agreements
affecting the Property, and which are more particularly set forth on
Schedule 8.3(k) attached hereto.

 

“Licensee Parties” has the meaning ascribed to such term in Section 5.1.

 

“Licenses and Permits” means, collectively, all of the Property Owner’s right,
title and interest, in and to licenses, permits, certificates of occupancy,
approvals, dedications, zoning approvals, warranties, lien waivers, utility
arrangements, subdivision maps and entitlements now existing or hereafter
issued, approved or granted by the Authorities in connection with the Real
Property and the Improvements, together with all renewals and modifications
thereof.

 

“Losses” has the meaning ascribed to such term in Section 17.17.

 

“Monetary Objections” has the meaning ascribed to such term in Section 6.2.

 

“NJDEP” means the New Jersey Department of Environmental Protection.

 

“Operating Expenses” has the meaning ascribed to such term in Section 10.4(c).

 

“Ordinance” means a validly adopted, effective and non-appealable Ordinance of
the Municipal Council of the City in the form annexed hereto as Exhibit 7.3;
provided, however, that such form may be modified to include any non-material
changes requested by the City and such other matters as may be approved by both
Purchaser and Seller, which approval shall not be unreasonably withheld,
conditioned or delayed by either party.  The parties hereto hereby agree that
the Ordinance shall be deemed non-appealable after the expiration of the
applicable 45-day appeal period.

 

“Outside Closing Date” has the meaning ascribed to such term in Section 10.1.

 

“PECA” means that certain Project Employment and Contracting Agreement between
the City and PXURA, dated as of November 15, 2000, as amended through the
Closing Date.

 

“Permitted Exceptions” has the meaning ascribed to such term in Section 6.2(a).

 

“Permitted Outside Parties” has the meaning ascribed to such term in
Section 5.2(b).

 

“Permitted Transfers” means transfers, whether directly or indirectly, of all or
any portion of Seller’s LLC Interest between all or any of the Seller Entities
and/or Seller’s Affiliates; provided, however, that such transferee (to the
extent not already a party hereto) shall automatically be bound by the
provisions of this Agreement to the same extent as the transferor of its
interest.

 

“Personal Property” means that certain equipment, appliances, tools, supplies,
machinery, artwork, furnishings and other tangible personal property attached
to, appurtenant to, located in and used in connection with the ownership or
operation of the Improvements and situated at the Real Property more
particularly identified on Schedule B annexed hereto.

 

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“Property” means, collectively, the following:  (i) the Real Property; (ii) the
Improvements and all of the Property Owner’s right, title and interest in and to
any land lying in the bed of any street, road, avenue or alley, open or
proposed, in front of or adjoining the Land to the center line thereof, and any
strips or gores adjacent to the Real Property, and all right, title and interest
of Property Owner in and to any award made or to be made for damages by reason
of any change in grade of any street; (iii) the Personal Property; (iv) the
Schwab Lease, the Ground Lease and the Sublease; (v) the Licenses and Permits;
(vi) the Leasing Commission Agreements; (vii) the Construction Agreements;
(viii) the Owner Controlled Insurance Program for the construction of the
Building (the “OCIP”) consisting of the General Liability Policy issued by St.
Paul Fire and Marine Insurance Company, policy number KG0290072 and the Workers
Compensation Policy issued by St. Paul Fire and Marine Insurance Company under
policy number WVW2989000, but specifically excluding any savings, refunds or
other amounts payable under the OCIP; and (ix) all other plans, specifications,
approvals, tax abatements and all other intangible rights, titles, interests,
privileges and appurtenances owned by Property Owner and related to or used in
connection with the ownership, use or operation of the Real Property or the
Improvements, but specifically excluding any property owned by Tenants or others
and the Excluded Real Property.

 

“Proration Items” has the meaning ascribed to such term in Section 10.4(a).

 

“Purchase Price” has the meaning ascribed to such term in Section 3.1.

 

“Purchaser has actual knowledge” (and variations thereon used herein) means the
actual (as opposed to constructive or imputed) knowledge solely of H. Cabot
Lodge III, as Executive Vice President of iStar Financial Inc, Joe Welsh, as
Vice President of iStar Financial Inc., and Christopher Miculis, as Associate of
iStar Financial Inc., without any independent investigation or inquiry
whatsoever, other than the due diligence conducted by Purchaser in connection
with this transaction.

 

“Purchaser’s Affiliates” means all of the Affiliates of Purchaser.

 

“Purchaser’s Information” has the meaning ascribed to such term in
Section 5.3(c).

 

“Redevelopment Agreement” means that certain Redevelopment Agreement dated as of
April 12, 1985 between Jersey City Redevelopment Agency, a New Jersey public
body corporate, and A-S-H Management Corporation, a Delaware corporation, and
recorded in the Hudson County Register of Deeds on November 27, 1985 in Book
3485, at Page 1, as subsequently amended, modified, supplemented and assigned.

 

“Rental” has the meaning ascribed to such term in Section 10.4(b), and same are
“Delinquent” in accordance with the meaning ascribed to such term in
Section 10.4(b).

 

“Scheduled Closing Date” means the date that is ten (10) Business Days following
the satisfaction, or waiver in writing of, the conditions set forth in Sections
9.1(j) and (o), and 9.2(g) hereof, or such later date to which the Closing may
be adjourned in accordance with the express

 

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terms of this Agreement or such earlier or later date to which Purchaser and
Seller may hereafter agree in writing.

 

“Schwab’s Expansion Options” means the First Expansion Option (as such term is
defined in the Schwab Lease) and Second Expansion Option (as such term is
defined in the Schwab Lease) granted to Schwab under the Schwab Lease.

 

“Seller’s Affiliates” means all of the Affiliates of Seller.

 

“Significant Portion” means, for purposes of the casualty provisions set forth
in Article XI hereof, damage by fire or other casualty to the Real Property and
the Improvements or a portion thereof, such that Schwab is entitled to terminate
the Schwab Lease pursuant to Section 10.05(d) thereof.

 

“Termination Surviving Obligations” means the rights, liabilities and
obligations set forth in Sections 5.2, 5.3, 5.4, 12.1, and 16.1, and Articles
XIII, XIV and XVII, and any other provisions which pursuant to their terms
survive any termination of this Agreement.

 

“Title Company” means First American Title Insurance Company and Fidelity
National Title Company as equal co-insurers.

 

“Title Policy” means the title policy, if any, obtained by Purchaser from the
Title Company at Closing.

 

“Title Report” has the meaning ascribed to such term in Section 6.2(a).

 

“To Columbia’s Knowledge” (and variations thereon used herein) means the present
actual (as opposed to constructive or imputed) knowledge solely of Joseph A.
Panepinto, Peter Mangin and Frank Guarini without any independent investigation
or inquiry whatsoever.

 

“To Harsimus’ Knowledge” (and variations thereon used herein) means the present
actual (as opposed to constructive or imputed) knowledge solely of Mitchell
Hersh, as Chief Executive Officer of Mack-Cali Realty Corporation, Roger Thomas,
as General Counsel of Mack-Cali Realty Corporation, Gary Wagner, as Associate
General Counsel of Mack-Cali Realty Corporation, John Crandall, as Senior Vice
President – Development of Mack-Cali Realty Corporation and John Marazzo, as
Senior Director – Property Management of Mack-Cali Realty Corporation, without
any independent investigation or inquiry whatsoever.

 

“To Seller’s Knowledge” (and variations thereon used herein) means,
collectively, To Columbia’s Knowledge and To Harsimus’ Knowledge.

 

“Treasury Regulations” means the regulations prescribed under the Code.

 

“Updated Deed Notice” has the meaning ascribed to such term in Section 7.1(h).

 

SECTION 1.2             REFERENCES:  EXHIBITS AND SCHEDULES.   EXCEPT AS
OTHERWISE SPECIFICALLY INDICATED, ALL REFERENCES IN THIS AGREEMENT TO ARTICLES
OR SECTIONS REFER TO ARTICLES OR SECTIONS OF

 

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THIS AGREEMENT, AND ALL REFERENCES TO EXHIBITS OR SCHEDULES REFER TO EXHIBITS OR
SCHEDULES ATTACHED HERETO, ALL OF WHICH EXHIBITS AND SCHEDULES ARE INCORPORATED
INTO, AND MADE A PART OF, THIS AGREEMENT BY REFERENCE. THE WORDS “HEREIN,”
“HEREOF,” “HEREINAFTER” AND WORDS AND PHRASES OF SIMILAR IMPORT REFER TO THIS
AGREEMENT AS A WHOLE AND NOT TO ANY PARTICULAR SECTION OR ARTICLE.

 

ARTICLE II

AGREEMENT OF PURCHASE AND SALE

 

SECTION 2.1             PURCHASE AND SALE.  SUBJECT TO THE CONDITIONS AND ON THE
TERMS CONTAINED IN THIS AGREEMENT, PURCHASER AGREES TO PURCHASE AND ACQUIRE FROM
SELLER, AND SELLER AGREES TO SELL AND TRANSFER TO PURCHASER, SELLER’S LLC
INTEREST.  BY ACQUIRING SELLER’S LLC INTEREST PURSUANT HERETO, THE RETAINED
INTEREST PURSUANT TO THE RETAINED INTEREST ASSIGNMENTS, PURCHASER SHALL
INDIRECTLY OWN ONE HUNDRED PERCENT (100%) OF THE BENEFICIAL OWNERSHIP INTEREST
IN AND TO THE PROPERTY AND PROPERTY OWNER.  ANYTHING TO THE CONTRARY CONTAINED
HEREIN NOTWITHSTANDING, SELLER IS NOT TRANSFERRING TO PURCHASER ANY BANK
ACCOUNTS OR FUNDS THEREIN MAINTAINED BY AFE OR ANY PROPERTY OWNER AND SELLER
SHALL HAVE THE RIGHT, AT ANY TIME ON OR PRIOR TO CLOSING, TO TRANSFER ANY SUCH
BANK ACCOUNTS OR WITHDRAW ANY SUCH FUNDS AND KEEP THE SAME FOR ITS OWN BENEFIT;
PROVIDED, THAT THIS SENTENCE SHALL NOT AFFECT THE PRO RATIONS UNDER
SECTION 10.4.

 

Section 2.2             Indivisible Economic Package.  Purchaser has no right to
purchase, and Seller has no obligation to sell, less than all of Seller’s LLC
Interest, it being the express agreement and understanding of Purchaser and
Seller that, as a material inducement to Seller and Purchaser to enter into this
Agreement, Purchaser has agreed to purchase, and Seller has agreed to sell, all
of Seller’s LLC Interest, subject to and in accordance with the terms and
conditions hereof

 

SECTION 2.3             FULL PERFORMANCE.  THE EXECUTION AND DELIVERY OF THE LLC
ASSIGNMENT AND ASSUMPTION (AS HEREINAFTER DEFINED) AND THE OTHER DOCUMENTS TO BE
EXECUTED AND/OR DELIVERED BY SELLER TO PURCHASER PURSUANT TO THIS AGREEMENT
SHALL BE DEEMED TO BE A FULL PERFORMANCE AND DISCHARGE OF EVERY AGREEMENT AND
OBLIGATION ON THE PART OF SELLER TO BE PERFORMED UNDER THIS AGREEMENT, EXCEPT
THOSE AGREEMENTS, OBLIGATIONS, COVENANTS, REPRESENTATIONS, WARRANTIES AND
INDEMNIFICATIONS OF SELLER WHICH ARE SPECIFICALLY STATED TO SURVIVE THE CLOSING
OF THE TRANSACTION CONTEMPLATED IN THIS AGREEMENT.

 

ARTICLE III

CONSIDERATION

 

Section 3.1             Purchase Price.  The purchase price for Seller’s LLC
Interest shall be the sum of One Hundred Eighty Six Million One Hundred Ninety
Two Thousand and 00/100 Dollars ($186,192,000.00) all in lawful currency of the
United States of America, payable as provided in Section 3.2, and subject to
adjustments and credits as expressly contemplated by this Agreement (the
“Purchase Price”).

 

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Section 3.2             Method of Payment of Purchase Price.  No later than 1:00
p.m. Eastern Time on the Scheduled Closing Date, Purchaser shall pay to Escrow
Agent (on behalf of Seller) the Purchase Price (less the Earnest Money Deposit),
together with all other costs and amounts to be paid by Purchaser at the Closing
pursuant to the terms of this Agreement (such other costs and amounts,
“Purchaser’s Costs”), by Federal Reserve wire transfer of immediately available
funds to the account of Escrow Agent pursuant to and in accordance with the
wiring instructions supplied by Seller to Purchaser one (1) Business Day prior
to the Scheduled Closing Date.  Escrow Agent, following authorization and
instruction by the parties at Closing, shall (i) pay to each of Harsimus (or its
designee) and Columbia (or its designee) by separate Federal Reserve wire
transfers of immediately available funds to the account designated by each of
them, the amount of the Purchase Price, less any costs or other amounts to be
paid by Seller at Closing pursuant to the terms of this Agreement, to which each
of them are entitled, as set forth in a writing executed by both Harsimus and
Columbia (the “Allocation Letter”) and which shall be furnished to Escrow Agent,
(ii) pay to the appropriate payees out of the proceeds of Closing payable to
Seller all costs and amounts to be paid by Seller at Closing pursuant to the
terms of this Agreement, and (iii) pay Purchaser’s Costs to the appropriate
payees at Closing pursuant to the terms of this Agreement. A Closing Statement
will be prepared by Seller and submitted to Purchaser in accordance with the
terms of Section 10.4.

 

ARTICLE IV

EARNEST MONEY DEPOSIT
AND ESCROW INSTRUCTIONS

 

SECTION 4.1             THE EARNEST MONEY DEPOSIT AND INDEPENDENT CONTRACT
CONSIDERATION.  SIMULTANEOUSLY WITH THE EXECUTION AND DELIVERY OF THIS AGREEMENT
BY PURCHASER, PURCHASER SHALL DEPOSIT WITH THE ESCROW AGENT, BY FEDERAL RESERVE
WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS, THE SUM OF TWO MILLION AND 00/100
DOLLARS ($2,000,000.00) AS THE EARNEST MONEY DEPOSIT ON ACCOUNT OF THE PURCHASE
PRICE (SUCH AMOUNT, TOGETHER WITH ALL INTEREST ACCRUED THEREON, THE “EARNEST
MONEY DEPOSIT”).

 

SECTION 4.2             ESCROW INSTRUCTIONS.  THE EARNEST MONEY DEPOSIT SHALL BE
HELD IN ESCROW BY THE ESCROW AGENT IN AN INTEREST-BEARING ACCOUNT, IN ACCORDANCE
WITH THE PROVISIONS OF ARTICLE XVI.  THE EARNEST MONEY DEPOSIT IS NON-REFUNDABLE
TO PURCHASER, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT.

 

SECTION 4.3             DESIGNATION OF CERTIFYING PERSON.  IN ORDER TO ASSURE
COMPLIANCE WITH THE REQUIREMENTS OF SECTION 6045 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE “CODE”), AND ANY RELATED REPORTING REQUIREMENTS OF THE
CODE, THE PARTIES HERETO AGREE AS FOLLOWS:

 

(A)           PROVIDED THE ESCROW AGENT SHALL EXECUTE A STATEMENT IN WRITING (IN
FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE PARTIES HEREUNDER) PURSUANT TO
WHICH IT AGREES TO ASSUME ALL RESPONSIBILITIES FOR INFORMATION REPORTING
REQUIRED UNDER SECTION 6045(E) OF THE CODE, SELLER AND PURCHASER SHALL DESIGNATE
THE ESCROW AGENT AS THE PERSON TO BE RESPONSIBLE FOR ALL INFORMATION REPORTING
UNDER SECTION 6045(E)OF THE CODE (THE “CERTIFYING PERSON”).  IF THE

 

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ESCROW AGENT REFUSES TO EXECUTE A STATEMENT PURSUANT TO WHICH IT AGREES TO BE
THE CERTIFYING PERSON, SELLER AND PURCHASER SHALL AGREE TO APPOINT ANOTHER THIRD
PARTY AS THE CERTIFYING PERSON.

 

(B)           SELLER AND PURCHASER EACH HEREBY AGREE:

 

(I)            TO PROVIDE TO THE CERTIFYING PERSON ALL INFORMATION AND
CERTIFICATIONS REGARDING SUCH PARTY, AS REASONABLY REQUESTED BY THE CERTIFYING
PERSON OR OTHERWISE REQUIRED TO BE PROVIDED BY A PARTY TO THE TRANSACTION
DESCRIBED HEREIN UNDER SECTION 6045 OF THE CODE; AND

 

(II)           TO PROVIDE TO THE CERTIFYING PERSON SUCH PARTY’S TAXPAYER
IDENTIFICATION NUMBER AND A STATEMENT (ON INTERNAL REVENUE SERVICE FORM W-9 OR
AN ACCEPTABLE SUBSTITUTE FORM, OR ON ANY OTHER FORM THE APPLICABLE CURRENT OR
FUTURE CODE SECTIONS AND REGULATIONS MIGHT REQUIRE AND/OR ANY FORM REQUESTED BY
THE CERTIFYING PERSON), SIGNED UNDER PENALTIES OF PERJURY, STATING THAT THE
TAXPAYER IDENTIFICATION NUMBER SUPPLIED BY SUCH PARTY TO THE CERTIFYING PERSON
IS CORRECT.

 

ARTICLE V

INSPECTION OF PROPERTY

 

SECTION 5.1             COMPLETION OF DUE DILIGENCE.  ANYTHING TO THE CONTRARY
CONTAINED IN THIS AGREEMENT NOTWITHSTANDING, PURCHASER ACKNOWLEDGES AND AGREES
THAT IT HAS COMPLETED ALL OF ITS DUE DILIGENCE WITH RESPECT TO THE PROPERTY AND
SELLER’S LLC INTERESTS AND PURCHASER HAS NO RIGHT TO TERMINATE THIS AGREEMENT BY
REASON OF ANY DUE DILIGENCE MATTERS (BUT THIS SENTENCE SHALL NOT AFFECT ANY
OTHER TERMINATION RIGHT OF PURCHASER EXPRESSLY PROVIDED HEREIN). 
NOTWITHSTANDING THE FOREGOING, PURCHASER AND ITS AUTHORIZED AGENTS, PARTNERS,
LENDERS, OFFICERS, EMPLOYEES, ADVISORS, ATTORNEYS, ACCOUNTANTS, ARCHITECTS,
ENGINEERS AND OTHER REPRESENTATIVES (FOR PURPOSES OF THIS ARTICLE V, THE
“LICENSEE PARTIES”) SHALL HAVE THE RIGHT, SUBJECT TO THE PROVISIONS OF THIS
ARTICLE V, INCLUDING, WITHOUT LIMITATION, THE PROVISIONS OF SECTION 5.3, AND THE
RIGHTS OF SCHWAB AND ITS SUBTENANTS (SCHWAB AND SUCH SUBTENANTS ARE COLLECTIVELY
REFERRED TO HEREIN AS, THE “SCHWAB PARTIES”), TO ENTER UPON THE REAL PROPERTY AT
ALL REASONABLE TIMES DURING NORMAL BUSINESS HOURS TO PERFORM INSPECTIONS AND TO
OTHERWISE EVALUATE THE PROPERTY, INCLUDING, WITHOUT LIMITATION, PHYSICAL TESTING
AND INVASIVE SAMPLING.  PURCHASER WILL PROVIDE TO SELLER NOTICE (FOR PURPOSES OF
THIS SECTION 5.1, AN “ENTRY NOTICE”) OF THE INTENTION OF PURCHASER OR THE OTHER
LICENSEE PARTIES TO ENTER THE REAL PROPERTY AT LEAST 24 HOURS PRIOR TO SUCH
INTENDED ENTRY AND SPECIFY THE INTENDED PURPOSE THEREFOR AND THE INSPECTIONS AND
EXAMINATIONS CONTEMPLATED TO BE MADE AND WITH WHOM ANY LICENSEE PARTY WILL
COMMUNICATE.  AT SELLER’S OPTION, SELLER MAY BE PRESENT FOR ANY SUCH ENTRY AND
INSPECTION.  PURCHASER SHALL NOT COMMUNICATE WITH OR CONTACT ANY OF THE SCHWAB
PARTIES OR ANY OF THE AUTHORITIES WITHOUT THE PRIOR WRITTEN CONSENT OF SELLER,
WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED (OTHER THAN TO
PERMIT SELLER OR ITS REPRESENTATIVE TO PARTICIPATE IN ANY MEETINGS OR CALLS
BETWEEN SCHWAB AND PURCHASER) OR DELAYED.

 

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SECTION 5.2             DOCUMENT REVIEW.

 

(A)           NOTWITHSTANDING THAT PURCHASER HAS COMPLETED ITS DUE DILIGENCE
REVIEW, PURCHASER AND THE LICENSEE PARTIES SHALL HAVE THE CONTINUING RIGHT TO
REVIEW AND INSPECT, AT PURCHASER’S SOLE COST AND EXPENSE, ANY AND ALL OF THE
FOLLOWING WHICH, TO THE EXTENT THE SAME ARE IN SELLER’S AND/OR THE PROPERTY
OWNER’S POSSESSION OR CONTROL (COLLECTIVELY, THE “DOCUMENTS”): ALL FINAL
ENVIRONMENTAL, ENGINEERING OR CONSULTING REPORTS AND STUDIES OF THE REAL
PROPERTY THAT HAVE BEEN PREPARED FOR PROPERTY OWNER, AND/OR SELLER, REAL ESTATE
TAX BILLS (AND ALL AGREEMENT(S) RELATING TO PAYMENTS IN LIEU OF REAL ESTATE
TAXES), TOGETHER WITH ASSESSMENTS (SPECIAL OR OTHERWISE), AD VALOREM AND
PERSONAL PROPERTY TAX BILLS, COVERING THE PERIOD OF PROPERTY OWNER’S OWNERSHIP
OF THE PROPERTY; THE SCHWAB LEASE AND RELATED LEASE AND SUBLEASE FILES; CURRENT
OPERATING STATEMENTS; THE LICENSES AND PERMITS; THE LEASING COMMISSION
AGREEMENTS; AND SUCH OTHER DOCUMENTS, FILES AND ITEMS AS PURCHASER SHALL
REASONABLY REQUEST, INCLUDING, WITHOUT LIMITATION, ALL DOCUMENTS RELATING TO
SELLER’S LLC INTERESTS.  SUCH INSPECTIONS SHALL OCCUR AT A LOCATION REASONABLY
SELECTED BY SELLER, WHICH MAY BE AT THE OFFICE OF SELLER, SELLER’S COUNSEL,
PROPERTY OWNER’S PROPERTY MANAGER, AT THE REAL PROPERTY OR ANY OF THEM.  UNLESS
OTHERWISE EXPRESSLY SET FORTH HEREIN, PURCHASER SHALL NOT HAVE THE RIGHT TO
REVIEW OR INSPECT MATERIALS NOT DIRECTLY RELATED TO THE LEASING, MAINTENANCE,
OPERATION, OWNERSHIP AND/OR MANAGEMENT OF THE PROPERTY, INCLUDING, WITHOUT
LIMITATION, ALL OF SELLER’S AND/OR PROPERTY OWNER’S INTERNAL MEMORANDA,
FINANCIAL PROJECTIONS, BUDGETS, APPRAISALS, PROPOSALS FOR WORK NOT ACTUALLY
UNDERTAKEN, AND OTHER PROPRIETARY AND CONFIDENTIAL INFORMATION.

 

(B)           PURCHASER ACKNOWLEDGES THAT ANY AND ALL OF THE DOCUMENTS MAY BE
PROPRIETARY AND CONFIDENTIAL IN NATURE AND HAVE BEEN PROVIDED TO PURCHASER
SOLELY TO ASSIST PURCHASER IN EVALUATING THE PROPERTY, OBTAINING FINANCING FOR
THE TRANSACTION CONTEMPLATED HEREIN AND CONSUMMATING THE TRANSACTIONS
CONTEMPLATED HEREIN.  SUBJECT ONLY TO THE PROVISIONS OF ARTICLE XII, PURCHASER
AGREES NOT TO DISCLOSE THE CONTENTS OF THE DOCUMENTS OR ANY OF THE PROVISIONS,
TERMS OR CONDITIONS CONTAINED THEREIN, TO ANY PARTY OUTSIDE OF PURCHASER’S
ORGANIZATION OTHER THAN ITS ATTORNEYS, PARTNERS OR OTHER INVESTORS, ACCOUNTANTS,
LENDERS AND LENDERS’ ADVISORS, TITLE AGENTS, OR ANY OTHER LICENSEE PARTIES
(COLLECTIVELY, THE “PERMITTED OUTSIDE PARTIES”).  PURCHASER FURTHER AGREES THAT
WITHIN ITS ORGANIZATION, OR AS TO THE PERMITTED OUTSIDE PARTIES, THE DOCUMENTS
WILL BE DISCLOSED AND EXHIBITED ONLY TO THOSE PERSONS WITHIN PURCHASER’S
ORGANIZATION OR TO THOSE PERMITTED OUTSIDE PARTIES WHO ARE RESPONSIBLE FOR
EVALUATING THE PROPERTY, PROVIDING FINANCING FOR THE TRANSACTION CONTEMPLATED
HEREIN AND CONSUMMATING THE TRANSACTION CONTEMPLATED HEREBY OR OTHERWISE
INVOLVED IN PERFORMING PURCHASER’S OBLIGATIONS UNDER THIS AGREEMENT.  PURCHASER
FURTHER ACKNOWLEDGES THAT THE DOCUMENTS AND OTHER INFORMATION RELATING TO THE
LEASING ARRANGEMENTS BETWEEN SELLER AND THE SCHWAB PARTIES ARE PROPRIETARY AND
CONFIDENTIAL IN NATURE.  PURCHASER AGREES NOT TO DIVULGE THE CONTENTS OF SUCH
DOCUMENTS AND OTHER INFORMATION EXCEPT IN ACCORDANCE WITH THE CONFIDENTIALITY
STANDARDS SET FORTH IN THIS SECTION 5.2 AND ARTICLE XII.  IN PERMITTING
PURCHASER AND THE PERMITTED OUTSIDE PARTIES TO REVIEW THE DOCUMENTS AND OTHER
INFORMATION TO ASSIST PURCHASER, SELLER AND PROPERTY OWNER HAVE NOT WAIVED ANY
PRIVILEGE OR CLAIM OF CONFIDENTIALITY WITH RESPECT THERETO, AND NO THIRD PARTY
BENEFITS OR RELATIONSHIPS OF ANY KIND, EITHER EXPRESS OR IMPLIED, HAVE BEEN
OFFERED, INTENDED OR CREATED BY SELLER AND PROPERTY OWNER, AND ANY SUCH CLAIMS
ARE EXPRESSLY REJECTED BY SELLER AND PROPERTY OWNER AND WAIVED BY PURCHASER AND
THE PERMITTED OUTSIDE PARTIES, FOR

 

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WHOM, BY ITS EXECUTION OF THIS AGREEMENT, PURCHASER IS ACTING AS AN AGENT FOR
THE PERMITTED OUTSIDE PARTIES WITH REGARD TO SUCH WAIVER.

 

(C)           PURCHASER ACKNOWLEDGES THAT SOME OF THE DOCUMENTS MAY HAVE BEEN
PREPARED BY THIRD PARTIES AND MAY HAVE BEEN PREPARED PRIOR TO PROPERTY OWNER’S
OWNERSHIP OF THE PROPERTY. PURCHASER HEREBY ACKNOWLEDGES THAT, EXCEPT AS
EXPRESSLY SET FORTH IN SECTIONS 8.1, 8.2 AND 8.3, SELLER OR SELLER ENTITY HAS
NOT MADE AND DOES NOT MAKE ANY REPRESENTATION OR WARRANTY REGARDING THE TRUTH,
ACCURACY OR COMPLETENESS OF THE DOCUMENTS OR THE SOURCES THEREOF.  SELLER HAS
NOT UNDERTAKEN ANY INDEPENDENT INVESTIGATION AS TO THE TRUTH, ACCURACY OR
COMPLETENESS OF THE DOCUMENTS AND IS PROVIDING THE DOCUMENTS SOLELY AS AN
ACCOMMODATION TO PURCHASER.

 

SECTION 5.3             ENTRY AND INSPECTION OBLIGATIONS; TERMINATION OF
AGREEMENT.

 

(A)           PURCHASER AGREES THAT IN ENTERING UPON AND INSPECTING OR EXAMINING
THE PROPERTY, PURCHASER AND THE OTHER LICENSEE PARTIES WILL NOT: MATERIALLY
DISTURB ANY OF THE SCHWAB PARTIES, OR MATERIALLY INTERFERE WITH THE USE OF THE
PROPERTY PURSUANT TO THE SCHWAB LEASE; MATERIALLY INTERFERE WITH THE OPERATION
AND MAINTENANCE OF THE REAL PROPERTY OR IMPROVEMENTS; DAMAGE ANY PART OF THE
PROPERTY OR ANY PERSONAL PROPERTY OWNED OR HELD BY ANY OF THE SCHWAB PARTIES, OR
ANY OTHER PERSON OR ENTITY; INJURE OR OTHERWISE CAUSE BODILY HARM TO SELLER,
PROPERTY OWNER OR ANY OF THE SCHWAB PARTIES, OR TO ANY OF THEIR RESPECTIVE
AGENTS, GUESTS, INVITEES, CONTRACTORS AND EMPLOYEES, OR TO ANY OTHER PERSON OR
ENTITY; PERMIT ANY LIENS TO ATTACH TO THE REAL PROPERTY BY REASON OF THE
EXERCISE OF PURCHASER’S INSPECTION RIGHTS UNDER THIS ARTICLE V; OR REVEAL OR
DISCLOSE ANY INFORMATION OBTAINED CONCERNING THE PROPERTY AND THE DOCUMENTS TO
ANYONE OUTSIDE PURCHASER’S ORGANIZATION, EXCEPT IN ACCORDANCE WITH THE
CONFIDENTIALITY STANDARDS SET FORTH IN SECTION 5.2(B) AND ARTICLE XII. 
PURCHASER SHALL: (I) MAINTAIN (OR CAUSE THE APPROPRIATE LICENSEE PARTIES TO
MAINTAIN) COMPREHENSIVE GENERAL LIABILITY (OCCURRENCE) INSURANCE ON TERMS AND IN
AMOUNTS REASONABLY SATISFACTORY TO SELLER AND WORKERS’ COMPENSATION INSURANCE IN
STATUTORY LIMITS, AND IF PURCHASER OR ANY LICENSEE PARTY PERFORMS ANY INVASIVE
PHYSICAL TESTING OR INVASIVE SAMPLING IN ACCORDANCE WITH SECTION 5.1 OF THIS
AGREEMENT, ERRORS AND OMISSIONS INSURANCE AND CONTRACTOR’S POLLUTION LIABILITY
INSURANCE ON TERMS AND IN AMOUNTS ACCEPTABLE TO SELLER, COVERING ANY ACCIDENT OR
EVENT ARISING IN CONNECTION WITH THE PRESENCE OF PURCHASER OR ANY OTHER LICENSEE
PARTY ON THE REAL PROPERTY OR IMPROVEMENTS, AND DELIVER EVIDENCE OF INSURANCE
VERIFYING SUCH COVERAGE TO SELLER PRIOR TO ENTRY UPON THE REAL PROPERTY OR
IMPROVEMENTS; (II) PROMPTLY PAY WHEN DUE THE COSTS OF ALL ENTRY AND INSPECTIONS
AND EXAMINATIONS DONE WITH REGARD TO THE PROPERTY; (III) CAUSE ANY INSPECTION TO
BE CONDUCTED IN ACCORDANCE WITH STANDARDS CUSTOMARILY EMPLOYED IN THE INDUSTRY
AND IN COMPLIANCE WITH ALL GOVERNMENTAL REGULATIONS AND THE EXISTING DEED NOTICE
(AS SUCH TERM IS HEREINAFTER DEFINED); (IV) FURNISH TO SELLER COPIES OF ANY
STUDIES, REPORTS OR TEST RESULTS RECEIVED BY PURCHASER REGARDING THE PROPERTY,
PROMPTLY AFTER SUCH RECEIPT, IN CONNECTION WITH SUCH INSPECTION; AND (V) REPAIR
ANY DAMAGE TO THE REAL PROPERTY AND IMPROVEMENTS CAUSED BY ANY INSPECTION OR
EXAMINATION BY PURCHASER OR ITS AGENTS.  NOTWITHSTANDING THE FOREGOING OR
SUBSECTION (B) BELOW TO THE CONTRARY, PURCHASER SHALL NOT BE REQUIRED TO RESTORE
NOR TO BE LIABLE FOR ANY DAMAGE TO THE PROPERTY

 

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resulting from the negligence or willful misconduct of Seller, AFE, PXURA, PXR,
PXLA (or any of their respective members, partners, officers, directors,
employees, agents or other authorized representatives) or any of the Schwab
Parties.  In addition, Purchaser shall not be liable to restore any damage to
the Real Property or the Improvements to the extent relating to existing
conditions at the Property which are revealed by Purchaser’s investigations
permitted hereunder.

 

(B)           EXCEPT AS STATED TO THE CONTRARY IN THE LAST SENTENCE OF SECTION
5.3(A) ABOVE, PURCHASER HEREBY INDEMNIFIES, DEFENDS AND HOLDS SELLER AND
PROPERTY OWNER AND THEIR RESPECTIVE PARTNERS, AGENTS, DIRECTORS, OFFICERS,
EMPLOYEES, SUCCESSORS AND ASSIGNS (COLLECTIVELY, THE “SELLER INDEMNIFIED
PARTIES”) HARMLESS FROM AND AGAINST ANY AND ALL LIENS, CLAIMS, CAUSES OF ACTION,
DAMAGES, LIABILITIES, DEMANDS, SUITS, AND OBLIGATIONS TO THIRD PARTIES, TOGETHER
WITH ALL LOSSES, PENALTIES, COSTS AND EXPENSES RELATING TO ANY OF THE FOREGOING
(INCLUDING BUT NOT LIMITED TO COURT COSTS AND REASONABLE ATTORNEYS’ FEES),
ARISING OUT OF ANY DISCLOSURE(S) OF CONFIDENTIAL INFORMATION IN VIOLATION OF THE
PROVISIONS OF SECTION 5.2(B) AND ANY INSPECTIONS, INVESTIGATIONS, EXAMINATIONS,
SAMPLING OR TESTS CONDUCTED BY PURCHASER OR ANY OF THE LICENSEE PARTIES, WHETHER
PRIOR TO OR AFTER THE DATE HEREOF, PURSUANT TO THE PROVISIONS OF ARTICLE V OF
THIS AGREEMENT.

 

(C)           PROMPTLY FOLLOWING THE TIME THAT THIS AGREEMENT IS TERMINATED FOR
ANY REASON, PURCHASER SHALL RETURN TO SELLER ALL COPIES PURCHASER HAS MADE OF
THE DOCUMENTS AND ALL COPIES OF ANY STUDIES, REPORTS OR TEST RESULTS REGARDING
ANY PART OF THE PROPERTY OBTAINED BY PURCHASER, BEFORE OR AFTER THE EXECUTION OF
THIS AGREEMENT, IN CONNECTION WITH PURCHASER’S INSPECTION OF THE PROPERTY
(COLLECTIVELY, “PURCHASER’S INFORMATION”).  PURCHASER’S INFORMATION SHALL NOT
INCLUDE PURCHASER’S INTERNAL MEMORANDA, FINANCIAL PROJECTIONS, BUDGETS,
APPRAISALS OR OTHER PROPRIETARY AND CONFIDENTIAL INFORMATION.  PURCHASER’S
INFORMATION SHALL BE DELIVERED WITHOUT ANY REPRESENTATION OR WARRANTY, EXPRESS
OR IMPLIED, AS TO THE ACCURACY OR COMPLETENESS (OTHER THAN THAT PURCHASER HAS
RETURNED ALL OF THE ITEMS IT IS REQUIRED TO RETURN) OF PURCHASER’S INFORMATION,
OR ANY OTHER REPRESENTATION OR WARRANTY; NEITHER SELLER NOR ANY OTHER PERSON OR
PARTY SHALL HAVE ANY RIGHT TO RELY ON PURCHASER’S INFORMATION NOR SHALL
PURCHASER SHALL HAVE ANY LIABILITY OR OBLIGATION WITH REGARD TO PURCHASER’S
INFORMATION.

