PURCHASE AND SALE AGREEMENT

BETWEEN

FAIRFIELD INVESTORS, LLC,

AS SELLER,

AND

WHEELER REIT, L.P.,

AS BUYER

DATE: AS OF MAY 10, 2013

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PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made as of the 10th day
of May, 2013 (the “Effective Date”) by and between FAIRFIELD INVESTORS, LLC, a
Virginia limited liability company (the “Seller”), and WHEELER REIT, L.P., a
Virginia limited partnership (or its assignee pursuant to Section 9.1) (the
“Buyer”).

ARTICLE 1

PURCHASE AND SALE

Section 1.1. Agreement of Purchase and Sale. Subject to the terms and conditions
hereinafter set forth, on the Closing Date (as defined in Section 4.1), the
Seller agrees to sell, assign and convey to Buyer, and Buyer agrees to purchase
from the Seller, the following:

(a) any and all right, title and interest in and to Seller’s leasehold interest
in the Ground Lease (the “Ground Lease”) between Seller, as tenant, and
Fairfield TIC, LLC; DMF TIC, LLC; GCK TIC, LLC; and BCP TIC, LLC, as landlord
(together, the “Landlord”), dated March 31, 2012, for the property located in
the City of Virginia Beach, Virginia (the “Land”), which Land is more
particularly described in Exhibit A attached hereto and incorporated herein by
this reference, together with all of the Seller’s right, title and interest in
all buildings located thereon (the “Building”) and any other improvements and
fixtures (together with the Building, the “Improvements”) located thereon and
all rights, privileges and appurtenances pertaining thereto including all right,
title and interest in and to all rights-of-way and easements and strips and
gores of land adjacent thereto (herein collectively, the “Real Property”);

(b) any and all right, title and interest in and to all tangible personal
property and equipment located on the Real Property (the “Personal Property”);

(c) any and all right, title and interest in and to the following:

(i) any and all leases, licenses and occupancy agreements in which Seller is the
landlord or licensor (as the same may have been amended, restated, supplemented,
altered or otherwise modified from time to time), covering all or any portion of
the Real Property and any lease guarantees (the “Leases”) all of which Leases
are listed and described on Schedule 1, as supplemented as set forth below, in
each case to the extent they are in effect on the Closing Date (as defined in
Section 4.1). Any Leases entered into after the Effective Date in accordance
with Section 5.2(b) hereof shall be deemed for purposes of this Agreement to
constitute Leases, and the defined term Leases as used herein shall be deemed to
have been revised to include and incorporate any such Leases;

(ii) all rents and other sums due under such Leases (the “Rents”); and

(iii) any and all security deposits or letters of credit held by or on behalf of
Seller under the Leases (the “Security Deposits”).

 

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(d) any and all of the Seller’s right, title and interest in and to the
following (to the extent they are in effect on the Closing Date):

(i) all service contracts and agreements (collectively, the “Contracts”)
relating to the upkeep, repair, maintenance, leasing, management and operation
of the Real Property or the Personal Property, to the extent Buyer has agreed to
assume one or more of the Contracts pursuant to Section 3.2 hereof. Any
Contracts entered into after the Effective Date in accordance with
Section 5.2(c) hereof shall be deemed for purposes of this Agreement to
constitute Contracts, and the defined term Contracts as used herein shall be
deemed to have been revised to include and incorporate any such Contracts;

(ii) all warranties and guaranties (express or implied) issued to, and held in
the name of, Seller in connection with the Real Property or the Personal
Property (the “Warranties”); and

(iii) all permits, licenses, approvals and authorizations issued by any
governmental authority in favor of Seller in connection with the Real Property
(the property described in this Section 1.1(e) being sometimes herein referred
to collectively as the “Intangibles”).

The term “Property” shall mean the Real Property, the Personal Property, the
Leases, Rents, Security Deposits, and the Intangibles.

Section 1.2. Consideration. The Seller is to sell, and Buyer is to acquire and
accept, the Property for the sum of One Million Three Hundred Ninety-Two
Thousand Four Hundred and No/Dollars ($1,392,400) (the “Sale Price”). The Sale
Price shall be subject to the credits, prorations and adjustments described
under Section 4.4 hereof.

Section 1.3. Method of Payment. The Sale Price shall be payable by Buyer in cash
subject to the adjustments pursuant to Section 4.4 below and the amounts to be
paid by Seller pursuant to Section 4.5 below.

Section 1.4. Independent Contract Consideration. Buyer has as of the date hereof
delivered to the Seller the amount of TEN AND NO/100 DOLLARS ($10.00), the
receipt and sufficiency of which is hereby acknowledged by the Seller (the
“Independent Contract Consideration”), which amount the Seller and Buyer agree
has been bargained for as consideration for the Seller’s execution and delivery
of this Agreement and Buyer’s right to inspect the Property pursuant to ARTICLE
III. The Independent Contract Consideration is in addition to and independent of
any other consideration or payment provided for in this Agreement and is
non-refundable in all events.

ARTICLE 2

TITLE AND SURVEY

Section 2.1. Title, Survey and Zoning Objections.

(a) On or prior to the Effective Date, Buyer shall request the Buyer’s title
company (the “Title Company”) to issue its leasehold title insurance commitment
for the Real Property, along with all requested endorsements (which may require
the issuance of a zoning compliance letter) (the “Title Commitment”) and may
engage a licensed surveyor to prepare an ATLA/ACSM survey of the Real Property
(the “Surveys”). No later than 5:00 p.m. Virginia

 

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Beach, Virginia local time on the date 35 days after the Effective Date (the
“Approval Date”) (with the period from the Effective Date to the Approval Date
referred to herein as the “Due Diligence Period”), Buyer shall have the right to
notify the Seller in writing of its objection to any matters disclosed by the
Title Commitment or the Survey or any other matters of record (collectively, the
“Title Objections”). Upon receipt of any such timely written notice of Title
Objections from the Buyer, the Seller may, but shall not be obligated to, cure
the Title Objections on or before the Closing Date. The Seller shall notify
Buyer in writing within three (3) days of receiving the Title Objections as to
its decision to either cure or not cure the Title Objections. Notwithstanding
the foregoing, in the event that the Title Objection is a monetary lien, charge
or encumbrance voluntarily placed against the Property by Seller which is able
to be removed by the payment of a certain sum, or a judgment or mechanics’ lien
caused by the acts of Seller, then Seller shall be required to cure the Title
Objection by paying the certain sum or the sum required to remove the judgment
or mechanics’ lien on or prior to the Closing Date (“Monetary Liens”). In the
event Buyer fails to deliver a notice of any Title Objections by the end of the
Due Diligence Period, Buyer shall be conclusively deemed to have waived and
accepted any and all matter which are of record as of the effective date of the
Title Commitment, including exceptions listed in the Title Commitment and
matters that would be disclosed by a physical survey (other than the Monetary
Liens). If the Seller fails to respond to Buyer’s written notice of any Title
Objections with the 3-day time frame described above, the Seller shall be
conclusively deemed to have elected to cure or satisfy the Title Objections.

(i) If the Seller elects by notice not to cure any Title Objection, then the
Buyer’s sole right and remedy shall be, on the terms and conditions set forth
below, either: (x) to elect not to purchase the Property, in which event this
Agreement shall be terminated; or (y) to complete the transactions contemplated
hereby in accordance with this Agreement subject to such Title Objection without
reduction in or abatement of the Sale Price.