 

(D)           THE TERMS AND PROVISIONS OF SECTION 5.3(B) AND SECTION 5.3(C)
ABOVE SHALL SUPERCEDE, IN ITS ENTIRETY, THE TERMS AND PROVISIONS OF THAT CERTAIN
RIGHT OF ACCESS AGREEMENT DATED NOVEMBER      , 2002 (THE “ACCESS AGREEMENT“),
BETWEEN AFE AND ISTAR FINANCIAL INC. (“ISTAR”), AND SUCH AGREEMENT SHALL, FROM
AND AFTER THE DATE HEREOF, BE OF NO FURTHER FORCE AND EFFECT AND NO OBLIGATIONS
SET FORTH THEREIN SHALL SURVIVE THE EFFECTIVE DATE; PROVIDED, HOWEVER, IF ISTAR
SHALL HAVE INCURRED ANY LIABILITY UNDER THE ACCESS AGREEMENT ON ACCOUNT OF ANY
INSPECTIONS, INVESTIGATIONS, EXAMINATIONS, SAMPLING OR TESTS CONDUCTED PRIOR TO
THE EFFECTIVE DATE BY ISTAR, PURCHASER OR ANY OF THE LICENSEE PARTIES, THEN ANY
LIABILITY OF ISTAR UNDER THE ACCESS AGREEMENT SHALL SURVIVE THE EFFECTIVE DATE
BUT THE OBLIGATIONS WITH RESPECT THERETO SHALL BE GOVERNED BY THE PROVISIONS OF
THIS AGREEMENT, AND NOT BY THE PROVISIONS OF THE ACCESS AGREEMENT.

 

SECTION 5.4             SALE “AS IS”.  THE TRANSACTION CONTEMPLATED BY THIS
AGREEMENT HAS BEEN NEGOTIATED BETWEEN SELLER AND PURCHASER. THIS AGREEMENT
REFLECTS THE MUTUAL AGREEMENT OF SELLER AND

 

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PURCHASER, AND PURCHASER HAS HAD AND HAS THE RIGHT TO CONDUCT ITS OWN
INDEPENDENT EXAMINATION OF THE PROPERTY AND SELLER’S LLC INTEREST.  OTHER THAN
THE MATTERS REPRESENTED IN SECTIONS 8.1, 8.2 AND 8.3 HEREOF AND ANY CLOSING
CERTIFICATION OF SELLER AS TO THE TRUTH AND ACCURACY OF THE REPRESENTATIONS AND
WARRANTIES AS OF THE CLOSING DATE AND THE REPRESENTATIONS IN SELLER’S (AND
PROPERTY OWNER’S) TITLE AFFIDAVIT, NON-IMPUTATION ENDORSEMENT AFFIDAVIT AND ALL
OTHER CLOSING DOCUMENTS, BY WHICH ALL OF THE FOLLOWING PROVISIONS OF THIS
SECTION 5.4 ARE MODIFIED AND LIMITED AS IF SUCH EXCEPTION WERE FULLY SET FORTH
HEREIN IN EACH INSTANCE, PURCHASER HAS NOT RELIED UPON AND WILL NOT RELY UPON,
EITHER DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR WARRANTY OF SELLER OR ANY
OF SELLER’S AGENTS OR REPRESENTATIVES, AND PURCHASER HEREBY ACKNOWLEDGES THAT NO
SUCH REPRESENTATIONS OR WARRANTIES HAVE BEEN MADE.

 

SELLER SPECIFICALLY DISCLAIMS, AND NEITHER SELLER NOR ANY OF SELLER’S AFFILIATES
NOR ANY OTHER PERSON (INCLUDING, WITHOUT LIMITATION, PROPERTY OWNER) IS MAKING,
ANY REPRESENTATION, WARRANTY OR ASSURANCE WHATSOEVER TO PURCHASER, AND NO
WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EITHER EXPRESS OR
IMPLIED, ARE MADE BY SELLER OR ANY OF SELLER’S AFFILIATES OR RELIED UPON BY
PURCHASER WITH RESPECT TO THE STATUS OF TITLE TO OR THE MAINTENANCE, REPAIR,
CONDITION, DESIGN OR MARKETABILITY OF THE PROPERTY, OR ANY PORTION THEREOF,
INCLUDING BUT NOT LIMITED TO (a) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, (c) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES
OF MATERIALS, (d) ANY RIGHTS OF PURCHASER UNDER APPROPRIATE STATUTES TO CLAIM
DIMINUTION OF CONSIDERATION, (e) ANY CLAIM BY PURCHASER FOR DAMAGES BECAUSE OF
DEFECTS, WHETHER KNOWN OR UNKNOWN, WITH RESPECT TO THE IMPROVEMENTS OR THE
PERSONAL PROPERTY, (f) THE FINANCIAL CONDITION OR PROSPECTS OF THE PROPERTY OR
THE PROPERTY OWNER AND (g) THE COMPLIANCE OR LACK THEREOF OF THE REAL PROPERTY
OR THE IMPROVEMENTS WITH GOVERNMENTAL REGULATIONS, INCLUDING, WITHOUT
LIMITATION, ANY ENVIRONMENTAL LAWS, NOW EXISTING OR HEREINAFTER ENACTED OR
PROMULGATED, IT BEING THE EXPRESS INTENTION OF SELLER AND PURCHASER THAT, EXCEPT
AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PROPERTY (THROUGH THE TRANSFER OF
SELLER’S LLC INTEREST) WILL BE CONVEYED AND TRANSFERRED TO PURCHASER IN ITS
PRESENT CONDITION AND STATE OF REPAIR, “AS IS” AND “WHERE IS,” WITH ALL FAULTS. 
PURCHASER REPRESENTS THAT IT IS A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED
PURCHASER OF REAL ESTATE, AND THAT IT IS RELYING

 

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SOLELY ON ITS OWN EXPERTISE AND THAT OF PURCHASER’S CONSULTANTS IN PURCHASING
THE PROPERTY THROUGH THE TRANSFER OF SELLER’S LLC INTEREST.  PURCHASER HAS BEEN
GIVEN A SUFFICIENT OPPORTUNITY PRIOR TO THE EFFECTIVE DATE TO CONDUCT AND HAS
CONDUCTED SUCH INSPECTIONS, INVESTIGATIONS AND OTHER INDEPENDENT EXAMINATIONS OF
THE PROPERTY, SELLER’S LLC INTEREST AND RELATED MATTERS AS PURCHASER DEEMS
NECESSARY, INCLUDING BUT NOT LIMITED TO THE PHYSICAL AND ENVIRONMENTAL
CONDITIONS THEREOF, AND WILL RELY UPON SAME AND NOT UPON ANY STATEMENTS OF
SELLER OR SELLER ENTITIES (EXCLUDING THE LIMITED MATTERS REPRESENTED BY SELLER
IN SECTIONS 8.1, 8.2 AND 8.3 HEREOF AND ANY CLOSING CERTIFICATION OF SELLER AS
TO THE TRUTH AND ACCURACY OF THE REPRESENTATIONS AND WARRANTIES AS OF THE
CLOSING DATE AND THE REPRESENTATIONS IN SELLER’S (AND PROPERTY OWNER’S) TITLE
AFFIDAVIT, NON-IMPUTATION ENDORSEMENT AFFIDAVIT AND ALL OTHER CLOSING DOCUMENTS)
NOR OF ANY OFFICER, DIRECTOR, EMPLOYEE, AGENT OR ATTORNEY OF SELLER. PURCHASER
ACKNOWLEDGES THAT ALL INFORMATION OBTAINED BY PURCHASER WAS OBTAINED FROM A
VARIETY OF SOURCES, AND SELLER WILL NOT BE DEEMED TO HAVE REPRESENTED OR
WARRANTED THE COMPLETENESS, TRUTH OR ACCURACY OF ANY OF THE DOCUMENTS OR OTHER
SUCH INFORMATION HERETOFORE OR HEREAFTER FURNISHED TO PURCHASER.  UPON CLOSING,
SUBJECT TO THE EXPRESS PROVISIONS OF THIS AGREEMENT, PURCHASER WILL ASSUME THE
RISK THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY PURCHASER’S INSPECTIONS
AND INVESTIGATIONS. PURCHASER ACKNOWLEDGES AND AGREES THAT, UPON CLOSING, SELLER
WILL SELL AND CONVEY TO PURCHASER, AND PURCHASER WILL ACCEPT THE PROPERTY
THROUGH THE TRANSFER OF SELLER’S LLC INTEREST, “AS IS, WHERE IS,” WITH ALL
FAULTS. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT THERE ARE NO ORAL
AGREEMENTS, WARRANTIES OR REPRESENTATIONS COLLATERAL TO OR AFFECTING SELLER’S
LLC INTEREST OR THE PROPERTY BY SELLER, ANY AGENT OF SELLER OR ANY THIRD PARTY. 
SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN STATEMENTS,
REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR SELLER’S LLC
INTEREST FURNISHED BY ANY REAL ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER
PERSON, UNLESS THE SAME ARE SPECIFICALLY SET FORTH HEREIN. PURCHASER
ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS THE “AS IS, WHERE IS” NATURE OF
THIS SALE AND ANY FAULTS, LIABILITIES, DEFECTS OR OTHER ADVERSE MATTERS THAT MAY
BE ASSOCIATED WITH THE PROPERTY AND SELLER’S LLC INTEREST.  PURCHASER, WITH
PURCHASER’S COUNSEL, HAS FULLY REVIEWED THE DISCLAIMERS AND WAIVERS SET FORTH IN
THIS AGREEMENT AND UNDERSTANDS THEIR SIGNIFICANCE AND AGREES THAT THE
DISCLAIMERS AND OTHER

 

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AGREEMENTS SET FORTH HEREIN ARE AN INTEGRAL PART OF THIS AGREEMENT, AND THAT
SELLER WOULD NOT HAVE AGREED TO SELL SELLER’S LLC INTEREST TO PURCHASER FOR THE
PURCHASE PRICE WITHOUT THE DISCLAIMERS AND OTHER AGREEMENTS SET FORTH IN THIS
AGREEMENT.

 

PURCHASER AND PURCHASER’S AFFILIATES FURTHER COVENANT AND AGREE NOT TO SUE
SELLER AND SELLER’S AFFILIATES AND RELEASE SELLER AND SELLER’S AFFILIATES OF AND
FROM AND WAIVE ANY CLAIM OR CAUSE OF ACTION, INCLUDING, WITHOUT LIMITATION, ANY
STRICT LIABILITY CLAIM OR CAUSE OF ACTION, THAT PURCHASER OR PURCHASER’S
AFFILIATES MAY HAVE AGAINST SELLER OR SELLER’S AFFILIATES UNDER ANY
ENVIRONMENTAL LAW, NOW EXISTING OR HEREAFTER ENACTED OR PROMULGATED, RELATING TO
ENVIRONMENTAL MATTERS OR ENVIRONMENTAL CONDITIONS EXISTING AS OF THE CLOSING
(WHETHER KNOWN OR UNKNOWN) IN, ON, UNDER, ABOUT OR MIGRATING FROM OR ONTO THE
PROPERTY, INCLUDING, WITHOUT LIMITATION, THE COMPREHENSIVE ENVIRONMENTAL
RESPONSE, COMPENSATION AND LIABILITY ACT, OR BY VIRTUE OF ANY COMMON LAW RIGHT
(NOW EXISTING OR HEREINAFTER CREATED) RELATED TO ENVIRONMENTAL CONDITIONS OR
ENVIRONMENTAL MATTERS IN, ON, UNDER, ABOUT OR MIGRATING FROM OR ONTO THE REAL
PROPERTY.  THE FOREGOING SENTENCE SHALL NOT RELIEVE (A) SELLER OF ANY LIABILITY
IT MAY HAVE WITH RESPECT TO ITS REPRESENTATION MADE IN SECTION 8.3(f) OF THIS
AGREEMENT, SUBJECT, HOWEVER, IN ALL RESPECTS, TO THE PROVISIONS SET FORTH IN
SECTION 8.5 HEREOF, AND (B) 8/9 TRANSFEREE OF ANY LIABILITY IT MAY HAVE WITH
RESPECT TO ANY ENVIRONMENTAL MATTER OR ENVIRONMENTAL CONDITION IN, ON, UNDER,
ABOUT, OR MIGRATING FROM, THE EXCLUDED REAL PROPERTY OR WITH RESPECT TO THE ACTS
OR OMISSIONS OF 8/9 TRANSFEREE AT THE EXCLUDED REAL PROPERTY.

 

THE TERMS AND CONDITIONS OF THIS SECTION 5.4 WILL EXPRESSLY SURVIVE THE
TERMINATION OF THIS AGREEMENT OR THE CLOSING, AS THE CASE MAY BE, AND, IF THE
CLOSING OCCURS, WILL NOT MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS AND
ARE HEREBY DEEMED INCORPORATED INTO THE LLC ASSIGNMENT AND ASSUMPTION AS FULLY
AS IF SET FORTH AT LENGTH THEREIN.

 

NOTHING IN THIS SECTION 5.4 SHALL NEGATE THE PRORATIONS UNDER SECTION 10.4.

 

SECTION 5.5             ISTAR FINANCIAL GUARANTY.  ISTAR IS EXECUTING THIS
AGREEMENT FOR THE SOLE PURPOSE OF GUARANTEEING TO THE SELLER INDEMNIFIED PARTIES
ANY AND ALL LIABILITY OF PURCHASER UNDER SECTION 5.3(B).  BY ITS SIGNATURE
ANNEXED TO THIS AGREEMENT, ISTAR ACKNOWLEDGES THAT ITS GUARANTY IS A GUARANTY OF
PAYMENT, AND NOT OF COLLECTION.

 

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ARTICLE VI

TITLE AND SURVEY MATTERS

 

SECTION 6.1             SURVEY.  PURCHASER ACKNOWLEDGES RECEIPT OF THE EXISTING
SURVEY.  ANY MODIFICATION, UPDATE OR RE-CERTIFICATION OF THE EXISTING SURVEY
SHALL BE AT PURCHASER’S ELECTION AND SOLE COST AND EXPENSE.  THE EXISTING SURVEY
TOGETHER WITH ANY RE-CERTIFICATION THEREOF AND/OR UPDATE PURCHASER HAS ELECTED
TO OBTAIN, IF ANY, IS HEREIN REFERRED TO AS THE “SURVEY” .

 

SECTION 6.2             TITLE REPORT.

 

(A)           PURCHASER ACKNOWLEDGES RECEIPT FROM THE TITLE COMPANY OF A CURRENT
TITLE INSURANCE REPORT FOR THE PROPERTY (THE “TITLE REPORT”), TOGETHER WITH
COPIES OF THE TITLE EXCEPTIONS LISTED THEREON.  ALL (I) EXCEPTIONS TO TITLE SET
FORTH IN THE TITLE REPORT AND/OR MATTERS REVEALED BY THE EXISTING SURVEY,
(II) MATTERS WHICH ARE THE OBLIGATIONS OF SCHWAB UNDER THE SCHWAB LEASE,
(III) DOCUMENTS AND AGREEMENTS CONTEMPLATED BY THIS AGREEMENT TO BE RECORDED
AGAINST THE REAL PROPERTY ON OR PRIOR TO THE CLOSING DATE, INCLUDING, WITHOUT
LIMITATION, THE CREA, THE CRA AND THE UPDATED DEED NOTICE, AND (IV) TITLE
EXCEPTIONS CAUSED OR CREATED (WHETHER DIRECTLY OR INDIRECTLY) BY PURCHASER OR
ANY LICENSEE PARTIES WILL BE REFERRED TO HEREIN AS “PERMITTED EXCEPTIONS.  IN NO
EVENT SHALL ANY OF THE PERMITTED EXCEPTIONS CONSTITUTE TITLE DEFECTS (AS
HEREINAFTER DEFINED).

 

(B)           ALL TAXES, WATER RATES OR CHARGES, SEWER RENTS AND SPECIAL
ASSESSMENTS, PLUS INTEREST AND PENALTIES THEREON, WHICH ON THE CLOSING DATE ARE
DUE AND PAYABLE AND/OR ARE LIENS AGAINST THE REAL PROPERTY AND WHICH THE
PROPERTY OWNER IS OBLIGATED TO PAY AND DISCHARGE WILL BE CREDITED AGAINST THE
PURCHASE PRICE (SUBJECT TO THE PROVISION FOR APPORTIONMENT OF TAXES, WATER RATES
AND SEWER RENTS HEREIN CONTAINED) AND WITHOUT THE NEED FOR PURCHASER TO RAISE AS
A TITLE DEFECT.

 

(C)           IF ON THE CLOSING DATE THE REAL PROPERTY SHALL BE AFFECTED BY ANY
LIEN WHICH, PURSUANT TO THE PROVISIONS OF THIS AGREEMENT, IS REQUIRED TO BE
DISCHARGED OR SATISFIED BY SELLER, SELLER SHALL NOT BE REQUIRED TO DISCHARGE OR
SATISFY THE SAME OF RECORD PROVIDED THE MONEY NECESSARY TO SATISFY THE LIEN IS
RETAINED BY THE TITLE COMPANY AT CLOSING (WITH AUTHORITY TO PAY IN THE EVENT OF
ENFORCEMENT OF SUCH LIEN), AND THE TITLE COMPANY EITHER OMITS THE LIEN AS AN
EXCEPTION FROM THE TITLE POLICY OR INSURES AGAINST COLLECTION THEREOF FROM OR
OUT OF THE REAL PROPERTY AND/OR THE IMPROVEMENTS, AND A CREDIT IS GIVEN TO
PURCHASER FOR THE RECORDING CHARGES FOR A  SATISFACTION OR DISCHARGE OF SUCH
LIEN.  SELLER SHALL HAVE NO OBLIGATION TO REMOVE ANY LIEN AFFECTING THE REAL
PROPERTY WHICH IS THE OBLIGATION OF SCHWAB TO REMOVE PURSUANT TO THE PROVISIONS
OF THE SCHWAB LEASE.

 

(D)           NO FRANCHISE, TRANSFER, INHERITANCE, INCOME, CORPORATE OR OTHER
TAX OPEN, LEVIED OR IMPOSED AGAINST SELLER, THE PROPERTY OWNER OR ANY FORMER
OWNER OF THE PROPERTY, THAT MAY BE A LIEN AGAINST THE PROPERTY ON THE CLOSING
DATE, SHALL BE AN OBJECTION TO TITLE IF THE TITLE COMPANY INSURES AGAINST
COLLECTION THEREOF FROM OR OUT OF THE REAL PROPERTY AND/OR THE IMPROVEMENTS, AND
PROVIDED FURTHER THAT SELLER DEPOSITS WITH THE TITLE COMPANY A SUM REASONABLY
SUFFICIENT TO SECURE A RELEASE OF THE REAL PROPERTY AND/OR IMPROVEMENTS FROM THE
LIEN

 

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thereof (with authority to pay in the event of enforcement of such lien).  If a
search of title discloses judgments, bankruptcies, or other returns against
other persons having names the same as or similar to that of Seller or the
Property Owner, Seller will deliver (or cause the Property Owner to deliver) to
the Title Company an affidavit stating that such judgments, bankruptcies or
other returns do not apply to Seller or the Property Owner, as the case may be,
and such search results shall not be deemed Title Defects.

 

(E)           NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, EXCEPT
FOR PERMITTED EXCEPTIONS, SELLER SHALL BE OBLIGATED TO CURE AND/OR SATISFY OR
CAUSE TO BE DELETED AS AN EXCEPTION TO TITLE:  (X) ANY STANDARD EXCEPTIONS (TO
THE EXTENT THAT THE TITLE COMPANY IS WILLING TO DELETE THE SAME BASED SOLELY
UPON RECEIPT OF THE SURVEY AND A CUSTOMARY AFFIDAVIT FROM SELLER OR THE PROPERTY
OWNER); (Y) ANY OF THE FOLLOWING EXCEPTIONS AND ENCUMBRANCES TO THE TITLE TO THE
PROPERTY AS MAY BE DISCLOSED BY THE TITLE REPORT, ALL OF WHICH SHALL BE REFERRED
TO HEREIN AS “MONETARY OBJECTIONS:  (I) ANY DEED OF TRUST, MORTGAGE, OR OTHER
SECURITY TITLE, ASSIGNMENT OF LEASES, NEGATIVE PLEDGE, FINANCING STATEMENT OR
SIMILAR SECURITY INSTRUMENT ENTERED INTO BY SELLER, THE PROPERTY OWNER OR ANY OF
SELLER’S AFFILIATES (INCLUDING, WITHOUT LIMITATION, PXR) AND ENCUMBERING ALL OR
ANY PORTION OF THE PROPERTY (AND EXCLUDING ANY SUCH INSTRUMENT PLACED UPON THE
PROPERTY AGAINST AN INTEREST OF ANY SCHWAB PARTY AND WHICH ENCUMBERS SUCH SCHWAB
PARTY’S INTEREST THEREIN); (II) MECHANICS LIENS AFFECTING THE PROPERTY AND
(III) ANY OTHER LIENS AFFECTING THE PROPERTY WHICH CAN BE SATISFIED BY THE
PAYMENT OF A SPECIFIC, LIQUIDATED AMOUNT NOT TO EXCEED FIVE HUNDRED THOUSAND AND
00/100 DOLLARS ($500,000.00) IN THE AGGREGATE.  TO THE EXTENT ANY MONETARY
OBJECTION WHICH SELLER IS OBLIGATED TO REMOVE HAS NOT BEEN REMOVED AT OR PRIOR
TO CLOSING, PURCHASER SHALL BE ENTITLED TO APPLY A PORTION OF THE PURCHASE
PROCEEDS REASONABLY NECESSARY TO EFFECTUATE SUCH REMOVAL (OR WITHHOLD SUCH
PORTION AS MAY BE REASONABLY NECESSARY TO REMOVE SUCH MONETARY OBJECTION) AND
PURCHASER SHALL RECEIVE A CREDIT AGAINST THE PURCHASE PRICE FOR ANY SUCH AMOUNTS
SO APPLIED OR WITHHELD.  NOTWITHSTANDING THE FOREGOING TO THE CONTRARY, IF ON
THE CLOSING DATE THERE SHALL BE SECURITY INTERESTS FILED AGAINST THE PROPERTY,
SUCH ITEMS SHALL NOT BE MONETARY OBJECTIONS IF (A) THE PERSONAL PROPERTY COVERED
BY SUCH SECURITY INTERESTS ARE NO LONGER IN OR ON THE REAL PROPERTY AND WILL NOT
BE CONVEYED AS PART OF THE PERSONAL PROPERTY HEREUNDER, AND THE TITLE COMPANY
EITHER OMITS THE LIEN OR SECURITY INTEREST AS AN EXCEPTION FROM THE TITLE POLICY
OR INSURES AGAINST COLLECTION THEREOF FROM ALL OF THE REAL PROPERTY AND
IMPROVEMENTS ERECTED THEREON, OR (B) SUCH PERSONAL PROPERTY IS THE PROPERTY OF
ANY SCHWAB PARTY AND SELLER EXECUTES AND DELIVERS AN AFFIDAVIT TO SUCH EFFECT. 
AT CLOSING, SELLER WILL DELIVER (OR CAUSE TO BE DELIVERED BY PROPERTY OWNER)
SUCH AFFIDAVITS AS REASONABLY REQUIRED BY THE TITLE COMPANY TO ENABLE THE TITLE
COMPANY TO ISSUE A NON-IMPUTATION ENDORSEMENT TO THE TITLE POLICY, WHICH
ENDORSEMENT IS AT PURCHASER’S SOLE COST AND EXPENSE AND, WITHOUT LIMITING THE
FOREGOING, ANY AFFIDAVITS REASONABLY REQUIRED BY THE TITLE COMPANY TO OMIT ANY
EXCEPTION OR PROVIDE AFFIRMATIVE INSURANCE FOR ANY MECHANICS’ LIENS IN
CONNECTION WITH THE JMB CONSTRUCTION CONTRACT AND THE JMB COOLING TOWER
CONTRACT.  IN ADDITION, COLUMBIA SHALL CAUSE ITS AFFILIATES TO EXECUTE SUCH
AFFIDAVITS AND OTHER DOCUMENTATION REASONABLY REQUIRED BY TITLE COMPANY WITH
RESPECT TO THE RETAINED INTEREST IN CONNECTION WITH THE ISSUANCE OF THE TITLE
POLICY AND THE ENDORSEMENTS THERETO.

 

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SECTION 6.3             TITLE DEFECT.

 

(A)           IN THE EVENT SELLER RECEIVES ANY WRITTEN OBJECTIONS TO MATTERS
DISCLOSED BY AN UPDATE TO THE TITLE REPORT OR AN UPDATE TO THE EXISTING SURVEY
(COLLECTIVELY AND INDIVIDUALLY, A “TITLE DEFECT”) WITHIN THE TIME PERIODS
REQUIRED UNDER SECTIONS 6.3(B) BELOW, SELLER MAY ELECT (BUT SHALL NOT BE
OBLIGATED) TO ATTEMPT TO REMOVE, OR CAUSE TO BE REMOVED AT ITS EXPENSE, ANY SUCH
TITLE DEFECT, AND SHALL PROVIDE PURCHASER WITH NOTICE, WITHIN FIVE (5) BUSINESS
DAYS OF ITS RECEIPT OF ANY SUCH OBJECTION, OF ITS INTENTION TO CURE OR NOT TO
CURE ANY SUCH TITLE DEFECT.  IF SELLER ELECTS TO ATTEMPT TO CURE ANY TITLE
DEFECT, THE SCHEDULED CLOSING DATE MAY BE EXTENDED BY WRITTEN NOTICE FROM SELLER
TO PURCHASER AT ANY TIME ON OR PRIOR TO THE SCHEDULED CLOSING DATE, FOR A PERIOD
UP TO BUT NOT TO EXCEED SIXTY (60) DAYS IN THE AGGREGATE (BUT IN NO EVENT SHALL
SELLER HAVE THE RIGHT TO EXTEND THE SCHEDULED CLOSING DATE BEYOND THE OUTSIDE
CLOSING DATE), FOR THE PURPOSE OF SUCH REMOVAL.  IN THE EVENT THAT (I) SELLER
ELECTS NOT TO ATTEMPT TO CURE ANY SUCH TITLE DEFECT, OR (II) SELLER FAILS TO
CURE ANY SUCH TITLE DEFECT WITHIN THE PERIOD ELECTED BY SELLER BUT NOT TO EXCEED
SIXTY (60) DAYS IN THE AGGREGATE (BUT IN NO EVENT SHALL SELLER HAVE THE RIGHT TO
EXTEND THE SCHEDULED CLOSING DATE BEYOND THE OUTSIDE CLOSING DATE), SELLER SHALL
SO ADVISE PURCHASER AND PURCHASER SHALL HAVE THE RIGHT TO TERMINATE THIS
AGREEMENT AND RECEIVE A REFUND OF THE EARNEST MONEY DEPOSIT, OR TO WAIVE SUCH
TITLE DEFECT AND PROCEED TO THE CLOSING WITHOUT ANY REDUCTION OR ABATEMENT OF
THE PURCHASE PRICE.  PURCHASER SHALL MAKE SUCH ELECTION WITHIN TEN (10) DAYS OF
RECEIPT OF SELLER’S NOTICE.  IF PURCHASER ELECTS TO PROCEED TO THE CLOSING, ANY
TITLE DEFECTS WAIVED BY PURCHASER SHALL BE DEEMED PERMITTED EXCEPTIONS.  THIS
PROVISION IS SUBJECT IN ALL RESPECTS TO SELLER’S OBLIGATIONS, AND PURCHASER’S
RIGHTS, UNDER SECTION 6.2(E).  IN ANY SUCH EVENT OF TERMINATION, PURCHASER SHALL
PROMPTLY RETURN PURCHASER’S INFORMATION TO SELLER, AFTER WHICH  NEITHER PARTY
SHALL HAVE ANY FURTHER OBLIGATION TO THE OTHER UNDER THIS AGREEMENT EXCEPT FOR
THE TERMINATION SURVIVING OBLIGATIONS.

 

(B)           NOTWITHSTANDING THE FOREGOING, IN THE EVENT FURTHER UPDATES ARE
MADE TO THE TITLE REPORT OR SURVEY WHICH REVEAL NEW MATTERS WHICH ARE NOT
PERMITTED EXCEPTIONS AND ARE NOT SHOWN ON THE PREVIOUS VERSION OF THE TITLE
REPORT OR SURVEY, PURCHASER MAY GIVE SELLER NOTICE OF ANY SUCH NEW MATTERS
DISCLOSED BY SUCH UPDATE WHICH PURCHASER DEEMS UNACCEPTABLE.  PURCHASER MUST
OBJECT IN WRITING TO ANY SUCH NEW MATTERS, IF AT ALL, BEFORE 5:00 P.M. EASTERN
STANDARD TIME ON THE FIFTH (5TH) BUSINESS DAY AFTER RECEIPT OF ANY SUCH UPDATED
TITLE REPORT OR SURVEY FIRST DISCLOSING SAID NEW MATTERS.  IN THE EVENT
PURCHASER SO TIMELY NOTICES SELLER, SUCH ITEMS SHALL BE SUBJECT TO THE PROCESS
FOR TITLE DEFECTS SET FORTH ABOVE.  IF PURCHASER FAILS TO TIMELY DELIVER SUCH
NOTICE, ALL OF SUCH NEW MATTERS SHALL BE DEEMED PERMITTED EXCEPTIONS.

 

ARTICLE VII

INTERIM OPERATING COVENANTS AND POST-CLOSING MATTERS

 

SECTION 7.1             INTERIM OPERATING COVENANTS.

 

(A)           OPERATIONS. FROM THE EFFECTIVE DATE UNTIL CLOSING, SELLER SHALL,
AND SHALL CAUSE PROPERTY OWNER, TO CONTINUE TO OPERATE, MANAGE AND MAINTAIN THE
REAL PROPERTY, GROUND LEASE, SUBLEASE, IMPROVEMENTS AND OTHER PROPERTY IN THE
ORDINARY COURSE OF ITS BUSINESS AND SUBSTANTIALLY IN ACCORDANCE WITH ITS PRESENT
PRACTICE, SUBJECT TO ORDINARY WEAR AND TEAR AND

 

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DAMAGE CAUSED BY ANY SCHWAB PARTY AND FURTHER SUBJECT TO ARTICLE XI OF THIS
AGREEMENT.  IN ADDITION, FROM THE EFFECTIVE DATE UNTIL CLOSING, UNLESS REQUIRED
BY ANY AUTHORITIES OR GOVERNMENTAL REGULATIONS, OR THE SCHWAB LEASE, OR IN THE
CASE OF AN EMERGENCY OR ON ACCOUNT OF A CASUALTY AT THE PROPERTY (IN WHICH CASE
THE PROVISIONS OF SECTION 11.1 OF THIS AGREEMENT SHALL APPLY), SELLER SHALL NOT,
AND SHALL CAUSE PROPERTY OWNER NOT TO, MAKE ANY CAPITAL EXPENDITURE (OR
COMMITMENTS THEREFOR) AT THE PROPERTY (X) THAT AGGREGATE IN EXCESS OF $500,000,
AND (Y) THE PAYMENT FOR WHICH SHALL BE THE OBLIGATION OF PROPERTY OWNER AFTER
THE CLOSING.

 

(B)           COMPLIANCE WITH GOVERNMENTAL REGULATIONS/WATERFRONT DEVELOPMENT
PERMIT.

 

(I)            FROM THE EFFECTIVE DATE UNTIL CLOSING, SELLER SHALL NOT, AND
SHALL CAUSE PROPERTY OWNER NOT TO, KNOWINGLY TAKE ANY ACTION THAT WOULD RESULT
IN A FAILURE TO COMPLY IN ALL MATERIAL RESPECTS WITH ALL GOVERNMENTAL
REGULATIONS APPLICABLE TO THE PROPERTY GROUND LEASE, SUBLEASE, SCHWAB LEASE,
SELLER’S LLC INTEREST AND WITH ANY COVENANTS, CONDITIONS, RESTRICTIONS,
ENCUMBRANCES AND OTHER TITLE EXCEPTION DOCUMENTS AFFECTING THE PROPERTY, IT
BEING UNDERSTOOD AND AGREED THAT PRIOR TO CLOSING, SELLER WILL HAVE THE RIGHT TO
CONTEST ANY SUCH GOVERNMENTAL REGULATIONS AND ANY SUCH TITLE EXCEPTION
DOCUMENTS.

 

(II)           PURCHASER ACKNOWLEDGES THAT NJDEP HAS ISSUED THAT CERTAIN
WATERFRONT DEVELOPMENT PERMIT, ISSUED JULY 1, 1999, AS MODIFIED BY MODIFICATION
TO WATERFRONT DEVELOPMENT PERMIT #0906-92-0005.4 (MODIFICATION FILE
#0906-92-0005.5) DATED AS OF DECEMBER 5, 2000 (THE “WATERFRONT DEVELOPMENT
PERMIT”), A COPY OF WHICH PURCHASER HAS REVIEWED AS PART OF THE DOCUMENTS, WHICH
GRANTS TO AFE, AND ITS SUCCESSORS AND ASSIGNS, THE RIGHT TO DEVELOP THE REAL
PROPERTY, PLAZA VIII AND PLAZA IX, IN ACCORDANCE WITH AND PURSUANT TO THE
PROVISIONS THEREOF.  PURCHASER ACKNOWLEDGES THAT THE BUILDING FULLY UTILIZES THE
DEVELOPMENT RIGHTS ATTRIBUTABLE TO THE REAL PROPERTY, AND THAT IT IS THE
INTENTION OF THE PARTIES THAT ALL REMAINING DEVELOPMENT RIGHTS ACCRUING UNDER
THE WATERFRONT DEVELOPMENT PERMIT (AS WELL AS ANY OTHER DEVELOPMENT RIGHTS
ACCRUING UNDER ALL OTHER OF THE DOCUMENTS) ARE NOT BEING TRANSFERRED TO
PURCHASER ON THE CLOSING DATE, BUT ARE INSTEAD BEING TRANSFERRED TO 8/9
TRANSFEREE AS PART OF THE EXCLUDED REAL PROPERTY.  IN CONNECTION THEREWITH, IT
IS A CONDITION (THE “PERMIT CONDITION”) TO CLOSING THAT EITHER (X) THE
WATERFRONT DEVELOPMENT PERMIT IS BIFURCATED BY NJDEP PRIOR TO CLOSING SUCH THAT
AFTER SUCH BIFURCATION THERE SHALL BE TWO PERMITS, ONE RELATING TO PLAZA X (THE
“PLAZA X BIFURCATED WATERFRONT PERMIT”) AND ONE RELATING TO PLAZAS VIII AND IX
(THE “8/9 BIFURCATED WATERFRONT PERMIT”), WHICH PERMITS MUST ALSO COMPLY WITH
THE REMAINING PROVISIONS OF THIS SECTION 7.1(B)(II), OR (Y) 8/9 TRANSFEREE, IN
THE 8/9 TRANSFEREE GUARANTY (AS HEREINAFTER DEFINED), (I) USE COMMERCIALLY
REASONABLE EFFORTS TO OBTAIN SUCH BIFURCATION FOLLOWING THE CLOSING,
(II) SATISFY ANY OBLIGATIONS OF PROPERTY OWNER (AS RECONSTITUTED ON THE CLOSING
DATE WITH PURCHASER AS THE INDIRECT OR DIRECT OWNER THEREOF) (“POST-TRANSFER
AFE”) FOLLOWING THE CLOSING UNDER THE WATERFRONT DEVELOPMENT PERMIT UNTIL SUCH
TIME AS THE WATERFRONT DEVELOPMENT PERMIT IS BIFURCATED IN ACCORDANCE WITH THE
PROVISIONS OF THIS SECTION 7.1(B)(II), INCLUDING, WITHOUT LIMITATION, THE
COMPLETION OF ANY TRAFFIC MITIGATION STUDIES, BUT SPECIFICALLY EXCLUDING THE
MAINTENANCE OF THE WATERFRONT WALKWAY LOCATED ON THE REAL PROPERTY, WHICH SHALL
FROM AND AFTER THE CLOSING BE MAINTAINED BY POST-TRANSFER AFE AT ITS SOLE COST
AND EXPENSE.  IF THE WATERFRONT DEVELOPMENT PERMIT IS NOT BIFURCATED AND 8/9
TRANSFEREE IS TO GUARANTY THE

 

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FOREGOING OBLIGATIONS, THEN THE FORM OF THE 8/9 TRANSFEREE GUARANTY SHALL BE
MODIFIED (IN FORM REASONABLY SATISFACTORY TO BOTH PURCHASER AND SELLER) AT
CLOSING TO REFLECT THE ADDITION OF SUCH GUARANTY, AND PROVIDED THE 8/9
TRANSFEREE GUARANTY IS EXECUTED AT CLOSING, THEN THE PERMIT CONDITION SHALL BE
DEEMED SATISFIED.  IF SELLER AND PURCHASER ARE UNABLE TO REASONABLY AGREE UPON
THE MODIFICATIONS TO THE 8/9 TRANSFEREE GUARANTY FOR THE PERFORMANCE OF 8/9
TRANSFEREE’S OBLIGATIONS UNDER THIS SECTION 7.1(B)(II), THEN SUCH FAILURE SHALL
MERELY CONSTITUTE THE FAILURE OF A CONDITION PRECEDENT TO PURCHASER’S OBLIGATION
TO CLOSE THIS TRANSACTION AND SHALL NOT BE DEEMED A BREACH OR DEFAULT ON THE
PART OF SELLER.  THE PROVISIONS OF THE 8/9 TRANSFEREE GUARANTY WITH RESPECT TO
THE WATERFRONT DEVELOPMENT PERMIT SHALL AUTOMATICALLY TERMINATE UPON THE FINAL
SATISFACTION OF SUCH OBLIGATIONS AND LIABILITIES.  SELLER WILL ADVISE PURCHASER
IN ADVANCE OF ANY MEETINGS OR DISCUSSIONS WITH ANY APPLICABLE AGENCY INVOLVED IN
THE REVIEW OF THE BIFURCATION OF THE WATERFRONT DEVELOPMENT PERMIT AND PURCHASER
SHALL HAVE THE RIGHT TO PARTICIPATE IN ANY SUCH CONVERSATIONS OR MEETINGS. 
PURCHASER AND POST-TRANSFER AFE HAVE NO OBLIGATION TO SEEK OR OBTAIN THE
BIFURCATION OF THE WATERFRONT DEVELOPMENT PERMIT FROM AND AFTER THE CLOSING.  IN
ORDER FOR THE PLAZA X BIFURCATED WATERFRONT PERMIT TO COMPLY WITH THE PROVISIONS
OF THIS SECTION 7.1(B)(II), IT SHALL NOT CONTAIN ANY OBLIGATION ON THE PART OF
POST-TRANSFER AFE TO UNDERTAKE ANY TRAFFIC MITIGATION PROGRAM OR IMPOSE ANY NEW
OBLIGATIONS OR LIABILITIES ON THE PART OF POST-TRANSFER AFE OTHER THAN THOSE
THAT PERTAIN TO THE BUILDING AND THE REAL PROPERTY (UNLESS PURCHASER CONSENTS
THERETO, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD), IT BEING
ACKNOWLEDGED BY PURCHASER THAT THE OBLIGATION TO MAINTAIN THE WATERFRONT WALKWAY
LOCATED ON THE REAL PROPERTY IS NOT A NEW OBLIGATION OR LIABILITY.

 

(C)           SERVICE CONTRACTS.  FROM THE EFFECTIVE DATE UNTIL CLOSING, SELLER
SHALL NOT, AND SHALL CAUSE PROPERTY OWNER TO NOT, AMEND, MODIFY OR RENEW ANY
EXISTING SERVICE CONTRACTS OR ENTER INTO ANY NEW SERVICE CONTRACTS UNLESS (I)
SUCH AMENDED, MODIFIED, RENEWED OR NEW SERVICE CONTRACT WILL EXPIRE ON OR PRIOR
TO THE CLOSING DATE OR IS TERMINABLE ON NOT MORE THAN THIRTY (30) DAYS NOTICE
WITHOUT PENALTY OR (II) UNLESS PURCHASER CONSENTS THERETO IN WRITING, WHICH
APPROVAL WILL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED.  IN ADDITION
TO THE FOREGOING, FROM THE EFFECTIVE DATE UNTIL CLOSING, SELLER SHALL PROVIDE
PURCHASER WITH NOTICE AND COPIES OF ANY SUCH AMENDMENTS, MODIFICATIONS OR
RENEWALS OF ANY EXISTING SERVICE CONTRACTS OR ANY NEW SERVICE CONTRACTS.

 

(D)           NOTICES. FROM THE EFFECTIVE DATE UNTIL CLOSING, TO THE EXTENT
RECEIVED BY PROPERTY OWNER, SELLER SHALL, AND SHALL CAUSE PROPERTY OWNER TO,
PROMPTLY DELIVER TO PURCHASER COPIES OF WRITTEN DEFAULT NOTICES, WRITTEN NOTICES
OF LAWSUITS, ARBITRATIONS, ADMINISTRATIVE PROCEEDINGS AND OTHER MATERIAL
HEARINGS AND WRITTEN NOTICES OF VIOLATIONS AFFECTING THE GROUND LEASE, THE
SUBLEASE, THE SCHWAB LEASE, SELLER’S LLC INTEREST AND/OR THE OTHER PROPERTY.

 

(E)           SCHWAB LEASE, SUBLEASE AND GROUND LEASE.  (I) FROM THE EFFECTIVE
DATE UNTIL CLOSING, SELLER SHALL NOT, AND SHALL CAUSE PROPERTY OWNER AND PXR TO
NOT, AMEND, MODIFY, EXTEND OR TERMINATE THE SCHWAB LEASE, THE SUBLEASE AND THE
GROUND LEASE OR ENTER INTO ANY CONSENT OR OTHER AGREEMENT WITH RESPECT TO THE
SCHWAB SUBLEASES (EXCEPT, IN EACH INSTANCE, TO THE EXTENT REQUIRED PURSUANT TO
THE TERMS OF THE APPLICABLE DOCUMENT OR TO THE EXTENT THAT ANY SUCH REQUIRED
CONSENT SOUGHT BY SCHWAB PURSUANT TO THE PROVISIONS OF ANY OF THE FOREGOING
DOCUMENTS MUST BE GIVEN BY PXLA PRIOR TO THE THEN SCHEDULED CLOSING DATE, IN
WHICH CASE

 

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SELLER SHALL CONSULT WITH PURCHASER AND PROVIDE PURCHASER WITH COPIES OF THE
RELEVANT DOCUMENTATION PRIOR TO GRANTING SUCH CONSENT (BUT SELLER SHALL HAVE THE
RIGHT TO GRANT OR DENY SUCH CONSENT IN ITS SOLE DISCRETION)).  SELLER HEREBY
EXPRESSLY CONSENTS TO PURCHASER, AT ANY TIME PRIOR TO OR AT CLOSING, NEGOTIATING
AND ENTERING INTO AMENDMENTS AND MODIFICATIONS TO THE SCHWAB LEASE, THE SUBLEASE
AND THE GROUND LEASE AND TO ENTER INTO ANY OTHER CONSENTS OR OTHER AGREEMENTS
WITH RESPECT TO SUCH LEASES SO LONG AS ANY SUCH AMENDMENT, MODIFICATION, CONSENT
OR OTHER AGREEMENT IS NOT EFFECTIVE UNLESS AND UNTIL THE CLOSING OCCURS, AND
SELLER RECEIVES COPIES OF ANY SUCH AMENDMENTS, MODIFICATIONS, CONSENTS AND OTHER
AGREEMENTS PROMPTLY AFTER PURCHASER’S EXECUTION THEREOF (BUT IN ALL EVENTS PRIOR
TO OR AT CLOSING).  SELLER WILL REASONABLY COOPERATE IN ANY ESCROW ARRANGEMENTS
IN CONNECTION WITH ANY AMENDMENTS AND MODIFICATIONS TO THE SCHWAB LEASE
NEGOTIATED BY PURCHASER IN ACCORDANCE WITH THIS SECTION 7.1(E)(I).  THE
AMENDMENT BETWEEN PURCHASER AND SCHWAB WHICH IS IN ESCROW ON THE DATE HEREOF IS
CALLED THE “EXISTING ESCROW SCHWAB AMENDMENT”.

 

(II)           ATTACHED HERETO AS SCHEDULE 7.1(E)(II) IS A TRUE AND CORRECT
ITEMIZATION OF OPERATING EXPENSES FOR THE PARTIAL OPERATING YEARS FROM THE
COMMENCEMENT DATE (AS SUCH TERMS ARE DEFINED IN THE SCHWAB LEASE) THROUGH MAY
31, 2003.

 

(F)            STANDSTILL.

 

(I)            FROM THE EFFECTIVE DATE UNTIL CLOSING, SELLER SHALL NOT (AND
SELLER SHALL CAUSE PROPERTY OWNER NOT TO):  (I) MARKET SELLER’S LLC INTEREST,
THE GROUND LEASE, THE SUBLEASE, THE SCHWAB LEASE OR THE OTHER PROPERTY FOR SALE
OR DISPOSITION TO ANY OTHER PARTY, OR SELL, ENCUMBER, OR GRANT ANY INTEREST IN
OR TO SELLER’S LLC INTEREST, THE GROUND LEASE, SUBLEASE, SCHWAB LEASE OR THE
PROPERTY, (II) SOLICIT, NEGOTIATE OR ACCEPT OFFERS OR OTHERWISE ENTER INTO ANY
BINDING OR NON-BINDING AGREEMENT FOR A PURCHASE, FINANCING OR JOINT VENTURE
INVOLVING THE PROPERTY OR ANY INTEREST THEREIN WITH ANY OTHER PERSON OR ENTITY,
AND (III) OTHER THAN PERMITTED TRANSFERS, ENCUMBER, DISPOSE OF, SELL, CONVEY,
ASSIGN OR PLEDGE ANY INTEREST IN THE PROPERTY OR ANY TAX ABATEMENT OR OTHER TAX
RELIEF BENEFITS APPLICABLE TO THE PROPERTY, OR ANY INTEREST THEREIN OR OTHERWISE
ENTER INTO ANY AGREEMENT, OTHER THAN ANY PERMITTED EXCEPTIONS, AFFECTING OR
ENCUMBERING OR AGREEING TO DISPOSE OF, SELL, CONVEY, ASSIGN OR PLEDGE ANY
INTEREST IN THE PROPERTY, THE GROUND LEASE, THE SUBLEASE, THE SCHWAB LEASE OR
ANY INTEREST THEREIN, WHICH AGREEMENT WOULD BE CONSUMMATED PRIOR TO OR OTHERWISE
THE SURVIVE THE CLOSING.  NOTWITHSTANDING THE FOREGOING, FROM AND AFTER THE DATE
THAT THE APPROVALS SHALL HAVE BEEN OBTAINED AND AFTER THE CONVEYANCE OF THE
EXCLUDED REAL PROPERTY TO 8/9 TRANSFEREE, SELLER SHALL HAVE THE RIGHT TO RECORD
(X) AN AGREEMENT WHICH AMENDS THE GROUND LEASE IN THE FORM ANNEXED HERETO AS
EXHIBIT 7.1(F)(I)-1 (THE “AMENDMENT TO GROUND LEASE ) AND (Y) AN AGREEMENT WHICH
AMENDS THE SUBLEASE IN THE FORM ANNEXED HERETO AS EXHIBIT 7.1(F)(I)-2 (THE
“AMENDMENT TO SUBLEASE ; THE AMENDMENT TO GROUND LEASE AND THE AMENDMENT TO
SUBLEASE ARE COLLECTIVELY REFERRED TO HEREIN AS THE “AMENDED LEASES ) IN ORDER
TO REMOVE THE EXCLUDED REAL PROPERTY FROM THE SCOPE OF THE GROUND LEASE AND THE
SUBLEASE, AND TO REMOVE THE GROUND LEASE AND THE SUBLEASE AS ENCUMBRANCES UPON
THE EXCLUDED REAL PROPERTY.  PURCHASER HEREBY CONSENTS TO THE RECORDATION OF THE
AMENDED LEASES AGAINST THE REAL PROPERTY, AND ACKNOWLEDGES THAT THE AMENDED
LEASES CONSTITUTE PERMITTED EXCEPTIONS.

 

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(II)           SELLER SHALL HAVE THE RIGHT TO GRANT AN EASEMENT FOR THAT PORTION
OF THE REAL PROPERTY, MORE PARTICULARLY DESCRIBED ON SCHEDULE 7.1(F)(II) ANNEXED
HERETO, TO THE CITY (THE “DEDICATION”).  PURCHASER HEREBY CONSENTS TO THE
DEDICATION IN THE FORM ANNEXED HERETO AS EXHIBIT 7.1(F)(II) BEING RECORDED
AGAINST THE REAL PROPERTY, AND ACKNOWLEDGES THAT THE DEDICATION SHALL CONSTITUTE
A PERMITTED EXCEPTION.

 

(III)          PURCHASER AGREES THAT (I) HARSIMUS (AND ITS AFFILIATES) SHALL
HAVE THE RIGHT, AT THEIR SOLE COST AND EXPENSE, TO ERECT A MEMORIAL UPON THE
REAL PROPERTY IN THE LOCATION AND OF A TYPE MORE PARTICULARLY IDENTIFIED AND
DESCRIBED ON EXHIBIT 7.1(F)(III) ANNEXED HERETO (THE “MEMORIAL”), AND (II) THE
OBLIGATION TO MAINTAIN THE MEMORIAL FROM AND AFTER THE CLOSING DATE SHALL BE AS
IS SET FORTH IN THE CREA.

 

(IV)          PURCHASER AGREES THAT AFE SHALL HAVE THE RIGHT TO, AND SHALL,
TRANSFER ALL OF ITS RIGHT, TITLE AND INTEREST IN AND TO THE EXCLUDED REAL
PROPERTY TO 8/9 TRANSFEREE.

 

(G)           FURTHER ENCUMBRANCES.  EXCEPT FOR THE PERMITTED EXCEPTIONS AND AS
MAY OTHERWISE BE PERMITTED PURSUANT TO THE EXPRESS PROVISIONS OF THIS AGREEMENT,
SELLER SHALL NOT (AND SELLER SHALL CAUSE PROPERTY OWNER AND PXR TO NOT)
VOLUNTARILY ALTER OR ENCUMBER IN ANY WAY SELLER’S TITLE TO SELLER’S LLC INTEREST
AND PROPERTY OWNER’S TITLE TO THE PROPERTY OR THE GROUND LEASE OR THE SUBLEASE
OR THE SCHWAB LEASE AFTER THE EFFECTIVE DATE WITHOUT THE PRIOR WRITTEN CONSENT
OF PURCHASER.  IN ADDITION TO THE FOREGOING, FROM THE EFFECTIVE DATE UNTIL
CLOSING, SELLER SHALL PROVIDE PURCHASER WITH NOTICE AND COPIES OF ANY SUCH
ALTERATIONS TO OR ENCUMBRANCES ON SELLER’S TITLE TO SELLER’S LLC INTEREST AND
PROPERTY OWNER’S TITLE TO THE PROPERTY OR THE GROUND LEASE OR THE SUBLEASE OR
THE SCHWAB LEASE.

 

(H)           UPDATED DEED NOTICE.  PURCHASER ACKNOWLEDGES THAT A DECLARATION OF
ENVIRONMENTAL RESTRICTIONS, A COPY OF WHICH PURCHASER HAS REVIEWED DURING ITS
DUE DILIGENCE AS PART OF THE DOCUMENTS, IS CURRENTLY RECORDED IN THE TITLE
RECORDS OF THE REAL PROPERTY (THE “EXISTING DEED NOTICE”).  THE EXISTING DEED
NOTICE REFLECTS THAT CONTAMINATED HISTORIC FILL EXISTS AT THE REAL PROPERTY,
WHICH MUST BE CONTAINED AS PROVIDED IN THE EXISTING DEED NOTICE AND WHICH CANNOT
BE DISTURBED WITHOUT THE PRIOR CONSENT OF NJDEP.  PRIOR TO THE COMMENCEMENT OF
THE CONSTRUCTION OF THE BUILDING, AFE NOTIFIED THE NJDEP THAT IT INTENDED TO
DISTURB THE TWO FEET OF CLEAN FILL ACTING AS AN “ENGINEERING CONTROL” (AS THAT
TERM IS DEFINED IN ENVIRONMENTAL LAWS) OVER THE HISTORIC FILL AT THE REAL
PROPERTY, IN CONNECTION WITH ITS CONSTRUCTION ACTIVITIES.  AFE ALSO SOUGHT THE
CONSENT OF NJDEP TO DO SO.  AS A CONDITION TO NJDEP’S CONSENT TO THE
CONSTRUCTION ACTIVITIES AND THE DISTURBANCE OF THE ENGINEERING CONTROL, AFE
AGREED TO RECORD AN UPDATED DEED NOTICE REFLECTING THE CURRENT SITE CONDITIONS
AFTER THE CONSTRUCTION ACTIVITIES HAVE BEEN COMPLETED (THE “UPDATED DEED
NOTICE”).  IN ORDER TO COMPLETE THE FOREGOING, SELLER ENTERED INTO A MEMORANDUM
OF AGREEMENT (“MOA”) WITH THE NJDEP (A COPY OF WHICH HAS BEEN DELIVERED TO
PURCHASER AS PART OF THE DOCUMENTS) IN ORDER TO OBTAIN ITS APPROVAL TO RECORD
THE UPDATED DEED NOTICE IN THE TITLE RECORDS OF THE REAL PROPERTY AND TO REQUEST
A TERMINATION OF THE EXISTING DEED NOTICE AND SELLER RECORDED THE UPDATED DEED
NOTICE AND TERMINATION OF EXISTING DEED NOTICE, IN THE TITLE RECORDS OF THE REAL
PROPERTY IN ACCORDANCE WITH N.J.S.A. 58:10B-13.  PURCHASER HEREBY CONSENTS TO
THE UPDATED DEED NOTICE AND TERMINATION OF EXISTING DEED NOTICE BEING RECORDED

 

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AGAINST THE REAL PROPERTY, AND ACKNOWLEDGES THAT THE UPDATED DEED NOTICE AND
TERMINATION OF EXISTING DEED NOTICE CONSTITUTES A PERMITTED EXCEPTION.

 

(I)            APPROVALS.  FROM AND AFTER THE EFFECTIVE DATE, SELLER AND
PURCHASER SHALL ACT IN GOOD FAITH AND COOPERATE WITH EACH OTHER IN CONNECTION
WITH SELLER’S EFFORTS TO TIMELY OBTAIN THE APPROVALS, WHICH SHALL INCLUDE,
WITHOUT LIMITATION, EXECUTING DOCUMENTS, PROVIDING INFORMATION AS TO THE DIRECT
AND INDIRECT BENEFICIAL INTEREST HOLDERS IN PURCHASER, AND PROVIDING SUCH OTHER
INFORMATION AS THE APPLICABLE PARTY MAY REQUEST.  THE COSTS IN CONNECTION WITH
OBTAINING THE APPROVALS SHALL BE BORNE IN THE MANNER MORE PARTICULARLY SET FORTH
IN SECTION 10.5 OF THIS AGREEMENT.  PURCHASER ACKNOWLEDGES THAT A CERTIFICATE OF
SUBSTANTIAL COMPLETION WILL BE RECORDED AGAINST THE REAL PROPERTY AND WILL
CONSTITUTE A PERMITTED EXCEPTION.  SELLER WILL USE GOOD FAITH EFFORTS TO OBTAIN
SUCH ADDITIONAL CONSENTS FROM JCRA AS PURCHASER MAY REASONABLY REQUEST, BUT SUCH
ADDITIONAL CONSENTS SHALL NOT BE CONDITIONS TO PURCHASER’S OBLIGATION TO CLOSE
HEREUNDER.  WITHOUT PURCHASER’S PRIOR WRITTEN CONSENT, SELLER SHALL NOT, AND
SHALL CAUSE THE PROPERTY OWNER NOT TO, (A) AMEND OR MODIFY THE FINANCIAL
AGREEMENT, EXCEPT AS IT MAY BE AMENDED BY THE AMENDED FINANCIAL AGREEMENT, OR
(B) NEGOTIATE, SETTLE, COMPROMISE, OR CONSENT OR AGREE TO ANY CHANGE IN, THE
TOTAL PROJECT COST (AS DEFINED IN THE FINANCIAL AGREEMENT) IN ANY MANNER THAT
DIRECTLY OR INDIRECTLY DOES OR COULD INCREASE THE TOTAL PROJECT COST BEYOND
$78,674,777.

 

(J)            CREA.  AT THE CLOSING, SELLER SHALL CAUSE THAT CERTAIN CROSS
RECIPROCAL EASEMENT AGREEMENT IN THE FORM ANNEXED HERETO AS EXHIBIT 7.1(J)
(“CREA”) TO BE RECORDED AGAINST THE REAL PROPERTY, WHICH WILL PROVIDE FOR, INTER
ALIA, PEDESTRIAN EASEMENTS, VIEW CORRIDORS, CERTAIN PARKING RIGHTS, MEANS OF
ACCESS, RIGHTS RELATED TO STORMWATER RUNOFF AND ACCESS TO UTILITIES, ALL OF
WHICH SHALL BENEFIT AND BURDEN THE REAL PROPERTY AND THE EXCLUDED REAL PROPERTY,
AS MORE PARTICULARLY DESCRIBED IN THE CREA.  PURCHASER ACKNOWLEDGES THAT THE
CREA WILL BE RECORDED AGAINST THE REAL PROPERTY AND CONSTITUTES A PERMITTED
EXCEPTION.  NONE OF SELLER, PROPERTY OWNER AND 8/9 TRANSFEREE SHALL VOLUNTARILY
CAUSE TO BE PLACED ON THE EXCLUDED REAL PROPERTY ANY ENCUMBRANCE WHICH WOULD BE
SUPERIOR TO THE CREA.

 

(K)           COVENANT AND RESTRICTION AGREEMENT.  PURCHASER ACKNOWLEDGES THAT A
CERTAIN RECIPROCAL OPERATION AND EASEMENT AGREEMENT FOR THE HARBORSIDE FINANCIAL
CENTER, DATED AS OF DECEMBER 4, 1995 (AS AMENDED, THE “ROEA”) IS CURRENTLY
RECORDED IN THE TITLE RECORDS OF CERTAIN OF THE OTHER PARCELS WITHIN THE
HARBORSIDE FINANCIAL CENTER, AND THAT PURCHASER HAS REVIEWED THE ROEA DURING ITS
DUE DILIGENCE AS PART OF THE DOCUMENTS.  AT THE CLOSING, SELLER SHALL ENTER IN
AN AGREEMENT, IN THE FORM ANNEXED HERETO AS EXHIBIT 7.1(K) (THE “CRA”), TO BE
RECORDED AGAINST THE REAL PROPERTY; IT BEING UNDERSTOOD THAT THE CRA SHALL,
INTER ALIA, SUBJECT THE REAL PROPERTY TO CERTAIN PROVISIONS OF THE ROEA AND,
REQUIRE THE CONTINUED USE OF THE NAME “PLAZA X” AND “THE HARBORSIDE FINANCIAL
CENTER” AT THE REAL PROPERTY.  PURCHASER ACKNOWLEDGES THAT THE CRA WILL BE
RECORDED AGAINST THE REAL PROPERTY AND CONSTITUTES A PERMITTED EXCEPTION.

 

(L)            INSURANCE.  FROM THE EFFECTIVE DATE UNTIL CLOSING SELLER SHALL,
AND SHALL CAUSE PROPERTY OWNER AND PXR TO, MAINTAIN EXISTING INSURANCE POLICIES
WITH RESPECT TO THE PROPERTY (OR REPLACEMENTS OR RENEWALS THEREOF) IN FULL FORCE
AND EFFECT.

 

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(M)          TAXES.  FROM THE PERIOD BEGINNING ON THE EFFECTIVE DATE UNTIL
CLOSING, SELLER SHALL CAUSE PROPERTY OWNER AND PXR TO:  (I) PAY ALL REAL ESTATE
TAXES AND ASSESSMENTS WHICH ARE DUE AND PAYABLE DURING SUCH PERIOD (SUBJECT TO
PRORATION); AND (II) PAY ALL FRANCHISE TAXES (SUBJECT TO PRORATION) DUE AND
PAYABLE DURING SUCH PERIOD FOR EACH OF SELLER, PROPERTY OWNER AND PXR IN ALL
JURISDICTIONS WHERE SUCH ENTITY WAS FORMED OR WHERE SUCH ENTITY IS QUALIFIED TO
TRANSACT BUSINESS.

 

(N)           ZONING.  EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, FROM THE
EFFECTIVE DATE UNTIL CLOSING, SELLER SHALL NOT, AND SHALL CAUSE PROPERTY OWNER
AND PXR NOT TO, INITIATE ANY ZONING RECLASSIFICATIONS OR VARIANCE ORDER WITH
RESPECT TO THE PROPERTY, IMPOSE OR INCUR ANY RESTRICTIVE COVENANT OR EXECUTE A
SUBDIVISION PLAT OR OTHERWISE VOLUNTARILY AFFECT THE ZONING AND PERMITTED USES
OF THE PROPERTY.

 

(O)           WALKWAY EASEMENT.  AT OR PRIOR TO THE CLOSING, SELLER SHALL CAUSE
THAT CERTAIN WALKWAY EASEMENT, IN THE FORM ANNEXED HERETO AS EXHIBIT 7.1(O) (THE
“WALKWAY EASEMENT ), TO BE RECORDED AGAINST THE REAL PROPERTY, WHICH WILL
PROVIDE FOR A THIRTY (30) FOOT-WIDE PEDESTRIAN WALKWAY EASEMENT TRAVERSING THE
WATERFRONT PORTION OF THE PROPERTY (THE “WATERFRONT WALKWAY”) FOR USE BY THE
GENERAL PUBLIC WHICH SHALL BURDEN THE REAL PROPERTY, TO BE MORE PARTICULARLY
DESCRIBED IN THE WALKWAY EASEMENT.  PURCHASER ACKNOWLEDGES THAT THE WALKWAY
EASEMENT WILL BE RECORDED AGAINST THE REAL PROPERTY AND CONSTITUTES A PERMITTED
EXCEPTION.

 

SECTION 7.2             JMB CONSTRUCTION CONTRACT AND JMB COOLING TOWER
CONTRACT.  IF AT CLOSING, ALL AMOUNTS REQUIRED TO BE PAID TO JMB UNDER THE JMB
CONSTRUCTION CONTRACT AND JMB COOLING TOWER CONTRACT HAVE NOT BEEN PAID AND
SELLER HAS NOT RECEIVED FINAL LIEN WAIVERS FROM JMB WITH RESPECT TO SUCH
CONTRACTS AND ANY SUBCONTRACTS ENTERED INTO BY JMB UNDER THE JMB CONSTRUCTION
CONTRACT AND JMB COOLING TOWER CONTRACT, SELLER SHALL REMAIN RESPONSIBLE FOR
OBTAINING SUCH FINAL LIEN WAIVERS (BUT ONLY TO THE EXTENT THAT THE STATUTORY
PERIOD FOR THE APPLICABLE CONTRACTOR TO FILE A LIEN HAS NOT EXPIRED) AND FOR
PAYING SUCH REMAINING AMOUNTS AND PURCHASER SHALL COOPERATE WITH SELLER TO
ACCOMPLISH THE SAME.

 

SECTION 7.3             SCHWAB LEASE.  FROM AND AFTER THE EFFECTIVE DATE THROUGH
AND AFTER CLOSING, SELLER AND PROPERTY OWNER (PRIOR TO GIVING EFFECT TO THE
TRANSFERS AT CLOSING) SHALL MAKE ALL COMMERCIALLY REASONABLY EFFORTS TO
COOPERATE WITH RESPECT TO INQUIRIES AND INFORMATION REQUESTS RELATING TO AUDIT
RIGHTS OF AMOUNTS INCLUDED IN THE BASE OPERATING YEAR EXPENSES PROVIDED IN THE
SCHWAB LEASE.

 

SECTION 7.4             EXCESS NET PROFITS; FINES.  TO THE EXTENT (I) THE CITY
AUDIT OF THE PROPERTY SHALL CONCLUDE THAT THERE ARE ANY EXCESS NET PROFITS
PAYABLE UNDER THE FINANCIAL AGREEMENT WITH RESPECT TO THE OPERATION OF THE
BUILDING AND THE PROPERTY FOR ANY PERIOD PRIOR TO CLOSING OR (II) ANY FINES ARE
LEVIED AGAINST PROPERTY OWNER BY REASON OF SELLER’S FAILURE TO PERFORM ANY OF
ITS OBLIGATIONS UNDER THE FINANCIAL AGREEMENT OR PECA FOR ANY PERIOD PRIOR TO
CLOSING, SELLER SHALL BE RESPONSIBLE FOR THE PAYMENT IN FULL OF ANY SUCH EXCESS
NET PROFITS OR FINES, SUBJECT TO (X) SELLER’S RIGHT TO CONTEST THE CONCLUSION OF
ANY SUCH AUDIT OR THE IMPOSITION OF ANY SUCH FINES, AS THE CASE MAY BE, IN THE
NAME OF PROPERTY OWNER, PROVIDED THAT PROPERTY OWNER HAS BEEN APPRISED OF SUCH
CONTEST AND PURCHASER, AT PURCHASER’S EXPENSE, SHALL HAVE THE RIGHT TO
PARTICIPATE

 

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IN SUCH CONTEST, AND (Y) PURCHASER COOPERATING WITH SELLER AS MAY BE REASONABLY
NECESSARY IN CONNECTION WITH SUCH CONTEST, AND SELLER’S OBLIGATION TO PAY SUCH
EXCESS NET PROFITS OR FINES SHALL ONLY BE TO THE EXTENT THE CONCLUSION OF SUCH
AUDIT OR THE IMPOSITION OF SUCH FINES, AS THE CASE MAY BE, IS FINAL AND
NON-APPEALABLE.  FROM AND AFTER CLOSING, WITHOUT SELLER’S PRIOR WRITTEN CONSENT,
PURCHASER SHALL NOT, AND SHALL CAUSE THE PROPERTY OWNER NOT TO, (A) AMEND OR
MODIFY THE FINANCIAL AGREEMENT OR PECA IN ANY MANNER THAT DIRECTLY OR INDIRECTLY
DOES OR COULD INCREASE THE EXCESS NET PROFITS OR FINES WHICH SELLER IS
RESPONSIBLE FOR HEREUNDER, OR (B) NEGOTIATE, SETTLE, COMPROMISE, OR CONSENT OR
AGREE TO ANY CHANGE IN, THE FINANCIAL AGREEMENT OR PECA IN ANY MANNER THAT
DIRECTLY OR INDIRECTLY DOES OR COULD INCREASE THE EXCESS NET PROFITS OR FINES
WHICH SELLER IS RESPONSIBLE FOR HEREUNDER.

 

SECTION 7.5             OCIP.  PURCHASER SHALL PAY TO SELLER ANY AMOUNTS
ACTUALLY RECEIVED BY PURCHASER OR PROPERTY OWNER FROM AND AFTER CLOSING UNDER
THE OCIP, INCLUDING ANY REFUNDS OR SAVINGS THEREUNDER.  SELLER SHALL BE
RESPONSIBLE FOR ANY PAYMENTS WHICH MAY BE REQUIRED TO BE MADE BY PROPERTY OWNER
UNDER THE OCIP AFTER THE CLOSING.

 

SECTION 7.6             EQR RELEASE.  SELLER SHALL USE COMMERCIALLY REASONABLE
EFFORTS TO OBTAIN A RELEASE OF AFE FROM ANY FURTHER OBLIGATIONS UNDER THAT
CERTAIN EASEMENT AGREEMENT DATED MARCH 21, 2001 BY AND AMONG AFE, CALI
HARBORSIDE (FEE) ASSOCIATES L.P. AND EQR – LINCOLN NORTH PIER L.L.C.

 

ARTICLE VIII

REPRESENTATIONS AND WARRANTIES

 

SECTION 8.1             HARSIMUS REPRESENTATIONS AND WARRANTIES.  HARSIMUS
REPRESENTS AND WARRANTS TO PURCHASER THE FOLLOWING:

 

(A)           STATUS. HARSIMUS IS A LIMITED LIABILITY COMPANY, DULY ORGANIZED
AND VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE STATE OF NEW
JERSEY.

 

(B)           AUTHORITY.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND ALL
OTHER DOCUMENTS NOW OR HEREAFTER TO BE EXECUTED AND DELIVERED BY HARSIMUS
PURSUANT TO THIS AGREEMENT (COLLECTIVELY, THE “HARSIMUS DOCUMENTS” ) AND THE
PERFORMANCE OF HARSIMUS’ OBLIGATIONS HEREUNDER AND UNDER THE HARSIMUS DOCUMENTS
HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY ACTION ON THE PART OF HARSIMUS, AND
THIS AGREEMENT CONSTITUTES, AND THE HARSIMUS DOCUMENTS WILL CONSTITUTE, THE
LEGAL, VALID AND BINDING OBLIGATION OF HARSIMUS, ENFORCEABLE IN ACCORDANCE WITH
THEIR TERMS, SUBJECT TO BANKRUPTCY, REORGANIZATION AND OTHER SIMILAR LAWS
AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY AND EXCEPT AS MAY BE
LIMITED BY GENERAL EQUITABLE PRINCIPLES.  THE PERSON SIGNING THIS AGREEMENT ON
BEHALF OF HARSIMUS HAS BEEN DULY AUTHORIZED TO SIGN AND DELIVER THIS AGREEMENT
ON BEHALF THEREOF.

 

(C)           NON-CONTRAVENTION.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT
AND THE HARSIMUS DOCUMENTS BY HARSIMUS AND THE CONSUMMATION BY HARSIMUS OF THE
TRANSACTIONS CONTEMPLATED HEREBY WILL NOT (I) VIOLATE ANY JUDGMENT, ORDER,
INJUNCTION, DECREE, REGULATION OR RULING OF ANY COURT OR AUTHORITY HAVING
JURISDICTION OVER HARSIMUS, (II) CONFLICT WITH, RESULT IN A

 

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BREACH OF, OR CONSTITUTE A DEFAULT UNDER THE ORGANIZATIONAL DOCUMENTS OF
HARSIMUS, (III) VIOLATE ANY NOTE OR OTHER EVIDENCE OF INDEBTEDNESS, ANY
MORTGAGE, DEED OF TRUST OR INDENTURE TO WHICH HARSIMUS IS A PARTY OR BY WHICH IT
IS BOUND, OR (IV) PROVIDED THE APPROVALS ARE OBTAINED, VIOLATE ANY LEASE OR
OTHER MATERIAL AGREEMENT OR INSTRUMENT TO WHICH HARSIMUS IS A PARTY OR BY WHICH
IT IS BOUND.

 

(D)           CONSENTS.  OTHER THAN THE RECEIPT OF THE APPROVALS, NO CONSENT,
WAIVER, APPROVAL OR AUTHORIZATION IS REQUIRED FROM ANY PERSON OR ENTITY (THAT
HAS NOT ALREADY BEEN OBTAINED) IN CONNECTION WITH THE EXECUTION AND DELIVERY OF
THIS AGREEMENT AND THE HARSIMUS DOCUMENTS BY HARSIMUS OR THE PERFORMANCE BY
HARSIMUS OF THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(E)           SUITS AND PROCEEDINGS.  EXCEPT AS LISTED ON SCHEDULE 8.1(E), THERE
ARE NO LEGAL ACTIONS, SUITS OR SIMILAR PROCEEDINGS PENDING AND SERVED, OR, TO
HARSIMUS’S KNOWLEDGE, THREATENED IN WRITING AGAINST HARSIMUS, WHICH (I) ARE NOT
ADEQUATELY COVERED BY EXISTING INSURANCE AND (II) IF ADVERSELY DETERMINED, WOULD
MATERIALLY AND ADVERSELY AFFECT THE VALUE OF THE HARSIMUS INTEREST OR HARSIMUS’
ABILITY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(F)            BANKRUPTCY.  HARSIMUS HAS NOT (A) COMMENCED A VOLUNTARY CASE, OR
HAD ENTERED AGAINST IT A PETITION, FOR RELIEF UNDER ANY FEDERAL BANKRUPTCY ACT
OR ANY SIMILAR PETITION, ORDER OR DECREE UNDER ANY FEDERAL OR STATE LAW OR
STATUTE RELATIVE TO BANKRUPTCY, INSOLVENCY OR OTHER RELIEF FOR DEBTORS,
(B) CAUSED, SUFFERED OR CONSENTED TO THE APPOINTMENT OF A RECEIVER, TRUSTEE,
ADMINISTRATOR, CONSERVATOR, LIQUIDATOR OR SIMILAR OFFICIAL IN ANY FEDERAL, STATE
OR FOREIGN JUDICIAL OR NON-JUDICIAL PROCEEDING, TO HOLD, ADMINISTER AND/OR
LIQUIDATE ALL OR SUBSTANTIALLY ALL OF ITS ASSETS, OR (C) MADE AN ASSIGNMENT FOR
THE BENEFIT OF CREDITORS.

 

(G)           NON-FOREIGN ENTITY.  HARSIMUS IS NOT A “FOREIGN PERSON” (WITHIN
THE MEANING OF SECTION 1445(F)(3) OF THE CODE).