(ii) The Buyer shall exercise its options pursuant to clause (x) of Sections
2.1(a)(i) above by written notice given to and received by the Seller within
five (5) business days after the receipt by Buyer of Seller’s notice that the
Seller will not cure the Title Objections. If the Buyer shall fail to send a
written notice to the Seller exercising the Buyer’s option set forth under
clause (x) of Sections 2.1(a)(i) and/or (ii) within the applicable period, then
the Buyer shall conclusively be deemed to have exercised the option set forth in
clause (y) of Section 2.1(a)(i).

Section 2.2. Permitted Exceptions. For purposes of this Agreement, the term
“Permitted Exceptions” shall mean all title exceptions and survey matters
pertaining to the Property which: (i) are of record as of the date of the Title
Commitment and/or Survey (other than Monetary Liens) and are not the subject of
a Title Objection made by Buyer pursuant to this ARTICLE 2, or (ii) constitute
Title Objections made by Buyer which Seller has elected not to cure (or have
caused the Title Company to endorse or insure over), and which Buyer has elected
(or is deemed to have elected) to accept pursuant to this ARTICLE II, or
(iii) are otherwise expressly stated in this Agreement as being Permitted
Exceptions.

Section 2.3. Assignment of Ground Lease. At Closing, Seller shall assign and
transfer to Buyer, and Buyer shall accept and assume, all of Seller’s leasehold
interest in the Ground Lease.

 

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ARTICLE 3

DUE DILIGENCE INVESTIGATION; ACCESS

Section 3.1. Delivery of Due Diligence Documents. Seller agrees to deliver to
Buyer, without charge to Buyer, copies of the documents set forth on Exhibit K,
to the extent in possession of the Seller or reasonably available to the Seller
at no additional expense to the Seller (collectively the “Due Diligence
Documents”). In addition to the foregoing, (1) Buyer shall have the right to
interview tenants on the Property upon the giving of notice thereof to the
Seller who shall have an opportunity to be present, and (2) Seller hereby agrees
to promptly deliver or make available to Buyer any other documents relating to
the Property reasonably requested by Buyer

Section 3.2. Review and Approval of Contracts. On or before the Closing Date,
Buyer shall notify Seller in writing as to which of the Contracts, if any, Buyer
elects to assume at Closing except that Buyer shall in all events assume the
obligations of Seller to pay any and all real estate commissions to Wheeler Real
Estate, LLC pursuant to the Leases, accruing from and after the Closing Date
with respect to any renewal term exercised by any Tenant on or after the
Effective Date. Unless such notice is given by Buyer, Buyer shall at and as of
the Closing not assume such Contracts. Those Contracts not assumed by Buyer
shall be terminated by the Seller as of the Closing Date.

Section 3.3. Access. Seller agrees to provide Buyer access to the Property
following the Effective Date for the purpose of performing, at Buyer’s sole cost
and expense, studies, appraisals, physical inspections, investigations and any
tests on the Property deemed necessary by Buyer (the “Tests”) provided that such
Tests shall be conducted in a manner so as to not disturb or unreasonably
interfere with the current use of the Property. Upon completion of such Tests,
Buyer agrees at its sole cost to restore the Property to substantially the
condition it was in immediately prior to such Tests. Buyer shall indemnify,
defend (with counsel reasonably satisfactory to the Seller), protect, and hold
the Seller harmless from and against any and all liability, loss, cost, damage,
or expense (including, without limitation, reasonable, actual attorney’s fees
and costs) which Seller may sustain or incur by reason of or in connection with
any Tests made by Buyer or Buyer’s agents or contractors relating to or in
connection with the Property, or entries by Buyer or its agents or contractors
onto the Property. Buyer shall maintain comprehensive general liability
insurance in an amount not less than Two Million Dollars ($2,000,000.00) per
occurrence, which insurance shall name the Seller as an additional insured, and
Buyer shall maintain such insurance through Closing.

ARTICLE 4

CLOSING; CLOSING ADJUSTMENTS AND COSTS; CONDITIONS

Section 4.1. Time and Place. Subject to Section 4.6, Section 4.7 and
Section 5.4, the consummation of the transactions contemplated hereby (the
“Closing”) shall be held at the offices of Buyer’s counsel on a date determined
by Buyer, but no earlier than June 15, 2013 and no later than August 15, 2013
(the “Closing Date”). At the Closing, the Seller and Buyer shall perform the
obligations set forth in, respectively, Section 4.2 and Section 4.3, the
performance of which obligations shall be concurrent conditions.

 

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Section 4.2. Seller’s Obligations at Closing. At or prior to Closing, the Seller
shall execute (or cause the execution of) and deliver the following to Buyer
(the “Seller’s Closing Documents”):

(i) a duly executed assignment and assumption agreement assigning Seller’s
leasehold interest in the Ground Lease and by which Buyer shall assume Seller’s
obligations under the Ground Lease (the “Ground Lease Assignment”) in the form
attached hereto and made a part hereof as Exhibit B;

(ii) a duly executed bill of sale with respect to the Personal Property located
on the Property (the “Bill of Sale”) in the form attached hereto and made a part
hereof as Exhibit C;

(iii) a duly executed Assignment and Assumption of Leases (the “Assignment and
Assumption of Leases”) in the form attached hereto and made a part hereof as
Exhibit D;

(iv) a duly executed Assignment and Assumption of Contracts (the “Assignment and
Assumption of Contracts”) in the form attached hereto and made a part hereof as
Exhibit E;

(v) a duly executed Assignment and Assumption of Warranties and Guaranties (the
“Assignment and Assumption of Warranties and Guaranties”) in the form attached
hereto and made a part hereof as Exhibit F;

(vi) a duly executed Assignment and Assumption of Licenses and Permits (the
“Assignment of Licenses and Permits”) in the form attached hereto and made a
part hereof as Exhibit G;

(vii) notices (the “Tenant Notices”) in the form attached hereto and made a part
hereof as Exhibit H sent or to be sent by the Buyer to each tenant under each of
the Leases on or after the Closing Date;

(viii) a tenant estoppel certificate executed by the Tenant under each of the
Leases (as defined below) in substantially the same form attached hereto and
made a part hereof as Exhibit J;

(ix) the original Ground Lease, Leases, Contracts, Warranties and documented or
certificated Intangibles (including, without limitation, all certificates of
occupancy) relating to the Property, which shall be assigned by the Seller and
assumed by Buyer hereunder, (to the extent originals are available and, if not,
certified copies thereof), together with such leasing and property files and
records related to the Property. To the extent reasonably necessary, Buyer shall
make the original Leases, Contracts, Warranties and documented or certificated
Intangibles available to the Seller for a period of twelve (12) months after the
Closing Date for the Seller’s review and/or copying during the Buyer’s normal
business hours;

(x) possession of the Property and keys to all locks on the Property;

 

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(xi) a certificate regarding Seller’s non-foreign status for purposes of
Section 1445 of the Code in the form attached hereto and made a part hereof as
Exhibit I duly executed by each Seller;

(xii) a resolution (or other documentation) evidencing the authority of Seller
to consummate the transactions contemplated herein and the authority of the
signatory to this Agreement and the Related Documents to enter into this
Agreement and the Related Documents;

(xiii) such additional documents as Title Company shall reasonably require to
consummate the transactions contemplated in this Agreement (including, but not
limited to, organizational documents of the Seller, a certificate of good
standing of the Seller, a standard form owner’s affidavit, and a gap indemnity
agreement but excluding any document required by the Title Company for the
purpose of eliminating any Permitted Exception as an exception to the title
policy to be issued by the Title Company; and

(xiv) a certificate, dated as of the Closing Date and duly executed by the
Seller, certifying: (i) that all of the representations and warranties of the
Seller set forth in this Agreement, as modified pursuant to Section 5.4, are
true and accurate in all material respects as of the Closing Date; and (ii) the
manner in which the information set forth in the various Schedules attached to
this Agreement has changed as of the Closing Date, if applicable;

(xv) an estoppel certificate executed by the Landlord in substantially the same
form as attached hereto as Exhibit L.