 

(H)           HARSIMUS’ INTEREST.  HARSIMUS HAS GOOD TITLE TO THE HARSIMUS
INTEREST AND HAS NOT TRANSFERRED, ASSIGNED, SOLD, CONVEYED, PLEDGED, MORTGAGED,
GRANTED A SECURITY INTEREST IN, OR OTHERWISE DISPOSED OF THE HARSIMUS INTEREST
OR ANY PORTION THEREOF OR INTEREST THEREIN OR GRANTED ANY OPTION TO ANY PERSON
OR ENTITY TO ACQUIRE SUCH INTEREST.  THE HARSIMUS INTEREST IS FREE AND CLEAR OF
ALL LIENS, ENCUMBRANCES, LIABILITIES, CLAIMS, EXCEPTIONS, COVENANTS AND
RESTRICTIONS OF ANY KIND OR CHARACTER, INCLUDING BUT NOT LIMITED TO, ANY
SECURITY INTERESTS OR, ANY RESTRICTION ON SALE OR ASSIGNMENT OR GRANTING OF ANY
OPTION, RIGHT OR AGREEMENT FOR THE PURCHASE OR ACQUISITION OF THE SAME OR ANY
INTEREST IN THE SAME.

 

The provisions of this Section 8.1 are subject to the limitations on liability
with respect to the representations, warranties and covenants of Harsimus set
forth in Section 8.5 of this Agreement.

 

SECTION 8.2             COLUMBIA REPRESENTATIONS AND WARRANTIES.  COLUMBIA
REPRESENTS AND WARRANTS TO PURCHASER THE FOLLOWING:

 

(A)           STATUS. COLUMBIA IS A LIMITED LIABILITY COMPANY, DULY ORGANIZED
AND VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE STATE OF NEW
JERSEY.

 

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(B)           AUTHORITY.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND ALL
OTHER DOCUMENTS NOW OR HEREAFTER TO BE EXECUTED AND DELIVERED BY COLUMBIA
PURSUANT TO THIS AGREEMENT (COLLECTIVELY, THE “COLUMBIA DOCUMENTS”) AND THE
PERFORMANCE OF COLUMBIA’S OBLIGATIONS HEREUNDER AND UNDER THE COLUMBIA DOCUMENTS
HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY ACTION ON THE PART OF COLUMBIA, AND
THIS AGREEMENT CONSTITUTES, AND THE COLUMBIA DOCUMENTS WILL CONSTITUTE, THE
LEGAL, VALID AND BINDING OBLIGATION OF COLUMBIA, ENFORCEABLE IN ACCORDANCE WITH
THEIR TERMS, SUBJECT TO BANKRUPTCY, REORGANIZATION AND OTHER SIMILAR LAWS
AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY AND EXCEPT AS MAY BE
LIMITED BY GENERAL EQUITABLE PRINCIPLES.  THE PERSON SIGNING THIS AGREEMENT ON
BEHALF OF COLUMBIA HAS BEEN DULY AUTHORIZED TO SIGN AND DELIVER THIS AGREEMENT
ON BEHALF THEREOF.

 

(C)           NON-CONTRAVENTION.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT
AND THE COLUMBIA DOCUMENTS BY COLUMBIA AND THE CONSUMMATION BY COLUMBIA OF THE
TRANSACTIONS CONTEMPLATED HEREBY WILL NOT (I) VIOLATE ANY JUDGMENT, ORDER,
INJUNCTION, DECREE, REGULATION OR RULING OF ANY COURT OR AUTHORITY HAVING
JURISDICTION OVER COLUMBIA, (II) CONFLICT WITH, RESULT IN A BREACH OF, OR
CONSTITUTE A DEFAULT UNDER THE ORGANIZATIONAL DOCUMENTS OF COLUMBIA, (III)
VIOLATE ANY NOTE OR OTHER EVIDENCE OF INDEBTEDNESS, ANY MORTGAGE, DEED OF TRUST
OR INDENTURE TO WHICH COLUMBIA IS A PARTY OR BY WHICH IT IS BOUND, OR
(IV) PROVIDED THE APPROVALS ARE OBTAINED, VIOLATE ANY LEASE OR OTHER MATERIAL
AGREEMENT OR INSTRUMENT TO WHICH COLUMBIA IS A PARTY OR BY WHICH IT IS BOUND.

 

(D)           CONSENTS.  SUBJECT TO RECEIPT OF THE APPROVALS, NO CONSENT,
WAIVER, APPROVAL OR AUTHORIZATION IS REQUIRED FROM ANY PERSON OR ENTITY (THAT
HAS NOT ALREADY BEEN OBTAINED) IN CONNECTION WITH THE EXECUTION AND DELIVERY OF
THIS AGREEMENT AND THE COLUMBIA DOCUMENTS BY COLUMBIA OR THE PERFORMANCE BY
COLUMBIA OF THE TRANSACTIONS CONTEMPLATED HEREBY

 

(E)           SUITS AND PROCEEDINGS.  EXCEPT AS LISTED ON SCHEDULE 8.2(E), THERE
ARE NO LEGAL ACTIONS, SUITS OR SIMILAR PROCEEDINGS PENDING AND SERVED, OR, TO
COLUMBIA’S KNOWLEDGE, THREATENED IN WRITING AGAINST COLUMBIA, WHICH (I) ARE NOT
ADEQUATELY COVERED BY EXISTING INSURANCE AND (II) IF ADVERSELY DETERMINED, WOULD
MATERIALLY AND ADVERSELY AFFECT THE VALUE OF THE COLUMBIA INTEREST OR COLUMBIA’
ABILITY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(F)            BANKRUPTCY.  COLUMBIA HAS NOT (A) COMMENCED A VOLUNTARY CASE, OR
HAD ENTERED AGAINST IT A PETITION, FOR RELIEF UNDER ANY FEDERAL BANKRUPTCY ACT
OR ANY SIMILAR PETITION, ORDER OR DECREE UNDER ANY FEDERAL OR STATE LAW OR
STATUTE RELATIVE TO BANKRUPTCY, INSOLVENCY OR OTHER RELIEF FOR DEBTORS,
(B) CAUSED, SUFFERED OR CONSENTED TO THE APPOINTMENT OF A RECEIVER, TRUSTEE,
ADMINISTRATOR, CONSERVATOR, LIQUIDATOR OR SIMILAR OFFICIAL IN ANY FEDERAL, STATE
OR FOREIGN JUDICIAL OR NON-JUDICIAL PROCEEDING, TO HOLD, ADMINISTER AND/OR
LIQUIDATE ALL OR SUBSTANTIALLY ALL OF ITS ASSETS, OR (C) MADE AN ASSIGNMENT FOR
THE BENEFIT OF CREDITORS.

 

(G)           NON-FOREIGN ENTITY.  COLUMBIA IS NOT A “FOREIGN PERSON” (WITHIN
THE MEANING OF SECTION 1445(F)(3) OF THE CODE).

 

(H)           COLUMBIA INTEREST.  COLUMBIA HAS GOOD TITLE TO THE COLUMBIA
INTEREST AND HAS NOT TRANSFERRED, ASSIGNED, SOLD, CONVEYED, PLEDGED, MORTGAGED,
GRANTED A SECURITY INTEREST IN,

 

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OR OTHERWISE DISPOSED OF THE COLUMBIA INTEREST OR ANY PORTION THEREOF OR
INTEREST THEREIN OR GRANTED ANY OPTION TO ANY PERSON OR ENTITY TO ACQUIRE SUCH
INTEREST.  THE COLUMBIA INTEREST IS FREE AND CLEAR OF ALL LIENS, ENCUMBRANCES,
LIABILITIES, CLAIMS, EXCEPTIONS, COVENANTS AND RESTRICTIONS OF ANY KIND OR
CHARACTER, INCLUDING BUT NOT LIMITED TO, ANY SECURITY INTERESTS OR, ANY
RESTRICTION ON SALE OR ASSIGNMENT OR GRANTING OF ANY OPTION, RIGHT OR AGREEMENT
FOR THE PURCHASE OR ACQUISITION OF THE SAME OR ANY INTEREST IN THE SAME.

 

The provisions of this Section 8.2 are subject to the limitations on liability
with respect to the representations, warranties and covenants of Columbia set
forth in Section 8.5 of this Agreement.

 

SECTION 8.3             SELLER’S REPRESENTATIONS AND WARRANTIES.  SELLER
REPRESENTS AND WARRANTS TO PURCHASER THE FOLLOWING:

 

(A)           NON-CONTRAVENTION.  THE CONSUMMATION OF THE TRANSACTIONS
CONTEMPLATED HEREBY WILL NOT, PROVIDED THE APPROVALS ARE OBTAINED, VIOLATE ANY
JUDGMENT, ORDER, INJUNCTION, DECREE, REGULATION OR RULING OF ANY COURT OR
AUTHORITY HAVING JURISDICTION OVER THE PROPERTY, THE SELLER’S LLC INTERESTS, THE
SELLER, THE PROPERTY OWNER OR PXR.

 

(B)           SUITS AND PROCEEDINGS/INSURANCE.

 

(I)            EXCEPT AS LISTED IN SCHEDULE 8.3(B)(I), THERE ARE NO LEGAL
ACTIONS, SUITS, ARBITRATIONS, ADMINISTRATIVE PROCEEDINGS OR SIMILAR PROCEEDINGS
PENDING AND SERVED, OR, TO SELLER’S KNOWLEDGE, THREATENED IN WRITING AGAINST
PROPERTY OWNER, PXR OR THE PROPERTY WHICH (I) ARE NOT ADEQUATELY COVERED BY
EXISTING INSURANCE AND (II) IF ADVERSELY DETERMINED, WOULD MATERIALLY AND
ADVERSELY AFFECT THE VALUE OF THE PROPERTY (OR THE CONTINUED OPERATIONS
THEREOF), ANY RIGHTS TO DEVELOP THE PROPERTY OR THE PILOT, OR SELLER’S ABILITY
TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(II)           ATTACHED HERETO AS SCHEDULE 8.3(B)(II) (THE “SCHEDULE OF
INSURANCE BY PROPERTY OWNER”) IS A CORRECT AND COMPLETE LIST, IN ALL MATERIAL
RESPECTS, OF THE TYPES AND AMOUNTS OF INSURANCE COVERAGE MAINTAINED BY THE
PROPERTY OWNER AND IN FORCE WITH RESPECT TO THE PROPERTY, GROUND LEASE OR
SUBLEASE.  PROPERTY OWNER HAS NOT RECEIVED ANY NOTICE IN WRITING FROM THE
COMPANIES ISSUING SUCH INSURANCE WHICH THREATENS TO WITHDRAW SUCH COVERAGE OR
REQUIRING THAT ANY WORK BE PERFORMED TO PRESERVE SUCH COVERAGE.  ALL PREMIUMS ON
EXISTING INSURANCE POLICIES WHICH ARE DUE AND PAYABLE PRIOR TO THE CLOSING DATE
SHALL BE PAID.

 

(C)           LEASES/TENANTS.

 

(I)            AS OF THE EFFECTIVE DATE, THE ONLY TENANT (EXCLUDING SUBTENANTS)
AT THE BUILDING IS SCHWAB.  SCHEDULE 8.3(C)(I)-1 ANNEXED HERETO IS A TRUE AND
COMPLETE SCHEDULE IDENTIFYING THE SCHWAB LEASE AND ALL MATERIAL GUARANTEES,
AMENDMENTS AND MODIFICATIONS THERETO.  SCHEDULE 8.3(C)(I)-2 ANNEXED HERETO IS A
TRUE AND COMPLETE SCHEDULE IDENTIFYING THE SUBLEASE AND ALL MATERIAL AMENDMENTS
AND MODIFICATIONS THERETO, OTHER THAN THE AMENDMENT TO SUBLEASE, WHICH IS NOT
REFLECTED ON SAID SCHEDULE.  SCHEDULE 8.3(C)(I)-3 ANNEXED HERETO IS A TRUE AND
COMPLETE SCHEDULE IDENTIFYING THE GROUND LEASE AND ALL AMENDMENTS AND
MODIFICATIONS THERETO, OTHER THAN THE AMENDMENT TO GROUND LEASE, WHICH IS NOT
REFLECTED ON SAID SCHEDULE.

 

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THE DOCUMENTS MADE AVAILABLE TO PURCHASER PURSUANT TO SECTION 5.2 HEREOF INCLUDE
TRUE AND CORRECT COPIES OF (I) THE SCHWAB LEASE (AS DESCRIBED ON SCHEDULE
8.3(C)(I)-1), (II) THE SUBLEASE (AS DESCRIBED ON SCHEDULE 8.3(C)(I)-2),  AND
(III) THE GROUND LEASE (AS DESCRIBED ON SCHEDULE 8.3(C)(I)-3).

 

(II)           EXCEPT AS SET FORTH ON SCHEDULE 8.3(C)(II), NO WRITTEN CLAIM OF
MATERIAL DEFAULT (WHICH REMAINS UNCURED) UNDER THE SCHWAB LEASE HAS BEEN GIVEN
OR RECEIVED BY ANY PARTY THERETO PRIOR TO THE DATE HEREOF AND SELLER HAS NOT
RECEIVED WRITTEN NOTICE FROM SCHWAB CLAIMING ANY RIGHTS OF SET-OFF OR
COUNTERCLAIM UNDER THE SCHWAB LEASE.

 

(III)          TO SELLER’S KNOWLEDGE, SCHEDULE 8.3(C)(III) IS A TRUE AND CORRECT
LIST, IN ALL MATERIAL RESPECTS, OF SUBLEASES UNDER THE SCHWAB LEASE AT THE
BUILDING (COLLECTIVELY, THE “SCHWAB SUBLEASES”).  TO SELLER’S KNOWLEDGE, THE
DOCUMENTS MADE AVAILABLE TO PURCHASER PURSUANT TO SECTION 5.2 HEREOF INCLUDE
COPIES OF ALL THE SCHWAB SUBLEASES IN SELLER’S, AFE’S, PXURA’S, PXLA’S AND PXR’S
POSSESSION.

 

(D)           CONTRACTS.  SCHEDULE 8.3(D)(1) IS A TRUE AND CORRECT LIST OF ALL
MATERIAL WRITTEN CONTRACTS AND AGREEMENTS (COLLECTIVELY, “CONTRACTS” ), OTHER
THAN THE GROUND LEASE, SUBLEASE AND THE SCHWAB LEASE, WHICH WILL BE BINDING UPON
PURCHASER (WHETHER DIRECTLY OR INDIRECTLY) AND/OR THE PROPERTY AFTER THE
CLOSING.  THE DOCUMENTS MADE AVAILABLE TO PURCHASER PURSUANT TO SECTION 5.2
HEREOF INCLUDE COPIES OF ALL OF THE CONTRACTS.  EXCEPT AS SET FORTH ON SCHEDULE
8.3(D)(2), NO WRITTEN CLAIM OF A MATERIAL DEFAULT (WHICH REMAINS UNCURED) OR
RIGHTS OF SET-OFF OR COUNTERCLAIM UNDER THE CONTRACTS HAS BEEN GIVEN OR RECEIVED
BY ANY PARTY PRIOR TO THE DATE HEREOF. SCHEDULE 8.3(D)(3) SETS FORTH THE AMOUNT,
IF ANY, REMAINING TO BE PAID UNDER THE JMB CONTRACT AND THE JMB COOLING TOWER
CONTRACT. SCHEDULE 8.3(D)(4) IS A  TRUE AND CORRECT LIST OF ALL WARRANTIES
DELIVERED TO SELLER UNDER THE JMB CONTRACT AND THE JMB COOLING TOWER CONTRACT,
EXCLUDING THE WARRANTIES SET FORTH IN SUCH CONTRACTS. TO SELLER’S KNOWLEDGE,
EACH OF THE WARRANTIES SET FORTH ON SCHEDULE 8.3(D)(4) IS IN FULL FORCE AND
EFFECT AND, EXCEPT AS SET FORTH ON SCHEDULE 8.3(D)(5), THERE ARE NO RIGHTS OF
SET-OFF OR COUNTERCLAIM UNDER ANY OF SUCH WARRANTIES.

 

(E)           LEGAL COMPLIANCE.  NEITHER SELLER NOR PROPERTY OWNER HAS RECEIVED
ANY WRITTEN NOTICES OR CITATIONS OF ANY VIOLATIONS OF ANY APPLICABLE LOCAL,
STATE OR FEDERAL LAW, MUNICIPAL ORDINANCE OR REGULATION, ORDER, RULE OR
REQUIREMENT OF ANY FEDERAL, STATE OR MUNICIPAL DEPARTMENT OR AGENCY HAVING
JURISDICTION OVER OR AFFECTING THE PROPERTY OR THE CONSTRUCTION, MANAGEMENT,
OWNERSHIP, MAINTENANCE, OPERATION, USE, IMPROVEMENT, ACQUISITION OR SALE THEREOF
(INCLUDING, WITHOUT LIMITATION, BUILDING, HEALTH AND ENVIRONMENTAL LAWS,
REGULATIONS AND ORDINANCES) WHICH WOULD HAVE A MATERIAL ADVERSE EFFECT ON A
PROPERTY AS CURRENTLY OWNED, OCCUPIED AND OPERATED.  NEITHER SELLER NOR PROPERTY
OWNER HAS RECEIVED ANY WRITTEN NOTIFICATION FROM ANY GOVERNMENTAL OR PUBLIC
AUTHORITY THAT THE PROPERTY IS IN VIOLATION OF ANY APPLICABLE FIRE, HEALTH,
BUILDING, USE, OCCUPANCY OR ZONING LAWS WHERE SUCH VIOLATION REMAINS OUTSTANDING
AND, IF UNADDRESSED, WOULD HAVE A MATERIAL ADVERSE EFFECT ON THE USE OF THE
PROPERTY AS CURRENTLY OWNED, OCCUPIED AND OPERATED.

 

(F)            ENVIRONMENTAL.  EXCEPT AS MAY BE DISCLOSED IN ANY OF THE
ENVIRONMENTAL REPORTS DESCRIBED ON SCHEDULE 8.3(F) (COLLECTIVELY, THE
“ENVIRONMENTAL REPORTS ), COPIES OF

 

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WHICH HAVE BEEN PROVIDED TO PURCHASER, (I) NEITHER SELLER NOR PROPERTY OWNER HAS
RECEIVED ANY WRITTEN NOTICE OF ANY VIOLATION OF ANY ENVIRONMENTAL LAW WITH
RESPECT TO THE PROPERTY, AND (II) NEITHER SELLER NOR PROPERTY OWNER HAS ASSERTED
IN WRITING THAT SCHWAB HAS CAUSED ANY VIOLATION OF ANY ENVIRONMENTAL LAW WITH
RESPECT TO THE PROPERTY.  SELLER HAS CAUSED THE UPDATED DEED NOTICE AND THE
TERMINATION OF THE EXISTING DEED NOTICE, IN ACCORDANCE WITH N.J.S.A. 58:10B-13,
TO BE SUBMITTED FOR RECORDING IN THE TITLE RECORDS OF THE REAL PROPERTY IN THE
OFFICIAL LAND RECORDS OF THE CITY OR THE COUNTY RECORDER’S OFFICE OF HUDSON
COUNTY, NEW JERSEY.

 

(G)           BANKRUPTCY.  NEITHER SELLER NOR PROPERTY OWNER HAS (A) COMMENCED A
VOLUNTARY CASE, OR HAD ENTERED AGAINST IT A PETITION, FOR RELIEF UNDER ANY
FEDERAL BANKRUPTCY ACT OR ANY SIMILAR PETITION, ORDER OR DECREE UNDER ANY
FEDERAL OR STATE LAW OR STATUTE RELATIVE TO BANKRUPTCY, INSOLVENCY OR OTHER
RELIEF FOR DEBTORS, (B) CAUSED, SUFFERED OR CONSENTED TO THE APPOINTMENT OF A
RECEIVER, TRUSTEE, ADMINISTRATOR, CONSERVATOR, LIQUIDATOR OR SIMILAR OFFICIAL IN
ANY FEDERAL, STATE OR FOREIGN JUDICIAL OR NON-JUDICIAL PROCEEDING, TO HOLD,
ADMINISTER AND/OR LIQUIDATE ALL OR SUBSTANTIALLY ALL OF ITS ASSETS, OR (C) MADE
AN ASSIGNMENT FOR THE BENEFIT OF CREDITORS.

 

(H)           FINANCIAL MATTERS.  ATTACHED HERETO AS EXHIBIT 8.3(H) ARE TRUE,
CORRECT AND COMPLETE COPIES, IN ALL MATERIAL RESPECTS, OF THE FINANCIAL
STATEMENTS.  THE FINANCIAL STATEMENTS PRESENT FAIRLY IN ALL MATERIAL RESPECTS
THE FINANCIAL POSITION OF AFE (TOGETHER WITH ITS CONSOLIDATED SUBSIDIARIES) AS
OF THE DATE THEREOF IN ACCORDANCE WITH GAAP.  AS OF THE DATE OF THE FINANCIAL
STATEMENTS, THERE WERE NO MATERIAL LIABILITIES, WHETHER ACCRUED, CONTINGENT,
ABSOLUTE, DETERMINED, DETERMINABLE OR OTHERWISE, OF AFE (TOGETHER WITH ITS
CONSOLIDATED SUBSIDIARIES, INCLUDING, WITHOUT LIMITATION, PXURA, PXLA AND PXR)
REQUIRED PURSUANT TO GAAP TO BE REFLECTED IN THE FINANCIAL STATEMENTS OR
DISCLOSED IN THE NOTES THERETO WHICH WERE NOT SO REFLECTED OR DISCLOSED.  SINCE
THE DATE OF THE FINANCIAL STATEMENTS, NO MATERIAL LIABILITIES HAVE BEEN INCURRED
BY AFE (TOGETHER WITH ITS CONSOLIDATED SUBSIDIARIES, INCLUDING, WITHOUT
LIMITATION, PXURA, PXLA AND PXR) WHICH WOULD BE REQUIRED TO BE REFLECTED IN A
BALANCE SHEET OF AFE (TOGETHER WITH ITS CONSOLIDATED SUBSIDIARIES, INCLUDING,
WITHOUT LIMITATION, PXURA, PXLA AND PXR) PREPARED IN ACCORDANCE WITH GAAP, OTHER
THAN LIABILITIES INCURRED IN THE ORDINARY COURSE OF AFE’S (TOGETHER WITH ITS
CONSOLIDATED SUBSIDIARIES’, INCLUDING, WITHOUT LIMITATION, PXURA, PXLA AND PXR)
BUSINESS CONSISTENT WITH PAST PRACTICE OR AS DISCLOSED IN THE SCHEDULES AND
LIABILITIES.

 

(I)            LICENSES AND PERMITS.  SCHEDULE 8.3(I) CONTAINS A COMPLETE AND
CORRECT LIST OF ALL MATERIAL LICENSES AND PERMITS ISSUED BY ALL APPLICABLE
GOVERNMENTAL AUTHORITIES TO THE PROPERTY OWNER WITH RESPECT TO THE OWNERSHIP,
MANAGEMENT AND OPERATION OF THE PROPERTY.  THE DOCUMENTS MADE AVAILABLE TO
PURCHASER PURSUANT TO SECTION 5.2 HEREOF INCLUDE COPIES OF EACH LICENSE AND
PERMIT EXISTING ON THE DATE HEREOF.  NEITHER PROPERTY OWNER NOR PXR HAS NOT
RECEIVED WRITTEN NOTICE THAT ANY LICENSE AND PERMIT HAS BEEN OR IS THREATENED TO
BE REVOKED.  THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY SHALL NOT
CAUSE ANY LICENSE AND PERMIT TO BE TERMINATED OR REVOKED.  SELLER HAS NO
KNOWLEDGE OF ANY CONTINUING OBLIGATIONS WHICH WILL BE BINDING UPON THE PROPERTY
OWNER UNDER THE REDEVELOPMENT AGREEMENT OTHER THAN SUCH OBLIGATIONS WHICH ARE
CONTAINED IN THE ORIGINAL REDEVELOPMENT AGREEMENT AND THE AMENDMENTS DATED
JANUARY 7, 1986, APRIL 30, 1991, AUGUST 11, 1993, JANUARY 28, 1997, JUNE 10,
1997 AND DECEMBER 19, 2001.

 

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(J)            TAXES.  NONE OF PXLA, PXR, PXURA OR AFE HAS FILED AN ELECTION
UNDER TREASURY REGULATION SECTION 301.7701-3 TO BE CLASSIFIED OTHER THAN AS
PROVIDED IN TREASURY REGULATION SECTION 301.7701-3(B).

 

(K)           LEASING COMMISSION AGREEMENTS.  THE LEASING COMMISSION AGREEMENTS
CONSTITUTE ALL OF THE LEASING AGREEMENTS TO WHICH PROPERTY OWNER IS A PARTY AND
WHICH AFFECT THE PROPERTY.  THE DOCUMENTS MADE AVAILABLE TO PURCHASER PURSUANT
TO SECTION 5.2 HEREOF INCLUDE COPIES OF ALL LEASING COMMISSION AGREEMENTS LISTED
ON SCHEDULE 8.3(K).

 

(L)            MORTGAGE LIENS.  AS OF THE DATE HEREOF, THERE IS NO OUTSTANDING
MORTGAGE LIEN AFFECTING THE PROPERTY.  PROPERTY OWNER HAS NOT MADE ANY
ASSIGNMENT, PLEDGE OR MORTGAGE OF, OR GRANTED ANY SECURITY INTEREST IN, ANY
PORTION OF THE PROPERTY.

 

(M)          ENCUMBRANCES.  NONE OF AFE, PXR, PXURA AND PXLA HAS ENTERED INTO
ANY WRITTEN CONTRACTS FOR THE SALE OF THE PROPERTY, GROUND LEASE, SUBLEASE,
PXLA’S INTEREST IN THE SCHWAB LEASE OR SELLER’S LLC INTERESTS WHICH REMAIN
BINDING ON ANY OF AFE, PXR, PXURA AND PXLA AND, OTHER THAN PROVIDED IN THE
SCHWAB LEASE, NONE OF COLUMBIA, HARSIMUS, AFE, PXR, PXURA AND PXLA HAS GRANTED,
DIRECTLY OR INDIRECTLY, ANY CURRENTLY EFFECTIVE OPTIONS TO PURCHASE THE
PROPERTY, GROUND LEASE, SUBLEASE OR PXLA’S INTEREST IN THE SCHWAB LEASE.  OTHER
THAN AS SET FORTH IN THE SCHWAB LEASE, NO PERSON, FIRM OR ENTITY HAS ANY RIGHTS
TO ACQUIRE AN OWNERSHIP INTEREST IN THE PROPERTY INCLUDING, WITHOUT LIMITATION,
ANY RIGHTS OF FIRST REFUSAL, RIGHTS OF REVERTER OR RIGHTS OF FIRST OFFER
RELATING TO THE PROPERTY, GROUND LEASE, SUBLEASE OR PXLA’S INTEREST IN THE
SCHWAB LEASE.  OTHER THAN IN FAVOR OF SELLER, THERE ARE NO OPTIONS TO PURCHASE
OR RIGHTS TO ACQUIRE AN OWNERSHIP INTEREST, INCLUDING, WITHOUT LIMITATION,
RIGHTS OF FIRST REFUSAL, RIGHTS OF REVERTER OR RIGHTS OF FIRST OFFER, WITH
RESPECT TO THE SELLER’S LLC INTERESTS.

 

(N)           CONDEMNATION.  IN THE PAST TWO YEARS, NONE OF SELLER, PROPERTY
OWNER OR PXR HAS RECEIVED WRITTEN NOTICE OF ANY PENDING OR CONTEMPLATED
CONDEMNATION OR EMINENT DOMAIN PROCEEDINGS AFFECTING THE PROPERTY, AND TO
SELLER’S KNOWLEDGE, THERE IS NO:  (I) PENDING OR CONTEMPLATED ANNEXATION OR
CONDEMNATION PROCEEDING AFFECTING, OR WHICH MAY AFFECT, ALL OR ANY PORTION OF
THE PROPERTY; OR (II) PROPOSED CHANGE IN ROAD PATTERNS OR GRADES WHICH MAY
ADVERSELY AFFECT ACCESS TO ANY ROADS PROVIDING A MEANS OF INGRESS TO OR EGRESS
FROM THE PROPERTY.

 

(O)           EMPLOYEES.  NONE OF AFE, PXR, PXURA AND PXLA HAS OR HAS EVER HAD
ANY EMPLOYEES.  NONE OF AFE, PXR, PXURA AND PXLA IS A PARTICIPANT IN ANY PENSION
OR EMPLOYEE BENEFIT PLANS SUBJECT TO THE PROVISIONS OF THE EMPLOYEE RETIREMENT
SECURITY ACT OF 1974, AS AMENDED.  NONE OF AFE, PXR, PXURA AND PXLA HAS OFFICERS
OR DIRECTORS.  EACH OF AFE, PXR, PXURA AND PXLA IS MEMBER-MANAGED.

 

(P)           DEVELOPMENT RIGHTS.  NONE OF AFE, PXR, PXURA AND PXLA HAS SOLD,
LEASED, OR OTHERWISE ENCUMBERED ANY DEVELOPMENT RIGHTS AND/OR AIR RIGHTS RELATED
TO THE PROPERTY, IT BEING UNDERSTOOD, HOWEVER, THAT EXCEPT AS SET FORTH IN THE
PLAZA X BIFURCATED DEVELOPMENT PERMIT, AS OF THE CLOSING DATE THERE WILL BE NO
REMAINING DEVELOPMENT ATTRIBUTABLE TO THE PROPERTY AND ALL DEVELOPMENT RIGHTS
UNDER THE DEVELOPMENT PERMIT WILL BE TRANSFERRED ON OR PRIOR TO THE CLOSING DATE
TO THE EXCLUDED REAL PROPERTY IN CONNECTION WITH THE TRANSFER OF THE EXCLUDED
REAL PROPERTY TO 8/9 TRANSFEREE.

 

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(Q)           PILOT MATTERS.  SELLER HAS DELIVERED TO PURCHASER A TRUE, ACCURATE
AND COMPLETE COPY OF THE FINANCIAL AGREEMENT, CONTRIBUTION AGREEMENT AND THE TAX
EXEMPTION APPLICATION.  TO SELLER’S KNOWLEDGE, THE FINANCIAL AGREEMENT IS IN
FULL FORCE AND EFFECT.  PXURA HAS MADE ALL PAYMENTS REQUIRED TO BE PAID TO DATE
UNDER THE FINANCIAL AGREEMENT AND FILED ALL REPORTS IN CONNECTION THEREWITH
REQUIRED TO BE FILED TO DATE.  NEITHER SELLER NOR PROPERTY OWNER HAS RECEIVED
ANY WRITTEN NOTICE THAT IT HAS FAILED TO PAY OR PERFORM ANY OBLIGATION ON ITS
PART TO BE PAID OR PERFORMED UNDER THE FINANCIAL AGREEMENT (WHICH REMAINS
UNCURED) OR THAT IT IS IN DEFAULT (WHICH REMAINS UNCURED) UNDER THE FINANCIAL
AGREEMENT.  TO THE BEST OF SELLER’S KNOWLEDGE, ALL REPRESENTATIONS AND
WARRANTIES OF PXURA IN THE TAX EXEMPTION APPLICATION ARE TRUE, COMPLETE AND
CORRECT IN ALL MATERIAL RESPECTS.  AFE HAS PAID ALL AMOUNTS REQUIRED TO BE PAID
TO DATE UNDER THE CONTRIBUTION AGREEMENT AND THE CITY HAS NOT NOTIFIED AFE IN
WRITING OF ANY DEFAULT WITH REGARD TO THE CONTRIBUTION AGREEMENT OR PREPAYMENT
PROVISION OF THE FINANCIAL AGREEMENT.  AS OF THE DATE HEREOF, THERE IS NO
LITIGATION OR PROCEEDINGS PENDING OR, TO SELLER’S KNOWLEDGE, THREATENED IN
WRITING WITH RESPECT TO THE FINANCIAL AGREEMENT, THE CONTRIBUTION AGREEMENT OR
THE TAX EXEMPTION APPLICATION TO WHICH PROPERTY OWNER OR ANY SELLER ENTITY IS A
PARTY.

 

(R)            PROPERTY OWNER.  THE STATEMENTS CONTAINED IN THE THIRD, FOURTH,
FIFTH AND SIXTH RECITALS TO THIS AGREEMENT ARE INCORPORATED IN THIS
SECTION 8.3(R) AS REPRESENTATIONS AND WARRANTIES OF SELLER.  AFE OWNS ITS
INTERESTS IN PXR FREE AND CLEAR OF ALL LIENS, ENCUMBRANCES, LIABILITIES, CLAIMS,
COVENANTS AND RESTRICTIONS OF ANY  KIND OR CHARACTER, INCLUDING BUT NOT LIMITED
TO, ANY SECURITY INTERESTS OR, ANY RESTRICTION ON SALE OR ASSIGNMENT OR GRANTING
OF ANY OPTION, RIGHT OR AGREEMENT FOR THE PURCHASE OR ACQUISITION OF THE SAME OR
ANY INTEREST IN THE SAME AND AFE HAS NOT TRANSFERRED, ASSIGNED, SOLD, CONVEYED,
PLEDGED, MORTGAGED, GRANTED A SECURITY INTEREST IN, OR OTHERWISE DISPOSED OF ANY
OF SUCH INTERESTS OR ANY PORTION THEREOF OR INTEREST THEREIN OR GRANTED ANY
OPTION TO ANY PERSON OR ENTITY TO ACQUIRE ANY OF SUCH INTERESTS.  PXR OWNS ITS
INTERESTS IN PXURA AND PXLA FREE AND CLEAR OF ALL LIENS, ENCUMBRANCES,
LIABILITIES, CLAIMS, COVENANTS AND RESTRICTIONS OF ANY KIND OR CHARACTER,
INCLUDING BUT NOT LIMITED TO, ANY SECURITY INTERESTS OR, ANY RESTRICTION ON SALE
OR ASSIGNMENT OR GRANTING OF ANY OPTION, RIGHT OR AGREEMENT FOR THE PURCHASE OR
ACQUISITION OF THE SAME OR ANY INTEREST IN THE SAME, AND PXR HAS NOT
TRANSFERRED, ASSIGNED, SOLD, CONVEYED, PLEDGED, MORTGAGED, GRANTED A SECURITY
INTEREST IN, OR OTHERWISE DISPOSED OF ANY OF SUCH INTEREST OR ANY PORTION
THEREOF OR INTEREST THEREIN OR GRANTED ANY OPTION TO ANY PERSON OR ENTITY TO
ACQUIRE ANY OF SUCH INTEREST.  EACH OF AFE, PXR, PXURA AND PXLA IS VALIDLY
EXISTING AND IN GOOD STANDING UNDER THE LAWS OF THE STATE OF NEW JERSEY.

 

The provisions of this Section 8.3 are subject to the limitations on liability
set forth in Section 8.5 of this Agreement.

 

SECTION 8.4             PURCHASER’S REPRESENTATIONS AND WARRANTIES.  PURCHASER
REPRESENTS AND WARRANTS TO SELLER THE FOLLOWING:

 

(A)           STATUS. PURCHASER IS A DULY ORGANIZED AND VALIDLY EXISTING LIMITED
LIABILITY COMPANY UNDER THE LAWS OF THE STATE OF DELAWARE.

 

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(B)           AUTHORITY.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT AND ALL
OTHER DOCUMENTS NOW OR HEREAFTER TO BE EXECUTED AND DELIVERED BY PURCHASER
PURSUANT TO THIS AGREEMENT (COLLECTIVELY, THE “PURCHASER DOCUMENTS” ) AND THE
PERFORMANCE OF PURCHASER’S OBLIGATIONS HEREUNDER AND UNDER THE PURCHASER
DOCUMENTS HAVE BEEN OR WILL BE DULY AUTHORIZED BY ALL NECESSARY ACTION ON THE
PART OF PURCHASER, AND THIS AGREEMENT CONSTITUTES, AND THE PURCHASER DOCUMENTS
WILL CONSTITUTE, THE LEGAL, VALID AND BINDING OBLIGATION OF PURCHASER,
ENFORCEABLE IN ACCORDANCE WITH THEIR TERMS, SUBJECT TO BANKRUPTCY,
REORGANIZATION AND OTHER SIMILAR LAWS AFFECTING THE ENFORCEMENT OF CREDITORS’
RIGHTS GENERALLY AND EXCEPT AS MAY BE LIMITED BY GENERAL EQUITABLE PRINCIPLES. 
THE PERSON SIGNING THIS AGREEMENT ON BEHALF OF PURCHASER HAS BEEN DULY
AUTHORIZED TO SIGN AND DELIVER THIS AGREEMENT ON BEHALF THEREOF.