Section 4.3. Buyer’s Obligations at Closing. At the Closing, Buyer shall:

(a) pay to the Seller the amount of the Base Cash Amount and the Adjusted Cash
Amount in the manner set forth in Section 1.3, plus any other fees, costs,
expenses and amounts set forth as Buyer’s obligations in Section 4.4 and
Section 4.5;

(b) join Seller in the execution of the Ground Lease Assignment;

(c) join Seller in the execution of the Assignment and Assumption of Leases;

(d) join Seller in the execution of the Assignment and Assumption of Contracts;

(e) join Seller in the execution of the Assignment and Assumption of Warranties
and Guaranties;

(f) join Seller in the execution of the Assignment of Licenses and Permits;

(g) deliver to the Seller such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Buyer;

(h) deliver certificates in the names of the Electing Members to the Seller
representing the OP Units; and

 

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(i) deliver such additional documents as shall be reasonably required by the
Title Company to consummate the transaction contemplated by this Agreement.

Section 4.4. Credits and Prorations. The following adjustments to the Sale Price
paid hereunder shall be made between the Seller and Buyer and shall be prorated
(as applicable) on a per diem basis as of 12:01 a.m. on the Closing Date:

(a) Rent. All rent (excluding tenant reimbursements for Operating Expenses (as
defined in Section 4.4(b)) and other collected income (and any applicable state
or local tax on rent) under Leases in effect on the Closing Date shall be
prorated as of the Closing. Buyer shall be credited with any rent and other
income collected by Seller but applicable to any period of time after Closing.
Any rent received by Seller after the Closing with respect to time periods after
the Closing shall be delivered to Buyer within three (3) days of Seller’s
receipt thereof. After the Closing, Buyer shall apply rent and other income from
tenants that are collected after the Closing first to the obligations then owing
to Buyer for its period of ownership and to those reasonable attorney fees
incurred by Buyer in collecting said amount, remitting the balance, if any, to
the Seller if any amounts are still owed to such Seller by the tenant or tenants
for the period of time prior to the Closing Date.

(b) Operating Expenses. The Seller, as landlord under the Leases, is currently
collecting from tenants under the Leases additional rent to cover taxes,
insurance, utilities (to the extent not paid directly by tenants), common area
maintenance and other operating costs and expenses (collectively, “Operating
Expenses”) in connection with the ownership, operation, maintenance and
management of the Real Property. The Seller and Buyer shall each receive a debit
or credit, as the case may be, for the difference between the tenants’ current
account balances for Operating Expenses and amount of Operating Expenses
reimbursable to the Seller. The parties shall reasonably estimate Operating
Expenses for the Seller’s period of ownership if final bills are not available.
Those Operating Expenses being paid directly by tenant shall not be prorated.
Operating Expenses that are not payable by tenants either directly or
reimbursable under the Leases shall be prorated between the Seller and Buyer on
an accrual basis.

(c) Taxes and Assessments. Real estate taxes and assessments imposed by
governmental authority that are not yet due and payable and that are not
reimbursable by tenants under the Leases as Operating Expenses shall be prorated
as of the Closing based upon the most recent ascertainable assessed values and
tax rates. The Seller shall receive a credit for any taxes and assessments paid
by the Seller and applicable to any period after the Closing. All refunds or tax
savings relating to real estate taxes shall inure to the benefit of the Seller
if such refunds or tax savings relate to any period for which the Seller owned
the Property. Buyer shall have no obligation to pursue any such refunds or
savings. Buyer shall remit to the Seller any such refund or tax savings relating
to such period immediately upon Buyer’s receipt, after deducting any amounts due
to tenants under the Leases. Any additional taxes relating to the year of
Closing or prior years arising out of a change in the use of the Property by
Buyer or the change in ownership contemplated by this Agreement shall be assumed
by Buyer effective as of Closing and paid by Buyer when due and payable, and
Buyer shall indemnify the Seller from and against any and all such taxes, which
indemnification obligation shall survive the Closing.

 

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(d) Final Adjustment After Closing. If final prorations cannot be made at
Closing for any item being prorated under this Section 4.4, then Buyer and the
Seller agree to allocate such items on an accrual basis as soon as the necessary
invoices or bills are available for purposes of a final computation of
prorations and applicable reconciliation with tenants have been completed, with
a final adjustment of prorations to be made no later than sixty (60) days after
the Closing Date. Income and expenses shall be received and paid by the parties
on an accrual basis with respect to their period of ownership. Payments in
connection with the final adjustment shall be due in cash within thirty
(30) days of written notice of such final adjustment amount. Each party shall
have reasonable access to, and the right to inspect and audit the other party’s
supporting documentation to confirm the final prorations; provided at least five
(5) business days advance notice is given by the auditing party to the audited
party. To the extent that water consumption or other utility charges may
constitute a lien against the Real Property, the Seller agrees that an
appropriate amount with respect to accrued but unpaid charges for water
consumption or other utility charges may be held in escrow by the Title Company
in connection with its issuance of a title insurance policy to Buyer.

(e) Leasing Commissions and Cost of Tenant Finish. Except as otherwise expressly
set forth herein, any Tenant Inducement Costs (as hereafter defined) and Leasing
Commissions (as hereafter defined) (collectively, “Tenant Payment Obligations”)
paid or incurred by Seller prior to the Effective Date shall remain the Seller’s
obligation and shall be paid by Seller at or prior to Closing. Any Tenant
Payment Obligations paid or incurred by Seller after the Effective Date and
prior to Closing shall be Buyer’s obligation, provided Buyer approved such
corresponding leases to the extent required under Section 5.3(b) hereof. If any
Tenant Payment Obligations for which the Seller is responsible are not due and
payable until after the Closing Date, then, at Closing, Buyer shall assume the
Tenant Payment Obligations and receive a credit against the Sale Price in the
amount of such Tenant Payment Obligations. For purposes hereof the term “Tenant
Inducement Costs” shall mean any out-of-pocket payments required under a lease
to be paid by the landlord thereunder (including the cost of work to be
performed by or on behalf of the landlord) to or for the benefit of the tenant
thereunder, which is in the nature of a tenant inducement or concession,
including, without limitation, tenant improvement costs, and other work
allowances, lease buyout costs, free rental periods, legal fees and expenses and
moving allowances; and the term “Leasing Commissions” shall mean any leasing
commission payable to any third party broker or affiliate of Seller in
connection with a lease for the existing term of any lease in effect on the
Effective Date.

(f) Tenant Deposits. All tenant security deposits received by Seller or owing
from tenants under the Leases (and interest thereon if required by law or
contract to be earned thereon) and not theretofore applied to tenant obligations
under the Leases shall be transferred or credited to Buyer at Closing or placed
in escrow if required by law. As of the Closing, Buyer shall assume Seller’s
obligations related to tenant security deposits. To the extent that any such
tenant security deposit to be so transferred is in the form of a letter of
credit and as such is not transferable as of the Closing Date, the Seller and
Buyer shall cooperate with each other and take all steps necessary prior to
Closing (or, if necessary, as soon as possible immediately following Closing) to
transfer such letter(s) of credit to Buyer or to obtain replacement letter(s) of
credit with respect thereto in favor of Buyer. Until any such letter of credit
shall be transferred or replaced, the Seller shall hold the same for the benefit
of Buyer and shall draw upon the same and deliver the proceeds to Buyer or
return the same to the applicable tenant, in each case upon Buyer’s written
request provided that circumstances exist which authorize the landlord to draw
upon the letter of credit under the applicable Lease.