 

(C)           NON-CONTRAVENTION.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT
AND THE PURCHASER DOCUMENTS BY PURCHASER AND THE CONSUMMATION BY PURCHASER OF
THE TRANSACTIONS CONTEMPLATED HEREBY WILL NOT (I) VIOLATE ANY JUDGMENT, ORDER,
INJUNCTION, DECREE, REGULATION OR RULING OF ANY COURT OR AUTHORITY HAVING
JURISDICTION OVER PURCHASER, (II) CONFLICT WITH, RESULT IN A BREACH OF, OR
CONSTITUTE A DEFAULT UNDER THE ORGANIZATIONAL DOCUMENTS OF PURCHASER, (III)
VIOLATE ANY NOTE OR OTHER EVIDENCE OF INDEBTEDNESS, ANY MORTGAGE, DEED OF TRUST
OR INDENTURE TO WHICH PURCHASER IS A PARTY OR BY WHICH IT IS BOUND, OR (IV)
VIOLATE ANY MATERIAL AGREEMENT OR INSTRUMENT TO WHICH PURCHASER IS A PARTY OR BY
WHICH IT IS BOUND.

 

(D)           CONSENTS.  NO CONSENT, WAIVER, APPROVAL OR AUTHORIZATION IS
REQUIRED FROM ANY PERSON OR ENTITY (THAT HAS NOT ALREADY BEEN OBTAINED) IN
CONNECTION WITH THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY PURCHASER OR THE
PERFORMANCE BY PURCHASER OF THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 8.5             SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  THE
REPRESENTATIONS AND WARRANTIES OF HARSIMUS SET FORTH IN SECTION 8.1, OF COLUMBIA
SET FORTH IN SECTION 8.2, OF SELLER SET FORTH IN SECTION 8.3(A) AND 8.3(R) AND
OF PURCHASER SET FORTH IN SECTION 8.4, SHALL SURVIVE THE CLOSING INDEFINITELY
AND SHALL NOT BE SUBJECT TO THE REPRESENTATION BASKET (AS HEREINAFTER DEFINED)
AND THE REPRESENTATION CAP (AS HEREINAFTER DEFINED) SET FORTH BELOW.  THE
REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH IN SECTIONS 8.3(B) THROUGH
8.3(Q) WILL SURVIVE THE CLOSING FOR A PERIOD OF TWELVE (12) MONTHS, AFTER WHICH
TIME THEY WILL MERGE INTO THE LLC ASSIGNMENT AND ASSUMPTION.  PURCHASER WILL NOT
HAVE ANY RIGHT TO BRING ANY ACTION AGAINST HARSIMUS, COLUMBIA, OR SELLER AS A
RESULT OF ANY UNTRUTH, INACCURACY OR BREACH OF ANY REPRESENTATIONS AND
WARRANTIES OF HARSIMUS, COLUMBIA, OR SELLER, AS THE CASE MAY BE, UNLESS AND
UNTIL THE AGGREGATE AMOUNT OF ALL LIABILITY AND LOSSES ARISING OUT OF ALL SUCH
UNTRUTHS EXCEEDS ONE HUNDRED THOUSAND AND 00/100 DOLLARS ($100,000.00) (THE
“REPRESENTATION BASKET”); AND THEN ONLY TO THE EXTENT OF SUCH EXCESS.  IN
ADDITION, IN NO EVENT WILL SELLER’S LIABILITY FOR ALL SUCH BREACHES EXCEED, IN
THE AGGREGATE, THE SUM OF TEN MILLION 00/100 DOLLARS ($10,000,000.00) (THE
“REPRESENTATION CAP”).  NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE
CONTRARY, HARSIMUS SHALL BE SOLELY LIABLE FOR A BREACH OF THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN SECTION 8.1, COLUMBIA SHALL BE SOLELY LIABLE FOR A
BREACH OF THE REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 8.2, AND
SELLER SHALL BE SOLELY LIABLE FOR A BREACH OF ITS REPRESENTATIONS AND WARRANTIES
SET FORTH IN SECTION 8.3.  NONE OF HARSIMUS, COLUMBIA OR SELLER SHALL HAVE ANY
LIABILITY WITH RESPECT ANY REPRESENTATION, WARRANTY AND COVENANT HEREIN WHICH
MAY HAVE BEEN MADE BY ANY OF THEM,

 

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 RESPECTIVELY, IF, PRIOR TO THE CLOSING, PURCHASER HAS ACTUAL KNOWLEDGE OF A
BREACH OF SUCH REPRESENTATION, WARRANTY OR COVENANT BY SUCH PARTY AND PURCHASER
NEVERTHELESS CONSUMMATES THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT.  THE
CLOSING SURVIVING OBLIGATIONS WILL SURVIVE CLOSING WITHOUT LIMITATION UNLESS A
SPECIFIED PERIOD IS OTHERWISE PROVIDED IN THIS AGREEMENT.  ALL OTHER
REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS MADE OR UNDERTAKEN BY
HARSIMUS, COLUMBIA, OR SELLER UNDER THIS AGREEMENT, UNLESS OTHERWISE
SPECIFICALLY PROVIDED HEREIN, WILL NOT SURVIVE THE CLOSING DATE BUT WILL BE
MERGED INTO THE LLC ASSIGNMENT AND ASSUMPTION AND OTHER CLOSING DOCUMENTS
DELIVERED AT THE CLOSING.

 

SECTION 8.6             UPDATES AND ADDITIONAL REPRESENTATION/WARRANTY MATTERS.

 

(A)           AT THE CLOSING, EACH SELLER ENTITY AND SELLER SHALL DELIVER TO
PURCHASER A CERTIFICATE (EACH, AN “UPDATE CERTIFICATE”) UPDATING ANY OR ALL OF
THE REPRESENTATIONS AND WARRANTIES MADE BY EACH SUCH PARTY IN THIS AGREEMENT. 
THE UPDATES CONTAINED IN THE UPDATE CERTIFICATE SHALL IN NO WAY AFFECT
PURCHASER’S OBLIGATIONS TO CLOSE THIS TRANSACTION UNLESS (X) ANY UPDATE REVEALS
A BREACH ON THE PART OF A SELLER ENTITY OR SELLER UNDER THIS AGREEMENT, IN WHICH
CASE PURCHASER MAY PURSUE ITS REMEDIES SET FORTH IN SECTION 13.1(A) AND (B) OF
THIS AGREEMENT, OR (Y) ANY UPDATE (OR GROUP OF UPDATES, IN THE AGGREGATE) HAS A
MATERIAL ADVERSE EFFECT UPON THE PROPERTY OR SELLER’S LLC INTERESTS AND DOES NOT
REVEAL A BREACH ON THE PART OF ANY OF SELLER OR SELLER ENTITY, IN WHICH CASE
PURCHASER MAY EITHER (I) CLOSE THIS TRANSACTION WITHOUT ANY ADJUSTMENT IN THE
PURCHASE PRICE, OR (II) TERMINATE THIS AGREEMENT UPON WRITTEN NOTICE TO SELLER,
WHEREUPON THE EARNEST MONEY DEPOSIT SHALL BE RETURNED TO PURCHASER AND NEITHER
PARTY HERETO SHALL HAVE ANY FURTHER RIGHTS UNDER THIS AGREEMENT OTHER THAN WITH
RESPECT TO THE TERMINATION SURVIVING OBLIGATIONS.  PURCHASER SHALL HAVE NO
ABILITY TO UPDATE ITS REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 8.4 AT
CLOSING, IT BEING AGREED THAT ANY MODIFICATION TO PURCHASER’S REPRESENTATIONS
AND WARRANTIES SET FORTH IN THIS AGREEMENT SHALL HAVE A MATERIAL ADVERSE EFFECT
UPON PURCHASER’S ABILITY AND/OR AUTHORITY TO CONSUMMATE THIS TRANSACTION.

 

(B)           NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY,
INCLUDING, WITHOUT LIMITATION, THE PROVISIONS OF SECTIONS 8.1(C) AND (D),
SECTIONS 8.2(C) AND (D), SECTION 8.3(A), SECTION 9.1(J) AND SECTION 9.2(G),
PURCHASER HEREBY ACKNOWLEDGES THAT HARSIMUS, COLUMBIA AND SELLER HAVE NOT MADE,
AND ARE NOT MAKING, EITHER INDIVIDUALLY OR COLLECTIVELY, ANY REPRESENTATIONS OR
WARRANTIES WHATSOEVER IN THIS AGREEMENT AS TO WHETHER OR NOT THE APPROVAL AND
CONSENT OF THE MUNICIPAL COUNCIL OF THE CITY IS REQUIRED IN CONNECTION WITH THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

 

ARTICLE IX

 

CONDITIONS PRECEDENT TO CLOSING

 

SECTION 9.1             CONDITIONS PRECEDENT TO OBLIGATION OF PURCHASER.  THE
OBLIGATION OF PURCHASER TO CONSUMMATE THE TRANSACTION HEREUNDER SHALL BE SUBJECT
TO THE FULFILLMENT ON OR BEFORE THE SCHEDULED CLOSING DATE OF ALL OF THE
FOLLOWING CONDITIONS, ANY OR ALL OF WHICH MAY BE WAIVED BY PURCHASER IN ITS SOLE
DISCRETION:

 

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(A)           SELLER SHALL HAVE DELIVERED TO ESCROW AGENT ALL OF THE ITEMS
REQUIRED TO BE DELIVERED TO PURCHASER PURSUANT TO THE TERMS OF THIS AGREEMENT,
INCLUDING BUT NOT LIMITED TO, THOSE PROVIDED FOR IN SECTION 10.3.

 

(B)           SUBJECT TO THE PROVISIONS OF SECTION 8.6(A), ALL OF THE
REPRESENTATIONS AND WARRANTIES OF EACH SELLER ENTITY AND SELLER CONTAINED IN
THIS AGREEMENT SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS AS OF THE
CLOSING DATE.

 

(C)           SELLER SHALL HAVE PERFORMED AND OBSERVED, IN ALL MATERIAL
RESPECTS, ALL COVENANTS AND AGREEMENTS OF THIS AGREEMENT TO BE PERFORMED AND
OBSERVED BY SELLER AS OF THE CLOSING DATE.

 

(D)           SCHWAB SHALL NOT HAVE COMMENCED A VOLUNTARY CASE, OR HAD ENTERED
AGAINST IT A PETITION, FOR RELIEF UNDER ANY FEDERAL BANKRUPTCY ACT OR ANY
SIMILAR PETITION, ORDER OR DECREE UNDER ANY FEDERAL OR STATE LAW OR STATUTE
RELATIVE TO BANKRUPTCY, INSOLVENCY OR OTHER RELIEF FOR DEBTORS, DURING THE
PERIOD FROM THE EFFECTIVE DATE TO, AND INCLUDING, THE CLOSING DATE.

 

(E)           THE AMENDED FINANCIAL AGREEMENT SHALL BE IN FULL FORCE AND EFFECT.

 

(F)            NO TEMPORARY RESTRAINING ORDER, PRELIMINARY OR PERMANENT
INJUNCTION OR OTHER ORDER OR DECREE ISSUED BY ANY COURT OF COMPETENT
JURISDICTION OR OTHER LEGAL RESTRAINT OR PROHIBITION (COLLECTIVELY, “LEGAL
RESTRAINTS) THAT HAS THE EFFECT OF PREVENTING THE CONSUMMATION OF THE
TRANSACTION CONTEMPLATED HEREBY SHALL BE IN EFFECT.

 

(G)           THE CREA AND THE CRA SHALL HAVE BEEN RECORDED AGAINST THE REAL
PROPERTY.

 

(H)           TITLE TO THE REAL PROPERTY AND IMPROVEMENTS SHALL BE IN THE
CONDITION REQUIRED PURSUANT TO ARTICLE VI OF THIS AGREEMENT.

 

(I)            THE EXCLUDED REAL PROPERTY SHALL HAVE BEEN, OR SIMULTANEOUSLY
WITH THE CLOSING SHALL BE, CONVEYED TO 8/9 TRANSFEREE.

 

(J)            THE APPROVALS SHALL HAVE BEEN OBTAINED.

 

(K)           THE PERMIT CONDITION SHALL HAVE BEEN SATISFIED.

 

(L)            THE RETAINED ENTITY SHALL HAVE CONTRIBUTED THE RETAINED INTEREST
TO PURCHASER PURSUANT TO THE RETAINED INTEREST ASSIGNMENTS, AND IF REQUIRED,
HARSIMUS SHALL HAVE CONSENTED THERETO.

 

(M)          PURCHASER SHALL HAVE RECEIVED AN ESTOPPEL CERTIFICATE EXECUTED BY
SCHWAB CERTIFYING AS TO THE ITEMS SPECIFIED IN THE FIRST SENTENCE OF SECTION
9.02 OF THE SCHWAB LEASE (THE “THRESHOLD ESTOPPEL CERTIFICATE”). 
NOTWITHSTANDING THE FOREGOING, SELLER AGREES TO REQUEST AN ESTOPPEL CERTIFICATE
FROM SCHWAB CERTIFYING AS TO THE ITEMS SPECIFIED IN THE FIRST SENTENCE OF
SECTION 9.02 OF THE SCHWAB LEASE AND SUCH OTHER ITEMS CONCERNING THE SCHWAB
LEASE AS

 

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PURCHASER MAY REASONABLY REQUEST (“PURCHASER’S PROPOSED ESTOPPEL CERTIFICATE”),
BUT IT SHALL ONLY BE A CONDITION TO CLOSING THAT THE THRESHOLD ESTOPPEL
CERTIFICATE BE DELIVERED ON THE CLOSING DATE.  PROMPTLY FOLLOWING THE PARTIES’
AGREEMENT AS TO THE FORM OF THE PURCHASER’S PROPOSED ESTOPPEL CERTIFICATE,
SELLER WILL REQUEST THAT SCHWAB EXECUTE PURCHASER’S PROPOSED ESTOPPEL
CERTIFICATE AND WILL OTHERWISE REASONABLY COOPERATE WITH PURCHASER TO FACILITATE
SCHWAB’S EXECUTION OF PURCHASER’S PROPOSED ESTOPPEL CERTIFICATE INCLUDING,
WITHOUT LIMITATION, MAKING INTRODUCTIONS AND ARRANGING MEETINGS BETWEEN
PURCHASER AND SCHWAB, TO THE EXTENT REASONABLY REQUESTED BY PURCHASER (IT BEING
UNDERSTOOD HOWEVER, THAT IN CONNECTION WITH SUCH COOPERATION SELLER SHALL NOT BE
OBLIGATED TO EXPEND MORE THAN A DE MINIMIS AMOUNT, NOR SHALL SELLER BE OBLIGATED
TO COMMENCE ANY LITIGATION, ARBITRATION OR OTHER PROCEEDING).  SELLER SHALL NOT
BE IN DEFAULT OF ITS OBLIGATIONS HEREUNDER IF TENANT FAILS TO DELIVER THE
THRESHOLD ESTOPPEL CERTIFICATE, IT BEING AGREED THAT SUCH FAILURE SHALL MERELY
CONSTITUTE THE FAILURE OF A CONDITION PRECEDENT TO PURCHASER’S OBLIGATION TO
CLOSE THIS TRANSACTION.  ANYTHING TO THE CONTRARY CONTAINED HEREIN
NOTWITHSTANDING, PURCHASER OBTAINING THE THRESHOLD ESTOPPEL CERTIFICATE SHALL
ONLY BE A CONDITION PRECEDENT TO PURCHASER’S OBLIGATIONS HEREUNDER IF THE
EXISTING ESCROW SCHWAB AMENDMENT DOES NOT BECOME EFFECTIVE ON THE CLOSING DATE
PURSUANT TO THE TERMS OF THE ESCROW AGREEMENT BETWEEN SCHWAB AND PURCHASER.

 

(N)           THE AMENDED LEASES SHALL HAVE BEEN, OR SIMULTANEOUSLY WITH THE
CLOSING SHALL BE, RECORDED AGAINST THE REAL PROPERTY.

 

(O)           THE RECEIPT FROM THE PLANNING BOARD OF THE CITY (THE “PLANNING
BOARD”) OF A MODIFICATION OF THE RESOLUTION PREVIOUSLY PASSED BY THE PLANNING
BOARD WHICH AUTHORIZED THE SUBDIVISION OF PLAZAS, 8, 9 AND 10, WHICH
MODIFICATION EXPRESSLY APPROVES THE DEVIATIONS OR GRANTS A VARIANCE FROM THE
YARD SET-BACK REQUIREMENTS FOR THE WEST AND SOUTH SIDES OF THE BUILDING.

 

SECTION 9.2             CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER.  THE
OBLIGATION OF SELLER TO CONSUMMATE THE TRANSACTION HEREUNDER SHALL BE SUBJECT TO
THE FULFILLMENT ON OR BEFORE THE SCHEDULED CLOSING DATE OF ALL OF THE FOLLOWING
CONDITIONS, ANY OR ALL OF WHICH MAY BE WAIVED BY SELLER IN IT SOLE DISCRETION:

 

(A)           SELLER SHALL HAVE RECEIVED THE PURCHASE PRICE AS ADJUSTED PURSUANT
TO, AND PAYABLE IN THE MANNER PROVIDED IN, THIS AGREEMENT (INCLUDING, WITHOUT
LIMITATION, A CREDIT AGAINST THE PURCHASE PRICE IN THE AMOUNT OF THE EARNEST
MONEY DEPOSIT).

 

(B)           PURCHASER SHALL HAVE DELIVERED TO ESCROW AGENT (TO THE EXTENT
DIRECTED BY SELLER TO DO SO) AND/OR SELLER, AS THE CASE MAY BE, ALL OF THE ITEMS
REQUIRED TO BE DELIVERED TO SELLER PURSUANT TO THE TERMS OF THIS AGREEMENT,
INCLUDING BUT NOT LIMITED TO, THOSE PROVIDED FOR IN SECTION 10.2.

 

(C)           ALL OF THE REPRESENTATIONS AND WARRANTIES OF PURCHASER CONTAINED
IN THIS AGREEMENT SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS AS OF THE
DATE OF CLOSING.

 

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(D)           PURCHASER SHALL HAVE PERFORMED AND OBSERVED, IN ALL MATERIAL
RESPECTS, ALL COVENANTS AND AGREEMENTS OF THIS AGREEMENT TO BE PERFORMED AND
OBSERVED BY PURCHASER AS OF THE CLOSING DATE.

 

(E)           ON THE CLOSING DATE, PURCHASER SHALL CAUSE PXLA (AS RECONSTITUTED
ON THE CLOSING DATE WITH PURCHASER AS THE INDIRECT OWNER THEREOF) TO EXECUTE AND
DELIVER THE PROPERTY MANAGEMENT AGREEMENT (AS HEREINAFTER DEFINED).

 

(F)            THE CREA AND THE CRA SHALL HAVE BEEN RECORDED AGAINST THE REAL
PROPERTY.

 

(G)           THE APPROVALS SHALL HAVE BEEN OBTAINED.

 

(H)           NO LEGAL RESTRAINT THAT HAS THE EFFECT OF PREVENTING THE
CONSUMMATION OF THE TRANSACTION CONTEMPLATED HEREBY SHALL BE IN EFFECT.

 

(I)            INTENTIONALLY OMITTED.

 

(J)            THE RETAINED ENTITY SHALL HAVE CONTRIBUTED THE RETAINED INTEREST
TO PURCHASER PURSUANT TO THE RETAINED INTEREST ASSIGNMENTS, AND IF REQUIRED,
HARSIMUS SHALL HAVE CONSENTED THERETO.

 

(K)           MCRLP AND COLUMBIA SHALL HAVE BEEN RELEASED BY SCHWAB FROM ALL
LIABILITY UNDER ALL GUARANTEES RELATED TO THE SCHWAB LEASE AND THE RIGHT OF
FIRST OFFER AND EXPANSION AGREEMENTS SHALL HAVE BEEN RELEASED BY SCHWAB, ALL
SUCH RELEASES OF GUARANTEES AND AGREEMENTS BEING ATTACHED HERETO AS
EXHIBIT 9.2(K) (COLLECTIVELY, THE “SCHWAB RELEASE DOCUMENTS”).

 

(L)            THE PAYMENT TO HARSIMUS OF A TERMINATION PAYMENT OF ONE MILLION
SIX HUNDRED THOUSAND AND 00/100 DOLLARS ($1,600,000) (THE “OPTION TERMINATION
PAYMENT”) IN CONSIDERATION FOR THE TERMINATION OF HARSIMUS’ RIGHT TO PARTICIPATE
IN THE OPTION GRANTED UNDER THE OPTION AGREEMENT.

 

SECTION 9.3             FAILURE OF CONDITION.  IF, BY THE SCHEDULED CLOSING
DATE, ANY OF THE CONDITIONS SET FORTH IN (I) SECTION 9.1 ABOVE ARE NOT PERFORMED
OR SATISFIED FOR ANY REASON WHATSOEVER OR, ALTERNATIVELY, ARE NOT EXPRESSLY
WAIVED BY PURCHASER IN WRITING, THEN, EXCEPT AS  EXPRESSLY PROVIDED BELOW,
PURCHASER’S SOLE REMEDY SHALL BE TO TERMINATE THIS AGREEMENT, WHEREUPON THE
EARNEST MONEY DEPOSIT SHALL BE RETURNED TO PURCHASER AND NEITHER PARTY HERETO
SHALL HAVE ANY FURTHER RIGHTS UNDER THIS AGREEMENT OTHER THAN WITH RESPECT TO
THE TERMINATION SURVIVING OBLIGATIONS, AND (II) SECTION 9.2 ABOVE ARE NOT
PERFORMED OR SATISFIED FOR ANY REASON WHATSOEVER OR, ALTERNATIVELY, ARE NOT
EXPRESSLY WAIVED BY SELLER IN WRITING, THEN, EXCEPT AS EXPRESSLY PROVIDED BELOW,
SELLER’S SOLE REMEDY SHALL BE TO TERMINATE THIS AGREEMENT, WHEREUPON THE EARNEST
MONEY DEPOSIT SHALL BE RETURNED TO PURCHASER AND NEITHER PARTY HERETO SHALL HAVE
ANY FURTHER RIGHTS UNDER THIS AGREEMENT OTHER THAN WITH RESPECT TO THE
TERMINATION SURVIVING OBLIGATIONS.  NOTWITHSTANDING THE FOREGOING, (X) IF ANY OF
THE CONDITIONS SET FORTH IN SECTION 9.1

 

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ARE NOT PERFORMED OR SATISFIED BY THE SCHEDULED CLOSING DATE BY REASON OF A
DEFAULT BY SELLER UNDER THE OTHER PROVISIONS OF THIS AGREEMENT, THEN PURCHASER
SHALL BE ENTITLED TO THE REMEDIES SET FORTH IN SECTION 13.1(A) BELOW, AND (Y) IF
ANY OF THE CONDITIONS SET FORTH IN SECTION 9.2 ARE NOT PERFORMED OR SATISFIED BY
THE SCHEDULED CLOSING DATE BY REASON OF A DEFAULT BY PURCHASER UNDER THE OTHER
PROVISIONS OF THIS AGREEMENT, THEN SELLER SHALL BE ENTITLED TO THE REMEDIES SET
FORTH IN SECTION 13.2 BELOW.

 

ARTICLE X

CLOSING

 

SECTION 10.1           CLOSING.  THE CONSUMMATION OF THE TRANSACTION
CONTEMPLATED BY THIS AGREEMENT BY DELIVERY OF DOCUMENTS AND PAYMENTS OF MONEY
SHALL TAKE PLACE AT 1:00 P.M. EASTERN TIME ON THE SCHEDULED CLOSING DATE AT THE
OFFICES OF FRIED, FRANK, HARRIS, SHRIVER & JACOBSON, LOCATED AT ONE NEW YORK
PLAZA, NEW YORK, NEW YORK.  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
CONTRARY, INCLUDING, WITHOUT LIMITATION, SELLER’S RIGHT TO ADJOURN THE SCHEDULED
CLOSING DATE SET FORTH IN SECTION 6.3(A), THE SCHEDULED CLOSING DATE SHALL BE
ADJOURNED TO NO LATER THAN NOVEMBER 15, 2003 (THE “OUTSIDE CLOSING DATE).  IF
THE CLOSING DOES NOT OCCUR BY THE OUTSIDE CLOSING DATE, THIS AGREEMENT SHALL
AUTOMATICALLY TERMINATE AND SHALL BE OF NO FURTHER FORCE AND EFFECT, WHEREUPON
(X) THE EARNEST MONEY DEPOSIT SHALL BE RETURNED TO PURCHASER, UNLESS THE FAILURE
OF THE CLOSING TO OCCUR BY THE OUTSIDE CLOSING DATE IS DUE TO A DEFAULT BY
EITHER PARTY, IN WHICH EVENT THE PROVISIONS OF ARTICLE XIII SHALL APPLY, AND
(Y) NEITHER PARTY HERETO SHALL HAVE ANY FURTHER RIGHTS UNDER THIS AGREEMENT
OTHER THAN WITH RESPECT TO THE TERMINATION SURVIVING OBLIGATIONS.  AT CLOSING,
THE EVENTS SET FORTH IN THIS ARTICLE X WILL OCCUR, IT BEING UNDERSTOOD THAT THE
PERFORMANCE OR TENDER OF PERFORMANCE OF ALL MATTERS SET FORTH IN THIS ARTICLE X
ARE MUTUALLY CONCURRENT CONDITIONS WHICH MAY BE WAIVED BY THE PARTY FOR WHOSE
BENEFIT THEY ARE INTENDED.  THE ACCEPTANCE OF THE LLC ASSIGNMENT AND ASSUMPTION
BY PURCHASER SHALL BE DEEMED TO BE FULL PERFORMANCE AND DISCHARGE OF EACH AND
EVERY AGREEMENT AND OBLIGATION ON THE PART OF SELLER TO BE PERFORMED HEREUNDER,
OTHER THAN THE CLOSING SURVIVING OBLIGATIONS.  THE ACCEPTANCE OF THE PURCHASE
PRICE BY SELLER SHALL BE DEEMED TO BE FULL PERFORMANCE AND DISCHARGE OF EACH AND
EVERY AGREEMENT AND OBLIGATION ON THE PART OF THE PURCHASER TO BE PERFORMED
HEREUNDER, OTHER THAN THE CLOSING SURVIVING OBLIGATIONS.  THE PARTIES AGREE TO
PROVIDE ALL OF THE DOCUMENTS REQUIRED UNDER SECTIONS 10.2 AND 10.3 TO THE ESCROW
AGENT, IN ESCROW, AT LEAST ONE DAY PRIOR TO THE SCHEDULED CLOSING DATE.

 

SECTION 10.2           PURCHASER’S CLOSING OBLIGATIONS.  ON THE SCHEDULED
CLOSING DATE, PURCHASER, AT ITS SOLE COST AND EXPENSE, WILL DELIVER (OR CAUSE TO
BE DELIVERED) THE FOLLOWING ITEMS TO SELLER AT CLOSING AS PROVIDED HEREIN
(UNLESS THE DELIVERY THEREOF SHALL HAVE BEEN WAIVED IN WRITING BY SELLER):

 

(A)           THE PURCHASE PRICE, AFTER ALL ADJUSTMENTS ARE MADE AS HEREIN
PROVIDED (INCLUDING, WITHOUT LIMITATION, A CREDIT AGAINST THE PURCHASE PRICE IN
THE AMOUNT OF THE EARNEST MONEY DEPOSIT), BY FEDERAL RESERVE WIRE TRANSFER OF
IMMEDIATELY AVAILABLE FUNDS, IN ACCORDANCE WITH THE TIMING AND OTHER
REQUIREMENTS OF SECTION 3.2;

 

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(B)           DOCUMENTS EVIDENCING THE AUTHORITY OF PURCHASER TO CONSUMMATE THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION,
EVIDENCE THAT THE PERSON EXECUTING THE LLC ASSIGNMENT AND ASSUMPTION ON BEHALF
OF PURCHASER HAS FULL RIGHT, POWER AND AUTHORITY TO DO SO;

 

(C)           A COUNTERPART ORIGINAL OF THE LLC ASSIGNMENT AND ASSUMPTION, DULY
EXECUTED BY PURCHASER;

 

(D)           WRITTEN NOTICE EXECUTED BY PURCHASER AND ADDRESSED AND DELIVERED
TO SCHWAB BY PURCHASER IN ACCORDANCE WITH SECTION 10.6 HEREIN, (I) ACKNOWLEDGING
THE SALE OF SELLER’S LLC INTEREST TO PURCHASER, (II) INDICATING THAT RENT SHOULD
THEREAFTER BE PAID IN ACCORDANCE WITH THE INSTRUCTIONS SET FORTH THEREIN, AND
(III) PROVIDING A REVISED ADDRESS FOR NOTICE PURPOSES UNDER THE SCHWAB LEASE
(THE “TENANT NOTICE LETTER”), IN THE FORM ANNEXED HERETO AS EXHIBIT 10.2(D);

 

(E)           A COUNTERPART ORIGINAL OF THE CLOSING STATEMENT, DULY EXECUTED BY
PURCHASER;

 

(F)            A PROPERTY MANAGEMENT AGREEMENT IN THE FORM ANNEXED HERETO AS
EXHIBIT 10.2(F) (THE “PROPERTY MANAGEMENT AGREEMENT”), EXECUTED BY PXLA (AS
RECONSTITUTED ON THE CLOSING DATE WITH PURCHASER AS THE INDIRECT OWNER THEREOF),
PURSUANT TO WHICH MACK-CALI REALTY, L.P. (“MCRLP”) OR ITS DESIGNEE WILL BE
RETAINED AS THE MANAGEMENT AGENT FOR THE PROPERTY FROM AND AFTER THE CLOSING;

 

(G)           A CERTIFICATE, DATED AS OF THE DATE OF CLOSING, STATING (I) THAT
THE REPRESENTATIONS AND WARRANTIES OF PURCHASER CONTAINED IN SECTION 8.4 ARE
TRUE AND CORRECT IN ALL MATERIAL RESPECTS AS OF THE CLOSING DATE;

 

(H)           IF APPLICABLE, ALL TRANSFER AND OTHER TAX DECLARATIONS AND RETURNS
AND INFORMATION RETURNS AS MAY BE REQUIRED BY LAW IN CONNECTION WITH THE
CONVEYANCE OF SELLER’S LLC INTEREST TO PURCHASER, INCLUDING, BUT NOT LIMITED TO,
IRS FORMS (COLLECTIVELY, “TRANSFER TAX FORMS”), DULY EXECUTED AND SWORN TO BY
PURCHASER;

 

(I)            EVIDENCE OF THE AUTHORIZATION OF THE TRANSACTIONS CONTEMPLATED
HEREBY, INCLUDING A SECRETARY’S CERTIFICATE CERTIFYING TO THE FORMATION AND GOOD
STANDING (OR EQUIVALENT THEREOF) OF PURCHASER AND PROOF OF ANY REQUIRED PARTNER
OR MEMBER CONSENTS OR APPROVALS, TOGETHER WITH SUCH EVIDENCE AS THE TITLE
COMPANY MAY REASONABLY REQUIRE AS TO THE AUTHORITY OF THE PERSONS EXECUTING
DOCUMENTS ON BEHALF OF PURCHASER;

 

(J)            A COUNTERPART ORIGINAL OF THE RETAINED INTEREST ASSIGNMENT TO
PURCHASER, DULY EXECUTED BY PURCHASER;

 

(K)           FULLY-EXECUTED COUNTERPART ORIGINALS OF THE SCHWAB RELEASE
DOCUMENTS;

 

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(L)            A GUARANTY DULY EXECUTED BY POST-TRANSFER AFE IN THE FORM ANNEXED
HERETO AS EXHIBIT 10.2(L), PURSUANT TO WHICH POST-TRANSFER AFE SHALL GUARANTY
THE CLOSING SURVIVING OBLIGATIONS OF PURCHASER (THE “AFE GUARANTY”);

 

(M)          AN AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF
POST-TRANSFER AFE DATED AS OF THE CLOSING DATE WHICH AGREEMENT HAS BEEN DULY
EXECUTED BY PURCHASER (THE “RECONSTITUTED AFE AGREEMENT”);

 

(N)           AN AGREEMENT, DULY EXECUTED BY PURCHASER (THE “OPTION AGREEMENT”),
PURSUANT TO WHICH THE RETAINED ENTITY SHALL BE GRANTED THE RIGHT TO PURCHASE
PURCHASER’S EQUITY INTERESTS IN POST TRANSFER AFE UPON THE TERMS AND CONDITIONS
MUTUALLY SATISFACTORY TO THE PARTIES THERETO AND MORE PARTICULARLY SET FORTH
THEREIN;

 

(O)           AN AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT FOR
PURCHASER, DULY EXECUTED BY THE ISTAR HARBORSIDE MEMBER LLC OR ITS AFFILIATE,
UPON  TERMS AND CONDITIONS MUTUALLY SATISFACTORY TO THE PARTIES THERETO (THE
“PURCHASER LLC AGREEMENT”);

 

(P)           A GUARANTY DULY EXECUTED BY ISTAR IN THE FORM ANNEXED HERETO AS
EXHIBIT 10.2(P) PURSUANT TO WHICH ISTAR SHALL GUARANTY PURCHASER’S OBLIGATIONS
UNDER ARTICLE XX.

 

(Q)           THE OPTION TERMINATION PAYMENT SHALL BE PAID TO HARSIMUS; AND

 

(R)            SUCH OTHER DOCUMENTS AS MAY BE REASONABLY NECESSARY OR
APPROPRIATE TO EFFECT THE CONSUMMATION OF THE TRANSACTION WHICH IS THE SUBJECT
OF THIS AGREEMENT.