 

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(g) Utilities; Utility Deposits. Buyer shall take all steps necessary to
effectuate the transfer of all utilities (other than those paid directly by
tenants) to its name as of the Closing Date, and where necessary, post deposits
with the utility companies. The Seller shall ensure that all utility meters
(other than those paid directly by tenants) are read as of the Closing Date. The
Seller shall be entitled to recover any and all deposits held by any utility
company as of the Closing Date. Any utility deposits not recovered by the Seller
shall be transferred to and assumed by Buyer and the Seller shall receive an
equal credit for the same at Closing. To the extent that utility meters cannot
be read as of the Closing Date, then a proration estimation shall be made based
on the most recently available readings, with adjustments to be made after the
Closing in accordance with Section 4.4(d).

(h) Insurance. The fire, hazard, and other insurance policies relating to the
Property shall be cancelled by Seller as of the Closing Date and shall not,
under any circumstances, be assigned to Buyer. All unearned premiums for fire
and any additional hazard insurance premium or other insurance policy premiums
with respect to the Property shall be retained by Seller.

The provisions of this Section 4.4 shall survive Closing.

Section 4.5. Transaction Taxes and Closing Costs.

(a) The Seller shall pay for the following fees, costs and expenses:

(i) the fees of any counsel representing the Seller in connection with this
transaction;

(ii) the Virginia grantor’s tax in connection with the recordation of the Ground
Lease Assignment;

(iii) the cost or fee for the insurance or endorsement over any Title Objection
cured by Seller by such insurance or endorsement pursuant to Section 2.1(a)
hereof;

(iv) one-half of any escrow charges incurred hereunder; and

(v) all other closing costs incurred by Seller on Seller’s behalf in connection
with this transaction.

(b) Buyer shall pay the following fees, costs and expenses:

(i) the fees of any counsel representing Buyer in connection with this
transaction;

(ii) the recordation tax in connection with the recordation of the Ground Lease
Assignment;

 

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(iii) the recording fees for the Ground Lease Assignment;

(iv) (A) the cost of the premium for an ALTA owner’s/lender’s title insurance
policy for the Property and (B) any other fees or premiums for extended coverage
or any endorsements requested by Buyer (excluding, however, any cost or fee for
the insurance or endorsement over any Title Objection cured by Seller by such
insurance or endorsement pursuant to Section 2.1(a));

(v) all costs and expenses incurred in connection with the preparation of the
Surveys requested by Buyer;

(vi) one-half of any escrow charges incurred hereunder; and

(vii) all other closing costs incurred by Buyer on Buyer’s behalf in connection
with this transaction.

Section 4.6. Conditions Precedent to Obligation of Buyer. The obligation of
Buyer to consummate the transaction hereunder shall be subject to the
fulfillment on or before the Closing Date of all of the conditions set forth in
this Section 4.6, any or all of which may be waived by Buyer, in writing, in its
sole discretion. In the event any of the conditions set forth in this
Section 4.6 are not satisfied on or before Closing and Buyer does not waive such
condition, as provided in the previous sentence, then this Agreement shall
terminate and no party shall have any further obligations to the other parties.
In the event that the failure of a condition is due to a default by Seller, then
the provisions of Section 6.2 shall apply.

(a) The Seller shall have delivered to Buyer all of the items required to be
delivered to Buyer pursuant to the terms of this Agreement, including but not
limited to, those provided for in Section 4.2;

(b) The representations and warranties of the Seller contained in this Agreement
(as the same may be modified from time to time as set forth in Section 5.4)
shall have been true and correct in all material respects as of the Effective
Date and shall be true and correct in all material respects as of the Closing
Date;

(c) The Seller shall have performed and observed, in all material respects, all
covenants and agreements of this Agreement to be performed and observed by the
Seller as of the Closing Date;

(d) Title to the Property shall be in a condition as contemplated by Sections
2.3, 2.4 and 5.1(e) hereof;

(e) The physical condition of the Real Property shall be substantially the same
on the Closing Date as on the Effective Date, except for changes thereto which
result from or are attributable to: (i) reasonable or normal wear and tear,
(ii) the exercise by Seller or Buyer of any of their respective rights or
obligations under this Agreement, (iii) any acts done, suffered or caused by
Buyer or any affiliate, contractor, officer, director, member, manager,
employee, agent, representative, successor or assign thereof, (iv) any matter
covered or addressed under Article 7, (v) any work, remodeling, alterations,
improvements or repairs which is/are required to

 

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be done or furnished pursuant to the terms of any Lease and/or which is/are done
in response to or as a result of an emergency situation with respect to the
Property, (vi) any work required to be done under or pursuant to, or in any way
related or incidental, to any Contract, and/or (vii) any work, remodeling,
alterations, improvements or repairs to which Buyer has consented in writing,
which consent may not be unreasonably withheld or delayed; and

(f) Buyer’s general partner, Wheeler Real Estate Investment Trust, Inc., shall
have successfully obtained adequate financing.

Section 4.7. Conditions Precedent to Obligation of the Seller. The obligation of
the Seller to consummate the transaction hereunder shall be subject to the
fulfillment on or before the Closing Date of all of the following conditions,
any or all of which may be waived by Seller in its sole discretion:

(a) The Seller shall have received the Sale Price as adjusted as provided
herein;

(b) Buyer shall have delivered to the Seller all of the items required to be
delivered to the Seller pursuant to the terms of this Agreement, including but
not limited to, those provided for in Section 4.3;

(c) All of the representations and warranties of Buyer contained in this
Agreement shall have been true and correct in all material respects as of the
Effective Date and shall be true and correct as of the Closing Date; and

(d) Buyer shall have performed and observed, in all material respects, all
covenants and agreements of this Agreement to be performed and observed by Buyer
as of the Closing Date.

ARTICLE 5

REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 5.1. Representations and Warranties of Seller and Guarantor. Seller
hereby makes the following representations and warranties to Buyer as of the
Effective Date, each of which representations and warranties is subject to the
exceptions thereto (if any) set forth on Schedule 2 attached hereto and made a
part hereof (as the same may be revised and/or updated from time to time
pursuant to Section 5.4 the “Seller’s Disclosure Schedule”), and the other terms
and provisions of this Agreement:

(a) Organization and Authority. Seller has been duly organized and is in good
standing under the laws of the state of its formation and the state in which the
Real Property is located. Seller has the full right and authority to enter into
this Agreement and to transfer all of the Property and to consummate or cause to
be consummated the transactions contemplated by this Agreement. The persons
signing this Agreement on behalf of Seller are authorized to do so.

(b) Noncontravention. Neither the entry into nor the performance of, or
compliance with, this Agreement by Seller has resulted, or will result, in any
violation of, or default under, or result in the acceleration of, any obligation
under any existing organizational

 

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documents or agreements, mortgage, indenture, lien agreement, note, contract,
permit, judgment, decree, order, restrictive covenant, statute, rule, or
regulation applicable to the Seller (excluding the Loan Documents).