 

SECTION 10.3           SELLER’S CLOSING OBLIGATIONS.  ON THE SCHEDULED CLOSING
DATE, SELLER (AND/OR EACH OF THE SELLER ENTITIES, AS THE CASE MAY BE) WILL
DELIVER (OR CAUSE PROPERTY OWNER TO DELIVER) TO PURCHASER THE FOLLOWING
DOCUMENTS (UNLESS THE DELIVERY THEREOF SHALL HAVE BEEN WAIVED IN WRITING BY
PURCHASER):

 

(A)           AN ASSIGNMENT AND ASSUMPTION OF SELLER’S LLC INTEREST IN THE FORM
ANNEXED HERETO AS EXHIBIT 10.3(A) (THE “LLC ASSIGNMENT AND ASSUMPTION”), FREE
AND CLEAR OF LIENS AND ENCUMBRANCES, DULY EXECUTED BY EACH OF THE SELLER
ENTITIES, CONVEYING TO PURCHASER ALL OF SELLER’S LLC INTEREST;

 

(B)           THE TENANT NOTICE LETTER, DULY EXECUTED BY PXLA;

 

(C)           (I) EVIDENCE OF THE AUTHORIZATION OF THE TRANSACTIONS CONTEMPLATED
HEREBY (INCLUDING WITHOUT LIMITATION, THE TRANSFER OF THE SELLER’S LLC
INTERESTS, TRANSFER OF THE EXCLUDED REAL PROPERTY TO 8/9 TRANSFEREE, THE OPTION
AGREEMENT AND PURCHASER LLC AGREEMENT), INCLUDING WITHOUT
LIMITATION, SECRETARY’S OR MEMBER’S CERTIFICATES CERTIFYING TO THE FORMATION AND
GOOD STANDING (OR EQUIVALENT THEREOF) OF EACH OF THE SELLER ENTITIES, AFE, PXR,
PXURA AND PXLA (AND COLUMBIA’S AFFILIATES WITH RESPECT TO THE RETAINED INTEREST
ASSIGNMENTS, THE OPTION AGREEMENT AND PURCHASER LLC AGREEMENT), CERTIFYING AND
ANNEXING ALL CHARTER DOCUMENTS OF ALL PARTIES CONTROLLING SUCH ENTITIES AND ANY
AND ALL PARTNER, MEMBER OR BOARD CONSENTS OR APPROVALS REQUIRED BY SUCH CHARTER
DOCUMENTS, TOGETHER WITH SUCH OTHER EVIDENCE AS THE TITLE COMPANY OR PURCHASER
MAY REASONABLY REQUIRE AS TO THE DUE AUTHORITY OF THE PERSONS EXECUTING
DOCUMENTS ON

 

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(D)           BEHALF OF THE APPLICABLE ENTITIES TO EXECUTE SUCH DOCUMENTS; AND
(II) EVIDENCE OF THE AUTHORIZATION OF THE TRANSACTIONS CONTEMPLATED HEREBY
(INCLUDING WITHOUT LIMITATION, THE TRANSFER OF THE SELLER’S LLC INTERESTS,
TRANSFER OF THE EXCLUDED REAL PROPERTY TO 8/9 TRANSFEREE AND THE OPTION
AGREEMENT), INCLUDING, WITHOUT LIMITATION, SECRETARY’S OR MEMBER’S CERTIFICATES
CERTIFYING TO THE FORMATION AND GOOD STANDING (OR EQUIVALENT THEREOF) OF MCRLP
AND 8/9 TRANSFEREE, CERTIFYING AND ANNEXING ALL CHARTER DOCUMENTS OF ALL PARTIES
CONTROLLING SUCH ENTITIES AND ANY AND ALL PARTNER, MEMBER OR BOARD CONSENTS OR
APPROVALS REQUIRED BY SUCH CHARTER DOCUMENTS, TOGETHER WITH SUCH OTHER EVIDENCE
AS THE PURCHASER MAY REASONABLY REQUIRE AS TO THE DUE AUTHORITY OF THE PERSONS
EXECUTING DOCUMENTS ON BEHALF OF THE APPLICABLE ENTITIES TO EXECUTE SUCH
DOCUMENTS;

 

(E)           A CERTIFICATE IN THE FORM ANNEXED HERETO AS EXHIBIT 10.3(D)
(“CERTIFICATE AS TO FOREIGN STATUS”) CERTIFYING THAT EACH OF SELLER AND RETAINED
ENTITY IS NOT A “FOREIGN PERSON” AS DEFINED IN SECTION 1445 OF THE CODE;

 

(F)            THE PERSONAL PROPERTY AND ORIGINALS (OR IF NOT IN SELLER’S
POSSESSION, COPIES) OF THE: (V) CONSTRUCTION AGREEMENTS, (W) FINANCIAL AGREEMENT
AND THE AMENDED FINANCIAL AGREEMENT (TOGETHER WITH ALL EXHIBITS THERETO), (X)
SCHWAB LEASE, (Y) LICENSES AND PERMITS, AND (Z) LEASING COMMISSION AGREEMENTS,
ALL OF WHICH LICENSES AND PERMITS, LEASING COMMISSION AGREEMENTS AND PERSONAL
PROPERTY MAY REMAIN ON SITE AT THE PROPERTY AND NEED NOT BE DELIVERED TO THE
LOCATION OF THE CLOSING;

 

(G)           IF APPLICABLE, A COUNTERPART ORIGINAL OF THE TRANSFER TAX FORMS,
DULY EXECUTED AND SWORN TO BY SELLER;

 

(H)           A COUNTERPART ORIGINAL OF THE CLOSING STATEMENT, DULY EXECUTED BY
SELLER;

 

(I)            COPIES OF ANY OPERATING FILES MAINTAINED BY PROPERTY OWNER OR ITS
PROPERTY MANAGER IN CONNECTION WITH THE DEVELOPMENT, LEASING, MAINTENANCE,
AND/OR MANAGEMENT OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION, PLANS,
SPECIFICATIONS, OPERATING AGREEMENTS, BILLS, INVOICES, RECEIPTS, REAL ESTATE TAX
RECORDS AND INFORMATION AND OTHER GENERAL RECORDS RELATING TO THE INCOME AND
EXPENSES OF THE PROPERTY;

 

(J)            A GUARANTY DULY EXECUTED BY 8/9 TRANSFEREE (THE “8/9 TRANSFEREE
GUARANTY), IN THE FORM ANNEXED HERETO AS EXHIBIT 10.3(I), PURSUANT TO WHICH 8/9
TRANSFEREE SHALL (IN ADDITION TO OTHER MATTERS PROVIDED IN SECTION 7.1(B)(II)
HEREOF) GUARANTY THE OBLIGATIONS AND LIABILITIES OF SELLER WHICH ARE EXPRESSLY
SET FORTH IN (A) SECTION 8.5 OF THIS AGREEMENT, SUBJECT, HOWEVER, IN ALL
RESPECTS, TO THE PROVISIONS OF SAID SECTION 8.5 OF THIS AGREEMENT, (B) ARTICLE
XV OF THIS AGREEMENT, SUBJECT, HOWEVER, IN ALL RESPECTS, TO THE PROVISIONS OF
SAID ARTICLE XV, (C) ARTICLE XIX OF THIS AGREEMENT, SUBJECT, HOWEVER, IN ALL
RESPECTS, TO THE PROVISIONS OF SAID ARTICLE XIX, AND (D) THE CLOSING SURVIVING
OBLIGATIONS (COLLECTIVELY, THE “8/9 GUARANTY PROVISIONS”);

 

(K)           A GUARANTY DULY EXECUTED BY MCRLP IN THE FORM ANNEXED HERETO AS
EXHIBIT 10.3 (J), PURSUANT TO WHICH MCRLP SHALL GUARANTY SELLER’S OBLIGATIONS
UNDER SECTION 7.2 AND ARTICLE XX;

 

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(L)            SUBJECT TO THE PROVISIONS OF SECTION 8.6(A), A CERTIFICATE, DATED
AS OF THE DATE OF CLOSING, STATING THAT ALL OF THE REPRESENTATIONS AND
WARRANTIES OF SELLER CONTAINED IN THIS AGREEMENT ARE TRUE AND CORRECT IN ALL
MATERIAL RESPECTS AS OF THE CLOSING DATE;

 

(M)          EVIDENCE REASONABLY SATISFACTORY TO PURCHASER THAT 8/9 TRANSFEREE
IS THE OWNER OF THE EXCLUDED REAL PROPERTY ON AND AS OF THE CLOSING;

 

(N)           SELLER’S, PROPERTY OWNER’S OR RETAINED ENTITY’S TITLE AFFIDAVIT
AND IF NOT IN THE TITLE AFFIDAVIT, SELLER’S, PROPERTY OWNER’S OR RETAINED
ENTITY’S AFFIDAVIT REQUIRED IN CONNECTION WITH THE NON-IMPUTATION ENDORSEMENT,
ALL AS REASONABLY REQUIRED BY THE TITLE COMPANY AND REASONABLY ACCEPTABLE TO
EACH SELLER ENTITY, PROPERTY OWNER AND RETAINED ENTITY, AS THE CASE MAY BE;

 

(O)           INTENTIONALLY OMITTED.

 

(P)           THE KEYS TO THE BUILDING;

 

(Q)           A COUNTERPART ORIGINAL OF THE PROPERTY MANAGEMENT AGREEMENT, DULY
EXECUTED BY MCRLP OR ITS DESIGNEE;

 

(R)            A COUNTERPART ORIGINAL OF THE OPTION AGREEMENT, DULY EXECUTED BY
THE RETAINED ENTITY;

 

(S)           A COUNTERPART ORIGINAL OF THE RETAINED INTEREST ASSIGNMENTS DULY
EXECUTED BY COLUMBIA AND THE RETAINED ENTITY, AS APPLICABLE, TOGETHER WITH
HARSIMUS’ CONSENT THERETO IF REQUIRED;

 

(T)            A COUNTERPART ORIGINAL OF THE PURCHASER LLC AGREEMENT DULY
EXECUTED BY THE RETAINED ENTITY;

 

(U)           COUNTERPART ORIGINALS OF THE SCHWAB RELEASE DOCUMENTS EXECUTED BY
SELLER OR ITS AFFILIATES TO THE EXTENT REQUIRED;

 

(V)           THE AMENDED LEASES SHALL HAVE BEEN, OR SIMULTANEOUSLY WITH THE
CLOSING SHALL BE, RECORDED AGAINST THE REAL PROPERTY; AND

 

(W)          SUCH OTHER DOCUMENTS AS MAY BE REASONABLY NECESSARY OR APPROPRIATE
TO EFFECT THE CONSUMMATION OF THE TRANSACTION WHICH IS THE SUBJECT OF THIS
AGREEMENT.

 

(X)            AT THE CLOSING, SELLER SHALL DELIVER TO, AND CERTIFY TO,
PURCHASER A LIST OF ADDITIONAL CHARGES (AS SUCH TERM IS DEFINED IN THE SCHWAB
LEASE), UNDER ARTICLE 4 OF THE SCHWAB LEASE (COLLECTIVELY, “OPERATING EXPENSES”)
BILLED TO SCHWAB FOR THE CALENDAR YEAR IN WHICH THE CLOSING OCCURS (BOTH ON A
MONTHLY BASIS AND IN THE AGGREGATE THROUGH THE MONTH PRIOR TO THE MONTH IN WHICH
THE CLOSING OCCURS IF THE CLOSING OCCURS ON OR AFTER THE FIFTEENTH (15TH) DAY OF
THE MONTH, AND IF THE CLOSING OCCURS PRIOR TO THE FIFTEENTH (15TH) DAY OF THE
MONTH, THROUGH THE MONTH THAT IS TWO (2) MONTHS PRIOR TO THE MONTH IN WHICH THE
CLOSING OCCURS (I.E., IF THE CLOSING OCCURS

 

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ON NOVEMBER 10, 2003, THROUGH SEPTEMBER 2003), THE MONTHLY AMOUNTS BEING BILLED
FOR OPERATING EXPENSES AND THE AMOUNTS INCURRED BY SELLER ON ACCOUNT OF THE
COMPONENTS OF OPERATING EXPENSES FOR SUCH PORTION OF SUCH CALENDAR YEAR.

 

SECTION 10.4           PRORATIONS.

 

(A)           SELLER AND PURCHASER AGREE TO ADJUST, AS OF 11:59 P.M. ON THE DAY
PRECEDING THE CLOSING DATE (THE “PRORATION TIME”), THE FOLLOWING (COLLECTIVELY,
THE “PRORATION ITEMS”):

 

(I)            RENTALS, IN ACCORDANCE WITH SECTION 10.4(B) BELOW;

 

(II)           UTILITY CHARGES PAYABLE BY SELLER, AFE, PXURA, PXR, PXLA IF ANY,
INCLUDING, WITHOUT LIMITATION, ELECTRICITY, WATER CHARGES AND SEWER CHARGES.  IF
THERE ARE METERS ON THE REAL PROPERTY, SELLER WILL CAUSE READINGS OF ALL SAID
METERS TO BE PERFORMED NOT MORE THAN FIVE (5) DAYS PRIOR TO THE CLOSING DATE,
AND A PER DIEM ADJUSTMENT SHALL BE MADE FOR THE DAYS BETWEEN THE METER READING
DATE AND THE CLOSING DATE BASED ON THE MOST RECENT METER READING;

 

(III)          ALL REAL ESTATE AD VALOREM AND PERSONAL PROPERTY TAXES,
INCLUDING, WITHOUT LIMITATION, ALL PILOT PAYMENTS (AS SUCH TERM IS DEFINED IN
THE SCHWAB LEASE) SEWER RENTS AND CHARGES AND OTHER STATE, COUNTRY, SCHOOL
DISTRICT, MUNICIPAL AND OTHER GOVERNMENTAL AND QUASI-GOVERNMENTAL TAXES AND
CHARGES, DUE AND PAYABLE BY SELLER, AFE, PXURA, PXR, PXLA FOR THE CALENDAR YEAR
IN WHICH THE CLOSING OCCURS;

 

(IV)          PURCHASER’S SHARE OF THE CONTRIBUTION AMOUNT (AS HEREINAFTER
DEFINED) AND THE PILOT SERVICE CHARGE (AS HEREINAFTER DEFINED), IN ACCORDANCE
WITH SECTION 10.4(E) BELOW;

 

(V)           CHARGES AND PAYMENTS UNDER SERVICE CONTRACTS OWED BY SELLER, AFE,
PXURA, PXR, PXLA TO THE EXTENT THAT THE CHARGES AND PAYMENT REFER TO PERIODS
INCLUDING THE CLOSING DATE; AND

 

(VI)          SUCH OTHER ITEMS OF INCOME AND EXPENSE AS ARE TYPICALLY PRORATED
AT CLOSING SIMILAR TO THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT.

 

Seller will be charged and credited for the amounts of all of the Proration
Items relating to the period up to and including the Proration Time, and
Purchaser will be charged and credited for the amounts of all of the Proration
Items relating to the period after the Proration Time.  The estimated Closing
prorations being adjusted pursuant to this Agreement shall be set forth on a
preliminary closing statement to be prepared by Seller and submitted to
Purchaser two (2) days prior to the Closing Date (the “Closing Statement” ). 
The Closing Statement, once agreed upon, shall be signed by Purchaser and
Seller.  The prorations being adjusted pursuant to this Agreement shall be paid
at Closing by Purchaser to Seller (if the prorations result in a net credit to
Seller) or by Seller to Purchaser (if the prorations result in a net credit to
Purchaser) by increasing or reducing the cash to be delivered by Purchaser in
payment of the Purchase Price at the Closing.  If the actual amounts of the
Proration Items are not known as of the Closing Date,

 

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the prorations will be made at Closing on the basis of the best evidence then
available; thereafter, when actual figures are received, re-prorations will be
made on the basis of the actual figures, and a final cash settlement will be
made between Seller and Purchaser.  No prorations will be made in relation to
insurance premiums, and Seller’s insurance policies will not be assigned to
Purchaser.  Final readings and final billings for utilities will be made if
possible as of the Closing Date, in which event no proration will be made at the
Closing with respect to utility bills.  Seller will be entitled to all deposits
presently in effect with the utility providers, and Purchaser will be obligated
to make its own arrangements for any deposits with the utility providers, but
Seller will, if necessary, maintain such deposits until such time as Purchaser
can post its own deposits (but in no event longer than thirty (30) days after
Closing) so that such utility service will not be discontinued to the Property. 
No later than September 30, 2005, Seller and Purchaser will jointly and in good
faith prepare a final closing statement reasonably satisfactory in form and
substance to Seller and Purchaser (the “Final Closing Statement) setting forth
the final determination of the adjustments and prorations provided for herein.

 

(B)           PURCHASER WILL RECEIVE A CREDIT ON THE CLOSING STATEMENT FOR THE
PRORATED AMOUNT (AS OF THE PRORATION TIME) OF ALL RENTAL PREVIOUSLY PAID TO OR
COLLECTED BY SELLER AND ATTRIBUTABLE TO ANY PERIOD FOLLOWING THE PRORATION
TIME.  AFTER THE CLOSING, SELLER WILL CAUSE TO BE PAID OR TURNED OVER TO
PURCHASER ALL RENTAL, IF ANY, RECEIVED BY SELLER AFTER CLOSING AND ATTRIBUTABLE
TO ANY PERIOD FOLLOWING THE PRORATION TIME.  “RENTAL”  AS USED HEREIN MEANS ALL
RENT (AS SUCH TERM IS DEFINED IN THE SCHWAB LEASE) PAID UNDER THE SCHWAB LEASE. 
RENTAL IS “DELINQUENT”  WHEN IT WAS DUE PRIOR TO THE CLOSING DATE, AND PAYMENT
THEREOF HAS NOT BEEN MADE ON OR BEFORE THE PRORATION TIME.  DELINQUENT RENTAL
WILL NOT BE PRORATED.  PURCHASER AGREES TO USE GOOD FAITH COLLECTION PROCEDURES
WITH RESPECT TO THE COLLECTION OF ANY DELINQUENT RENTAL, BUT PURCHASER WILL HAVE
NO LIABILITY FOR THE FAILURE TO COLLECT ANY SUCH AMOUNTS AND WILL NOT BE
REQUIRED TO PURSUE LEGAL ACTION TO ENFORCE COLLECTION OF ANY SUCH AMOUNTS OWED
TO SELLER BY ANY TENANT.  ALL SUMS COLLECTED BY PURCHASER FROM AND AFTER CLOSING
FROM SCHWAB WILL BE APPLIED FIRST TO CURRENT AMOUNTS OWED BY SCHWAB TO PURCHASER
AND THEN TO DELINQUENCIES OWED BY SCHWAB TO PXLA.  ANY SUMS DUE SELLER WILL BE
PROMPTLY REMITTED TO SELLER.

 

(C)           WITH RESPECT TO SPECIFIC TENANT BILLINGS FOR WORK ORDERS, SPECIAL
ITEMS PERFORMED OR PROVIDED AT THE REQUEST OF SCHWAB OR OTHER SPECIFIC SERVICES,
WHICH ARE COLLECTED BY PURCHASER AFTER THE CLOSING DATE BUT RELATE TO THE
FOREGOING SPECIFIC SERVICES RENDERED BY SELLER PRIOR TO THE PRORATION TIME, THEN
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, PURCHASER SHALL CAUSE
THE FIRST AMOUNTS COLLECTED FROM SCHWAB SPECIFICALLY FOR SUCH SPECIAL SERVICES
(AS OPPOSED TO REGULAR SCHEDULED RENTAL PAYMENTS) TO BE PAID TO SELLER ON
ACCOUNT THEREOF, SO LONG AS SELLER IDENTIFIES SAME PRIOR TO CLOSING.

 

(D)           SELLER SHALL BE LIABLE AND SOLELY RESPONSIBLE FOR THE PAYMENT OF
ALL OF THE LEASING COMMISSIONS DUE AND OWING WITH RESPECT TO THE INITIAL TERM OF
THE SCHWAB LEASE (THE “INITIAL TERM SCHWAB COMMISSIONS”).  PURCHASER SHALL BE
LIABLE AND SOLELY RESPONSIBLE FOR ALL LEASING COMMISSIONS PAYABLE UNDER THE
LEASING COMMISSION AGREEMENTS OR OTHERWISE WITH RESPECT TO ANY RENEWALS OR
EXTENSIONS OF THE SCHWAB LEASE (THE “RENEWAL TERM SCHWAB COMMISSIONS”), AS WELL
AS, SUBJECT TO THE PROVISIONS OF SECTION 18.2 OF THIS AGREEMENT, THE WORK
ALLOWANCE AND THE ADDITIONAL WORK ALLOWANCE (AS SUCH TERMS ARE DEFINED IN THE
SCHWAB

 

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LEASE) AND ALL TENANT IMPROVEMENT COSTS OR OTHER EXPENDITURES DUE WITH RESPECT
TO ANY AMENDMENTS, RENEWALS AND/OR EXTENSIONS OF THE SCHWAB LEASE FIRST ARISING,
ACCRUING AND PAYABLE FOLLOWING THE CLOSING DATE, AS SET FORTH IN THE SCHWAB
LEASE OR IN DOCUMENTS PROVIDED TO PURCHASER PRIOR TO CLOSING AND IN ANY
DOCUMENTS OR PURSUANT TO ANY AGREEMENTS (WHETHER WRITTEN OR ORAL ENTERED INTO
AFTER THE CLOSING BY PURCHASER OR PROPERTY OWNER), AND ALL OF THE LEASING
COMMISSIONS, TENANT IMPROVEMENT COSTS AND OTHER EXPENDITURES DUE AND OWING WITH
RESPECT TO SCHWAB’S EXERCISE OF SCHWAB’S EXPANSION OPTIONS.

 

(E)           PRIOR TO THE CLOSING DATE, SELLER (OR PROPERTY OWNER) SHALL HAVE
PRE-PAID TO THE APPLICABLE AUTHORITY THE AMOUNT OF ONE MILLION FIVE HUNDRED
SEVENTY-SIX THOUSAND FOUR HUNDRED NINETEEN AND 00/100 DOLLARS ($1,576,419.00)
(THE “PILOT SERVICE CHARGE)”  AS AND FOR THE ANNUAL SERVICE CHARGE REQUIRED TO
BE PAID IN CONNECTION WITH THE PILOT.  IN ADDITION, PURCHASER HEREBY
ACKNOWLEDGES THAT PROPERTY OWNER HAS ENTERED INTO THE CONTRIBUTION AGREEMENT AND
IN CONNECTION THEREWITH, THE AMOUNT OF THREE HUNDRED NINETY-NINE THOUSAND SEVEN
HUNDRED AND NO/100 ($399,700.00) (THE “CONTRIBUTION AMOUNT”) HAS BEEN PAID TO
THE CITY.  SELLER WILL RECEIVE A CREDIT ON THE CLOSING STATEMENT (X) IN AN
AMOUNT EQUAL TO FIFTY PERCENT (50%) OF THE CONTRIBUTION AMOUNT (“PURCHASER’S
SHARE OF THE CONTRIBUTION AMOUNT”), AND (Y) IN AN AMOUNT EQUAL TO THE PILOT
SERVICE CHARGE LESS THAT AMOUNT OF THE PILOT SERVICE CHARGE, IF ANY, WHICH WAS
AMORTIZED BY SELLER (AND/OR PROPERTY OWNER) PRIOR TO THE CLOSING DATE (IT BEING
UNDERSTOOD THAT THE PILOT SERVICE CHARGE SHALL BE AMORTIZED ON A STRAIGHT-LINE
BASIS COMMENCING ON THE DATE OF THE FIRST PILOT PAYMENT MADE UNDER THE FINANCIAL
AGREEMENT (EXCLUDING THE PILOT SERVICE CHARGE FOR PURPOSES OF DETERMINING SUCH
FIRST PILOT PAYMENT)).

 

(F)            AT THE CLOSING, PURCHASER SHALL RECEIVE A CREDIT AGAINST THE
PURCHASE PRICE IN AN AMOUNT CALCULATED IN ACCORDANCE WITH SCHEDULE 10.4(F),
PRO-RATED FOR A PARTIAL MONTH (THE “RENT SHORTFALL CREDIT”).

 

(G)           THE PROVISIONS OF THIS SECTION 10.4 SHALL SURVIVE THE CLOSING
INDEFINITELY.

 

SECTION 10.5           COSTS OF TITLE COMPANY AND CLOSING COSTS.  COSTS OF THE
TITLE COMPANY AND OTHER CLOSING COSTS INCURRED IN CONNECTION WITH THE CLOSING
WILL BE ALLOCATED AS FOLLOWS:

 

(A)           SELLER SHALL PAY (I) ALL STATE OR COUNTY DOCUMENTARY STAMPS ON
TRANSFER TAXES AND RECORDING FEES AND CHANGES NECESSARY OR REQUIRED IN
CONNECTION WITH THE LLC ASSIGNMENT AND ASSUMPTION, IF ANY; (II) SELLER’S
ATTORNEY’S FEES; (III) ONE-HALF (1/2) OF ESCROW FEES, IF ANY; AND (IV) ANY AND
ALL FEES REQUIRED TO BE PAID TO THE CITY AND/OR THE JERSEY CITY REDEVELOPMENT
AUTHORITY IN CONNECTION WITH OBTAINING THE APPROVALS FROM SUCH PARTY FOR THIS
TRANSACTION, INCLUDING ANY FEES REQUIRED TO BE PAID FOR ITS CONSENT TO THE
TRANSACTION CONTEMPLATED BY THIS AGREEMENT, IF SUCH CONSENT IS NECESSARY,
INCLUDING ANY RELATED FEES REQUIRED BY, OR INCREASES IN THE AMOUNTS PAYABLE
UNDER, THE FINANCIAL AGREEMENT IN ORDER FOR THE TAX EXEMPTION TO REMAIN IN FULL
FORCE AND EFFECT, INCLUDING ANY FEES (OR INCREASES IN AMOUNTS PAYABLE UNDER THE
FINANCIAL AGREEMENT) REQUIRED FOR OBTAINING THE APPROVAL OF THE TRANSACTION
CONTEMPLATED BY THIS AGREEMENT BY MEANS OF THE ORDINANCE.

 

(B)           PURCHASER SHALL PAY (I) THE COST OF THE PREMIUM FOR ITS TITLE
POLICY AND CUSTOMARY TITLE SEARCHES, TOGETHER WITH ALL COSTS OF ANY ADDITIONAL
COVERAGE UNDER ITS TITLE POLICY

 

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OR ENDORSEMENTS (INCLUDING, WITHOUT LIMITATION, THE NON-IMPUTATION ENDORSEMENT)
TO ITS TITLE POLICY THAT ARE DESIRED BY PURCHASER; (II) ALL PREMIUMS AND OTHER
COSTS FOR ANY MORTGAGEE POLICY OF TITLE INSURANCE, IF ANY, INCLUDING BUT NOT
LIMITED TO ANY ENDORSEMENTS OR DELETIONS; (III) PURCHASER’S ATTORNEY’S FEES;
(IV) ONE-HALF (1/2) OF ESCROW FEES, IF ANY; AND (V) THE COSTS OF THE SURVEY, AS
PROVIDED FOR IN SECTION 6.1.

 

(C)           THE PROVISIONS OF THIS SECTION 10.5 SHALL SURVIVE THE CLOSING
INDEFINITELY.

 

SECTION 10.6           POST-CLOSING DELIVERY OF TENANT NOTICE LETTERS. 
IMMEDIATELY FOLLOWING CLOSING, PURCHASER WILL DELIVER TO SCHWAB A TENANT NOTICE
LETTER, AS DESCRIBED IN SECTION 10.2(D).  THE PROVISIONS OF THIS SECTION 10.6
SHALL SURVIVE THE CLOSING INDEFINITELY.

 

SECTION 10.7           LIKE-KIND EXCHANGE.  IN THE EVENT THAT EITHER SELLER
SHALL ELECT TO EFFECTUATE THE CLOSING AS A “LIKE-KIND” EXCHANGE UNDER SECTION
1031 OF THE CODE, PURCHASER AGREES TO COOPERATE AND ASSIST SUCH SELLER IN ALL
REASONABLE RESPECTS (WITH NO ADJUSTMENT TO THE CLOSING DATE HEREUNDER) IN ORDER
THAT THE EXCHANGE SO QUALIFIES AS A “LIKE-KIND” EXCHANGE UNDER SECTION 1031 OF
THE CODE AND THE TREASURY REGULATIONS PROMULGATED, OR TO BE PROMULGATED,
THEREUNDER; PROVIDED, HOWEVER, THAT SELLER SHALL REIMBURSE PURCHASER FOR ANY
REASONABLE OUT-OF-POCKET ATTORNEYS’ FEES (OTHER THAN INCIDENTAL, DE MINIMIS
EXPENSES AND ATTORNEYS’ FEES).

 

ARTICLE XI

 

CONDEMNATION AND CASUALTY

 

SECTION 11.1           CASUALTY.  IF, PRIOR TO THE SCHEDULED CLOSING DATE, ALL
OR A SIGNIFICANT PORTION OF THE REAL PROPERTY AND IMPROVEMENTS IS DESTROYED OR
DAMAGED BY FIRE OR OTHER CASUALTY, SELLER WILL NOTIFY PURCHASER OF SUCH
CASUALTY.  PURCHASER WILL HAVE THE OPTION TO TERMINATE THIS AGREEMENT UPON
NOTICE TO SELLER GIVEN NOT LATER THAN FIFTEEN (15) DAYS AFTER RECEIPT OF
SELLER’S NOTICE.  IF THIS AGREEMENT IS TERMINATED, THE EARNEST MONEY DEPOSIT
WILL BE RETURNED TO PURCHASER AND THEREAFTER NEITHER SELLER NOR PURCHASER WILL
HAVE ANY FURTHER RIGHTS OR OBLIGATIONS TO THE OTHER HEREUNDER EXCEPT WITH
RESPECT TO THE TERMINATION SURVIVING OBLIGATIONS.  IF PURCHASER DOES NOT ELECT
TO TERMINATE THIS AGREEMENT OR LESS THAN A SIGNIFICANT PORTION OF THE REAL
PROPERTY AND IMPROVEMENTS IS DESTROYED OR DAMAGED AS AFORESAID, NEITHER SELLER
NOR THE PROPERTY OWNER WILL BE OBLIGATED TO REPAIR SUCH DAMAGE OR DESTRUCTION
BUT (A) SELLER WILL (OR WILL CAUSE PROPERTY OWNER TO) (I) TURN OVER TO PURCHASER
THE INSURANCE PROCEEDS NET OF REASONABLE COLLECTION COSTS (OR IF SUCH HAVE NOT
BEEN AWARDED, ALL OF ITS RIGHT, TITLE AND INTEREST THEREIN) PAYABLE WITH RESPECT
TO SUCH FIRE OR OTHER CASUALTY AND (II) ASSIGN TO AFE (AS RECONSTITUTED ON THE
CLOSING DATE WITH PURCHASER AS THE DIRECT OR INDIRECT OWNER THEREIN), WITHOUT
ANY REPRESENTATION, WARRANTY OR RECOURSE WHATSOEVER, ALL OF PROPERTY OWNER’S
RIGHTS, IF ANY, TO ANY PAYMENTS TO BE MADE (AFTER THE CLOSING DATE) WITH RESPECT
TO THE PROPERTY UNDER ANY APPLICABLE RENTAL LOSS INSURANCE POLICIES IN EFFECT ON
THE CLOSING DATE, AND (B) THE PARTIES WILL PROCEED TO CLOSING PURSUANT TO THE
TERMS HEREOF WITHOUT ABATEMENT OF THE PURCHASE PRICE, EXCEPT THAT PURCHASER WILL
RECEIVE CREDIT FOR ANY INSURANCE DEDUCTIBLE AMOUNT.  IN THE EVENT SELLER OR
PROPERTY OWNER ELECTS TO PERFORM ANY REPAIRS AS A RESULT OF A CASUALTY PRIOR TO
CLOSING, (I) THE PERFORMANCE THEREOF SHALL BE SUBJECT, EXCEPT IN THE CASE OF
EMERGENCY OR TO PERFORM REPAIRS REQUIRED BY APPLICABLE LAW, TO PURCHASER’S
CONSENT, NOT TO BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED, AND (II)
SELLER WILL

 

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BE ENTITLED TO DEDUCT ITS COSTS AND EXPENSES FROM ANY AMOUNT TO WHICH PURCHASER
IS ENTITLED UNDER THIS SECTION 11.1, WHICH RIGHT SHALL SURVIVE THE CLOSING. 
NEITHER SELLER NOR PROPERTY OWNER WILL HAVE ANY RIGHT TO ELECT TO PERFORM ANY
REPAIRS AFTER THE CLOSING.

 

SECTION 11.2           CONDEMNATION OF PROPERTY.  IN THE EVENT OF ANY
CONDEMNATION OR SALE IN LIEU OF CONDEMNATION OF ALL OR THAT PORTION OF THE
PROPERTY WHICH ENTITLES SCHWAB TO TERMINATE THE SCHWAB LEASE PURSUANT TO SECTION
10.04 THEREOF (A “MATERIAL TAKING”), PURCHASER WILL HAVE THE OPTION, TO BE
EXERCISED WITHIN FIFTEEN (15) DAYS AFTER RECEIPT OF NOTICE OF SUCH CONDEMNATION
OR SALE, OF TERMINATING PURCHASER’S OBLIGATIONS UNDER THIS AGREEMENT, OR
ELECTING TO HAVE THIS AGREEMENT REMAIN IN FULL FORCE AND EFFECT.  IN THE EVENT
THAT EITHER (I) ANY CONDEMNATION OR SALE IN LIEU OF CONDEMNATION OF THE PROPERTY
IS NOT A MATERIAL TAKING, OR (II) PURCHASER DOES NOT TERMINATE THIS AGREEMENT
PURSUANT TO THE PRECEDING SENTENCE, SELLER WILL (OR WILL CAUSE PROPERTY OWNER
TO) TURN OVER TO PURCHASER ANY AND ALL CLAIMS FOR THE PROCEEDS OF SUCH
CONDEMNATION OR SALE TO THE EXTENT THE SAME ARE APPLICABLE TO THE PROPERTY, AND
PURCHASER WILL TAKE TITLE TO THE PROPERTY SUBJECT TO SUCH CONDEMNATION AND
WITHOUT REDUCTION OF THE PURCHASE PRICE.  SHOULD PURCHASER ELECT TO TERMINATE
PURCHASER’S OBLIGATIONS UNDER THIS AGREEMENT UNDER THE PROVISIONS OF THIS
SECTION 11.2, THE EARNEST MONEY DEPOSIT WILL BE RETURNED TO PURCHASER AND
NEITHER SELLER NOR PURCHASER WILL HAVE ANY FURTHER OBLIGATION UNDER THIS
AGREEMENT, EXCEPT FOR THE TERMINATION SURVIVING OBLIGATIONS.  PURCHASER HEREBY
ACKNOWLEDGES AND AGREES THAT THE DEDICATION SHALL NOT CONSTITUTE A MATERIAL
TAKING AND PURCHASER SHALL HAVE NO RIGHTS WHATSOEVER PURSUANT TO THE PROVISIONS
OF THIS SECTION 11.2 WITH RESPECT TO THE DEDICATION.

 

ARTICLE XII

CONFIDENTIALITY

 

SECTION 12.1           CONFIDENTIALITY.  SELLER AND PURCHASER EACH EXPRESSLY
ACKNOWLEDGE AND AGREE THAT THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND
THE TERMS AND CONDITIONS CONCERNING THE SAME WILL BE HELD IN CONFIDENCE BY EACH
OF THEM AND WILL NOT BE DISCLOSED BY EITHER OF THEM EXCEPT TO THEIR RESPECTIVE
LEGAL COUNSEL, ACCOUNTANTS, CONSULTANTS, OFFICERS, PARTNERS, DIRECTORS, AND
SHAREHOLDERS AND MUNICIPAL OFFICIALS WITH THE CITY WITH WHOM PURCHASER IS
PERMITTED TO DISCUSS THE TRANSACTION CONTEMPLATED HEREIN, OR AS OTHERWISE
PERMITTED HEREUNDER (INCLUDING, WITHOUT LIMITATION, SECTION 5.2(B)), AND EXCEPT
AND ONLY TO THE EXTENT THAT SUCH DISCLOSURE MAY BE NECESSARY OR ADVISABLE FOR
THEIR RESPECTIVE PERFORMANCES HEREUNDER.  PURCHASER FURTHER ACKNOWLEDGES AND
AGREES THAT, UNLESS AND UNTIL THE CLOSING OCCURS, ALL INFORMATION OBTAINED BY
PURCHASER IN CONNECTION WITH THE PROPERTY WILL NOT BE DISCLOSED BY PURCHASER TO
ANY THIRD PERSONS (OTHER THAN LICENSEE PARTIES) WITHOUT THE PRIOR WRITTEN
CONSENT OF SELLER, UNLESS SUCH DISCLOSURE IS REQUIRED BY LAW, RULE OR
REGULATION.   NOTHING CONTAINED IN THIS ARTICLE XII WILL PRECLUDE OR LIMIT
EITHER PARTY TO THIS AGREEMENT FROM DISCLOSING OR ACCESSING ANY INFORMATION
OTHERWISE DEEMED CONFIDENTIAL UNDER THIS ARTICLE XII OR THIS AGREEMENT IN
RESPONSE TO LAWFUL PROCESS OR SUBPOENA OR OTHER VALID OR ENFORCEABLE ORDER OF A
COURT OF COMPETENT JURISDICTION OR ANY FILINGS WITH GOVERNMENTAL AUTHORITIES
REQUIRED BY REASON OF THE TRANSACTIONS PROVIDED FOR HEREIN PURSUANT TO AN
OPINION OF COUNSEL. IN ADDITION, PRIOR TO OR AS A PART OF THE CLOSING, ANY
RELEASE TO THE PUBLIC OF INFORMATION WITH RESPECT TO THE SALE CONTEMPLATED
HEREIN OR ANY MATTERS SET FORTH IN THIS AGREEMENT WILL BE MADE ONLY IN THE FORM
APPROVED BY PURCHASER AND SELLER AND

 

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THEIR RESPECTIVE COUNSEL, WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD OR
DELAYED.  SUBJECT TO PRECEDING 2 SENTENCES OF THIS SECTION 12.1, SELLER AND/OR
SELLER’S AFFILIATES SHALL NOT NAME PURCHASER, PURCHASER’S AFFILIATES, ISTAR OR
ANY ISTAR AFFILIATES IN ANY PUBLIC STATEMENTS OR GOVERNMENTAL FILINGS RELATED TO
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION,
PRESS RELEASES, BROCHURES, MARKETING MATERIALS OR OTHER WRITTEN, ORAL, DIGITAL
OR ELECTRONIC COMMUNICATIONS; PROVIDED, HOWEVER, IN DESCRIBING THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT, SELLER AND SELLER’S AFFILIATES MAY REFER TO
PURCHASER, PURCHASER’S AFFILIATES, ISTAR OR ANY ISTAR AFFILIATES AS AN
“INSTITUTIONAL REAL ESTATE BUYER”.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
PROVIDED HEREIN, IN NO EVENT SHALL SELLER AND/OR SELLER’S AFFILIATES BE LIABLE
UNDER THIS SECTION 12.1 FOR ANY DISCLOSURE OF PURCHASER’S, ISTAR’S OR ANY ISTAR
AFFILIATES’ INVOLVEMENT IN THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT TO
THE EXTENT SUCH INVOLVEMENT BECOMES PUBLIC KNOWLEDGE (AND ONLY TO THE EXTENT OF
SUCH PUBLIC KNOWLEDGE) OTHER THAN AS A RESULT OF A DISCLOSURE BY SELLER AND/OR
SELLER’S AFFILIATES.  THE PROVISIONS OF THIS ARTICLE XII WILL SURVIVE THE
CLOSING OR ANY TERMINATION OF THIS AGREEMENT.  NOTHING IN THIS ARTICLE XII WILL
NEGATE, SUPERSEDE OR OTHERWISE AFFECT THE OBLIGATIONS OF THE PARTIES UNDER THE
CONFIDENTIALITY AGREEMENT, AND THE PROVISIONS OF THIS ARTICLE XII WILL SURVIVE
THE TERMINATION OF THIS AGREEMENT, AND IN THE EVENT OF A CONFLICT BETWEEN THE
PROVISIONS OF THE CONFIDENTIALITY AGREEMENT AND THIS AGREEMENT, THE PROVISIONS
OF THIS AGREEMENT SHALL GOVERN.