(c) Agreement Binding. This Agreement constitutes a legal, valid and binding
obligation of Seller enforceable against Seller in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights and by
general principles of equity (whether applied in a proceeding at law or in
equity). All Related Documents executed by the Seller at the Closing will be
duly authorized, executed, and delivered by the Seller, are or at the Closing
will be legal, valid, and binding obligations of the Seller, are sufficient to
convey title, and do not violate any provisions of any agreement to which Seller
is a party or to which it is subject (excluding the Loan Documents). The term
“Related Documents” shall mean any document or instrument executed and/or
delivered by Seller or Buyer in connection with or pursuant to the Closing of
the transaction contemplated by this Agreement including, without limitation,
the Deed, Bill of Sale, Assignment and Assumption of Leases, Assignment and
Assumption of Contracts, Assignment and Assumption of Guaranties and Warranties,
Assignment and Assumption of Licenses and Permits and the FIRPTA Certificate.

(d) Consents. Each consent, approval, authorization, order, license,
certificate, permit, registration, designation, or filing by or with any
governmental agency or body necessary for the execution, delivery, and
performance of this Agreement or the transactions contemplated hereby by the
Seller have been obtained or will be obtained on or before the Closing Date.

(e) Ownership. Seller represents and warrants to Buyer (i) that no
understanding, agreement (either express or implied), or reasonable expectancy
of agreement with respect to the sale, lease or other transfer of the Property
exists between Seller and any third party other than those leases provided to
Buyer pursuant to Section 3.1 hereof, and (ii) that each Seller is in no way
restricted from negotiating and entering into an agreement with Buyer and
selling the Property to Buyer.

(f) Leases. There are no Leases at the Real Property other than those described
on Schedule 2 attached hereto. The Seller has heretofore delivered to Buyer true
and complete copies of all of the material documents which comprise the Leases
(and any material amendments thereto). There are no other understandings, oral
or written, between Seller or any of the tenants with respect to the Leases.
Seller is not aware of any default under any of the Leases and has not received
nor delivered a written notice declaring a default by landlord or tenant under
any of the Leases (which has not otherwise been cured). There are no agreements
with respect to any leased space allowing the tenant any concession, reduction
or abatement of rent, or allowing the payment of any rent other than in cash
except as set forth in the Leases; the security deposits thereunder have not
been pledged or assigned by the landlord to any third party other than in
connection with indebtedness to be paid off at Closing or assumed by Buyer; no
rentals or other payments for periods in excess of one month have been received
under any lease except as reflected on the rent roll delivered to Buyer; and
there are no tenant leases or any other document or instrument which give any
tenant the right to purchase the Property or any part thereof.

 

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(g) Tenant Inducement Costs and Leasing Commissions. Except as set forth on
Schedule 2 of the Disclosure Schedule, Seller is not obligated to pay any Tenant
Payment Obligations with respect to any of the Leases.

(h) Contracts. Seller has heretofore delivered to Buyer true and complete copies
of all of the material documents which comprise the Contracts (and any material
amendments thereto). There are no other understandings, oral or written, between
Seller and any of the other parties to the Contracts with respect to the
Contracts. Seller is not aware of any default under any of the Contracts and has
not received nor delivered a written notice declaring a default under any of the
Contracts (which has not otherwise been cured).

(i) Oral Agreements. No oral agreement has been entered into with any person or
entity relating to or connected with the ownership, construction, use,
operation, maintenance or condition of the Property which would be binding upon
Buyer at or subsequent to the Closing.

(j) Environmental. To the best of the Seller’s actual knowledge, information and
belief, (i) the Real Property is not presently being used, or has ever been
used, for the storage or disposal of any hazardous or toxic waste or as a dump
site for hazardous or toxic waste, (ii) the Real Property has not been affected
by the presence of, and there is not present, oil, hazardous waste, toxic
substances or other pollutants or materials that could be a detriment to the
Real Property or in violation of any local, state or federal law or regulation,
(iii) there is no soil condition adversely affecting the Real Property and the
Real Property is not in an area identified by any agency or department of the
federal, state or local government as containing endangered species, (iv) there
are no state of facts which could cause any portion of the Real Property to be
designated as containing any endangered species, and (v) there are no
underground storage tanks on or under the Real Property, nor have underground
storage tanks been removed from the Real Property.

(k) No Pending Actions. Seller has not received any written notice of: (i) any
pending (and to Seller’s knowledge there is no threatened) action, suit,
arbitration, unsatisfied order or judgment relating to the Real Property; or
(ii) any government investigation or proceeding pending against Seller or the
Real Property; or (iii) any pending (or to Seller’s knowledge, threatened)
condemnation, taking or eminent domain proceedings against the Real Property.

(l) Certificates of Occupancy and Use. To Seller’s knowledge, all required
certificates of occupancy for the Real Property or any portion thereof have been
issued and are in full force and effect. To Seller’s knowledge, the use being
made of the Real Property complies with all such certificates of occupancy.

(m) No Violations. Seller has not received written notice of any material
violations of any laws enacted by any federal, state, local or other
governmental agency or regulatory body with respect to the Real Property which
remain uncured and could materially and adversely affect the use and operation
or the value of the Real Property or materially and adversely interfere with the
consummation of the transaction contemplated by this Agreement.

 

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(n) Insurance. Seller has not received any written notice from any insurance
company which has issued a policy with respect to the Property requesting
performance of any structural or other major repairs or alterations to any of
the Property which has not been complied with. Seller has not received from any
insurance company presently insuring the Property any notice of cancellation of
any policy or of a material increase in the current premium of any policy. The
Seller agrees to keep present coverages in full force and effect, and to pay the
premiums thereon, until the date of Closing.

(o) Bankruptcy. Seller has not made a general assignment for the benefit of
creditors, filed any voluntary petition in bankruptcy or suffered the filing of
an involuntary petition by its creditors, suffered the appointment of a receiver
to take possession of substantially all of its assets, suffered the attachment
or other judicial seizure of substantially all of its assets, admitted its
inability to pay its debts as they come due, or made an offer of settlement,
extension or composition to its creditors generally.

(p) Commitments. The Seller has not made, and prior to Closing hereunder shall
not make, any commitments to any government authority or agency, utility
company, or to any other organization, group or person relating to the Real
Property that would impose on Buyer or the Real Property (or any future owner
thereof) the obligation to make on or after the Closing any contributions of
money, dedication of land or grants of easements, rights-of-way or other things,
or to construct, install or maintain any improvements, public or private, on or
off the Real Property.

(q) No Termination of Utilities. Seller has not received any written notice of
the termination or impairment of the furnishing of services to the Property or
any component thereof of water, sewer, gas (if any), electric, telephone,
drainage and other such utility services.

(r) Employees. The Seller has not entered into any management contracts,
employment contracts or labor union contracts and has not established any
retirement, health insurance, vacation, pension, profit sharing or other benefit
plans relating to the operation or maintenance of the Real Property (or any
component thereof) for which Buyer shall have any liability or obligation.
Neither Seller nor any of its management agents has any employees at the
Property (or any component thereof), other than at-will employees who shall
remain the responsibility of Seller or its management agent and as to whom Buyer
shall have no liability or obligation whatsoever. As of the Closing Date, there
shall be no employees working at the Property (or any component thereof). Seller
shall have paid or caused to be paid to all employees of such Seller or its
management agent all salary and any other payments which shall be payable on
account of each such employee for such period through Closing Date.

(s) Non-Foreign Status. No Seller is a “foreign person” as defined in the
Federal Foreign Investment in Real Property Tax Act of 1980.