 

ARTICLE XIII

 

REMEDIES

 

SECTION 13.1           DEFAULT BY SELLER.

 

(A)           IN THE EVENT THE CLOSING AND THE TRANSACTIONS CONTEMPLATED HEREBY
DO NOT OCCUR AS HEREIN PROVIDED BY REASON OF ANY DEFAULT OF SELLER UNDER THIS
AGREEMENT, PURCHASER MAY, AS PURCHASER’S SOLE AND EXCLUSIVE REMEDY, ELECT BY
NOTICE TO SELLER WITHIN TEN (10) BUSINESS DAYS FOLLOWING THE SCHEDULED CLOSING
DATE, EITHER OF THE FOLLOWING:  (I) TO TERMINATE THIS AGREEMENT, IN WHICH EVENT
PURCHASER WILL RECEIVE FROM THE ESCROW AGENT THE EARNEST MONEY DEPOSIT, AND
THEREAFTER SELLER AND PURCHASER WILL HAVE NO FURTHER RIGHTS OR OBLIGATIONS UNDER
THIS AGREEMENT, EXCEPT WITH RESPECT TO THE TERMINATION SURVIVING OBLIGATIONS; OR
(II) SEEK TO ENFORCE SPECIFIC PERFORMANCE OF SELLER’S OBLIGATION TO EXECUTE THE
DOCUMENTS REQUIRED TO CONVEY SELLER’S LLC INTEREST TO PURCHASER, IT BEING
UNDERSTOOD AND AGREED THAT THE REMEDY OF SPECIFIC PERFORMANCE SHALL NOT BE
AVAILABLE TO ENFORCE ANY OTHER OBLIGATION OF SELLER HEREUNDER.  OTHER THAN AS
EXPRESSLY SET FORTH IN SECTION 13.1(B) BELOW, PURCHASER EXPRESSLY WAIVES ITS
RIGHTS TO SEEK DAMAGES IN THE EVENT THAT THE CLOSING DOES NOT OCCUR BY REASON OF
SELLER’S DEFAULT HEREUNDER.  PURCHASER SHALL BE DEEMED TO HAVE ELECTED TO
TERMINATE THIS AGREEMENT AND RECEIVE BACK THE EARNEST MONEY DEPOSIT IF PURCHASER
FAILS TO FILE SUIT FOR SPECIFIC PERFORMANCE AGAINST SELLER IN A COURT HAVING
JURISDICTION IN THE COUNTY AND STATE IN WHICH THE PROPERTY IS LOCATED, ON OR
BEFORE NINETY (90) DAYS FOLLOWING THE SCHEDULED CLOSING DATE.  NOTWITHSTANDING
THE FOREGOING AS TO THE TERMINATION SURVIVING OBLIGATIONS, NOTHING CONTAINED IN
THIS SECTION 13.1 WILL LIMIT PURCHASER’S REMEDIES AT LAW, IN EQUITY OR AS HEREIN
PROVIDED IN PURSUING REMEDIES OF A BREACH BY SELLER OF ANY OF THE TERMINATION
SURVIVING OBLIGATIONS.  PURCHASER SPECIFICALLY WAIVES ITS RIGHTS TO SEEK ANY
PUNITIVE, SPECULATIVE, OR CONSEQUENTIAL DAMAGES.

 

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(B)           NOTWITHSTANDING SECTION 13.1(A) ABOVE, IF PURCHASER TERMINATES
THIS AGREEMENT BY REASON OF SELLER’S BAD FAITH, WILLFUL DEFAULT UNDER THIS
AGREEMENT, THEN, IN ADDITION TO THE RETURN OF THE EARNEST MONEY DEPOSIT,
PURCHASER SHALL BE ENTITLED TO BE REIMBURSED FOR PURCHASER’S ACTUAL
OUT-OF-POCKET COSTS RELATED TO THIS TRANSACTION, INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS’ AND THIRD PARTY FEES AND REASONABLE EXPENSES AND
REASONABLE DUE DILIGENCE EXPENSES WITH RESPECT TO THE PURCHASE OF THE PROPERTY,
THE NEGOTIATION OF THIS AGREEMENT (AND ANCILLARY AGREEMENTS)  AND OBTAINING THE
TITLE REPORT AND ANY SURVEY OF THE PROPERTY.

 

SECTION 13.2           DEFAULT BY PURCHASER.  IN THE EVENT THE CLOSING AND THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREIN DO NOT OCCUR AS PROVIDED
HEREIN BY REASON OF ANY DEFAULT OF PURCHASER, PURCHASER AND SELLER AGREE IT
WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO FIX THE DAMAGES WHICH SELLER MAY
SUFFER.  IN SUCH EVENT, ESCROW AGENT SHALL PAY THE EARNEST MONEY DEPOSIT TO EACH
OF HARSIMUS (OR ITS DESIGNEE) AND COLUMBIA (OR ITS DESIGNEE) BY SEPARATE 
FEDERAL RESERVE WIRE TRANSFERS OF IMMEDIATELY AVAILABLE FUNDS TO THE ACCOUNT
DESIGNATED BY EACH OF THEM, THE PORTION OF THE EARNEST MONEY DEPOSIT TO WHICH
EACH OF THEM IS ENTITLED, AS SET FORTH IN A WRITING EXECUTED BY HARSIMUS AND
COLUMBIA AND WHICH SHALL BE FURNISHED TO ESCROW AGENT, AND PURCHASER AND SELLER
HEREBY AGREE THAT (A) AN AMOUNT EQUAL TO THE EARNEST MONEY DEPOSIT IS A
REASONABLE ESTIMATE OF THE TOTAL NET DETRIMENT SELLER WOULD SUFFER IN THE EVENT
PURCHASER DEFAULTS AND FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY, AND (B)
SUCH AMOUNT WILL BE THE FULL, AGREED AND LIQUIDATED DAMAGES FOR PURCHASER’S
DEFAULT AND FAILURE TO COMPLETE THE PURCHASE OF SELLER’S LLC INTEREST, AND WILL
BE SELLER’S SOLE AND EXCLUSIVE REMEDY (WHETHER AT LAW OR IN EQUITY) FOR ANY
DEFAULT OF PURCHASER RESULTING IN THE FAILURE OF CONSUMMATION OF THE CLOSING,
WHEREUPON THIS AGREEMENT WILL TERMINATE AND SELLER AND PURCHASER WILL HAVE NO
FURTHER RIGHTS OR OBLIGATIONS HEREUNDER, EXCEPT WITH RESPECT TO THE TERMINATION
SURVIVING OBLIGATIONS.  THE PAYMENT OF SUCH AMOUNT AS LIQUIDATED DAMAGES IS NOT
INTENDED AS A FORFEITURE OR PENALTY BUT IS INTENDED TO CONSTITUTE LIQUIDATED
DAMAGES TO SELLER. NOTWITHSTANDING THE FOREGOING, AS TO THE TERMINATION
SURVIVING OBLIGATIONS, NOTHING CONTAINED HEREIN WILL LIMIT SELLER’S REMEDIES AT
LAW, IN EQUITY OR AS HEREIN PROVIDED IN THE EVENT OF A BREACH BY PURCHASER OF
ANY OF THE TERMINATION SURVIVING OBLIGATIONS.  SELLER SPECIFICALLY WAIVES ITS
RIGHTS TO SEEK ANY PUNITIVE, SPECULATIVE, OR CONSEQUENTIAL DAMAGES.

 

ARTICLE XIV

 

NOTICES

 

SECTION 14.1           NOTICES.

 

(A)           ALL NOTICES OR OTHER COMMUNICATIONS REQUIRED OR PERMITTED
HEREUNDER SHALL BE IN WRITING, AND SHALL BE GIVEN BY ANY NATIONALLY RECOGNIZED
OVERNIGHT DELIVERY SERVICE (USING THE NEXT BUSINESS DAY DELIVERY METHOD) WITH
PROOF OF DELIVERY, OR BY FACSIMILE TRANSMISSION (PROVIDED THAT SUCH FACSIMILE IS
CONFIRMED BY THE SENDER BY EXPEDITED DELIVERY SERVICE IN THE MANNER PREVIOUSLY
DESCRIBED), SENT TO THE INTENDED ADDRESSEE AT THE ADDRESS SET FORTH BELOW, OR TO
SUCH OTHER ADDRESS OR TO THE ATTENTION OF SUCH OTHER PERSON AS THE ADDRESSEE
WILL HAVE DESIGNATED BY WRITTEN NOTICE SENT IN ACCORDANCE HEREWITH. UNLESS
CHANGED IN ACCORDANCE WITH THE PRECEDING SENTENCE, THE ADDRESSES FOR NOTICES
GIVEN PURSUANT TO THIS AGREEMENT WILL BE AS FOLLOWS:

 

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If to Purchaser:

 

c/o iStar Financial Inc.

 

 

 

1114 Avenue of the Americas

 

 

 

New York, NY 10036

 

 

 

Attn:  H. Cabot Lodge III, Executive Vice President

 

 

 

Nina B. Matis, Executive Vice President and General Counsel

 

 

 

(212) 930-9400 (tele.)

 

 

 

(212) 930-9494 (fax)

 

 

 

 

 

with a copy to :

 

Katten Muchin Zavis Rosenman

 

 

 

575 Madison Avenue

 

 

 

New York, New York 10022-2585

 

 

 

Attn:  Ellen L. Shapiro, Esq.

 

 

 

(212) 940-8800 (tele.)

 

 

 

(212) 940-8776 (fax)

 

 

 

 

 

If to Seller:

 

c/o Mack-Cali Realty Corporation

 

 

 

11 Commerce Drive

 

 

 

Cranford, New Jersey  07016

 

 

 

 

 

 

 

with separate notices to the attention of:

 

 

 

 

 

 

 

Attn:  Mitchell E. Hersh

 

 

 

(908) 272-8000 (tele.)

 

 

 

(908) 272-0214 (fax)

 

 

 

 

 

 

 

and

 

 

 

 

 

 

 

Attn:  Roger W. Thomas, Esq.

 

 

 

(908) 272-2612 (tele.)

 

 

 

(908) 497-0485 (fax)

 

 

 

 

 

 

 

and

 

 

 

 

 

 

 

  Columbia Development Company, L.L.C.

 

 

 

c/o Panepinto Properties Inc.

 

 

 

30 Montgomery Street, 15th Floor

 

 

 

Jersey City, New Jersey 07302

 

 

 

Attn:  Joseph A. Panepinto

 

 

 

(201) 521-9000 (tele.)

 

 

 

(201) 434-3218 (fax)

 

 

 

 

 

 

 

and

 

 

 

 

 

 

 

Garden State Development Inc.

 

 

 

30 Montgomery Street, 15th Floor

 

 

 

Jersey City, New Jersey 07302

 

 

 

Attn:  Peter G. Mangin

 

 

 

(201) 521-9000 (tele.)

 

 

 

(201) 434-3218 (fax)

 

 

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with a copy to:

 

 

 

 

 

 

 

Fried, Frank, Harris, Shriver & Jacobson

 

 

 

One New York Plaza

 

 

 

New York, New York 10004

 

 

 

Attn: Andrew Dady, Esq.

 

 

 

(212) 859-8161 (tele.)

 

 

 

(212) 859-4000 (fax)

 

 

 

 

 

 

 

and

 

 

 

 

 

 

 

Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP

 

 

 

99 Wood Avenue South

 

 

 

Woodbridge, New Jersey 08830

 

 

 

Attn: Robert Greenbaum, Esq.

 

 

 

(732) 549-5600 (tele.)

 

 

 

(732) 549-1881 (fax)

 

 

 

 

 

If to Escrow Agent:

 

First American Title Insurance Company

 

 

 

633 Third Avenue

 

 

 

New York, New York 10017

 

 

 

Attn:  Anthony Ruggeri

 

 

 

(212) 922-9700 (tele.)

 

 

 

(212) 922-0881 (fax)

 

 

(B)           NOTICES GIVEN BY (I) OVERNIGHT DELIVERY SERVICE AS AFORESAID SHALL
BE DEEMED RECEIVED AND EFFECTIVE ON THE FIRST BUSINESS DAY FOLLOWING SUCH
DISPATCH AND (II) FACSIMILE TRANSMISSION AS AFORESAID SHALL BE DEEMED GIVEN AT
THE TIME AND ON THE DATE OF MACHINE TRANSMITTAL PROVIDED SAME IS SENT AND
CONFIRMATION OF RECEIPT IS RECEIVED BY THE SENDER PRIOR TO 4:00 P.M. EASTERN
STANDARD TIME ON A BUSINESS DAY (IF SENT LATER, THEN NOTICE SHALL BE DEEMED
GIVEN ON THE NEXT BUSINESS DAY).  NOTICES MAY BE GIVEN BY COUNSEL FOR THE
PARTIES DESCRIBED ABOVE, AND SUCH NOTICES SHALL BE DEEMED GIVEN BY SAID PARTY,
FOR ALL PURPOSES HEREUNDER.

 

ARTICLE XV

BROKERAGE

 

SECTION 15.1           BROKERS.  PURCHASER AND SELLER REPRESENT THAT THEY HAVE
NOT DEALT WITH ANY BROKERS, FINDERS OR SALESMEN, IN CONNECTION WITH THIS
TRANSACTION, OTHER THAN THE GREENWICH GROUP INTERNATIONAL LLC (THE “BROKER” ). 
PURCHASER AND SELLER SHALL EACH PAY ONE HALF OF ANY AND ALL FEES AND COMMISSIONS
PAYABLE TO THE BROKER ON ACCOUNT OF THIS TRANSACTION UP TO A MAXIMUM AMOUNT OF
FIVE HUNDRED THOUSAND DOLLARS ($500,000) EACH.  PURCHASER AND SELLER AGREE TO
INDEMNIFY, DEFEND AND HOLD EACH OTHER HARMLESS FROM AND AGAINST ANY AND ALL
LOSS, COST, DAMAGE, LIABILITY OR EXPENSE, INCLUDING REASONABLE ATTORNEYS’ FEES,
WHICH EITHER PARTY MAY SUSTAIN, INCUR OR BE EXPOSED TO BY REASON OF ANY CLAIM
FOR FEES OR COMMISSIONS MADE THROUGH THE

 

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OTHER PARTY ON ACCOUNT OF ANY BROKER, FINDER OR SALESMAN WITH WHOM THEY HAVE
DEALT, INCLUDING, WITH RESPECT TO PURCHASER’S INDEMNITY IN FAVOR OF SELLER, ANY
CLAIMS MADE BY BROKER AGAINST SELLER WITH RESPECT TO THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT IN EXCESS OF $500,000.  THE PROVISIONS OF THIS
ARTICLE XV WILL SURVIVE ANY CLOSING OR TERMINATION OF THIS AGREEMENT.

 

ARTICLE XVI

ESCROW AGENT

 

SECTION 16.1           ESCROW.

 

(A)           ESCROW AGENT WILL HOLD THE EARNEST MONEY DEPOSIT IN ESCROW IN AN
INTEREST-BEARING ACCOUNT OF THE TYPE GENERALLY USED BY ESCROW AGENT FOR THE
HOLDING OF ESCROW FUNDS UNTIL THE EARLIER OF (I) THE CLOSING, OR (II) THE
TERMINATION OF THIS AGREEMENT IN ACCORDANCE WITH ANY RIGHT HEREUNDER.  THE
EARNEST MONEY DEPOSIT SHALL BE NON-REFUNDABLE TO PURCHASER, EXCEPT AS OTHERWISE
SET FORTH HEREIN, AND SHALL BE CREDITED AGAINST THE PURCHASE PRICE AT THE
CLOSING.  ALL INTEREST EARNED ON THE EARNEST MONEY DEPOSIT SHALL BE PAID TO THE
PARTY ENTITLED TO THE EARNEST MONEY DEPOSIT.  IN THE EVENT THE CLOSING OCCURS,
THE EARNEST MONEY DEPOSIT WILL BE RELEASED TO SELLER, AND PURCHASER SHALL
RECEIVE A CREDIT AGAINST THE PURCHASE PRICE IN THE AMOUNT OF THE EARNEST MONEY
DEPOSIT.  IN ALL OTHER INSTANCES, ESCROW AGENT SHALL NOT RELEASE THE EARNEST
MONEY DEPOSIT TO EITHER PARTY UNTIL ESCROW AGENT HAS BEEN REQUESTED BY SELLER OR
PURCHASER TO RELEASE THE EARNEST MONEY DEPOSIT AS FOLLOWS: (I) IF REQUESTED BY
SELLER, THEN UPON SELLER’S WRITTEN DEMAND THEREFORE STATING THAT PURCHASER
DEFAULTED IN THE PERFORMANCE OF PURCHASER’S OBLIGATIONS TO CLOSE UNDER THIS
AGREEMENT AND THE FACTS AND CIRCUMSTANCES FORMING THE BASIS OF SUCH DEFAULT AND
(II) IF REQUESTED BY PURCHASER, THEN UPON PURCHASER’S WRITTEN DEMAND THEREFORE,
STATING THAT SELLER DEFAULTED IN THE PERFORMANCE OF SELLER’S OBLIGATIONS TO
CLOSE UNDER THIS AGREEMENT AND THE FACTS AND CIRCUMSTANCES FORMING THE BASIS OF
SUCH DEFAULT; PROVIDED, THAT, IN NEITHER CASE SHALL ESCROW AGENT RELEASE THE
EARNEST MONEY DEPOSIT UNTIL FIVE (5) BUSINESS DAYS FOLLOWING ESCROW AGENT’S
DELIVERY OF SUCH WRITTEN DEMAND TO THE NON-REQUESTING PARTY; PROVIDED, FURTHER,
THAT IF DURING SUCH FIVE (5) BUSINESS DAYS PERIOD, THE NON-REQUESTING PARTY
SHALL HAVE DELIVERED TO ESCROW AGENT A WRITTEN DISPUTE TO THE RELEASE OF THE
EARNEST MONEY DEPOSIT, ESCROW AGENT SHALL NOT RELEASE THE EARNEST MONEY DEPOSIT
UNLESS IT RECEIVES FURTHER WRITTEN DIRECTION SIGNED BY SELLER AND PURCHASER.  IF
NO WRITTEN DISPUTE IS SO DELIVERED, ESCROW AGENT SHALL DISBURSE THE EARNEST
MONEY DEPOSIT AS DIRECTED.  PURCHASER REPRESENTS THAT ITS TAX IDENTIFICATION
NUMBER, FOR PURPOSES OF REPORTING THE INTEREST EARNINGS, IS 03-0493637. 
HARSIMUS REPRESENTS THAT ITS TAX IDENTIFICATION NUMBER, FOR PURPOSES OF
REPORTING THE INTEREST EARNINGS, IS 22-3666122, AND COLUMBIA REPRESENTS THAT ITS
TAX IDENTIFICATION NUMBER, FOR PURPOSES OF REPORTING INTEREST EARNINGS, IS
22-3571776.

 

(B)           ESCROW AGENT SHALL NOT BE LIABLE TO ANY PARTY FOR ANY ACT OR
OMISSION, EXCEPT FOR BAD FAITH, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, AND THE
PARTIES AGREE TO INDEMNIFY ESCROW AGENT AND HOLD ESCROW AGENT HARMLESS FROM ANY
AND ALL CLAIMS, DAMAGES, LOSSES OR EXPENSES ARISING IN CONNECTION HEREWITH.  THE
PARTIES ACKNOWLEDGE THAT ESCROW AGENT IS ACTING SOLELY AS STAKEHOLDER FOR THEIR
MUTUAL CONVENIENCE.  IN THE EVENT ESCROW AGENT RECEIVES WRITTEN NOTICE OF A
DISPUTE BETWEEN THE PARTIES WITH RESPECT TO THE EARNEST MONEY DEPOSIT (THE

 

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“ESCROWED FUNDS”), ESCROW AGENT SHALL NOT BE BOUND TO RELEASE AND DELIVER THE
ESCROWED FUNDS TO EITHER PARTY BUT MAY EITHER (I) CONTINUE TO HOLD THE ESCROWED
FUNDS UNTIL OTHERWISE DIRECTED IN A WRITING SIGNED BY ALL PARTIES HERETO OR
(II) DEPOSIT THE ESCROWED FUNDS WITH THE CLERK OF ANY COURT OF COMPETENT
JURISDICTION.  UPON SUCH DEPOSIT, ESCROW AGENT WILL BE RELEASED FROM ALL DUTIES
AND RESPONSIBILITIES HEREUNDER.  ESCROW AGENT SHALL HAVE THE RIGHT TO CONSULT
WITH SEPARATE COUNSEL OF ITS OWN CHOOSING (IF IT DEEMS SUCH CONSULTATION
ADVISABLE) AND SHALL NOT BE LIABLE FOR ANY ACTION TAKEN, SUFFERED OR OMITTED BY
IT IN ACCORDANCE WITH THE ADVICE OF SUCH COUNSEL.

 

(C)           ESCROW AGENT SHALL NOT BE REQUIRED TO DEFEND ANY LEGAL PROCEEDING
WHICH MAY BE INSTITUTED AGAINST IT WITH RESPECT TO THE ESCROWED FUNDS, THE
PROPERTY OR THE SUBJECT MATTER OF THIS AGREEMENT UNLESS REQUESTED TO DO SO BY
PURCHASER OR SELLER AND IS INDEMNIFIED TO ITS SATISFACTION AGAINST THE COST AND
EXPENSE OF SUCH DEFENSE.  ESCROW AGENT SHALL NOT BE REQUIRED TO INSTITUTE LEGAL
PROCEEDINGS OF ANY KIND AND SHALL HAVE NO RESPONSIBILITY FOR THE GENUINENESS OR
VALIDITY OF ANY DOCUMENT OR OTHER ITEM DEPOSITED WITH IT OR THE COLLECTIBILITY
OF ANY CHECK DELIVERED IN CONNECTION WITH THIS AGREEMENT.  ESCROW AGENT SHALL BE
FULLY PROTECTED IN ACTING IN ACCORDANCE WITH ANY WRITTEN INSTRUCTIONS GIVEN TO
IT HEREUNDER AND BELIEVED BY IT TO HAVE BEEN SIGNED BY THE PROPER PARTIES.

 

ARTICLE XVII

MISCELLANEOUS

 

SECTION 17.1           WAIVERS.  NO WAIVER OF ANY BREACH OF ANY COVENANT OR
PROVISIONS CONTAINED HEREIN WILL BE DEEMED A WAIVER OF ANY PRECEDING OR
SUCCEEDING BREACH THEREOF, OR OF ANY OTHER COVENANT OR PROVISION CONTAINED
HEREIN.  NO EXTENSION OF TIME FOR PERFORMANCE OF ANY OBLIGATION OR ACT WILL BE
DEEMED AN EXTENSION OF THE TIME FOR PERFORMANCE OF ANY OTHER OBLIGATION OR ACT.

 

SECTION 17.2           TIME OF THE ESSENCE.  TIME IS OF THE ESSENCE WITH RESPECT
TO ALL TIME PERIODS AND DATES FOR PERFORMANCE SET FORTH IN THIS AGREEMENT.

 

Section 17.3           Recovery of Certain Fees.  In the event a party hereto
files any action or suit against another party hereto by reason of any breach of
any of the covenants, agreements or provisions contained in this Agreement, then
in that event the prevailing party will be entitled to have and recover certain
fees from the other party including all reasonable attorneys’ fees and costs
resulting therefrom. For purposes of this Agreement, the term “attorneys’ fees”
or “attorneys’ fees and costs” shall mean the fees and expenses of counsel to
the parties hereto, which may include printing, photocopying, duplicating and
other expenses, air freight charges, and fees billed for law clerks, paralegals
and other persons not admitted to the bar but performing services under the
supervision of an attorney, and the costs and fees incurred in connection with
the enforcement or collection of any judgment obtained in any such proceeding. 
The provisions of this Section 17.3 shall survive the entry of any judgment, and
shall not merge, or be deemed to have merged, into any judgment.

 

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SECTION 17.4           CONSTRUCTION.  HEADINGS AT THE BEGINNING OF EACH
ARTICLE AND SECTION ARE SOLELY FOR THE CONVENIENCE OF THE PARTIES AND ARE NOT A
PART OF THIS AGREEMENT.  WHENEVER REQUIRED BY THE CONTEXT OF THIS AGREEMENT, THE
SINGULAR WILL INCLUDE THE PLURAL AND THE MASCULINE WILL INCLUDE THE FEMININE AND
VICE VERSA.  THIS AGREEMENT WILL NOT BE CONSTRUED AS IF IT HAD BEEN PREPARED BY
ONE OF THE PARTIES, BUT RATHER AS IF BOTH PARTIES HAD PREPARED THE SAME.  ALL
EXHIBITS AND SCHEDULES REFERRED TO IN THIS AGREEMENT ARE ATTACHED AND
INCORPORATED BY THIS REFERENCE, AND ANY CAPITALIZED TERM USED IN ANY EXHIBIT OR
SCHEDULE WHICH IS NOT DEFINED IN SUCH EXHIBIT OR SCHEDULE WILL HAVE THE MEANING
ATTRIBUTABLE TO SUCH TERM IN THE BODY OF THIS AGREEMENT.  IN THE EVENT THE DATE
ON WHICH PURCHASER OR SELLER IS REQUIRED TO TAKE ANY ACTION UNDER THE TERMS OF
THIS AGREEMENT IS NOT A BUSINESS DAY, THE ACTION WILL BE TAKEN ON THE NEXT
SUCCEEDING BUSINESS DAY.

 

SECTION 17.5           COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN MULTIPLE
COUNTERPARTS, EACH OF WHICH, WHEN ASSEMBLED TO INCLUDE AN ORIGINAL SIGNATURE FOR
EACH PARTY CONTEMPLATED TO SIGN THIS AGREEMENT, WILL CONSTITUTE A COMPLETE AND
FULLY EXECUTED ORIGINAL.  ALL SUCH FULLY EXECUTED ORIGINAL COUNTERPARTS WILL
COLLECTIVELY CONSTITUTE A SINGLE AGREEMENT.

 

SECTION 17.6           SEVERABILITY.  IF ANY TERM OR OTHER PROVISION OF THIS
AGREEMENT IS INVALID, ILLEGAL, OR INCAPABLE OF BEING ENFORCED BY ANY RULE OF LAW
OR PUBLIC POLICY, ALL OF THE OTHER CONDITIONS AND PROVISIONS OF THIS AGREEMENT
WILL NEVERTHELESS REMAIN IN FULL FORCE AND EFFECT, SO LONG AS THE ECONOMIC OR
LEGAL SUBSTANCE OF THE TRANSACTIONS CONTEMPLATED HEREBY IS NOT AFFECTED IN ANY
ADVERSE MANNER TO EITHER PARTY.  UPON SUCH DETERMINATION THAT ANY TERM OR OTHER
PROVISION IS INVALID, ILLEGAL, OR INCAPABLE OF BEING ENFORCED, THE PARTIES
HERETO WILL NEGOTIATE IN GOOD FAITH TO MODIFY THIS AGREEMENT SO AS TO REFLECT
THE ORIGINAL INTENT OF THE PARTIES AS CLOSELY AS POSSIBLE IN AN ACCEPTABLE
MANNER TO THE END THAT THE TRANSACTIONS CONTEMPLATED HEREBY ARE FULFILLED TO THE
EXTENT POSSIBLE.

 

SECTION 17.7           ENTIRE AGREEMENT.  THIS AGREEMENT IS THE FINAL EXPRESSION
OF, AND CONTAINS THE ENTIRE AGREEMENT BETWEEN, THE PARTIES WITH RESPECT TO THE
SUBJECT MATTER HEREOF, AND SUPERSEDES ALL PRIOR UNDERSTANDINGS WITH RESPECT
THERETO.  THIS AGREEMENT MAY NOT BE MODIFIED, CHANGED, SUPPLEMENTED OR
TERMINATED, NOR MAY ANY OBLIGATIONS HEREUNDER BE WAIVED, EXCEPT BY WRITTEN
INSTRUMENT, SIGNED BY THE PARTY TO BE CHARGED OR BY ITS AGENT DULY AUTHORIZED IN
WRITING, OR AS OTHERWISE EXPRESSLY PERMITTED HEREIN.

 

SECTION 17.8           GOVERNING LAW.  THIS AGREEMENT WILL BE CONSTRUED,
PERFORMED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW JERSEY. 
SELLER AND PURCHASER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY STATE
OR FEDERAL COURT SITTING IN THE STATE OF NEW JERSEY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT AND HEREBY IRREVOCABLY AGREE THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING SHALL BE HEARD AND DETERMINED
IN A STATE OR FEDERAL COURT SITTING IN THE STATE OF NEW JERSEY.

 

SECTION 17.9           NO RECORDING.  EXCEPT TO THE EXTENT THE TITLE COMPANY
REQUIRES A NOTICE OF THE SETTLEMENT TO BE RECORDED AT CLOSING AGAINST THE REAL
PROPERTY, THE PARTIES HERETO AGREE THAT NEITHER THIS AGREEMENT NOR ANY AFFIDAVIT
OR MEMORANDUM CONCERNING IT WILL BE RECORDED AND

 

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UNLESS SO REQUIRED BY THE TITLE COMPANY, ANY RECORDING OF THIS AGREEMENT OR ANY
SUCH AFFIDAVIT OR MEMORANDUM BY PURCHASER WILL BE DEEMED A DEFAULT BY PURCHASER
HEREUNDER.

 

SECTION 17.10         FURTHER ACTIONS.  THE PARTIES AGREE TO EXECUTE SUCH
INSTRUCTIONS TO THE TITLE COMPANY AND SUCH OTHER INSTRUMENTS AND TO DO SUCH
FURTHER ACTS AS MAY BE REASONABLY NECESSARY TO CARRY OUT THE PROVISIONS OF THIS
AGREEMENT.

 

SECTION 17.11         NO PARTNERSHIP.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED HEREIN, THIS AGREEMENT SHALL NOT BE DEEMED OR CONSTRUED TO MAKE THE
PARTIES HERETO PARTNERS OR JOINT VENTURERS, IT BEING THE INTENTION OF THE
PARTIES TO MERELY CREATE THE RELATIONSHIP OF SELLER AND PURCHASER WITH RESPECT
TO THE PROPERTY TO BE CONVEYED AS CONTEMPLATED HEREBY.

 

SECTION 17.12         LIMITATIONS ON BENEFITS.  IT IS THE EXPLICIT INTENTION OF
PURCHASER AND SELLER THAT NO PERSON OR ENTITY OTHER THAN PURCHASER, PURCHASER’S
AFFILIATES, SELLER, SELLER’S AFFILIATES AND THEIR PERMITTED SUCCESSORS AND
ASSIGNS IS OR SHALL BE ENTITLED TO BRING ANY ACTION TO ENFORCE ANY PROVISION OF
THIS AGREEMENT AGAINST ANY OF THE PARTIES HERETO, AND THE COVENANTS,
UNDERTAKINGS AND AGREEMENTS SET FORTH IN THIS AGREEMENT SHALL BE SOLELY FOR THE
BENEFIT OF, AND SHALL BE ENFORCEABLE ONLY BY, PURCHASER, PURCHASER’S AFFILIATES,
SELLER AND SELLER’S AFFILIATES, OR THEIR RESPECTIVE SUCCESSORS AND ASSIGNS AS
PERMITTED HEREUNDER.  EXCEPT AS SET FORTH IN THIS SECTION 17.12, NOTHING
CONTAINED IN THIS AGREEMENT SHALL UNDER ANY CIRCUMSTANCES WHATSOEVER BE DEEMED
OR CONSTRUED, OR BE INTERPRETED, AS MAKING ANY THIRD PARTY A BENEFICIARY OF ANY
TERM OR PROVISION OF THIS AGREEMENT OR ANY INSTRUMENT OR DOCUMENT DELIVERED
PURSUANT HERETO, AND PURCHASER AND SELLER EXPRESSLY REJECT ANY SUCH INTENT,
CONSTRUCTION OR INTERPRETATION OF THIS AGREEMENT.

 

SECTION 17.13         ASSIGNMENT: BINDING EFFECT.  EXCEPT AS SET FORTH IN THIS
SECTION 17.13, PURCHASER WILL NOT HAVE THE RIGHT TO ASSIGN THIS AGREEMENT;
PURCHASER MAY ASSIGN ALL OF ITS RIGHTS UNDER THIS AGREEMENT TO AN ENTITY WHICH
DIRECTLY OR INDIRECTLY CONTROLS, IS CONTROLLED BY, OR IS UNDER COMMON CONTROL
WITH, ISTAR, INCLUDING, WITHOUT LIMITATION, A SINGLE PURPOSE ENTITY CREATED BY
PURCHASER FOR THE PURPOSE OF HOLDING TITLE TO SELLER’S LLC INTEREST.  PURCHASER
WILL NOTIFY EACH SELLER OF ANY SUCH ASSIGNMENT.  IN THE EVENT OF ANY SUCH
ASSIGNMENTS, WHETHER ACCOMPLISHED AS A MATTER OF RIGHT OR UPON THE CONSENT OF
THE OTHER PARTY, THE ORIGINAL PARTIES TO THIS AGREEMENT SHALL NOT BE RELEASED. 
THIS AGREEMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF THE PARTIES
HERETO AND THEIR RESPECTIVE SUCCESSORS AND PERMITTED ASSIGNS.

 

SECTION 17.14         REMEDIES CUMULATIVE.  EXCEPT AS PROVIDED IN ARTICLE XIII
OF THIS AGREEMENT, ALL RIGHTS, POWERS AND PRIVILEGES CONFERRED HEREUNDER UPON
THE PARTIES IN ANY SPECIFIC SECTION SHALL BE CUMULATIVE BUT NOT RESTRICTIVE OF
THOSE GIVEN IN OTHER SECTIONS OF THIS AGREEMENT AND BY LAW.

 

SECTION 17.15         FURTHER ASSURANCES.  AT AND AFTER CLOSING, THE PARTIES
SHALL DELIVER TO EACH OTHER ANY ADDITIONAL MATERIALS AND DOCUMENTS WHICH ARE
NECESSARY OR APPROPRIATE TO FURTHER ASSURE, COMPLETE AND DOCUMENT THE
CONSUMMATION OF THE PURCHASE AND SALE CONTEMPLATED HEREIN ON THE TERMS DESCRIBED
HEREIN.  FROM AND AFTER CLOSING, EACH PARTY SHALL AFFORD TO THE OTHER REASONABLE
ACCESS TO ANY INFORMATION IN ITS POSSESSION CONCERNING SELLER’S LLC INTEREST AND
THE OPERATIONS OF THE PROPERTY (INCLUDING THE RIGHT TO COPY THE SAME AT THE
EXPENSE OF THE PARTY

 

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DESIRING THE COPY) FOR PURPOSES OF ASCERTAINING POST-CLOSING ADJUSTMENTS, TAX
EXAMINATIONS OR AUDITS, OR OTHER SIMILAR PURPOSES.

 

SECTION 17.16         COOPERATION.

 

(A)           PURCHASER ACKNOWLEDGES THAT SELLER AND/OR ANY ONE OR MORE OF ITS
AFFILIATES MAY BE REQUIRED BY THE SECURITIES AND EXCHANGE COMMISSION TO FILE
AUDITED FINANCIAL STATEMENTS FOR ONE TO THREE YEARS AFTER CLOSING WITH REGARD TO
THE PROPERTY.  AT NO COST OR LIABILITY TO PURCHASER, AFTER CLOSING, PURCHASER
SHALL, AND SHALL CAUSE EACH PROPERTY OWNER, TO REASONABLY COOPERATE WITH SELLER
AND/OR ITS AFFILIATE, ITS COUNSEL, ACCOUNTANTS, AGENTS AND REPRESENTATIVES, TO
PROVIDE THEM WITH REASONABLE ACCESS TO PURCHASER’S AND PROPERTY OWNER’S BOOKS
AND RECORDS WITH RESPECT TO THE OWNERSHIP, MANAGEMENT, MAINTENANCE AND OPERATION
OF THE PROPERTY FOR THE APPLICABLE PERIOD, AND PERMIT THEM TO COPY SAME.  SELLER
OR ITS AFFILIATE AGREES TO DELIVER TO PURCHASER A COMMERCIALLY REASONABLE
CONFIDENTIALITY AGREEMENT IN CONNECTION WITH THE FOREGOING PRIOR TO ANY SUCH
ACCESS OR COPYING.