(t) Tax Matters. All Returns required to be filed by or on behalf of the Seller
on or before the Closing Date with respect to the Property have been duly filed
on a timely basis, (ii) such Returns are true, complete and correct in all
material respects, (iii) all Taxes which were shown to be due on such Returns or
on subsequent assessments with respect thereto have been paid in full on a
timely basis, and (iv) no other Taxes are payable by the Seller with respect to

 

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items or periods covered by such Returns (whether or not shown on or reportable
on such Returns) or with respect to any period prior to the Closing Date. There
are no liens for Taxes (other than for Taxes not yet due and payable) upon the
Property. None of the Property consists of securities, stock (including warrants
or stock rights) or debt instruments issued by any person. None of the Leases
provides for rent payments that are based on profits or net income of the tenant
thereunder of any other person. None of the Leases provides for the rental of
personal property that represents more than 15% of the value of the total real
property and personal property leased to such tenant under such Lease. For
purposes hereof, (i) “Returns” shall mean all reports, estimates, declarations
of estimated tax, information statements and returns relating to, or required to
be filed in connection with, any Taxes, including information returns or reports
with respect to backup withholding and other payments to third parties; and
(ii) “Taxes” shall mean “Taxes” shall mean all taxes and other governmental
fees, charges or assessments, however denominated, whether due and payable or
not yet due and payable, including any interest, penalties or other additions to
tax, whether due and payable or not yet due and payable in respect thereof,
imposed by any governmental entity.

(u) Completeness and Accuracy. To the Seller’s knowledge, the documents
delivered by the Seller to Buyer pursuant to Section 3.1 are (i) the material
documents in the possession of the Seller or their respective representatives
and agents relating to the Property and used by the Seller in its operation of
the Property and (ii) are true, accurate and complete.

(v) Ground Lease. Seller has heretofore delivered to Buyer a true and complete
copy of the Ground Lease, including all amendments thereto. There are no other
understandings, oral or written, between Seller and the Landlord with respect to
the Ground Lease. Seller is not aware of any defaults under the Ground Lease by
Seller or Landlord which has not been cured.

Section 5.2. Covenants of Seller. The Seller hereby covenants with Buyer as
follows:

(a) From the Effective Date hereof until the Closing or earlier termination of
this Agreement, the Seller shall use commercially reasonable best efforts to
operate and maintain the Property in a manner generally consistent with the
manner in which Seller has operated and maintained the Property prior to the
date hereof;

(b) Except as provided below, a copy of any amendment, renewal or expansion of
any existing Lease or any new lease (collectively, the “New Leases” and
individually “New Lease”) which Seller wishes to execute between the Effective
Date and the Closing Date will be submitted to Buyer. Buyer shall have the right
to approve (in its sole and absolute discretion) any such New Lease which Seller
desires to enter into between the Approval Date and the Closing Date. With
respect to any such New Lease which Buyer has the right to approve, Buyer shall
notify the Seller in writing within five (5) business days (“New Lease Approval
Period”) after its receipt thereof (and any additional information reasonably
requested by Buyer from Seller relating to any of the New Leases) of either its
approval or disapproval thereof. In the event Buyer notifies Seller in writing
within the New Lease Approval Period that Buyer does not approve any such New
Lease, then Seller shall not enter into such New Lease. In the event Buyer fails
to notify Seller in writing of its approval or disapproval within the New Lease
Approval Period, Buyer shall be deemed to have approved any such New Lease. At

 

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Closing, unless otherwise provided herein, all Tenant Payment Obligations
related to the New Leases (collectively, the “New Lease Costs”) shall be
(A) reimbursed to the Seller by Buyer to the extent such New Lease Costs are
incurred and paid by Seller, and (B) assumed by Buyer in writing to the extent
the Seller’s obligations for such New Lease Costs have not been satisfied. At
Closing, all unpaid Tenant Payment Obligations incurred in connection with the
Leases (other than the New Lease Costs) which have accrued prior to Closing
shall be handled in accordance with the terms of Section 4.4(e) hereof.
Notwithstanding the foregoing, nothing contained in this paragraph or elsewhere
in this Agreement shall prohibit Seller from doing any of the following:
(i) entering into month-to-month leases with existing tenants of the Property,
or (ii) complying with any of the obligations of the landlord under the Leases.

(c) Except as provided below, a copy of any amendment or renewal of any Contract
or any new Contract (collectively, the New Contracts” and individually “New
Contract”) which Seller wishes to execute between the Effective Date and the
Closing Date will be submitted to Buyer. Buyer shall have the right to approve
any such New Contract which such Seller desires to enter into between the
Approval Date and the Closing Date. With respect to any such New Contract which
Buyer has the right to approve, Buyer shall notify the Seller in writing within
five (5) business days (“New Contract Approval Period”) after its receipt
thereof (and any additional information reasonably requested by Buyer from
Seller relating to any of the New Contracts) of either its approval or
disapproval thereof. In the event Buyer notifies Seller in writing within the
New Contract Approval Period that Buyer does not approve any such New Contract,
then Seller shall not enter into such New Contract. In the event Buyer fails to
notify Seller in writing of its approval or disapproval within the New Contract
Approval Period, Buyer shall be deemed not to have approved any such New
Contract. Notwithstanding the foregoing, nothing contained in this
Section 5.2(c) or elsewhere this Agreement shall prohibit Seller from entering
into any Contract which either expires on or before the Closing Date or is
terminable upon no more than thirty (30) days written notice from Seller to the
other party to such Contract.

(d) From the Effective Date hereof until the Closing Date or earlier termination
of this Agreement, the Seller shall not modify or change the zoning
classifications of the Real Property without Buyer’s consent, which consent
shall not be unreasonably withheld or delayed.

(e) From the Effective Date hereof until the Closing Date or earlier termination
of this Agreement, the Seller shall use commercially reasonable best efforts to
obtain a tenant estoppel certificate from each of the tenants under the Leases
in substantially the same form attached hereto and made a part hereof as Exhibit
J.

Section 5.3. Survival of Seller’s Representations and Warranties. The Seller
agrees to indemnify, defend and hold Buyer harmless against all losses, damages,
suits, actions obligations, expenses, reasonable attorneys fees, costs claims or
liabilities (collectively, the “Claims”) (i) arising out of a breach of any
representation or warranty of the Seller contained in this Agreement and
(ii) for any Claims relating to the Property that arise prior to Closing.
Buyer’s sole remedies with respect to the breach of any representation or
warranty contained in this Agreement discovered by or disclosed to Buyer prior
to Closing shall be those specified in Section 6.1. The Seller’s indemnity
obligation relating to a breach of any representation or warranty under this
Agreement shall survive for a period of twelve (12) months from the Closing

 

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Date (the “Indemnification Period”); provided, however, that (i) in no event
shall the Seller be liable for any claim or claims made by Buyer for a breach of
any representation or warranty under this Agreement unless the aggregate thereof
is equal to or greater than $25,000.00 (the “Floor”), and (ii) the Seller’s
liability for such claims shall not exceed $500,000.00 (the “Cap”).

Section 5.4. Changed Circumstances. The Seller shall have the right to revise
the Seller Disclosure Schedule from time to time prior to the Closing Date to
reflect any changes that occur after the Effective Date (collectively, “Changed
Circumstances”) by delivering a revised Seller Disclosure Schedule to Buyer at
any time prior to Closing; provided, that Seller shall not have the right to
revise the Seller Disclosure Schedule to reflect or incorporate any Changed
Circumstances which Seller causes by willfully and intentionally breaching its
representations, warranties or covenants under this Agreement. Buyer shall have
the right to review the revised Seller Disclosure Schedule for a period of seven
(7) business days after its receipt thereof (and of such additional reasonable
information which is necessary to evaluate the matters added to the Seller
Disclosure Schedule, provided that Buyer has requested such additional
information no later than five (5) business days after its receipt of the
revised Seller Disclosure Schedule). If the Seller delivers a revised Seller
Disclosure Schedule on a day that is less than seven (7) business days prior to
the Closing Date, the Closing Date shall be extended for an additional number of
days sufficient to allow Buyer to utilize the full seven (7) business day-period
allotted above. If both (i) prior to the expiration of such seven (7) business
day period, Buyer delivers notice (“Changed Circumstance Objection Notice”) to
the Seller that Buyer objects to the Changed Circumstance(s) set forth in the
revised Seller Disclosure Schedule, and (ii) such Changed Circumstance(s) would
result in a material adverse effect on Buyer’s proposed use and operation of the
Property, as determined in Buyer’s sole discretion, then Buyer shall, as its
sole and exclusive remedy, have the right to terminate this Agreement, in which
event this Agreement shall terminate and no party hereto shall thereafter have
any further rights against, or obligations or liabilities to, the other by
reason of this Agreement. In the event that Buyer fails for any reason to
deliver a Changed Circumstance Objection Notice within such seven (7) business
day period, or such Changed Circumstance(s) do not result in a material adverse
effect on Buyer’s proposed use and operation of the Property, as determined in
Buyer’s sole discretion, then the Buyer shall conclusively be deemed to have
accepted such Changed Circumstance(s), such Changed Circumstance shall be deemed
to constitute part of the Seller Disclosure Schedule, and Schedule 6 attached
hereto shall be deemed to have been revised to include and incorporate such
Changed Circumstance(s).

Section 5.5. Representations, Warranties and Covenants of Buyer. Buyer hereby
makes the following representations and warranties to Seller as of the Effective
Date and as of the Closing Date:

(a) Organization and Authority of Buyer. Buyer has been duly organized and is in
good standing under the laws of the State of Virginia. Buyer has the full right
and authority to enter into this Agreement, to purchase all of the Property and
to consummate or cause to be consummated the transaction contemplated by this
Agreement. This Agreement and all Related Documents executed by Buyer at the
Closing will be duly authorized, executed, and delivered by Buyer, are, or at
the Closing will be legal, valid, and binding obligations of Buyer, and do not
violate any provisions of any agreement to which Buyer is a party or to which it
is subject.

 

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(b) Agreement Binding. This Agreement constitutes a legal, valid and binding
obligation of Buyer enforceable against Buyer in accordance with the terms
hereof, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights and by
general principles of equity (whether applied in a proceeding at law or in
equity).

(c) Pending Actions. To Buyer’s knowledge, there is no action, suit,
arbitration, unsatisfied order or judgment, government investigation or
proceeding pending against Buyer which, if adversely determined, could
individually or in the aggregate materially interfere with the consummation of
the transaction contemplated by this Agreement.

Section 5.6. Survival of Buyer’s Representations, Warranties and Covenants. The
covenants of Buyer set forth in Section 5.5 shall survive any Closing hereunder.

ARTICLE 6

DEFAULT

Section 6.1. Default by Buyer. In the event of any default by Buyer under this
Agreement that is not cured within five (5) days after Buyer’s receipt of notice
thereof (but in no event later than the Closing Date), the Seller shall be
entitled, as its sole and exclusive remedy, to terminate this Agreement and
receive the reimbursement from the Buyer for all of Seller’s documented
out-of-pocket expenses incurred by Seller in connection with this Agreement and
its contribution of the Property not to exceed, in the aggregate, the sum of
$75,000.00, which receipt shall operate to terminate this Agreement and release
the Buyer from any and all liability hereunder except for the indemnification
obligations set forth in Section 3.4 hereof and any unpaid Lender’s Fees.

Section 6.2. Default by Seller. In the event of any default by Seller under this
Agreement that is not cured within five (5) days after Seller’s receipt of
notice thereof (but in no event later than the Closing Date), Buyer shall be
entitled, as its sole and exclusive remedy, to either (i) receive the
reimbursement from the Seller for all of Buyer’s documented out-of-pocket
expenses incurred by Buyer in connection with this Agreement and its purchase of
the Property (including without limitation, Lender’s Fees) not to exceed, in the
aggregate, the sum of $75,000.00, which receipt shall operate to terminate this
Agreement and release the Seller from any and all liability hereunder, or
(ii) enforce specific performance.

ARTICLE 7

RISK OF LOSS

Section 7.1. Casualty. Subject to the provisions of this Section 7.1, Seller
shall bear the risk of any damage to the Property between the Effective Date and
the Closing Date. From the Effective Date to the Closing Date, Seller shall keep
and maintain all insurance policies necessary for the operation of the Property.
If the Property is damaged by fire, storm, flood, or any other casualty between
the Effective Date and Closing Date, the Seller and Buyer shall obtain an
estimate of the cost of repairing the damage from an established contractor
selected by the Seller and reasonably approved by Buyer.

 

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(a) If the estimated cost to repair such damage is less than $250,000, then the
Closing shall be held in accordance with the terms of this Agreement and the
Seller shall assign its rights to any and all insurance proceeds to Buyer or, if
the insurance proceeds have been received by Seller, credit the Sale Price the
amount of such proceeds. If the estimated cost to repair such damage is equal to
or more than $250,000, then either Buyer or the Seller may elect to terminate
this Agreement upon written notice to the other given within five (5) business
days after receipt of notice of the estimated cost of repair. If this Agreement
is terminated by Buyer or Seller within such five (5) business day period,
neither Seller nor Buyer shall have any further rights, claims or obligations
against one another arising out of this Agreement except those arising under
Section 3.4. If this Agreement is not so terminated, then the Closing shall be
held in accordance with the terms of this Agreement and the Seller shall assign
its right to all insurance proceeds to Buyer or repair the damage at Seller’s
sole cost and expense.

(b) All repairs to be performed by Seller pursuant to this Section 7.1 shall be
done in a good and workmanlike manner consistent with the original construction
of the Property.

Section 7.2. Condemnation.

(a) If prior to the Closing any part of the Property is condemned or taken
pursuant to any governmental or other power of eminent domain, or if written
notice of taking or condemnation is issued with respect to any portion of the
Property, or if proceedings are instituted or threatened in writing to be
instituted by any governmental or other authority having the power of eminent
domain with respect to any portion of the Property (any such event, a “Taking”),
the Seller shall immediately notify Buyer as soon as Seller receives written
notice of any such Taking. If the Taking is of all of the Real Property, or of a
portion of the Real Property which would materially and adversely affect the
Property or the use or value thereof or access thereto, then either the Seller
or Buyer shall have the right, to be exercised within five (5) business days
after receiving such notification, to terminate this Agreement effective upon
written notice to the other party.

(b) If this Agreement is terminated within such five (5) business day period,
neither Seller nor Buyer shall have any further rights, claims or obligations
against one another arising out of this Agreement.

(c) If neither Seller nor Buyer has right to terminate or, if they have such
right, they do not elect to terminate within the five (5) business day period,
then Buyer shall accept the Property net of the portion taken by the Taking. In
such event, if the condemnation award in respect of the Taking is paid to Seller
prior to the Closing, the Purchase Price shall be reduced by an amount equal to
the proceeds of the award received by, or on behalf of, Seller. If the award has
not been paid to the Seller as of the Closing Date, then the Seller shall assign
to Buyer, without recourse, at the Closing, by documents reasonably satisfactory
to Buyer, all rights of Seller to the award, in which case there shall be no
adjustment in the Purchase Price.