 

(B)(I)       SELLER AND ONLY SELLER SHALL PREPARE AND FILE, OR CAUSE TO BE
PREPARED AND FILED, ALL TAX RETURNS AND REPORTS THAT ARE REQUIRED TO BE FILED BY
OR WITH RESPECT TO EACH PROPERTY OWNER ENTITY FOR ALL TAX PERIODS ENDING ON OR
PRIOR TO THE CLOSING DATE AND ANY AMENDED TAX RETURN OR REPORT FOR ANY SUCH TAX
PERIOD (ANY SUCH TAX RETURN OR REPORT OR AMENDED TAX RETURN OR REPORT, A
“PRE-CLOSING TAX RETURN”).  UNLESS OTHERWISE REQUIRED BY APPLICABLE LAW OR
CONTRARY TO THE REASONABLE ADVICE OF SELLER’S TAX COUNSEL OR ACCOUNTANTS, ANY
PRE-CLOSING TAX RETURN SHALL BE PREPARED ON A BASIS CONSISTENT WITH PAST
PRACTICE.  SELLER SHALL DELIVER, OR CAUSE TO BE DELIVERED (THE DATE OF SUCH
DELIVERY, THE “DELIVERY DATE”), A COPY OF EACH SUCH PRE-CLOSING TAX RETURN TO
THE PURCHASER FOR THE PURCHASER’S REVIEW.  THE PURCHASER SHALL HAVE UNTIL
MIDNIGHT ON THE TENTH (10TH) DAY FOLLOWING THE DELIVERY DATE OF A PRE-CLOSING
TAX RETURN TO DELIVER TO THE SELLER ANY PROPOSED REVISIONS THAT IT MAY HAVE TO
SUCH RETURN, WHICH PROPOSED REVISIONS SHALL BE IN WRITING AND SHALL BE SET FORTH
IN REASONABLE DETAIL.  SELLER MAY INCORPORATE (OR CAUSE TO BE INCORPORATED) ANY
ONE OR MORE OF SUCH PROPOSED REVISIONS BUT SHALL BE REQUIRED TO INCORPORATE (OR
CAUSE TO BE INCORPORATED) ONLY THOSE PROPOSED REVISIONS: (I) WHICH ARE NOT
INCONSISTENT WITH THE PAST PRACTICE IN FILING SUCH RETURN, EXCEPT IF OTHERWISE
REQUIRED BY APPLICABLE LAW OR CONTRARY TO THE REASONABLE ADVICE OF SELLER’S TAX
COUNSEL OR ACCOUNTANTS; (II) IN THE CASE OF ANY FEDERAL INCOME TAX RETURN, WHICH
HAS “SUBSTANTIAL AUTHORITY” (WITHIN THE MEANING OF TREASURY REGULATIONS
SECTION 1.6662-4(D)(1)) AND WHICH WOULD REPLACE A POSITION FOR WHICH THERE IS NO
“SUBSTANTIAL AUTHORITY” (WITHIN THE MEANING OF TREASURY REGULATIONS
SECTION 1.6662-4(D)(1)); AND (III) IN THE CASE OF ANY OTHER PRE-CLOSING TAX
RETURN, WHICH ARE CORRECT UNDER APPLICABLE LAW AND WHICH WOULD REPLACE A
POSITION WHICH IS CLEARLY ERRONEOUS; PROVIDED, HOWEVER, THAT, NOTWITHSTANDING
ANYTHING HEREIN TO THE CONTRARY, PURCHASER’S PRIOR WRITTEN CONSENT (WHICH
CONSENT SHALL NOT BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED) SHALL BE
REQUIRED WITH RESPECT TO ANY POSITION CONTAINED ON ANY SUCH PRE-CLOSING TAX
RETURN WHICH WOULD REASONABLY RESULT IN AN INCREASE IN LIABILITY TO PURCHASER
POST-CLOSING (INCLUDING UNDER THE FINANCIAL AGREEMENT OR AMENDED FINANCIAL
AGREEMENT).  SELLER, AND ONLY SELLER, MAY PREPARE AND FILE OR CAUSE TO BE
PREPARED AND FILED A PRE-CLOSING TAX RETURN, AND UNDER NO CIRCUMSTANCES MAY A
PRE-CLOSING TAX RETURN BE FILED BY PURCHASER OR ANY OTHER PERSON WITHOUT
SELLER’S PRIOR WRITTEN CONSENT. SELLER, AND ONLY SELLER, SHALL CONTROL (SUBJECT
TO PURCHASER’S RIGHTS HEREUNDER) ANY AUDIT (AS DEFINED BELOW) IN RESPECT OF ANY

 

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TAX PERIOD ENDING ON OR PRIOR TO THE CLOSING DATE (“SELLER AUDIT”) AND, IN
CONNECTION THEREWITH, SELLER SHALL KEEP PURCHASER FULLY AND CONTEMPORANEOUSLY
APPRISED OF ALL MATERIAL ASPECTS OF ANY SELLER AUDIT AND SHALL PROMPTLY FURNISH
OR CAUSE TO BE PROMPTLY FURNISHED TO PURCHASER COPIES OF ANY AND ALL DOCUMENTS,
REPORTS, CORRESPONDENCE AND OTHER WRITTEN MATERIALS PERTAINING TO ANY SELLER
AUDIT.  SELLER SHALL BE AUTHORIZED TO TAKE, OR CAUSE TO BE TAKEN (OR NOT TAKE,
OR CAUSE NOT TO BE TAKEN) ANY ACTION WITH RESPECT TO ANY SELLER AUDIT IN ITS
SOLE DISCRETION; PROVIDED, HOWEVER, THAT SELLER SHALL NOT TAKE OR CAUSE TO BE
TAKEN (OR NOT TAKE, OR CAUSE NOT TO BE TAKEN) ANY ACTION WHICH WOULD REASONABLY
RESULT IN AN INCREASE IN LIABILITY TO PURCHASER POST-CLOSING (INCLUDING UNDER
THE FINANCIAL AGREEMENT OR AMENDED FINANCIAL AGREEMENT) WITHOUT PURCHASER’S
PRIOR WRITTEN CONSENT (WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD
CONDITIONED OR DELAYED). SELLER, AND ONLY SELLER, SHALL BE ENTITLED TO ANY
REFUND OR CREDIT (AND/OR BENEFIT THEREFROM) RESULTING FROM THE FILING OF ANY
PRE-CLOSING TAX RETURN OR ARISING FROM OR IN RESPECT OF ANY SELLER AUDIT.

 

(II)           THE PURCHASER SHALL PREPARE, OR CAUSE TO BE PREPARED, AND TIMELY
FILE, OR CAUSE TO BE TIMELY FILED, ALL TAX RETURNS AND REPORTS THAT ARE REQUIRED
TO BE FILED BY OR WITH RESPECT TO EACH PROPERTY OWNER FOR ALL TAX PERIODS
BEGINNING PRIOR TO, AND ENDING AFTER, THE CLOSING DATE, AS WELL AS ANY AMENDED
TAX RETURN OR REPORT FOR ANY SUCH TAX PERIOD (ANY SUCH RETURN AND REPORT OR
AMENDED RETURN OR REPORT, A “STRADDLE RETURN”).  PURCHASER SHALL DELIVER, OR
CAUSE TO BE DELIVERED A COPY OF EACH SUCH STRADDLE RETURN TO SELLER FOR SELLER’S
REVIEW AT LEAST TEN (10) PRIOR TO THE FILING THEREOF.  SELLER’S PRIOR WRITTEN
CONSENT (NOT TO BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED) SHALL BE
REQUIRED WITH RESPECT TO ANY POSITION CONTAINED ON A STRADDLE RETURN WHICH WOULD
REASONABLY RESULT IN AN INCREASE IN LIABILITY TO SELLER FOR ANY PRE-CLOSING
PERIOD (INCLUDING UNDER THE FINANCIAL AGREEMENT OR AMENDED FINANCIAL AGREEMENT),
EXCEPT THAT NO SUCH CONSENT SHALL BE REQUIRED IF THE TOTAL LIABILITY RESULTING
FROM SUCH POSITION IS ALLOCABLE PROPORTIONATELY BETWEEN SELLER AND PURCHASER AND
PURCHASER IS LIABLE FOR MORE THAN FIFTY PERCENT (50%) OF SAID LIABILITY.  UNLESS
OTHERWISE REQUIRED BY APPLICABLE LAW, ANY STRADDLE RETURN SHALL BE PREPARED ON A
BASIS CONSISTENT WITH PAST PRACTICE (TO THE EXTENT OF PAST PRACTICE). THE
PURCHASER SHALL CONTROL (SUBJECT TO SELLER’S RIGHTS HEREUNDER) AND, UNLESS THE
SELLER CONSENTS IN WRITING FOR THE PURCHASER TO DO OTHERWISE, SHALL DILIGENTLY
PURSUE AND DEFEND (AND SHALL CAUSE A PROPERTY OWNER TO DILIGENTLY PURSUE AND
DEFEND) ANY AUDIT OF ANY STRADDLE PERIOD (“STRADDLE AUDIT”); PROVIDED, HOWEVER
THAT, WITHOUT SELLER’S PRIOR WRITTEN CONSENT (WHICH CONSENT SHALL NOT BE
UNREASONABLY WITHHELD, CONDITIONED OR DELAYED), PURCHASER SHALL NOT TAKE OR
CAUSE OR PERMIT TO BE TAKEN (OR NOT TAKE, OR CAUSE OR PERMIT NOT TO BE TAKEN)
ANY ACTION WHICH COULD REASONABLY BE EXPECTED TO RESULT IN AN INCREASE IN
LIABILITY FOR SELLER FOR ANY PRE-CLOSING PERIOD (INCLUDING UNDER THE FINANCIAL
AGREEMENT OR AMENDED FINANCIAL AGREEMENT), EXCEPT THAT NO SUCH CONSENT SHALL BE
REQUIRED IF THE TOTAL LIABILITY RESULTING FROM SUCH ACTION IS ALLOCABLE
PROPORTIONATELY BETWEEN SELLER AND PURCHASER AND PURCHASER IS LIABLE FOR MORE
THAN FIFTY PERCENT (50%) OF SAID LIABILITY.  PURCHASER SHALL KEEP THE SELLER
FULLY AND CONTEMPORANEOUSLY APPRISED OF ALL MATERIAL ASPECTS OF ANY STRADDLE
AUDIT AND SHALL PROMPTLY FURNISH OR CAUSE TO BE PROMPTLY FURNISHED TO THE SELLER
COPIES OF ANY AND ALL DOCUMENTS, REPORTS, CORRESPONDENCE AND OTHER WRITTEN
MATERIALS PERTAINING TO ANY STRADDLE AUDIT.  AT THE REASONABLE REQUEST OF
SELLER, THE PURCHASER SHALL USE COMMERCIALLY REASONABLE EFFORTS TO PURSUE ANY
CLAIM FOR A REFUND OR CREDIT IN RESPECT OF ANY TAXES FOR ANY STRADDLE PERIOD,
EITHER BY THE FILING OF AN AMENDED STRADDLE RETURN OR DURING A STRADDLE AUDIT,
UNLESS PURCHASER REASONABLY BELIEVES, AND IS ABLE TO ESTABLISH TO THE REASONABLE
SATISFACTION OF

 

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SELLER AND ITS TAX COUNSEL AND ACCOUNTANTS, THAT THE TOTAL COST OF PURSUING SUCH
CLAIM WOULD EXCEED THE AMOUNT OF SUCH REFUND OR CREDIT.  PURCHASER SHALL PAY TO
SELLER SELLER’S PROPORTIONATE SHARE OF ANY SUCH REFUND OR CREDIT (I.E., THE
AMOUNT OF SUCH REFUND OR CREDIT MULTIPLIED BY THE FRACTION THE NUMERATOR OF
WHICH IS THE TOTAL NUMBER OF DAYS IN THE PRE-CLOSING STRADDLE PERIOD AND THE
DENOMINATOR OF WHICH IS THE TOTAL NUMBER OF DAYS IN SUCH STRADDLE PERIOD) AND
ANY INTEREST THEREON SO OBTAINED PROMPTLY AFTER RECEIPT FROM, OR ALLOWANCE
THEREOF, BY THE RELEVANT TAX AUTHORITY, LESS SELLER’S PROPORTIONATE SHARE OF THE
COST THEREOF.  THE SELLER AND PURCHASER SHALL, AND PURCHASER SHALL CAUSE ANY
PROPERTY OWNER TO, FULLY COOPERATE IN THE OBTAINING OF ANY REFUND OR CREDIT.

 

(III)          FOR PURPOSES OF THIS SECTION 17.16(B), THE TERM “AUDIT” SHALL
MEAN ANY AUDIT, ASSESSMENT, OR OTHER EXAMINATION OR CLAIM BY ANY TAX AUTHORITY
AND ANY JUDICIAL, ADMINISTRATIVE OR OTHER PROCEEDING OR LITIGATION (INCLUDING
ANY APPEAL OF ANY SUCH JUDICIAL, ADMINISTRATIVE OR OTHER PROCEEDING OR
LITIGATION), RELATING TO TAXES OR TAX RETURNS OR REPORTS.  FOR PURPOSES OF THIS
SECTION 17.16(B), THE TERM “PRE-CLOSING STRADDLE PERIOD” SHALL MEAN WITH RESPECT
TO ANY STRADDLE PERIOD, THE PORTION OF SUCH STRADDLE PERIOD BEGINNING ON THE
FIRST DAY THEREOF AND ENDING ON AN INCLUDING THE CLOSING DATE.  THE PURCHASER
SHALL NOT DISPOSE OF ANY RECORDS OR DOCUMENTS RELEVANT TO ANY TAXES OR
PRE-CLOSING RETURNS OR STRADDLE RETURNS PRIOR TO THE LATER OF SIX MONTHS AFTER
THE EXPIRATION OF THE APPLICABLE LIMITATIONS PERIOD ON ASSESSMENT WITH RESPECT
TO ANY SUCH TAXES OR TAX RETURNS, OR THE FINAL RESOLUTION OF ANY SELLER AUDIT OR
STRADDLE AUDIT INITIATED PRIOR TO THE EXPIRATION OF THE APPLICABLE LIMITATIONS
PERIOD.

 

(iv)          Seller and Purchaser shall cooperate fully, to the extent
reasonably requested, in connection with the filing of any tax return (e.g.,
Pre-Closing Tax Return or Straddle Tax Return) or the procuring or claiming of
any refund or credit for any overpayment of taxes and with respect to any Audit
(e.g., any Seller Audit or Straddle Audit).  Such cooperation shall include, but
shall not be limited to:  (A) subject to any limitations set forth in this
Section 17.16, the taking or making or the declining to take or make (or the
causing of any Property Owner to take or make or to decline to take or make) any
action, position or claim with respect to any Audit or tax return, as directed
by the party authorized under Section 17.16 to prepare, file and/or control such
tax return or Audit (e.g., with respect to Seller’s control of any Seller Audit
in accordance with Section 17.16(b)(i)); (B), the prompt furnishing and/or
making available by Seller, Purchaser and any Property Owner of any and all
relevant records, documents, consents, certificates, workpapers and other
information as may be necessary to control and defend any Audit and/or to
prepare and timely file any tax return; and (C) making employees available on a
mutually convenient basis to sign any tax return and/or sign-off on any Audit
and to provide additional information and explanation of any material provided
hereunder.

 

(c) For purposes of this Section 17.16, and as the context requires, any
reference to “Property Owner” in this Section 17.16 shall be deemed to refer to
and include any one or more of the Post-Transfer AFE entities.

 

SECTION 17.17         EXCULPATION.    (A) IF THE CLOSING SHALL OCCUR, OTHER THAN
EXPRESSLY CONTAINED IN GUARANTIES, INDEMNITIES OR AGREEMENTS ENTERED INTO AT
CLOSING BY SELLER, 8/9 TRANSFEREE AND/OR MCRLP OR SELLER’S AFFILIATES FOR THE
BENEFIT OF PURCHASER (AND/OR PURCHASER’S

 

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AFFILIATES), PURCHASER ACKNOWLEDGES AND AGREES THAT PURCHASER SHALL LOOK SOLELY
TO SELLER’S, AFE’S, PXURA’S, PXLA’S AND PXR’S INTERESTS IN THE PROPERTY, THE
GROUND LEASE AND THE SUBLEASE, AND SELLER’S LLC INTEREST, FOR THE RECOVERY OF
ANY JUDGMENT AGAINST SELLER ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREIN, AND NO OTHER PROPERTY OR ASSETS OF SELLER,
SELLER’S AFFILIATES OR ANY OF SELLER’S AND SELLER’S AFFILIATES DIRECT AND
INDIRECT SHAREHOLDERS, OFFICERS, DIRECTORS, PARTNERS, PRINCIPALS, MEMBERS,
EMPLOYEES, AGENTS, CONTRACTORS, AND ANY SUCCESSORS OR ASSIGNS OF THE FOREGOING
(COLLECTIVELY WITH SELLER, “SELLER RELATED PARTIES”) SHALL BE SUBJECT TO LEVY,
EXECUTION OR OTHER ENFORCEMENT PROCEDURE FOR THE SATISFACTION OF PURCHASER’S
REMEDIES UNDER OR WITH RESPECT TO THIS AGREEMENT.  PURCHASER AGREES TO INDEMNIFY
AND HOLD THE SELLER RELATED PARTIES HARMLESS FROM AND AGAINST ANY AND ALL
LOSSES, COSTS, DAMAGES, LIENS, CLAIMS, LIABILITIES OR EXPENSES (INCLUDING, BUT
NOT LIMITED TO, REASONABLE ATTORNEYS’ FEES, COURT COSTS AND DISBURSEMENTS)
(COLLECTIVELY, “LOSSES”) INCURRED BY ANY OF THE SELLER’S RELATED PARTIES ARISING
FROM OR BY REASON OF ANY DAMAGE TO PERSON OR PROPERTY CAUSED BY PURCHASER’S
BREACH OF THIS SECTION 17.17(A).

 

(B)           IF THE CLOSING OCCURS HEREUNDER, THEN OTHER THAN EXPRESSLY
CONTAINED IN GUARANTIES, INDEMNITIES OR AGREEMENTS ENTERED INTO AT CLOSING BY
PURCHASER, POST-TRANSFER AFE, ISTAR OR PURCHASER’S AFFILIATES FOR THE BENEFIT OF
SELLER (AND/OR SELLER’S AFFILIATES), SELLER ACKNOWLEDGES AND AGREES THAT SELLER
SHALL LOOK SOLELY TO PURCHASER’S, AFE’S, PXURA’S, PXLA’S AND PXR’S INTERESTS IN
THE PROPERTY, THE GROUND LEASE AND THE SUBLEASE, AND SELLER’S LLC INTEREST, FOR
THE RECOVERY OF ANY JUDGMENT AGAINST PURCHASER ARISING OUT OF OR RELATING TO
THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN, AND NO OTHER PROPERTY
OR ASSETS OF PURCHASER, PURCHASER’S AFFILIATES OR ANY OF PURCHASER’S AND
PURCHASER’S AFFILIATES DIRECT AND INDIRECT SHAREHOLDERS, OFFICERS, DIRECTORS,
PARTNERS, PRINCIPALS, MEMBERS, EMPLOYEES, AGENTS, CONTRACTORS, AND ANY
SUCCESSORS OR ASSIGNS OF THE FOREGOING (COLLECTIVELY WITH PURCHASER, “PURCHASER
RELATED PARTIES”) SHALL BE SUBJECT TO LEVY, EXECUTION OR OTHER ENFORCEMENT
PROCEDURE FOR THE SATISFACTION OF SELLER’S REMEDIES UNDER OR WITH RESPECT TO
THIS AGREEMENT.  SELLER AGREES TO INDEMNIFY AND HOLD THE PURCHASER RELATED
PARTIES HARMLESS FROM AND AGAINST ANY AND ALL LOSSES INCURRED BY ANY OF THE
PURCHASER’S RELATED PARTIES ARISING FROM OR BY REASON OF ANY DAMAGE TO PERSON OR
PROPERTY CAUSED BY SELLER’S BREACH OF THIS SECTION 17.17(B).

 

SECTION 17.18         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 SELLER’S LLC INTEREST OR THE PROPERTY.  THE PARTIES SHALL BE LEGALLY BOUND
WITH RESPECT TO THE PURCHASE AND SALE OF THE SELLER’S LLC INTEREST 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 HERETO, AND EACH OF SELLER
AND PURCHASER HAVE FULLY EXECUTED AND DELIVERED TO EACH OTHER A COUNTERPART OF
THIS AGREEMENT.  UNLESS AND UNTIL EACH OF SELLER AND PURCHASER HAVE FULLY
EXECUTED AND DELIVERED A COUNTERPART OF THIS AGREEMENT TO THE OTHER, NEITHER
SHALL HAVE ANY OBLIGATION WHATSOEVER TO THE OTHER, EXCEPT AS SET FORTH IN THE
CONFIDENTIALITY AGREEMENT.

 

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ARTICLE XVIII

SCHWAB MATTERS

 

SECTION 18.1           SCHWAB’S LEASE.

 

(A)           AS SET FORTH IN SECTION 7.1(E), PURCHASER IS PERMITTED TO HAVE
NEGOTIATIONS WITH SCHWAB REGARDING THE SCHWAB LEASE AND RELATED ISSUES.

 

SECTION 18.2           WORK ALLOWANCE AND ADDITIONAL WORK ALLOWANCE.

 

(A)           PURCHASER ACKNOWLEDGES THAT (I) PURSUANT TO AND IN ACCORDANCE WITH
THE PROVISIONS OF (X) SECTION 6.02 OF THE SCHWAB LEASE, PXLA IS OBLIGATED TO PAY
TO SCHWAB THE WORK ALLOWANCE, AND (Y) SECTION 6.05 OF THE SCHWAB LEASE, PXLA IS
OBLIGATED TO PAY TO SCHWAB THE ADDITIONAL WORK ALLOWANCE AND (II) THE ADDITIONAL
WORK ALLOWANCE IS REPAID TO THE LANDLORD UNDER THE SCHWAB LEASE DURING THE TERM
THEREOF IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.05(F) OF THE SCHWAB
LEASE.  IT IS THE INTENTION OF THE PARTIES THAT SELLER SHALL PROVIDE PURCHASER,
AT CLOSING, A CREDIT IN AN AMOUNT EQUAL TO ANY UNPAID PORTION OF THE WORK
ALLOWANCE (THE “WORK ALLOWANCE CREDIT), AND PURCHASER (TOGETHER WITH PURCHASER’S
AFFILIATES) SHALL, FROM AND AFTER THE CLOSING, ASSUME ALL OBLIGATIONS AND
LIABILITIES WITH RESPECT TO THE WORK ALLOWANCE AND ADDITIONAL WORK ALLOWANCE,
AND SHALL PAY TO SCHWAB SAME AS AND WHEN DUE.

 

(B)           NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THE FOREGOING,
PURCHASER SHALL INDEMNIFY, DEFEND AND HOLD THE SELLER RELATED PARTIES
(INCLUDING, WITHOUT LIMITATION, MCRLP AND COLUMBIA), HARMLESS FROM ANY AND ALL
LOSSES ARISING OR RESULTING OUT OF PURCHASER’S FAILURE TO PAY THE WORK ALLOWANCE
(UP TO, BUT NOT TO EXCEED THE AMOUNT OF THE WORK ALLOWANCE CREDIT) AND THE
ADDITIONAL WORK ALLOWANCE TO SCHWAB AS AND WHEN DUE.

 

(C)           IN THE EVENT THAT IT SHALL BE FINALLY DETERMINED (WHETHER BY
SETTLEMENT OR BY A FINAL, NON-APPEALABLE ORDER ISSUED BY A COURT OF COMPETENT
JURISDICTION) THAT ANY WORK ALLOWANCE PAYMENTS IN EXCESS OF THE WORK ALLOWANCE
CREDIT ARE OWED AFTER THE CLOSING TO SCHWAB UNDER SECTION 6.02 OF THE SCHWAB
LEASE, THEN SELLER SHALL INDEMNIFY, DEFEND, AND HOLD PURCHASER AND THE PURCHASER
RELATED ENTITIES HARMLESS FROM ANY AND ALL LOSSES ARISING ON ACCOUNT OF SUCH
EXCESS WORK ALLOWANCE PAYMENTS.

 

ARTICLE XIX

INDEMNITY

 

SECTION 19.1           INDEMNIFICATION BY SELLER.  IN ADDITION TO ANY OTHER
INDEMNITIES EXPRESSLY PROVIDED FOR IN THIS AGREEMENT, SELLER AGREES TO
INDEMNIFY, HOLD HARMLESS AND DEFEND PURCHASER FROM AND AGAINST:

 

(A)           ANY LOSSES WHICH ACCRUE OR WHICH ARE BASED UPON SELLER’S FAILURE
TO COMPLY WITH ITS CLOSING SURVIVING OBLIGATIONS OR EVENTS WHICH OCCURRED PRIOR
TO THE CLOSING DATE, EXCEPT FOR LOSSES ARISING OUT OF MATTERS WHICH ARE
PURCHASER’S LIABILITY UNDER THIS

 

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AGREEMENT, ALL MATTERS WHICH PURSUANT TO SECTION 5.4 OF THIS AGREEMENT SELLER
HAS DISCLAIMED LIABILITY OR RESPONSIBILITY FOR, INCLUDING, WITHOUT LIMITATION,
THE CONDITION OF THE PROPERTY ON OR PRIOR TO THE CLOSING DATE, AND MATTERS WHICH
ARE APPORTIONED HEREUNDER;

 

(B)           ANY LOSSES WHICH ACCRUE OR WHICH ARE BASED UPON EVENTS RELATED TO
THE EXCLUDED REAL PROPERTY WHICH OCCURRED PRIOR TO THE CLOSING DATE; AND

 

(C)           ALL REASONABLE COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’
FEES AND EXPENSES) INCURRED BY THE PURCHASER IN CONNECTION WITH ANY ACTION,
SUIT, PROCEEDING, DEMAND, ASSESSMENT OR JUDGMENT INSTITUTED BY A THIRD PARTY
AGAINST PURCHASER OR BY THE PURCHASER AGAINST SELLER OR A THIRD PARTY INCIDENT
TO ANY OF THE MATTERS INDEMNIFIED AGAINST IN THIS SECTION 19.1.

 

SECTION 19.2           INDEMNIFICATION BY PURCHASER.  IN ADDITION TO ANY OTHER
INDEMNITIES EXPRESSLY PROVIDED FOR IN THIS AGREEMENT, PURCHASER AGREES TO
INDEMNIFY, HOLD HARMLESS AND DEFEND SELLER FROM AND AGAINST:

 

(A)           ANY LOSSES WHICH ACCRUE OR WHICH ARE BASED ON PURCHASER’S FAILURE
TO COMPLY WITH ITS CLOSING SURVIVING OBLIGATIONS OR EVENTS WHICH OCCURRED ON OR
AFTER THE CLOSING DATE, INCLUDING, WITHOUT LIMITATION, ANY FAILURE ON THE PART
OF PURCHASER TO PAY (OR CAUSE TO BE PAID) THE RENEWAL TERM SCHWAB COMMISSIONS
AND ANY FAILURE ON THE PART OF PURCHASER (AND PURCHASER’S AFFILIATES) TO PERFORM
AS REQUIRED UNDER THIS AGREEMENT AND THE SCHWAB LEASE (EXCEPT AS THE OBLIGATIONS
OF PERFORMANCE THEREUNDER IS RETAINED BY SELLER AS EXPRESSLY PROVIDED IN THIS
AGREEMENT); AND

 

(B)           ALL REASONABLE COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’
FEES AND EXPENSES) INCURRED BY THE SELLER IN CONNECTION WITH ANY ACTION, SUIT,
PROCEEDING, DEMAND, ASSESSMENT OR JUDGMENT INSTITUTED BY A THIRD PARTY AGAINST
SELLER OR BY THE SELLER AGAINST PURCHASER OR A THIRD PARTY INCIDENT TO ANY OF
THE MATTERS INDEMNIFIED AGAINST IN THIS SECTION 19.2.

 

SECTION 19.3           SURVIVAL OF INDEMNITY.  THE PROVISIONS OF THIS ARTICLE
XIX SHALL SURVIVE THE CLOSING UNTIL THE TENTH (10TH) ANNIVERSARY OF THE CLOSING
DATE, UNLESS A SHORTER STATUTE OF LIMITATIONS SHALL APPLY.

 

ARTICLE XX

8/9 TRANSFEREE DEBT MAINTENANCE COVENANT

 

SECTION 20.1           MAINTENANCE COVENANT.  FROM THE CLOSING THROUGH THE
SECOND ANNIVERSARY OF THE CLOSING (THE “NET WORTH SURVIVAL PERIOD”), SELLER
SHALL CAUSE 8/9 TRANSFEREE, AND PURCHASER SHALL CAUSE POST-TRANSFER AFE, TO
MAINTAIN A NET WORTH OF NOT LESS THAN $10,000,000.00.  NOTWITHSTANDING ANYTHING
TO THE CONTRARY PROVIDED HEREIN, EACH OF SELLER AND PURCHASER SHALL HAVE THE
RIGHT AT ANY TIME DURING THE NET WORTH SURVIVAL PERIOD TO PROVIDE ESCROW AGENT
WITH CASH OR A LETTER OF CREDIT IN THE AMOUNT OF $10,000,000, IN WHICH CASE SUCH

 

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PARTY PROVIDING THE CASH OR LETTER OF CREDIT SHALL HAVE NO FURTHER OBLIGATIONS
UNDER THIS ARTICLE XX; PROVIDED, THAT IF EITHER PARTY HAS DELIVERED A LETTER OF
CREDIT, SUCH PARTY SHALL HAVE NO FURTHER OBLIGATIONS AS AFORESAID SO LONG AS
SUCH LETTER OF CREDIT REMAINS IN EFFECT THROUGH THE END OF THE NET WORTH
SURVIVAL PERIOD OR SO LONG AS THE ESCROW AGENT DRAWS ON ANY SUCH LETTER OF
CREDIT AND HOLDS CASH PROCEEDS IN-LIEU OF SUCH LETTER OF CREDIT.  ANY CASH OR
LETTER OF CREDIT DELIVERED TO ESCROW AGENT SHALL BE HELD BY ESCROW AGENT
PURSUANT TO AN ESCROW AGREEMENT IN FORM REASONABLY SATISFACTORY TO THE PARTIES. 
IF ANY PARTY PROVIDES CASH OR A LETTER OF CREDIT HEREUNDER, SUCH CASH OR LETTER
OF CREDIT (LESS ANY AMOUNTS DRAWN DOWN UNDER THE ESCROW AGREEMENT) SHALL BE
REFUNDED TO SUCH PARTY AT THE EXPIRATION OF THE NET WORTH SURVIVAL PERIOD.  “NET
WORTH” MEANS (A) IN THE CASE OF POST-TRANSFER AFE, NET WORTH COMPUTED IN
ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND (B) IN THE CASE OF
8/9 TRANSFEREE, THE VALUE OF THE EXCLUDED REAL PROPERTY AND ANY IMPROVEMENTS NOW
OR HEREAFTER BUILT THEREON LESS ANY DEBT SECURED THEREBY.  “LETTER OF CREDIT”
MEANS AN IRREVOCABLE, UNCONDITIONAL LETTER OF CREDIT, IN FORM APPROVED BY THE
PARTY RECEIVING SUCH LETTER OF CREDIT (WHICH APPROVAL SHALL NOT BE UNREASONABLY
WITHHELD, CONDITIONED OR DELAYED), NAMING ESCROW AGENT AS BENEFICIARY, ISSUED BY
A BANK ORGANIZED OR LICENSED UNDER THE LAWS OF THE UNITED STATES, OR ANY STATE
THEREOF, HAVING (I) A NET WORTH COMPUTED IN ACCORDANCE WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES IN EXCESS OF $1,500,000,000 AND (II) A SENIOR UNSECURED
DEBT RATING OF “A” OR BETTER AS RATED BY STANDARD AND POORS OR ‘A-2’ OR BETTER
AS RATED BY MOODY’S, AND PROVIDING FOR DRAWS BY SIGHT DRAFT IN NEW YORK OR NEW
JERSEY, HAVING A TERM OF NOT LESS THAN 60 DAYS.  SELLER AGREES TO INDEMNIFY,
DEFEND AND HOLD HARMLESS PURCHASER, POST-TRANSFER AFE AND THE OTHER ENTITIES
CONSTITUTING PROPERTY OWNER (AS RECONSTITUTED UPON CLOSING) FROM AND AGAINST ANY
AND ALL LOSSES WHICH ANY SUCH PERSONS MAY INCUR ON ACCOUNT OF SELLER’S FAILURE
TO CAUSE 8/9 TRANSFEREE TO COMPLY WITH SECTION 20.1.  PURCHASER AGREES TO
INDEMNIFY, DEFEND AND HOLD HARMLESS THE SELLER FROM AND AGAINST ANY AND ALL
LOSSES WHICH ANY SUCH PERSONS MAY INCUR ON ACCOUNT OF PURCHASER’S FAILURE TO
CAUSE POST-TRANSFER AFE TO COMPLY WITH SECTION 20.1.

 

SECTION 20.2           GUARANTY OF MAINTENANCE.  AT THE CLOSING, MCRLP SHALL
EXECUTE A GUARANTY PURSUANT TO WHICH MCRLP AGREES TO GUARANTY SELLER’S
OBLIGATIONS UNDER THIS ARTICLE XX.  AT THE CLOSING, ISTAR SHALL EXECUTE A
GUARANTY PURSUANT TO WHICH ISTAR AGREES TO GUARANTY PURCHASER’S OBLIGATIONS
UNDER THIS ARTICLE XX.

 

[The remainder of this page is intentionally left blank.]

 

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IN WITNESS WHEREOF, Seller and Purchaser have respectively executed this
Agreement as of the Effective Date.

 

 

PURCHASER:

 

 

 

iSTAR HARBORSIDE LLC

 

 

 

By:

iStar Harborside Member, LLC, member

 

 

 

 

By:

iStar Financial Inc., member

 

 

 

 

By:

/s/ H. CABOT LODGE, III

 

 

 

 

Name:

H. Cabot Lodge, III

 

 

 

Title:

Executive Vice President

 

SELLER:

 

 

 

M-C Harsimus Partners L.L.C.

 

 

 

By:

Mack-Cali Realty, L.P., sole member

 

 

 

 

 

By:

Mack-Cali Realty Corporation,

 

 

 

general partner

 

 

 

 

By:

/s/ MITCHELL E. HERSH

 

 

 

 

Name:

Mitchell E. Hersh

 

 

 

Title:

Chief Executive Officer

 

 

 

COLUMBIA DEVELOPMENT COMPANY, L.L.C.

 

 

 

By:

Atlantis Charter Company, L.L.C., member

 

 

 

 

By:

/s/ FRANK GUARINI

 

 

 

 

Name:

Frank Guarini

 

 

 

Title:

Member

 

 

 

 

 

 

and

 

 

 

By:

Columbia Charter Group, L.L.C., member

 

 

 

 

By:

/s/ JOSEPH PANEPINTO

 

 

 

 

Name:

Joseph Panepinto

 

 

 

Title:

Member

 

[Additional Signatures on Following Page]

 

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The undersigned is executing this Agreement for the sole and exclusive purpose
of evidencing its agreement with the matters set forth in Sections 3.2 and 4.3
and Article XVI of this Agreement.

 

 

ESCROW AGENT:

 

 

 

FIRST AMERICAN TITLE INSURANCE
COMPANY

 

 

 

By:

/s/ ANTHONY RUGGERI

 

 

 

Name:

Anthony Ruggeri

 

 

Title:

Vice President

 

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The undersigned is executing this Agreement for the sole and exclusive purpose
of evidencing its agreement set forth in Section 5.5 of this Agreement.

 

 

iSTAR FINANCIAL INC.

 

 

 

By:

/s/ H. CABOT LODGE, III

 

 

 

Name:

H. Cabot Lodge, III

 

 

Title:

Executive Vice President

 

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