 

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ARTICLE 8

COMMISSIONS

Section 8.1. Brokerage Commissions. With respect to the transaction contemplated
by this Agreement, Seller and Buyer each represent to the other that no broker,
licensed or otherwise brought about this transaction. Each party hereto agrees
that if any other person or entity makes a claim for brokerage commissions or
finders fees related to the sale of the Property by Seller to Buyer, and such
claim is made by, through or on account of any acts or alleged acts of said
party or its representatives, said party will protect, indemnify, defend and
hold the other party free and harmless from and against any and all loss,
liability, cost, damage and expense (including reasonable attorneys’ fees) in
connection therewith. The provisions of this Section 8.1 shall survive the
Closing or any termination of this Agreement.

ARTICLE 9

MISCELLANEOUS

Section 9.1. Assignment. Subject to the provisions of this Section 9.1, the
terms and provisions of this Agreement are to apply to and bind the permitted
successors and assigns of the parties hereto. Buyer may not assign its rights
under this Agreement without first obtaining Seller’s written approval, which
approval may not be unreasonably withheld, conditioned or delayed if such
transfer is to a wholly-owned affiliate entity; provided, however, the Buyer
shall have the right to assign this Agreement to a wholly-owned subsidiary of
Buyer without the prior written consent of Seller. An assignment by Buyer of its
rights under this Agreement shall not relieve Buyer of any liability hereunder
nor shall it relieve the assignee of the obligation to deliver the OP Units to
the Electing Members at Closing.

Section 9.2. Notices. Any notice pursuant to this Agreement shall be given in
writing by (a) personal delivery, (b) reputable overnight delivery service with
proof of delivery, or (c) legible facsimile transmission, 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 shall have designated by written
notice sent in accordance herewith, and shall be deemed to have been given upon
receipt or refusal to accept delivery, or, in the case of facsimile
transmission, as of the date of the facsimile transmission (if such is received
by 5:00 p.m. local time of the recipient) provided that an original of such
facsimile is also sent to the intended addressee by means described in clauses
(a), or (b) above. Unless changed in accordance with the preceding sentence, the
addresses for notices given pursuant to this Agreement shall be as follows:

 

If to Seller:   If to Buyer:

Riversedge North

2529 Virginia Beach Boulevard

Virginia Beach, VA 23452

 

Riversedge North

2529 Virginia Beach Boulevard

Virginia Beach, VA 23452

Section 9.3. Modifications. This Agreement cannot be changed orally, and no
executory agreement shall be effective to waive, change, modify or discharge it
in whole or in part unless such executory agreement is in writing and is signed
by the parties against whom enforcement of any waiver, change, modification or
discharge is sought.

 

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Section 9.4. Entire Agreement. This Agreement, including the exhibits and
schedules hereto, contains the entire agreement between the parties hereto
pertaining to the subject matter hereof and fully supersedes all prior written
or oral agreements and understandings between the parties pertaining to such
subject matter.

Section 9.5. Further Assurances. Each party agrees that it will execute and
deliver such other documents and take such other action, whether prior or
subsequent to the Closing, as may be reasonably requested by the other party to
consummate the transaction contemplated by this Agreement.

Section 9.6. Counterparts. This Agreement may be executed in counterparts, all
such executed counterparts shall constitute the same agreement, and the
signature of any party to any counterpart shall be deemed a signature to, and
may be appended to, any other counterpart.

Section 9.7. Severability. If any provision of this Agreement is determined by a
court of competent jurisdiction to be invalid or unenforceable, the remainder of
this Agreement shall nonetheless remain in full force and effect; provided that
the invalidity or unenforceability of such provision does not materially
adversely affect the benefits accruing to any party hereunder.

Section 9.8. Applicable Law. This Agreement and the Related Documents shall be
governed by and construed in accordance with the internal laws of the
Commonwealth of Virginia without regard to conflicts of law principles. The
parties hereto agree that the provisions of this Section 9.8 shall survive the
Closing or any termination of this Agreement.

Section 9.9. No Third-Party Beneficiary. The provisions of this Agreement and of
the documents to be executed and delivered on the Closing Date are and will be
for the benefit of the Seller and Buyer only and, subject to the provisions of
Section 9.1, are not for the benefit of any third party, and accordingly, no
third party shall have the right to enforce the provisions of this Agreement or
of the documents to be executed and delivered on the Closing Date.

Section 9.10. Captions. The section headings appearing in this Agreement are for
convenience of reference only and are not intended, to any extent and for any
purpose, to limit or define the text of any section or any subsection hereof.

Section 9.11. Construction. The parties acknowledge that the parties and their
counsel have reviewed and revised this Agreement and that any normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any exhibits or amendments hereto.

Section 9.12. Internal Revenue Service Reporting Requirement. Each party shall
execute, acknowledge and deliver to the other party such instruments, and take
such other actions, as such other party may reasonably request in order to
comply with Section 6045(e) of the Internal Revenue Code of 1986, as amended, or
any successor provision or any regulations promulgated pursuant thereto (the
“Code”), insofar as the same requires reporting of information in respect of
real estate transactions. The provisions of this Section 9.12 shall survive the
delivery of the deed hereunder.

 

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Section 9.13. Confidentiality. Each party agrees that, except as otherwise set
forth in this Agreement or required by law or legal process, it shall: (i) keep
the contents of this Agreement and any information related to the transaction
contemplated hereby confidential (except that Buyer and the Seller may disclose
such data and information to their respective employees, lenders, consultants,
accountants and attorneys, provided that such persons agree to treat such data
and information confidentially); and (ii) refrain from generating or
participating in any publicity statement, press release or other public notice
regarding this transaction without the prior written consent of the other party
unless required under applicable law or by legal process; provided, however,
that Buyer and the Seller may at or following the Closing publicly announce the
sale of the Property and the identity of the new owner thereof. The provisions
of this Section 9.14 shall survive the Closing.

Section 9.14. Disclosure of Information. The Seller acknowledges that the
general partner of Buyer is a publicly traded real estate investment trust. The
Seller acknowledges that the rules and regulations promulgated by the United
States Securities and Exchange Commission (the “SEC”) may require Buyer to
disclose certain basic information concerning this Agreement and the
transactions contemplated herein in documents to be filed with the SEC. The
parties agree that Buyer shall be permitted to make such disclosures and that
such disclosures shall not constitute a breach or a violation of Section 9.14 or
any other confidentiality or non-disclosure agreement executed by the parties
prior to the Effective Date. Such confidentiality or non-disclosure agreement,
if any, shall be amended and modified to the extent provided in this Section.

Section 9.16. Joint and Several Liability. The liability of Seller hereunder
shall be joint and several hereunder. Unless otherwise expressly set forth
herein, all actions to be taken by Seller and all documents to be executed by
Seller shall be done so by each Seller.

 

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the Effective Date.

 

SELLER:     BUYER: FAIRFIELD INVESTORS, LLC, a Virginia limited liability
company     WHEELER REIT, L.P., a Virginia limited partnership, Managing Member
    By:  

/s/ Jon S. Wheeler

    By:   WHEELER REAL ESTATE INVESTMENT TRUST, INC., a Maryland corporation,
general partner   Jon S. Wheeler, Manager                           By:  

/s/ Jon S. Wheeler

  (SEAL)           Jon S. Wheeler, Chairman and CEO  

 

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